Mortgage Monday

Tips To Avoid Mishaps on a Mortgage Application

Tip 1: Try not to move cash around.

During the loan application process, your First Home Mortgage loan experts will have to verify all the income and assets listed as part of your application. Moving these assets around can create a paper trail nightmare. The best advice is to leave everything where it is and discuss any changes you wish to make with First Home Mortgage Loan Officer.

Tip 2: Document large deposits.

Your First Home Mortgage Loan Officer will have to verify all sources of funds for the transaction. We’ll be looking at any large deposits into your asset accounts (checking, savings, money market, etc.). You should be prepared to document all sources — perhaps a copy of a paycheck, bonus check, money from the sale of an asset, etc.

Tip 3: Selling something?

If you’re selling a large asset, such as a car, antique, baseball card collection to come up with the cash for closing, please document the sale. Keep everything, including the check the buyer gives you, car title or a bill of sale. Sometimes you’ll even need to get a certified appraisal of the item. Talk to your First Home Mortgage Loan Officer if you have questions.

Tip 4: Document gifts appropriately

Large cash gifts from relatives are very common when purchasing a home. If you are anticipating receiving a cash gift from a relative toward the purchase of your home, please notify your First Home Mortgage Loan Officer. Also refer to the Gift Letter form found in the First Home Mortgage document library.

Tip 5: Save everything!

Become a paper hound. Keep all of your bank statements, pay stubs, tax returns, along with any W-2s, 1099s or K-1s and any other financial papers from the past two years in a handy place. If you sold a home in the past two years, have your (HUD-1) Settlement Sheet handy. Try to create a file where you can consolidate all of your financial paperwork for easy access. When in doubt, just pop it in the folder. You never know when you may have to produce an item that you did not expect.

Tip 6: Avoid new lines of credit

It is a good idea to avoid any new sources of credit as it will materially change your credit report. Additionally, if you’re planning to pay off major credit debt before closing, hold off until you’ve spoken to your First Home Mortgage Loan Officer. We may be able to pay off those debts at closing without affecting the application process.

Tip 7: Review your credit report

The best way to get a jump start on your mortgage application process is to know what your creditors are saying about you. Request a free credit review with your First Home Mortgage loan officer.

Tip 8: Tell us about a new job

Making a career move? Make sure your First Home Mortgage Loan Officer knows about it as soon as possible so that we can ensure all appropriate changes are made to the loan application.

Mortgage Monday

Should I buy down my Mortgage Rate?

Interest rates are constantly in flux. In fact, the interest rates will likely change between the time you start your mortgage application and the time you are approved.

Locking the interest rate does not become in effect until you have property and contract.
First you need to understand how mortgage rates are priced.

1. The longer out you lock a rate the higher the rate. You will have a higher rate if you lock for 45 days out vs. 30 days out. Make sure if you lock on a 30 day you can close by that time otherwise the rate will have to be extended and additional fees apply.

2. Most buyers should be asking what current rates are WITHOUT any points. This means you don’t want to pay anything to get that rate and you are not buying down the rate. It is also known as PAR pricing.

3. You may decide to buy down the rate to get a lower rate. Have your lender run a good faith estimate for you both ways (buying the rate down and not buying the rate down). Although a lower rate always sounds more appealing it is not always the best option.

4. You need to decide how long you plan to stay in the new residence. For example, if you plan to stay in the new property a maximum of 5 years then it may not be worth buying the interest rate lower. You may not recoup the expense of buying the rate lower.

5. Ask if you lender has a float down option. This means you can lock and if rates go lower do you have an option to get a lower rate prior to closing. Most of these options require an charge up front and some are refundable and some are not. Ask questions.

Mortgage Monday

What is the Mortgage Application Process???

Before applying for a loan, you should check the current interest rates, you may want to review your credit report for accuracy, and begin shopping for a lender. When, comparing Mortgage Lenders, consider such factors as lock-in policies, fees and loan options.

Comparing Interest Rates:

Interest rates are constantly in flux. In fact, the interest rates will likely change between the time you start your mortgage application and the time you are approved. Even so, it’s wise to compare the rates offered by different lenders before you apply for your mortgage.

Filling Out the Mortgage Application:

After you’ve chosen a mortgage lender or mortgage broker, you’ll fill out the mortgage application. Be sure to complete the application honestly and completely. If you inadvertently (or intentionally) put false information on your mortgage application, it could seriously hurt your chances of getting approved.
Take your time when filling out the paperwork, and be sure to get all your questions answered by the mortgage lender.

Providing Mortgage Documents:

During the mortgage loan application process, you will be asked to provide a variety of documents to the mortgage lender. Always ask the lender whether or not they need the original document. If they need the original, be sure to copy each document for your own records when you apply for a mortgage.

Mortgage Approval With Conditions:

In most cases, mortgage approval comes with certain conditions. These conditions may include a satisfactory appraisal, termite inspection, etc. Ask your lender what conditions and requirements you need to meet, and be aggressive about completing them on time.

Making Changes to Your Application:

If anything significant changes during your mortgage application process (changing jobs, marital status, etc.), tell your lender as soon as possible. On closing day, you will be certifying that no significant changes have occurred, so it’s important to address changes as they arise.

Conclusion:

Keep in mind that everyone wants you to be approved for the mortgage loan as much as you do. It’s in everyone’s interest to see the process through to successful completion. Be honest and helpful, and things will work out in the end.

Mortgage Monday

Should I Lock or Float My Mortgage Interest Rate?

When shopping for a mortgage, what is the best time to float your rate and when should you lock it in? The answer to this question depends on two things:

1. Your objective – if you are buying a home, would your chances to qualify for the loan be jeopardized if interest rates rose? If you are refinancing, will the current interest rate save you a significant sum of money?

2. Your tolerance for risk – floating an interest rate can benefit a client in two ways. First, if rates were to fall, the client could lock a lower rate. Second, if a client chooses to wait until just before the closing date to lock the rate, often times the loan officer can give the client a small break on costs because the mortgage company doesn’t have to take on the risk of managing the lock. So, if you’re willing to risk the possibility of interest rates rising, it may pay off via a lower rate or lower costs. If you don’t like the idea of taking that risk – lock the rate.

What is a Rate Lock?

A rate lock is a pledge between lender and client that guarantees the loan at a specified interest rate. The lender and client have a window of time, usually 15, 30,45, or 60 days, to close the loan. The shorter the lock period, the better things look from a financial point of view. Locking a rate means the lender now has taken on the risk.

However, don’t confuse a rate quote with a rate lock. Just because a lender gives you a rate quote doesn’t mean you’ve locked in at that rate. This is a common mistake many prospective borrowers make. Make sure you are crystal clear as to whether you’re locked or not and, if you are locked, what the rate and terms are. Get it in writing.

What Does It Mean to Float?

Floating means you are willing to take the risk that interest rates will either not go up or that they will fall. If rates have been dropping, then you might want to take a chance that rates will be lower by the time you close your loan than they are today.

Here’s some practical wisdom from Bob Walters, chief economist, “Far too many people, who couldn’t have cared less about interest rates before, become obsessed with rates while they are in process with a mortgage company. The reality is that, while we’d all love to time the market perfectly, it’s extraordinarily difficult to do. If the loan, at the quoted rate, makes sense – lock it in. Leave the rate prognostication to the bond traders.”

Mortgage Monday

Why did rates jump so high???

Consumers have gotten so used to hearing about rates below 5% that it is shocking how they could jump from 4.75% on a 30 year fixed rate mortgage up to 5.75%. It seems to have happened overnight!!
Since May 21st the move has been pushing home rates to the highest level since December. Fears of future inflation and added supply have been the culprits behind the recent sell off of mortgage backed securities.

The market volatility is very high and conditions may change rapidly during the day. Remember the market can change daily even hourly. This may make shopping for that perfect rate a little challenging. While lenders may quote a rate in the morning it can change by afternoon depending on market and economic reports and conditions.

With rates going up is it still a good time to buy??? YES! Most consumers have conditioned their mind to think of rates at 4.75% or lower and 5.75% seems unbelievable but remember we are still in historic times for home mortgage rates.

Only 15 years ago in January 1993, the average rate for a 30 year fixed mortgage was 8.12% and 20 years ago in January 1988, 10.55%. Even those rates seem low though when considering the average interest rate for a 30 year fixed mortgage in January 1983 came in at a whopping 13.40%.

There hasn’t been a better time to buy a home or a first time homebuyer with the $8,000 tax credit that is now offered.

Mortgage Monday

Private Mortgage Insurance is Tax Deductible

Congress has extended tax deductions for homeowners paying private mortgage insurance through 2010.
But to qualify for the deduction you must have bought or refinanced your home since Jan. 1, 2007.
Families with adjusted gross incomes of up to $100,000 can deduct 100% of their insurance premiums, much the same as they deduct property taxes. The deduction is then phased out up to an adjusted gross income of $110,000

Mortgage insurance guarantees lenders will be repaid if the borrowers default. It’s almost always required if you hold less than 20% of the equity in your home. Your equity is the difference between your home’s market value and what you owe on your mortgage (and home equity loan, if you have one). The annual premiums run about 0.5% to 0.75% of the outstanding balance, $500 to $750 a year for every $100,000 you owe.

9 Steps to Cancel PMI (Private Mortgage Insurance)

1. Are you qualified? Most people can cancel PMI once equity in their home reaches 20 percent. Some types of loans, such as government insured FHA and VA loans, require PMI for the life of the loan. If in doubt, call your loan servicer to find out your options.
2. Do you have enough equity?
3. Has your home risen in value? If home values in your area are rising quickly, your equity will reach 80 percent more quickly. Mortgage servicers are not required to consider your homes current value but may do so.
4. Have you made extra payments? The other way to add equity is to make extra payments. Have you made any additional payments and applied them to principal?
5. Do the math Estimated value minus mortgage balance = equity.
Equity divided by estimated value = percentage of equity.
If you come up with a figure of 0.20 (20 percent) or greater, and your estimate is accurate, there’s a good chance you can drop PMI and save.
6. Call your lender Talk to someone at your lender’s customer service department to inquire about procedures for PMI removal. The formal request will likely have to be in writing, but calling first might save you some false steps later.
7. Write your lender When you make your written request, ask your lender to provide, in writing, the minimum amount the property will have to be valued at to qualify to have the PMI dropped.
8. Get an appraisal Most lenders require a formal appraisal of property — at your expense — before they will approve a request to drop PMI. Ask your lender if it has any specific requirements for the appraisal or appraiser that must be met. The company, rather than you, might have to order the work, for example, even though you’ll have to pay the tab of approximately $200 to $350.
9. Final precautions Make sure your loan is up-to-date before making the formal written inquiry to your lender. The lender will consider your payment history when deciding whether to drop PMI. Also, if the property has been converted into rental use, higher percentages of equity are required

Mortgage Monday

Using First-Time Homebuyer Tax Credits for the Downpayment

The American Recovery and Reinvestment Act of 2009 (Recovery Act) provides for as much as an
$8000 tax credit to qualified first-time homebuyers. FHA supports this important Administration
initiative to promote homeownership. This mortgagee letter provides:

• Basic information on the first-time homebuyer credit obtained from the Internal Revenue Service (IRS) website. Complete information on how the first time homebuyer tax credit works, including the eligibility requirements for the tax credit, the amount of the tax credit that a first-time homebuyer may be eligible to receive, and how a homebuyer may claim the tax credit is available on the IRS website.

• Guidance on how Federal, state, and local government agencies, nonprofits instrumentalities of government and FHA-approved nonprofits may assist homebuyers that are eligible for the tax credit.

About the First-Time Homebuyer Tax Credit
(Please check the IRS website to ensure you have up-to-date information)
Amount of the tax credit:

Generally, the credit is the smaller of:

• .. $8000 or
• .. 10% of the purchase price of the home

A phase-out of the credit begins when the taxpayer’s modified adjusted income exceeds
$75,000 or $150,000 if married filing jointly, and is eliminated completely at $95,000 or
$170,000 if married filing jointly.
As a “refundable” tax credit, taxes owed by or refunds due to the taxpayer are factored
into the calculation.
Claiming the tax credit:

Filing form IRS 5405 , “First-Time Homebuyer Credit” along with filing:

• The 2008 tax return (if not yet filed)
• An amended 2008 tax return (if already filed)
• The 2009 tax return

Eligibility for the tax credit

• First-time homebuyers, defined by IRS as those not having had any ownership, including that with a spouse if married, during the three-year period ending on the date of purchase.
• Owner-occupants who purchase a principal residence and close on the mortgage before December 1, 2009.
• First-time homebuyers must purchase the property from a source unrelated to them, i.e., they cannot purchase the house from a spouse, parent, grandparent, child, or acquire the property by gift or inheritance and obtain the tax credit.

FHA Guidance
The Tax Credit: Secondary Financing:
Entities that can offer tax credit advances with second liens.

• Federal, state, and local governmental agencies and nonprofit instrumentalities of government.
• FHA-approved nonprofits.

Additional information about these entities:

• Government agencies and instrumentalities of government are described in handbook HUD- 4155.1 REV-5, paragraphs 1-13 A and B.
• FHA-approved nonprofits can be found, per each Homeownership Center jurisdiction, at: http://www.hud.gov/offices/hsg/sfh/np/np_hoc.cfm

How the secondary financing works:

• The tax credit advance, when combined with the FHA-insured first mortgage may not result in cash back to the borrower. The second lien may not exceed the total needed for the down payment, closing costs and prepaid expenses.
• The tax credit advance must provide that if the borrower does not repay the amount borrowed by the designated deadline, that principal and interest payments begin automatically.
• If payments on the tax credit advance are required, they must be included in qualifying the borrower and, when combined with the first mortgage, cannot exceed the borrower’s reasonable ability to pay.
• If payments on the tax credit are deferred, the deferment must be for a minimum of 36 months in order for the payment to not be included in the qualifying ratios.
• The tax credit advance second mortgage must not provide for a balloon payment before ten years.

Entities that can offer the tax credit advance with short-term loans:

• Federal, state, and local governmental agencies and nonprofit instrumentalities of government, FHA-approved nonprofits, and FHA-approved mortgagees may provide short term or “bridge loans” secured only by the anticipated tax credit due the homebuyer as collateral.

How the short-term tax credit advance loan works:

• The amount that may be borrowed in this manner may not exceed the anticipated tax credit due the homebuyer based on the computations of form IRS 5405.
• Fees and charges for the tax credit advance loan are not to exceed a nominal amount necessary for preparing and administering the loan.

If you have any questions regarding this mortgagee letter, please call FHA’s Resource Center at
1-800-CALL-FHA (1-800-225-5342). Persons with hearing or speech impairments may access this
number via TDD/TTY by calling 1-877-TDD-2HUD (1-877-833-2483).

Mortgage Monday

Mortgage Monday 3/23/2009

MARKET COMMENT

Mortgage bond prices rose last week applying downward pressure on mortgage interest rates. The bond market got a boost from the Fed announcement (read below) to buy more mortgage debt. There was some profit taking in bonds Thursday afternoon following the run-up in prices Wednesday. Higher than expected core readings of the consumer and producer price indices reignited some inflation concerns. The Fed’s continued efforts to pump money into mortgage bonds helped keep mortgage interest rates favorable. For the week, interest rates on government and conventional loans fell by about 1/2 of a discount point.

The Treasury auctions will once again take center stage this week as additional debt supply hits the market. Durable goods orders and consumer sentiment data will be important.

LOOKING AHEAD

Economic Indicator	Release Date and Time	Consensus Estimate	Analysis
Existing Home Sales	Monday, March 23, 10:00 am, et	Down 0.8%	Low importance. An indication of mortgage credit demand. A significant decrease may lead to lower rates.
2-year Treasury Note Auction	Tuesday, March 24, 1:30 pm, et	None	Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Durable Goods Orders	Wednesday, March 25, 8:30 am, et	Down 2.0%	Important. An indication of the demand for “big ticket” items. Weakness may lead to lower rates.
New Home Sales	Wednesday, March 25, 10:00 am, et	Down 2.9%	Important. An indication of economic strength and credit demand. Weakness may lead to lower rates.
5-year Treasury Note Auction	Wednesday, March 25, 1:30 pm, et	None	Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Q4 GDP final revision	Thursday, March 26, 8:30 am, et	Down 6.6%	Important. The aggregate measure of US economic production. Weakness may lead to lower rates.
7-year Treasury Note Auction	Thursday, March 26, 1:30 pm, et	None	Important. Notes will be auctioned. Strong demand may lead to lower mortgage rates.
Personal Income and Outlays	Friday, March 27, 8:30 am, et	Down 0.1%, Outlays up 0.3%	Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates.
U of Michigan Consumer Sentiment	Friday, March 27, 10:00 am, et	56.0	Important. An indication of consumers’ willingness to spend. Weakness may lead to lower mortgage rates.

ADDITIONAL FED MONEY

Last week the Federal Reserve announced it would pump another $750 billion into purchasing more mortgage-backed securities, the bonds that directly dictate 30 year and 15 year fixed rate Government and Conventional mortgage interest rates. This is in addition to the $500 billion being used between January and June to drive mortgage interest rates lower and help stimulate the economy.

So far the Fed has been able to keep mortgage interest rates relatively low while not destroying the functioning secondary market where investors buy and sell mortgage bonds. The potential negative is that the Fed has become the primary purchaser of these bonds. In the short term take advantage of these advantageous rates. There is uncertainty how things will play out once the Fed begins to unwind those positions in the futures.

Heather Jobe

First Mortgage Company

Office: (918) 496-2241

Cell (918) 698-8938

Jim Bigelow    918-640-4657

www.jimbigelow.com                jim@jimbigelow.com

Coldwell Banker Select

 

Mortgage Monday

16 2009 Mortgage Monday

3 16 2009 Mortgage Monday

Rates last week were still fairly steady in the 5.0%+ range for a 30 year fixed. Keep in mind that rates are dependent on about 2 dozen factors, including loan type, loan term, amount of down payment, credit score…and so on.
HUD184 Native American Loans aka Indian Loans
The Section 184 Indian Home Loan Guarantee Program is a mortgage product specifically for American Indian and Alaska Native families who are members of a federally recognized tribe. Tribes, Alaska Villages or tribally designated housing entities are also eligible. Congress established this program in 1992 to facilitate homeownership in Native American communities.
With Section 184 financing you can get into a home with a low down payment, no mortgage insurance and flexible underwriting.
If you are a potential homebuyer, Section 184 is a great product – thanks to the low down payment requirement of 2.25% for loans over $50,000. If your loan amount is under $50,000 your down payment is 1.25%. Also, you don’t have to pay a mortgage insurance premium each month. Instead, a one-time, 1% loan guarantee fee can be added to your final loan amount. Our underwriters and Loan Guarantee Specialists are familiar with the unique issues and circumstances that Native Americans face when trying to get a mortgage in Indian Country.
Individuals, tribes, TDHEs and IHAs can use the Section 184 Loan for: purchase and/or rehabilitation of existing housing; construction of new housing, including manufactured housing affixed to a permanent foundation; and refinancing.
Link to HUD’s website for a list of Participating Tribes:
http://www.hud.gov/offices/pih/ih/homeownership/184/tribal_list.pdf
The 24 participating tribes in Oklahoma, from the list: Absentee Shawnee Tribe of Oklahoma, Cherokee Nation of Oklahoma, Choctaw Nation of Oklahoma, Osage Tribe, Citizen Potawatomi Nation, Apache Tribe of Oklahoma, Muskogee Creek Nation, Ponca Tribe of OK, Sac & Fox Nation of Oklahoma, Otoe-Missouria Tribe, Kaw Nation, Pawnee Tribe of Oklahoma, Alabama/Quassarte Tribal Town, Chickasaw Nation, Comanche Indian Tribe, Wichita & Affiliated Tribes, Kiowa Tribe, Seminole Nation – Oklahoma, Peoria Tribe of Oklahoma, Kialegee Tribal Town, Iowa Tribe of Oklahoma, Miami Tribe of Oklahoma, Quapaw Tribe, Delaware Nation.
One of the misunderstood aspects of the HUD184 loan is that you do not have to live within the boundaries of your tribal nation in order to be eligible to have a HUD184 loan. In May, 2005, for all of the above tribes, the entire state is now eligible, except for the Miami Tribe of Oklahoma which states “Miami Tribal operating area within 50 mile radius (of the Tribal headquarters) (subject to Tribal signed land status and jurisdiction form in MO). The Citizen Potawatomie Nation is also eligible in Kansas.
However, if you apply to your tribe for a grant, gift, loan or other funds that the tribe may have to help their tribal members purchase a home, the tribe sets its own guidelines for the use of that money, which may include the requirement that the home you purchase, using those funds for downpayment, closing costs, etc, must be within the Tribal Nation boundaries.
The HUD184 and the tribal funds, if any, are separate sources of funds and may be used together or not. The HUD184 allows the use of those tribal funds for your down payment and other loan costs.
The seller can, in almost all cases, after the borrower pays the minimum down payment, pay the balance of the buyer’s costs. If the seller will not pay the buyer’s costs, and tribal funds are not available, gifts for the closing costs are allowed from, for example, family members.
Rates are similar to other loans. Fixed rate loans, only.
Most lenders…there may be a few exceptions…now require a minimum 620 FICO credit score for “government” loans, including VA, FHA, HUD 184, etc.
HUD, the department of Housing and Urban Development, oversees both the FHA and the HUD184 programs, so there are many similarities but some differences.
Down payment, as stated above, is 2.25% (or 1.25%)…FHA is 3.5% of the purpose price.
The maximum loan is 150% of the FHA mortgage limit subject to appraised value and down payment requirements. FHA at $271,050 = HUD184 at $406,575.
There is a 1% guaranty fee, which is the HUD184 equivalent of up-front mortgage insurance, and which is the only item that can be financed into the loan amount. FHA is 1.75% on most loans…so the HUD184 total loan and, therefore, payment is relatively less.
There is no monthly mortgage insurance on the HUD184. On the FHA, in most cases, the monthly mortgage insurance is roughly equivalent to about ½ percent higher rate.
You are required to provide your CDIB (Certificate of Degree of Indian Blood) card aka Indian card or Tribal Affiliation card. It does not matter what your card shows as degree of Indian blood, as long as you have the card.
It’s a great time to buy…or to refinance. Give me a call for a free consultation or with any questions.
Steve Bell
Mortgage Consultant

Capital Mortgage Corporation
9014 S Yale Avenue
Tulsa, OK 74137
918-633-8909 Cell
918-481-8810 Office
918-481-8832 Fax
steve@capital-mortgage.com
www.capital-mortgage.com

 

Jim Bigelow    918-640-4657

www.jimbigelow.com                jim@jimbigelow.com

Coldwell Banker Select

Mortgage Monday

3 9 2009 Mortgage Monday

3 9 2009 Mortgage Monday

Rates last week were still fairly steady in the 5.0% range for a 30 year fixed. Keep in mind that rates are dependent on about 2 dozen factors, including loan type, loan term, amount of down payment, credit score…and so on.

VA (Veterans Administration) Loans

If you are a veteran of the US Military…Thank YOU!

If you know a veteran…give them a big hug and a Thank you!

As a benefit for serving our country, veterans have the opportunity to get a mortgage loan with some great features:

A VA loan is a true 100% loan, that is ZERO down payment (up to $417,000). With a loan amount over $417,000, known as a VA Jumbo loan, the down payment is 25% of the amount over $417,000.

The seller can, in almost all cases, pay all of the veteran buyer’s costs, so…

The veteran buyer can get into a home, in most cases, with nothing out of pocket.

Rates are similar to other loans. The rate for a VA Jumbo may be a slight bit higher, but much less than most conventional jumbo loans.

Because the risk is higher due to zero down and the veteran possibly not having much, if any, of their own money into the transaction, the underwriting guidelines, for credit and qualifying ratios, are a just a bit tighter than, for example, an FHA loan.

Most lenders…there may be a few exceptions…now require a minimum 620 FICO credit score for “government” loans, including VA, FHA, HUD 184, etc.

If the seller will not pay the buyer’s costs, gifts for the closing costs are allowed from, for example, family members.

There is a funding fee, which is the VA equivalent of up-front mortgage insurance, that is the only item that can be financed into the loan amount. The amount of the funding fee depends on the veteran status, amount of down payment, if any, and whether the veteran has previously owned a home with a VA loan. The funding fee is waived if the veteran receives any service connected disability compensation.

Side note: are you aware that a veteran with 100% service connected disability can get sales taxes, excise tax (Motor Vehicles Only), and property (ad valorem) taxes waived in the State of Oklahoma? For a booklet describing this incredible benefit for our veterans, call the Oklahoma Department of Veterans Affairs. 888-655-2838 or 405-521-3684   Also has information on their website: http://ok.gov/ODVA/

Another side note: Trivia: VA loans were formerly known as GI loans…what does GI stand for?

The veteran may also use this VA benefit more than once but can only have one at a time.

You must have your DD-214 Report of Separation, often called a discharge certificate, and a Certificate of Eligibility (COE) (for home loan purposes). If you do not have your DD-214, you can send The Standard Form 180, Request Pertaining to Military Records (SF180) to the records retention department in St Louis, MO (address on the form). A mortgage lender can provide the form to you…or you can go to http://www.archives.gov/veterans/evetrecs/index.html and follow the steps to first get the SF 180, you can print it on site…or, you can order your DD-214 directly on the site.

The lender can, in about 50% of the cases, get an ACE (Automated Certificate of Eligibility) on an automated lender access system. If not, it takes 2-3 weeks to get the DD-214 and then another 1-3 weeks to get the COE from the Winston-Salem office by mail. If you think that you are going to buy a home with a VA loan, you can and should get these documents well ahead of time. And then you should still get into a mortgage lender that offers VA loans and get pre-approved.

It’s a great time to buy…or to refinance. Give me a call for a free consultation or with any questions.

Steve Bell   Vietnam Veteran, US Navy

Mortgage Consultant

 

Capital Mortgage Corporation

9014 S Yale Avenue

Tulsa, OK 74137

918-633-8909 Cell

918-481-8810 Office

918-481-8832 Fax

steve@capital-mortgage.com

www.capital-mortgage.com

 

 

 

 

 

Jim Bigelow    918-640-4657

www.jimbigelow.com                

Mortgage Monday

2 23 2009 Mortgage Monday

2 23 2009 Mortgage Monday

 

Rates were fairly steady last week in the range of 5% + for a 30 year fixed rate, mid 4’s% + for a 15 year at zero discount points and 1% origination fee…a bit higher for zero origination…or lower with some discount points…your choice as to what makes sense for your particular situation.  The rates are still very close to historical lows.

 

Bullet points on the tax credit from the stimulus bill:

 

• First time homebuyer: defined as someone who has not owned a principal residence during the 3 year period prior to the purchase of a new or resale home.
• For the tax credit, the purchase closing (and title transfer and occupancy) must occur on or after January 1, 2009 and before December 1, 2009.
• The tax credit is equal to 10% of the home’s purchase price up to a maximum of $8,000
• Tax credit is reduced for “modified” adjusted gross income of more than $75,000 for single taxpayers and $150,000 for married taxpayers filing a joint tax return. The tax credit is zero for taxpayers with MAGI above $95,000 (single) and $170,000 (married).
• This tax credit does not have to be repaid. The previous $7,500 tax credit, enacted in 2008 and which is replaced by this tax credit, had to be repaid and was essentially an interest-free loan. You must use the property as your principal residence for at least 3 years or you will be subject to recapture of the tax credit amount (with some exceptions).
• You claim the tax credit on your federal income tax return, completing IRS Form 5405 to determine the tax credit amount, and then claim the amount on Line 69 of the 1040 tax return.
• Any home that will be used as a principal residence will qualify: single family detached, condominiums, townhomes, manufactured homes and houseboats.
• The tax credit is refundable. Simply, if you qualify for a credit, say $8,000, that is more than what you owe in taxes, say $1,000, when you file your taxes, you will receive a check…in this case for $7,000.
• There are some other points to the tax credit that might fit a few buyers particular situation.

 

Combine the low interest rates with the tax credit, and, as we have been saying:

 

It’s a great time to buy…or to refinance. Give me a call for a free consultation.

 

Steve Bell

Mortgage Consultant

 

Capital Mortgage Corporation

9014 S Yale Avenue

Tulsa, OK 74137

918-633-8909 Cell

918-481-8810 Office

918-481-8832 Fax

steve@capital-mortgage.com

www.capital-mortgage.com

 

Jim Bigelow    918-640-4657

www.jimbigelow.com                jim@jimbigelow.com

Coldwell Banker Select