Through the first 9 months of this year, Fannie Mae has issued 13 guideline updates. Most have had little recognizable effects on borrowers, but the most recent changes are more significant.
Starting Monday 12/13/2010, the following is an abbreviated list of some of the most significant changes:
• Borrowers are no longer required to invest 5% of their “own money” as their downpayment. They can now use gift money from a family member
• All revolving debt must be included in debt-to-income ratios, regardless of whether there are “10 Payments Or Less”.
• A 5% monthly payment against the balance must be assumed when no minimum monthly payment can be verified on a debt obligation.
• Finally, the waiting period for a conforming loan after foreclosure has been extended to 7 years.
Charlotte, NC Named in Top 100 Places to Live
RelocateAmerica just released the results of their annual Top 100 Places to Live study. This year they focused on communities positioned for recovery and future... Readmore...
The Tax Credit is Ending....What's Next?
The Tax Credit is ending, so what’s next ? Well, we need to figure out how to help sell more homes after the tax credit expires and give everyone new tools... Readmore...
14-Dec-2010
12-Nov-2010
New American Mortgage was recently named one of the best places to work in 2010. I can honestly say it’s the people that make this place great! Way to go team!!
12-Nov-2010
Facebook Heads to NC
Category : Charlotte and NC News
Facebook is planning to follow in the footsteps of Apple and Google in building a $450-million data center in Rutherford County in western North Carolina. While the data center will not bring many jobs to the area, it certainly will boost the property tax revenues of the region. Facebook will become the 6th largest non-residential taxpayer in the area. The company has chosen the area because North Carolina’s electricity rates are among the lowest in the country and it has a reliable utility infrastructure that was put in place years ago to serve the textile industry. County officials are hoping this venture will attract other companies to bring jobs to the area.
12-Nov-2010
The Charlotte City Council agreed to expand the city by approximately 2,434 acres and 4,100 residents effective June 30th.
There are three main areas that will be annexed. The first is Rhyne, a 289-acre area north of Mount Holly-Huntersville Road near Interstate 485 that includes the Cedar Mill community. Second is Whitehall, a 665-acre development southwest of the city that includes parts of the Whitehall and Renaissance Center business parks and the Villas at Laurel and Carrington Place communities. Finally, Camp Stewart South, a 1,480-acre area east of the city along Albemarle and Harrisburg roads that includes Lamplighter Village, Cedarbrook and Woodbury communities, J.H. Gunn Elementary School and the Wilgrove airport.
Although this move will cost the city in expanded fire and solid-waste services, I’m certain that it’s the first in a series of steps the City of Charlotte will take to raise property tax revenue. The city has lost plenty in the past few years with the increase in foreclosures county and state wide. Foreclosures were up 40% in October over last year and 13% from September.
28-May-2010
For the better part of the last 9 months, homeowners with adjusting adjustable rate mortgages have watched their mortgage rates fall.
As short-term solutions go, it’s been smart to let the mortgage adjust rather than refinance…until now. It may now be time to convert that soon-to-adjust ARM into something new.
The Math For Adjusting Mortgage Rates Is Worsening
Earlier this year, ARM’s adjusted to as low as 2.875 percent. It was a godsend to households worried their ARMs would actually go up in rate.
Today, though, that’s not happening.
Households with June-adjusting mortgages would get a 3.625 percent rate based on today’s market. And if the issues in the European market continue to exacerbate, households with ARMs could see them adjust to 5.000 percent or higher later this year.
Here’s how an adjustable rate mortgage works:
- The initial interest rate stays fixed for a set period of time in the beginning
- When the fixed period ends, the rate is recalculated based on a formula
- Every 12 months thereafter, the rate recalculates again based on the same formula
The adjustment formula is as follows:
Rate = Constant Rate +/- Variable
The “variable” and the “constant” will vary from ARM to ARM, but if you’ve got a conforming home loan originated after 2002, the chances are very high that your variable is the 12-month LIBOR and your constant is 2.250 percent.
In other words, to calculate your adjusting mortgage rate, just add 2.25% to LIBOR and that’s your new rate.
LIBOR Is Rising, Rising, Rising
LIBOR stands for London Interbank Offered Rate. It’s the interest rate at which banks lend money to each other and LIBOR tends to rise and fall with the stability of the global banking system. It spiked in 2008 after Lehman Brothers failed and it’s showing a similar pattern today as the debt crisis spreads from Greece to Spain and to the rest of Europe. So, of course, the risk of lending amongst the banks gets larger and the LIBOR rises. It is currently up 69 percent since February 2010.
What To Do About Your ARM
With “new” mortgage rates at their lowest levels ever, this is truly the best time to think about refinancing your adjusting ARM for a new one, or a fixed rate loan. So, as long as you can keep your closing costs to a minimum, this may be a consideration. You don’t want to wash out your payment savings with huge costs you’ll never recoup.
If you want to discuss a plan that’s right for you, call or email me today.
21-May-2010
The good news is that the USDA funds lasted longer than everyone expected…bad news is they are now completely exhausted.
USDA Section 502 Single Family Housing Guaranteed Loans are primarily used to help low-income borrowers purchase homes in rural areas. Funds can be used to build, repair, renovate or relocate a home, or to purchase and prepare sites, including providing water and sewage facilities. There is no required down payment and no monthly mortgage insurance required.
Every year USDA runs out of money for funding these loans and lending is not affected, but this year has been a little different. Due to the overwhelming demand placed on the housing market by first-time homebuyers fueled by the federal first time homebuyer tax credit and the elimination of many first time homebuyer financing programs, the USDA has seen an extraordinarily high demand for this loan product.
There is currently legislation before Congress that will bring this program back to the market and some estimate that it may be as late as October before the program comes back. So, for now, this avenue of affordable home financing to low income consumers who live in rural areas has been cut-off.
14-May-2010
RelocateAmerica just released the results of their annual Top 100 Places to Live study. This year they focused on communities positioned for recovery and future growth. They discovered communities with strong local leadership, employment opportunities, thriving community commitment, improving real estate markets, expanding green initiatives, plentiful recreational options and an overall high quality of life.
According to the study, Charlotte, NC was #7 on the list!
Charlotte is the nation’s second largest banking center (next to Wallstreet) and home to 292 of the top Fortune 500 companies and more than 340 foreign firms. The city is home to the number one most educated workforce and is one of the top large counties for business recruitment.
The cities accessibility to interstates and central location between the Blue Ridge Mountains and the beaches along the Atlantic make it a widely visited and desirable place to live. Charlotte’s is also homes to some of the world’s best golf courses.
Center city has undergone tremendous growth with several large-scale projects that combine residences, shops, restaurants, and entertainment. Charlotte real estate has a variety of communities and is the nation’s fifth largest urban region. The Charlotte mortgage and real estate market has suffered under the national housing market crisis however the market is still alive and steady
Charlotte boasts a cost of living index below the national average and has an impressive roster of professional sports teams along with the best and most varied recreational facilities available.
Charlotte’s vibrant economy is attracting corporate headquarters such as, Electrolux and Husquevarna. Major employers in the Charlotte area also include Bank of America, Duke Energy, Family Dollar, Goodrich Corporation, Lowe’s, Nucor, Sonic Automotive, SPX Corporation, Wachovia, Time Warner Cable, Continental Tire North America, Muzak, Belk, Harris Teeter, Meineke Car Care Centers, Lance, Inc., Bojangle’s, Lending Tree and Food Lion.
10-May-2010
My goal is to make sure the loan process is as effortless and stress-free as possible for my clients. For this reason, I’ve put together a list of Do’s and Dont’s during the loan process:
- DO continue making your mortgage or rent payments
- DO stay current on all existing accounts
- DO keep working at your current employer
- DO keep your same insurance company
- DO call us if you have any questions
- DON’T make a major purchase (cars, boats, jewelry, appliances, etc.)
- DON’T apply for new credit (even if you see “pre-approved”)
- DON’T open a new credit card
- DON’T transfer any balances from once account to another
- DON’T pay off charge offs or collections without a discussion with your lender first
- DON’T buy any furniture on credit
- DON’T close any credit card accounts
- DON’T change bank accounts
- DON’T max out or over charge on your credit card accounts
- DON’T consolidate your debt onto 1 or 2 credit cards
- DON’T take out a new loan
- DON’T finance any elective medical procedures
- DON’T payoff any loans or credit cards without discussing it with your lender first.
There are any number of things that could make your “pre-approved” mortgage become a “denied” mortgage. Don’t let this happen to you!
28-Apr-2010
The Tax Credit is ending, so what’s next ?
Well, we need to figure out how to help sell more homes after the tax credit expires and give everyone new tools to move homes that need a little TLC! I am happy to announce that New American Mortgage offers FHA 203K’s! Only a handful of lenders are able to do these loans so you might ask.. what exactly is an FHA 203K?
The FHA 203(k) is a loan available to owner-occupants (not investors or second homes) of homes that are in need of repairs (to meet minimum property standards set forth by HUD), or homes that are to be updated by the new buyer.
One single loan is given to the buyer, this loan will cover both the purchase and the proposed improvements. The maximum loan amount will be determined by the home’s after improved value. The maximum loan amount for FHA loans in the Charlotte area is $303,750. All the repairs are performed after the loan is closed. The seller is never responsible for the repairs; all homes sold under this program can be sold “As is.” If the repairs are under 35K, it’s eligible for the 203K streamline product which expedites the process. Please plan on 45 days to close these loans.
Please let me know if you have any further questions about the 203K program. I’m happy to help!
26-Apr-2010
Charlotte-area home sales were up 13.7 percent last month from a year ago, and they rose 36 percent from February, according to the Charlotte Regional Realtor Association.
The number of closings in March totaled 1,900, jumping from 1,671 a year earlier and 1,397 in February, the association says, citing Carolina Multiple Listing Services, Inc. data.
Pending contracts reported in March were also up, rising 23.2 percent from March 2009 and up 27.8 percent from February levels.
Many real estatel professionals attribute the increase in real estate activity, in part, to the federal government’s first-time home-buyer tax credit that expires at the end of April. But, then what?
The average sales price in March was $197,564, up 3.2 percent from a year ago and 3.3 percent above February’s average. The number of days on market has also fallen by about 9 days.
It will be interesting to watch how the market proceeds once the tax credits expire. One would hope that the upward trend will continue, thus confirming all of our hopes…that the market is finally making it’s recovery!
