Articles Published in: June 2015

June 17, 2015

FHA Mortgage Loan Rates: Post-Fed, Moving Lower

It’s been a tricky week for mortgage loan rates in general; rates seemed to be in a “defensive” position ahead of the highly anticipated Fed announcement which happened today–that announcement had major power to influence rates higher or lower depending on the contents of the statement and investor reaction to it. So what happened with rates today? According to several sources, certain markets that influence mortgage rates were weak in the morning, which sent some lenders to adjust their rates accordingly. Once the Fed had made its eagerly awaited announcement, rates began moving back the other way. Why? The Fed could have announced an interest rate hike today, which can and often does (when it occurs) have a negative effect on mortgage rates. But instead, the Fed declared that while | more...

June 17, 2015

HUD Announces More Housing Counseling Grants

By Joe Wallace

We write a great deal about the importance of housing counseling–especially for first time FHA loan applicants who might need some additional help with questions about the home buying process in general, getting credit ready for an FHA loan application, and what it takes to apply for a home loan after a bankruptcy or foreclosure. Yesterday HUD announced a new round of grants for housing counseling agencies that provide such services to FHA borrowers and other home loan applicants. HUDNo.15-074 announced nearly six million dollars in housing counseling grants, including “nearly $1.5 million to new housing counseling grantees and $4.5 million to supplement the funding awarded in April to existing grantees” according to the HUD press release. You can examine a comprehensive summary of each grant, organized by state as | more...

June 17, 2015

Home Loan Disclosure Changes Coming August 1, 2015

By Joe Wallace

On August 1, 2015, new federal laws will require changes to loan information disclosures that are designed to make borrowers more fully informed. The new requirements affect FHA, VA, conventional and any other type of mortgage loan. The new requirements, announced by the Consumer Financial Protection Bureau, “…will simplify and improve disclosure forms for mortgage transactions. Consumers currently receive different, but overlapping federal disclosure forms with the terms and costs of mortgage loans.” That overlap proves confusing for borrowers, especially those who have never purchased or refinanced a home loan before. Two new forms replace the set of previously required disclosures. According to CFPB.gov, these new forms are, “the Loan Estimate, given three business days after application, and the Closing Disclosure, given three business days before closing.” CFPB says all | more...

June 16, 2015

FHA Mortgage Loan Interest Rate Trends: Holding Steady Ahead Of Fed Announcement

By Joe Wallace

Mortgage loan interest rates are holding steady ahead of an important and much anticipated announcement by the Fed on Wednesday. The Fed does not set mortgage loan interest rates, but as we have seen in the past with the Fed’s handing of Quantitative Easing (QE) that Fed announcements can and do cause a reaction in the markets that directly affect mortgage loan rates. So Wednesday will definitely be a day to watch. At the time of this writing, we’re seeing some sources report best execution rates for 30-year fixed rate conventional mortgage loans at 4.125%, though others offer a best execution range with 4.25% at the top and 4.125% at the bottom. If the Fed were to announce a rate hike on Wednesday, that could bring higher mortgage loan rates | more...

June 16, 2015

CFPB Reminds HECM Applicants To Read The Fine Print

By Joe Wallace

The Consumer Financial Protection Bureau (CFPB) has published a consumer advisory warning those in the market for a Home Equity Conversion Mortgage Loan to pay special attention to the terms and conditions of the HECM loan, adding that some lenders are allegedly using false or misleading language in advertising about such loans. The first thing CFPB wants borrowers to know is that a HECM loan is just that–it’s a mortgage loan with legally binding financial agreements, not a government benefit. FHA HECM loans, which are guaranteed by the government, are not and should not presented as a benefit and require mandatory counseling about the HECM program. And that’s important to think about when shopping for a lender for your reverse mortgage or HECM loan; a participating FHA lender is required | more...

June 15, 2015

FHA Refinance Loan Options: FHA-To-FHA, Non-FHA to FHA

By Joe Wallace

Is now the right time to refinance your mortgage with an FHA loan? Many are considering their options, but if you don’t know the possibilities offered by an FHA refinance loan, now is a good time to get caught up on what’s available for owner-occupied single family home loans. FHA single-family home loan refinancing is available for both existing FHA loans and non-FHA mortgages. Your current loan can be an FHA, VA, conventional, or any other type of home loan that meets FHA program requirements for refinancing. Borrowers applying for any type of single family FHA home loan must be owner-occupiers of the property securing the new loan. For existing FHA loans, there is an option for cash-out (appraisal and new credit check required), no cash out (an appraisal and/or | more...

June 15, 2015

HUD Releases May Housing Scorecard

By Joe Wallace

The FHA/HUD official site has issued its housing scorecard for May 2015, and the numbers could help some borrowers decide whether the time is right to consider a cash-out or no-cash out refinance loan. According to the official site, www.HUD.gov, “HUDs May Housing Scorecard details the recovery of our nations housing market. As we look back, we witnessed progress among key indicators, including a spike in new home sales, a high level of previously-owned home sales over the last two months, and gains in U.S. home values. While great progress is being made, we must continue to support programs that will allow more American families and homeowners to recover from the Great Recession.” That might not sound terribly exciting to a borrower considering an FHA refinance loan, but the housing | more...

June 13, 2015

FHA Mortgage Loan Interest Rates: Still Near 2015 Highs

By Joe Wallace

We’ve been posting more about home loan interest rate trends as of late–rates have been moving higher in the last few weeks to what some industry professionals term 2015 highs. Next week we are due for an important, and highly anticipated announcement from the Federal Open Market Committee (FOMC) which has the power to influence mortgage loan rates depending on investor reaction to it. The big debate among some market watchers going into next week is whether or not the FOMC announcement WILL affect rates, or if European economic news will overshadow it. We’ve seen behavior like this before–a major, market moving event being overlooked in favor of breaking news from elsewhere. So it’s not entirely clear which way rates could move next week, except that it is reasonable to | more...

June 12, 2015

HUD Secretary Castro on LGBT Month

By Joe Wallace

On the FHA/HUD official site, there’s a blog post by HUD Secretary Julian Castro, which announces that June is Lesbian, Gay, Bisexual, and Transgender Month, described by Castro as, “a time to recognize the lasting contributions that these Americans have made to our nation, and to honor the progress thats been achieved in securing equal opportunity for all.” He adds, “Right now, were in the midst of a period of transformative change. In recent years, barriers that once blocked too many of our fellow Americans from living and loving freely have come tumbling down. In 2013, the Supreme Court struck down the Defense of Marriage Act, helping ensure that all couples are treated fairly under the law. Same-sex couples are now able to get married in 37 states. And earlier | more...

June 12, 2015

What You Should Know About FHA Loan Interest Rates

By Joe Wallace

We get many reader questions about interest rates on FHA home loans, and it’s clear from these questions that a misconception still exists–some people believe the FHA sets or regulates the interest rates on FHA single family home loans. This is not true, but in spite of that we get variations on a common type of question that goes something like this: “Should I expect an FHA loan interest rate above XYZ? What kind of interest rate should I be getting?” The truth is that FHA loan interest rates, while lower than the conventional equivalents, is still subject to negotiation between the borrower and the lender. A hypothetical FHA loan interest rate of 3.75% (which is at the time of this writing the “best execution rate” for an FHA loan | more...