Carmen’s Money 411

This is a clip from Carmen’s show on CNBC talking about the 4% proposed rates for purchases.  They also mention refinancing and that it is best not to wait for a hypothetical event that may never happen.

Don’t get me wrong, 4% rates would be incredible, but what if they don’t come?  How many months do you wait and lose out on the monthly savings that you could be enjoying now? OR worse case scenario, lose out all together because your home value has declined even more?

  I truly don’t have the magic answer to these questions.  We all have to ask ourselves for our own piece of mind and our own situations what is best for our family and their needs.  I am happy to help you explore the options out there for you, but it is your decision.


Reverse Mortgages

Here is an interview that one of Landmark Mortgage’s owners gave on AM Northwest about Reverse Mortgages.   Curt Lawrence and Bill Tucker have been doing reverse mortgages since 1996.  They are extremely well versed in all aspects of this loan product and are happy to answer all questions.

A Reverse Mortgage is a great option for our senior citizens that are on a fixed income if they own their home.  Please call 503-585-1105 or email if you have any questions.

First Time Homebuyer Tax Credit

Until July 2009, first time buyers (or buyer’s who have not owned a home in the past three years) are eligible for up to $7500.00 rebate from the Federal Government.  This rebate is actually a no interest loan to be repaid in the next 15 years.  Combine that with interest rates we are seeing and good inventory and buyers should find this is a wonderful opportunity to buy a home today.

Clients will want to check with their tax advisor to assess the true benefits to your individual situations, but this could be another reason to get serious about buying your first home.  There are still many programs available to you as a first time home buyer.  Veteran’s still have 100% financing available, buyers purchasing in outlying areas have the 100% USDA loan available and FHA is still going strong. FHA requires a 3% down payment until January when it increases to 3.5% but that down payment can be a gift from a relative too.

Buying a home is still the best way to build wealth. Today’s buyers have an advantage over buyers just a few years ago. There is more inventory to choose from and and you have the luxury of time.  A couple of years ago, buyers had to make buying decisions in less than 24 hours or risk losing the property to another buyer.

These are just a few of the reasons that buying a house now is a good move!

New FHA Loan Limits for 2009


Loan limits for Marion & Polk County were increased as part of the stimulas package earlier this year. These higher loan limits helped many borrowers refinance their homes and get into a good, conservative, fixed rate loan.

 FHA has just announced limits for 2009, unfortunately, these limits for Marion and Polk Counties are decreasing.  Until Dec 31, 2008 loan limits are 295,000 after January 1st, those limits will decrease to 271,050.    If you or someone you know were waiting to purchase or refinance hoping that FHA limits would rise in Marion or Polk County, there is still time to take advantage of the 295,000 loan amount if you act before Dec 31, 2008. 

Please call or email if you need the loan limits on other Oregon or Washington Counties.

Help for Struggling Homeowners

Freddie & Fannie’s regulator unveiled a plan that could cut payments for hundreds of thousands of struggling homeowners to help reverse defaults. Homeowners facing foreclosure who are spending more than 38 percent of their income on mortgage payments could have monthly payments reduced by Fannie Mae and Freddie Mac in an effort to keep their homes. Since it is generally believed that mortgage defaults are at the root of the global credit crisis and the recession here in the US , steps like this are important to “put a floor under the housing market” and are a prerequisite to recovery. Companies like Indymac, Chase and BofA have halted foreclosures, but since Fannie Mae and Freddie Mac own or insure 31 million mortgages (58% of SFH’s), this is big news. Eligible homeowners must first be contacted (I don’t know all the exact criteria, although one is that borrowers need to be delinquent 90 days or more to qualify) and could see their mortgage rates cut, the life of their loans extended, or their principal reduced in an effort to ease payments.

The plan does not apply to private-label mortgage securities, which typically have a much greater proportion of underwater borrowers. It will instruct servicers to change the terms of the loan so that the monthly payment (including principal, interest, taxes and insurance) would be lowered to 38% of the borrower’s income (income must be documented). This would be done in up to three steps: 1) the term of the loan would be stretched to 40 years. If the monthly payment is still too high relative to income, then 2) the interest rate would be reduced to as low as 3%.  Finally, if the implied monthly payment were still greater than 38% of the borrower’s income, 3) forbearance could be provided on loan principal down to the current appraised value of the property.  (However, the reduced principal would not be written off entirely, but instead would be payable as a balloon payment at sale or maturity of the loan.)

Be wary of solicitors calling and offering to do these modifications for you, they will charge you a fee to do exactly what you can do on your own by calling your lender directly.  Also, please be cautious and always read the fine print.  Since these programs are new, we are not sure yet what all the fine print is and how a principal reduction, forebearance or lengthening of your term will reflect on your credit in the future.  One would hope it would reflect better than a foreclosure or continuing late payments and carry a lesser time requirement to prove you are re-established in your credit.

If you have any questions or are struggling please don’t hesitate to call me or your lender directly. The best part of these programs is that communication is open!