FHA 203k is a little known program that has been in existence since 1978 and enables the Buyer to borrow monies to cover the purchase AND any repairs/renovations needed.  This Federal Housing Administration loan is federally-insured and allows the costs of the needed repairs to be included in the original loan amount.  With the many historic homes in the Tampa real estate market, this program could be beneficial to prospective buyers.

The renovations/repairs with a  FHA203k need to be completed within a six month period after the escrow closing.   These loans can be used to pay for new appliances, room additions, remodeled bathrooms and kitchens, in addition to necessary repairs such as doors, windows, roof, etc..  The FHA203k allows Buyers to purchase a home in an “as is” situation and complete the renovation before they move in.

An example of how the program can benefit a Buyer:

Last year, John Williams was looking for Tampa real estate when he found a home in the Hyde Park area that was priced  as a short sale and was listed as an “as is” sale.  Being an old bungalow, it was in need of wood replacement, new roof, window repairs, etc. – but being in the location of other higher priced homes, the home would be well worth the completed project.  The FHA203k enabled him to purchase the home for $ 150,000 and roll another $ 100,000. into the property renovations.  John was able to buy the property, renovate it to be structurally sound and update the electric, plumbing, kitchen appliances and bathroom fixtures.

With the reduced prices, interest rates at historic lows, and the substantial Tampa real estate inventory available combined with programs like the FHA203k, it is the most advantageous time in recent history to become a home owner.

Bookmark It

Hide Sites

FHA will increase the “up-front insurance premium” from 1.75% to 2.25% of the loan amount. Because these fees are added into the loan amount without affecting the LTV, the amount of monies that a Buyer needs for the purchase will not be affected.

Under current FHA guidelines, the Seller can contribute up to 6% of the sales price toward the Buyer’s closing costs/pre-paids, etc – this amount will decrease to 3% contribution under the new FHA policies.

To further strengthen and protect insurance reserves, FHA will require a larger down payment for Buyer’s with low credit scores. For borrowers with below a 580 credit score, they will now need a 10% down payment instead of the 3.5% for borrowers with higher credit scores. Since there are few lenders, if any, that will loan to borrowers with a credit score below 580, this is inconsequential to the present housing sales of FHA properties.

These FHA changes will be implemented over the next several months. If you should have any questions, please contact me at FBC Mortgage LLC, stimmerman@fbchomeloans.com.

Bookmark It

Hide Sites

Long-term mortgages rates moved lower again this week, hitting the lowest level in five weeks.

Freddie Mac‘s weekly report says the average 30-year fixed-rate mortgage was 4.91 percent in the week ending Nov. 12, down from 4.98 percent last week. Rates on 30-year mortgages have been below 5 percent for five of the last seven weeks.

A year ago, 30-year mortgages were averaging 6.14 percent.

A 15-year fixed-rate mortgage averaged 4.36 percent this week, remaining below one-year adjustable rate mortgages, which now average 4.46 percent.

“Mortgage rates eased further over the week, helping to promote an affordable home-purchase market and stimulate refinance,” said Freddie Mac (NYSE: FRE) chief economist Frank Nothaft. “This comes at a time when house price declines are moderating and consumer demand for prime mortgages at commercial banks has picked up.”

The National Association of Realtors this week said third quarter housing prices were down an average of 11.2 percent from a year ago, but 20 percent of the top metropolitan ares saw positive annual growth.

Sales continue to rise, with third quarter existing home sales up 11 percent from a year ago.

Tampa Bay Business Journal – by Jeff Clabaugh Washington Business Journal

Bookmark It

Hide Sites

Rates for a 30-year, fixed-rate mortgage averaged 5.04 percent, with points averaging 0.7 for the week ended Sept. 17. That is down from previous week, when it averaged 5.07 percent, according to Freddie Mac (NYSE: FRE).

Last year at this time, the 30-year, fixed-rate mortgage averaged 5.78 percent.

The 15-year, fixed-rate mortgage this week averaged 4.47 percent, with points averaging 0.6, down from the previous week, when it averaged 4.5 percent. A year ago at this time, the 15-year, fixed-rate mortgage averaged 5.35 percent. This is the lowest it has been since the McLean, Va.-based lender started tracking it in 1991.

“Interest rates for fixed-rate mortgages eased for the third consecutive week and remained at three-month lows,” said Frank Nothaft, Freddie Mac VP and chief economist, in a news release.

On Wednesday, the Mortgage Bankers Association reported that loan applications fell by a seasonally adjusted 8.6 percent, the result of the Labor Day holiday.

Smith & Associates Real Estate’s preferred Mortgage Consultants will be happy to discuss available loan programs with you.  For more information, please visit the website.

Article Courtesy Of:

Read the original:
Freddie Mac: Mortgage rates fall

Bookmark It

Hide Sites

With new incentives throughout the real estate industry, there are buyers in the marketplace that are new to the process of residential mortgages.  With the FHA program, the required down payment is only 3.5%  and this down payment can be a gift from a relative.  In addition, the Seller can contribute up to 6% of the purchase price of the home towards the Buyer’s closing costs and prepaid items.    When you combine these two features of the FHA product, a Buyer can come to the closing table with no money out of his/her pocket.  This has enabled many people to purchase homes that do not have the 20% down payment required by most conventional lenders.

The FHA mortgage loan limit in the Tampa Bay Area is $ 292,500.00 – with the 3.5% down payment, the maximum purchase price would be $ 303,105.00 .   An FHA loan does have standards for the home to qualify.  Basically, the home needs to be in sound structural condition including roof, windows, doors, etc..   Minor cosmetic repairs are permitted under the FHA mortgage loan guidelines.   FHA does allow the purchase of multi-unit properties up to 4 units as long as the Buyer lives in the property as a primary residence.   Smith and Associates’ realtors are aware of these standards and work closely with us to ensure a seamless process.

FHA loans are also available to refinance your present mortgage to a lower interest rate.  Homes can be refinanced up to 96.5% of today’s market value.  This can be significant if you presently have a high interest rate and/or have an ARM loan that will be adjusting within the next couple of years.  Contact us to evaluate your present mortgage to determine if you would benefit from a FHA loan.

USDA – No Down Payment

USDA is a program through the Federal Government that allows up to 100% mortgage financing in rural areas.  The home has to be within a certain rural area which is determined by population concentration.   Tampa Bay area locations include Land O Lakes, Wesley Chapel, southern Hillsborough County, east Hillsborough County, etc.

As with  FHA loans, the Seller can contribute up to 6% of the closing costs/prepaid items, the Buyer can receive gift monies from relatives, etc.   Additional criteria to qualify for this loan program include income limitations for the Buyer(s) which vary according to the area of the country and the number of people that will be living in the home.

Smith & Associates Real Estate’s preferred Mortgage Consultants will be happy to look up properties and evaluate your situation to determine if you are eligible for this loan program.  For more information, please visit the website.

Bookmark It

Hide Sites

The government’s first time homebuyer $8,000 tax credit has helped stimulate home sales, but buyers still hoping to take advantage of it will have to beat the clock.

The tax credit expires Nov. 30, giving buyers about 12 weeks to find, contract and settle on their purchase. The National Association of Realtors says on average, first-time buyers search 12 weeks to find a home, and closing can take up to 60 additional days.

The group says buyers still hoping to qualify for the credit will have to act quickly.

“By moving quickly, being prepared to make decisions in the face of increased competition, and [learning] from others to reduce time without cutting corners, first-time homebuyers starting today can close on time and quality for the $8,000 federal tax credit,” says Errol Samuelson, president of Realtor.com.

The tax credit was cited as the most important reason for buying by 10.8 percent of current homebuyers in a Realtor.com survey. An estimated 1.4 million buyers have already filed for the credit, with that number likely to swell by the time tax returns are due next April.

Do you have questions regarding your eligibility or are you interested in talking to a mortgage professional regarding purchasing a home?  Smith & Associates is here to help!  Please click here to get in touch with a consultant.

Article Courtesy Of:

Read the original post:
First time buyers face deadline

Bookmark It

Hide Sites

Article Courtesy of:

See more here:
Freddie Mac: Mortgage rates fall slightly

Bookmark It

Hide Sites