05 Dec 08 Questioning the Mortgage Crisis
The Associated Press put out a story yesterday reporting that the Bush Administration ignored in-house warnings of an impending mortgage collapse in 2005, delayed enacting proposed rules for a year, and bowed to lobbyists in stripping out the harshest of the proposals. Today, we find ourselves in foreclosure crisis and in the middle of the worst housing recession in a generation, the proposal reads like a list of what-ifs: FHA loans, VA mortgages and conventional have to change with the times to meet the needs of today’s homeowners. Continue to read complete published article> Bush Admin Slow to Correct Mortgage Crisis
Tags: FHA loans, VA mortgages
05 Dec 08 VA Home Mortgage Underwriting
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VA Underwriting Standards |
VA home loans involve a veteran’s benefit. Therefore, VA approved lenders are encouraged to make VA loans to all qualified veterans who apply. VA’s underwriting standards are intended to provide guidelines for lenders’ underwriters as well as VA’s mortgage underwriters. Underwriting decisions must be based on sound application of the underwriting standards, and underwriters are expected to use good judgment and flexibility in applying the guidelines set forth in the following pages. |
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Basic Requirements |
By law, VA may only guarantee a home loan when it is possible to determine that the veteran: · Borrower must be satisfactory credit risk, and · has present and anticipated income that bares a proper relation to the contemplated terms of repayment. It provides guidance on how to treat income, debts and obligations, credit history, and so on, and how to present and analyze these items on the VA home loan analysis form. It does not deal with every possible circumstance that will arise; therefore, underwriters must apply reasonable judgment and flexibility in administering this important veteran’s benefit. |
Read the complete published article> VA Home Loan Underwriting.
02 Dec 08 What is a VA Guaranteed Home Loan?
VA mortgage loans are guaranteed by VA and but the loans are actually made by private mortgage lenders, like banks, credit unions, or mortgage companies that are approved by VA. Veterans seeking financing should remember that these unique loans are for the purchase of a home which must be owner occupied. The guaranty ensures the mortgage lender protection against loss if the loan defaults. The guaranty replaces the protection lending companies receive by requiring a down-payment or by charging traditional private mortgage insurance (pmi).
Many military veterans have been misinformed that their entitlement guarantees that I will be approved for a VA home loan. The Dept. of Veterans Affair cannot force a mortgage lender to approve a loan that does not meet their lending guidelines. VA does not make loans, it guarantees them, so most VA mortgage lenders are comfortable with 100% VA home financing.
01 Dec 08 Can Obama Repair the Home Mortgage Lending Industry?
Here is the problem Mr. President Elect, the subprime meltdown and the foreclosure crisis problem is far more complicated than predatory lending from unscrupulous mortgage brokers. Banks do not like mortgage brokers and for years they fueled the fire that mortgage brokers caused the sub-prime meltdown. For the last decade, Banks have developed mortgage lending guidelines that created a housing boom. American homeowners prospered and what could go wrong. Lending guidelines in 2005 and 2006 went too far in allowing no money down home loans for borrowers with little, no or bad credit. The housing bubble bursted and jobs were lost. The home loan financing industry melted and banks tightened their guidelines to the point where average homeowners could not qualify to refinance into a fixed rate mortgage they could afford. FHA home loans have started to require certain credit scores and lenders like to play appraiser and reduce their appraised value to the point where everyone has been wasting their time. Home equity tanked and the foreclosure concerns became an epidemic. Read the Complete Home Loan Article > Will Obama Save the Mortgage Industry and Curb Predatory Lending? Article written and published by Bryan Dornan.
Tags: home loan financing, lending
01 Dec 08 VA Mortgage Loan Update
Veterans with conventional home loans now have new options for refinancing to a Department of Veterans Affairs (VA) guaranteed home loan. These new options are available as a result of the Veterans’ Benefits Improvement Act of 2008 (PL 110-389), which the President signed into law on Oct. 10, 2008. Veterans with financial hardships due to increasing high rate sub-prime mortgage loans are potentially the greatest beneficiaries. VA has never guaranteed sub-prime home loans. However, as a result of the new law, VA can now help many more veterans who currently have sub-prime mortgage loans.
The new law makes changes to VA home loan refinancing program. Veterans seeking to refinance their sub-prime or conforming mortgage loans may now do so for up to 100% of the value of the property. These types of mortgage loans were previously limited to 90 % of the value. Additionally, Congress raised VA’s maximum loan amount for these types of mortgage refinancing loans. Previously, these refinancing loans were capped at $144,000. With the new legislation, such loans may be made up to $729,750, depending on where the property is located.
Increasing the loan-to-value ratio and raising the maximum loan amount will allow more qualified veterans to refinance through VA, allowing for savings on interest costs or even potentially avoiding foreclosure. Originally set to expire at the end of this month, VA’s authority to guarantee Adjustable Rate Mortgages (ARMs) and Hybrid ARMs was also extended under this new law through Sept. 30, 2012. Unlike conventional ARMs and hybrid ARMs, VA loan imits interest rate increases on these loans from year to year, as well as over the life of the loans.
For more information, or for help from a VA loan specialist, call VA at 1-877-827-3702 or go to www.homeloans.va.gov.
01 Dec 08 100% VA Home Loans
The only true 100% home financing left is the VA home mortgage loans. You need to be a veteran and the mortgage rates are low. The VA funding fee is only .5% and borrowers can buy a new home with no money down. like FHA underwriting, the credit scores with VA mortgage loans are not as important as income and job history. Veterans who already have VA loans can do streamline refincing up to 100% as long as they keep the new mortgage rate and term. If Vets want cash out theu can refinance up to 90%. Read the complete article > 100% VA Home Loans
Tags: 100% VA loans
01 Dec 08 Military Money Magazine Shows Families How to Detect and Avoid Financial Scams
Recent reports indicated that America’s military families may be the latest target of financial scams. Military personnel are often young and transient, but they earn a regular paycheck from Uncle Sam – making them prime mortgage targets for shady sales practices and financial scammers. The Winter 2008-09 issue of Military Money® magazine uncovers common scams aimed at the men and women who protect our country and offers helpful tips to help families detect and avoid them. Military home loan financing has many benefits so don’t lose out because of a few scams.
- Unsuitable Insurance- Several unscrupulous agents have misrepresented their companies’ affiliation with the U.S. military. What you can do: (1) Max out your military insurance first. Service members’ Group Life Insurance (SGLI) costs only 6.5 cents per $1,000 of coverage per month. (2) Check out insurers and agents with your state insurance department. Ask about licensing, complaints and disciplinary actions.
- High-Fee Investments- Sales people for companies pushing high-fee investments pounce on military personnel who receive a financial windfall, such as deployment pay. What you can do: (1) Take advantage of the military’s Savings Deposit Program. Members of the military deployed in certain regions can deposit up to $10,000 into a special account that pays up to 10% per year. (2) Check the broker’s record. Use FINRA’s Broker Check tool (www.finra.org) to obtain information on a broker’s licensing status and any disciplinary actions.
- Affinity Fraud- Scammers will use any affiliation with the military, whether real or not, to gain a family’s trust. What you can do: (1) Check out the company or salesperson with the base community service office. Some offices maintain a database that cross-references complaints made to various on-base offices as well as the local Better Business Bureau. (2) Put an active-duty alert on your credit report. This free alert asks creditors to take extra precautions to verify the identity of an applicant before extending credit.
- Predatory Mortgage lending- Advance-fee or payday lenders target cash-strapped military members, requiring loan payments of as much as $900 or even $1,800 up front. What you can do: (1) Get a 0% loan through a military emergency relief fund. Contact the community service office at your base for details. (2) Join a credit union. On-base credit unions often offer short-term loans at competitive interest rates. (See VA Home Loans )
Read complete article at www.MilitaryMoney.com and enjoy additional content, calculators, surveys and other interactive tools.
01 Dec 08 FDIC Loan Modification vs Mortgage Loan Relief Program
Once the homeowner’s modification is determined, the home loan lenders’ service company must perform a property valuation test between the cost of a loan modification and the estimated cost of foreclosure to provide modification results in a reduced cost solution to the investor. By providing an automated appraisal that compares the cost of restructuring the home loans and the estimated cost of foreclosure, the service company fulfills the terms of most home loan servicing agreements. Read Complete Article > Mortgage Loan Relief Page.
Tags: home loan
