Quick tip:


I hope all the father’s out there had a great and relaxing day yesterday. The summer is finally here and I could certainly tell this weekend by the heat. The heat is certainly turning on for the bond market as well as interest rates are getting a little bit better today.

Quick tip: When applying for an FHA loan for a married couple you must run the spouses credit report and count total household debt even if they are not going on the loan. Call me with questions.

Make it a great week!
Oh by the way, I’m never too busy for any of your referrals.

Happy Father’s Day!

Happy Father’s Day!

If you like real-time updates follow me on my http://www.twitter.com/seanlarue. I’m constantly updating it and getting the latest information out to you. This week’s rate sheet is attached.

Quick Tip:
If you’re in escrow on a property, and the buyer is using an FHA loan advise your seller not to transfer title in any way, shape, or form during the escrow process. FHA has a 90 day flip rule in place that prevents a sale if the title is passed from one person to another… even changing it from a single owner to joint ownership. This does not apply for REO properties. If you don’t follow this rule it will stall your escrow. Call me with questions.

Mortgage Hotline:
Tune in to AM 970, 1140, or 1250 on Sunday 11:00am to 12:00pm to here me talk about your credit report. What you need to know about getting your score up or keeping your score up. Also, I’ll be talking about the 203k rehab construction loan and some of the details and opportunity that lies within. You can also listen online at http://www.knewsradio.com

I’m never too busy for any of your referrals and I’m looking forward to hearing from you.

States taking steps to turn $8,000 home-purchase tax credit into cash

States taking steps to turn $8,000 home-purchase tax credit into cash

Instead of making buyers wait until they receive their tax refunds, some states have created bridge-loan programs that advance purchasers the money they need for their closings.
By Kenneth R. Harney
Los Angeles Times
Reporting from Washington — For the housing market, it’s the equivalent of financial alchemy, and it’s hot: Turning the $8,000 federal home-purchase tax credit, which normally isn’t spendable until after you’ve gotten your refund, into immediate, hard cash, available for your down payment and closing costs.

Congress’ stimulus-bill tax credit for 2009 is generating efforts nationwide to find ways to “monetize” it — providing money upfront to buyers who need dollars for down payments right now, not next year after they file their federal returns and get refunds. The credit is available only to qualified taxpayers who have not owned a house during the previous three years, and who close by Nov. 30, among other requirements. Buyers can amend their 2008 returns to claim the credit or claim it on returns for 2009.
In recent weeks, at least 10 states say they’ve come up with ways to work this monetary magic. They have created innovative bridge-loan programs that advance credit-eligible buyers the cash they need for their closings. Generally the advances take the form of second mortgages — with or without interest charges — that become due and payable whenever buyers receive their credits in the form of refunds from the Internal Revenue Service.

In Missouri, which was the first state to create such a program, buyers can get a no-cost “tax credit advance” of up to 6% of the home price. The advance is actually an interest-free second lien that is repayable no later than June 2010, once the buyers have received their $8,000 tax credit.

If buyers can’t meet that repayment deadline, the advance morphs into a traditional second mortgage with a 10-year payback term and a fixed interest rate one-half a percentage point higher than their first mortgage rate. The underlying first loans are all fixed-rate 30-year mortgages issued by private lenders participating with the tax-exempt bond programs of the Missouri Housing Development Commission.

Colorado kicked off a similar program, known as JumpStart, on April 14. Delaware, New Jersey, Tennessee, Idaho, Washington state, Ohio, Pennsylvania and New Mexico have come out with their own versions, some with modest interest charges on the second mortgage from the beginning.

In Washington, where the state Housing Finance Commission already runs a tax credit bridge-loan program for buyers using its mortgages, state Treasurer James McIntire wants to make it much bigger. He has been pushing for creation of a “public-private” down-payment program that could reach far larger numbers of consumers than is possible under the housing commission’s current funding constraints.

McIntire has proposed depositing $25 million of state funds into interest-earning accounts at an FDIC-insured bank. The bank would then provide revolving lines of credit to the state housing commission to greatly expand its down payment bridge-loan efforts. In a novel arrangement, the Washington Assn. of Realtors has pledged $400,000 as a backstop for McIntire’s plan to cover any unexpected losses on the credit monetization transactions. The state Legislature has authorized the program in its new budget.

McIntire is also trying to persuade the Obama administration to allow the state to tap into bridge loan-assisted home buyers’ amended 2008 tax returns and be directly assigned all or a portion of the tax credit refunds. Under current IRS rules, McIntire said, tax refund checks are sent only to the taxpayer’s address. To ensure prompt repayment of bridge loans, the state would like to have refunds mailed to the housing finance commission in cases in which repayment of a bridge loan is due.

Bottom line: Since other state housing agencies reportedly are considering rolling out credit-monetization programs on their own, keep your eye on what’s happening in your area. A no-cost advance tied to the $8,000 credit just might get you the down payment and closing cash you need.

FHA Financing Update:

There are continuing changes to the FHA programs. Please call your lender to verify the pre-approval before writing any offers.

FHA Financing Update:
New loan limits are supported and available to lock at $500K.
Down payment requirement is still only 3.5%.
Fico score is also the same, which is required to be a 620 Fico.
Call me regarding details for the two appraisal requirement.
Market Update

Mortgage Bonds are near unchanged, but off the best levels seen earlier in the day. Stocks are starting the week on an upbeat note with Bank of America receiving a very strong buy recommendation by being put on Goldman Sachs conviction buy list. Lowe’s Companies posted positive earnings, also adding to the boost in Stocks.

Oil prices are moving higher in advance of the summer driving season. Unleaded gasoline has risen every day for the past three weeks and is now at $2.31 a gallon.

There are no economic reports set for release today, however there are several key reports this week, which include Thursday’s Initial Jobless Claims, that will give us a better look at the condition of the economy.

With prices in a sideways trend near the 25-day Moving Average, I recommend carefully floating for now.

I am never to busy for any of your referrals!

Major Update

Attached are several updates for rates, working with the tax assessor’s office, and the changes for FHA refi’s taking cash-out.

Updating Property Taxes
I’ve had many requests for information regarding the tax assessor’s office and lowering your clients property taxes. See the form attached, have your clients fill it out, and send it in. I recommend they send it certified mail so they know it was received. When I close a loan or estimate payments I estimate taxes based on the new purchase price It’s possible, that after closing, that based on the old tax basis the county could try to collect at the higher previous tax basis (ie previous owner). This is especially pertinent on foreclosed homes in Southern California. Use the attached forms for your clients benefit and get in the habit of completing them at closing so the changes will be nearly immediate.

FHA Financing Update:
New loan limits are supported and available to lock at $500K.
Down payment requirement is still only 3.5%.
Fico score is also the same, which is required to be a 620 Fico.

The biggest difference you all need to know about is the appraisal requirements. For all loan amounts above $417K, and have a LTV greater than 95%, will be required to have 2 appraisals. The best way to avoid a second appraisal we can have the buyers put 5% down. If they want to do the second appraisal this can be done too. This is a FHA requirement.

There is only 1 more week to pull a case number for anyone interested in doing a cash-out refinance to 95% loan to value using the FHA program. The loan to value changes to 85% after next week. See the attached mortgagee letter from HUD.

Conforming Loans – or High Balance Loan Amounts
Loan Amounts also extended in Riverside County to $500K.
Max cash out is $200K on all these loans.

I hope this information is helpful. Call me with questions and make it a great week!

I am never too busy for any of your referrals.

Conforming & FHA Loan limits have been increased to 500K

Market Update:
Rates continue to be volatile, but are still at historically low levels.
Check out my 4.125% – 5 year Fixed money – LOW!! The rate sheet is attached.

Conforming & FHA Loan limits have been increased to 500K for the rest of 2009. The bad news is that these agency jumbo loans are not yet available in the market place. So we don’t know the pricing or stipulations yet, but I will update you with more as it unravels.

FHA & VA has also just raised its minimum fico score requirement to 620, yes that’s correct. Any loan’s currently in the system must be approved soon, to be grandfathered in.

***If I have given you a pre-qualification please get with me to verify FICO scores.***
If you have a loan in process and the interest rate was not been locked, they will need to be locked by March 7th to be eligible.
Please let your friends and clients know!