Obama’s Home Affordable Refinance Program has been extended to June 30th, 2011. You still have time to take advantage of refinancing into a low, fixed rate.

Do you owe more on your mortgage than your home is worth? The good news is that if your current mortgage is owned by Fannie Mae or Freddie Mac (if you don’t know, call me- I can find out for you) there is still time to refinance into a low 30 year fixed rate. 

You are eligible to refinance if:

• You are the owner-occupant of a 1-4 unit home
• Your mortgage is guaranteed by Fannie Mae or Freddie Mac (call me)
• You are current on your mortgage payments and haven’t been more than 30 days late in the last 12 months
• The amount you owe on your 1st mortgage doesn’t exceed 125% of the current value
• You have a reasonable ability to pay the new mortgage payments

Call me today at 425-319-7734 to see if this program will benefit you.

Late last year, Fannie Mae conducted a national housing survey to check in on attitudes toward housing, especially in light of the current housing downturn. The research project asked more than 3,000 homeowners and renters nationwide, how confident they are about homeownership as an investment, the mortgage process, the housing finance system, their personal finances and the overall economy.

Survey Results

The survey showed that, despite the downturn, Americans continue to value homeownership.

• Nearly two-thirds of respondents said they preferred owning a home to renting (safety and having a positive environment to raise children were the top reasons to own).
• More than 60 percent said they would buy a house if they were going to move.
• Seven out of ten said that buying a home continues to be one of the safest investments available (only 17 percent believe buying stocks is a safe investment).
• Three-quarters of renters believe that owning makes more sense than renting, because it protects them against rent increases and is a good investment over the long term.

At the same time, people are more cautious and recognize the challenges to homeownership.

• About 60 percent said it would be harder to get a mortgage than it was for their parents, (citing poor credit and income as the main obstacles).
• Nearly seven in ten (68 percent) think it will be harder for their children to buy a home.
• Nearly one-quarter of renters say they will wait longer than they had planned to buy a home.
• More than half said they are making personal sacrifices to own their home, with 24 percent saying they are “sacrificing a great deal.”

In addition, a majority of Americans believe in upholding the financial responsibilities of homeownership.

• Nearly nine in ten said they do not believe it is acceptable to stop making mortgage payments on an underwater mortgage.
• Only six percent of homeowners said they had considered stopping their mortgage payments.
• More than half (53 percent) believe homeowners bear the responsibility if they get a home loan they can’t afford.

What We’ve Learned

What we’ve learned from these and other survey results is that even in light of the housing crisis Americans still value homeownership. But they have made a shift to a “new reality” — one that is less willing to take on risk to own a home and more focused on making homeownership a success for the long-term. 

Click here to see the survey.

Did you know that Cinco de Mayo is actually an American celebration and not a Mexican one?

Contrary to popular belief, it’s not Mexican Independence Day, which is commemorated Sept. 16.  It actually celebrates the 1862 Mexican victory over the French in the Battle of Puebla and, according to many people, is more of a U.S. holiday than a Mexican one.

For the average Mexican, today is just another Wednesday, according to Oscar Casares, a professor at the University of Texas-Austin. “The holiday, which has never really been much of one in Mexico, crossed over to this side of the border in the 1950s and 1960s, as civil rights activists were attempting to build harmony between the two countries and cultures.  The date gained more attention in the 1980s when marketers, particularly beer companies, saw this as a perfect opportunity to capitalize on the celebratory nature of the holiday.”

Eric Lurio wrote in the Huffington Post, “It’s actually a Mexican-American holiday, which was for some reason very popular in California, and over the years has become the official Mexican ethnic day, as Columbus Day is for the Italians … In other words, it’s a harmless, if totally fake holiday.”

Oh well, Happy Cinco de Mayo anyway!

As of today, you have 30 days to have mutual acceptance on a home purchase and still receive the homebuyers tax credit, which is set to expire soon. In order to qualify for the credit, you must have mutual acceptance on the home you are purchasing by April 30th, and it must close by June 30th.

According to the opinions in the following article, most people think that this will be the end of the tax credit. There isn’t much hope that it will be extended.

http://curiouscapitalist.blogs.time.com/2010/03/30/extending-the-home-buyer-tax-credit-up-is-down-and-down-is-up/ 

If you are hoping to purchase a home using either the first-time homebuyers credit of $8,000, or the move-up buyers credit of $6,500, give me a call today to get pre-approved right away. You don’t want to miss out on this one!

It’s already that time again! Don’t forget to set your clock ahead 1 hour tonight!

 It’s also time to get off the fence if you’re considering purchasing a home. Have your family’s needs changed?

Do you need more bedrooms or a bigger yard – or just more space?

Interest rates are rising, and even with the lost equity in your current home, it may make financial sense to make that move-up now while you still have some equity left for a down payment.

Each situation is unique – if you’d like a customized analysis, I’m happy to provide you with one.

You’ll be able to see just how much a move would save/cost you versus how much it will save/cost for you to stay in your current home.

 Let me introduce you to the “SBD or Seller Buydown Program”. This progam can dramatically effect how much home you are able to purchase. This is invaluable information for you to have, especially if you are thinking of waiting before buying. The Fed’s program to keep interest rates low is ending at the end of March. The average interest rate (over a 48 month period) before the Fed put their program into place was 6.250%.

See what a difference that can make?!

These payments are principal and interest only – they do not include taxes, homeowners insurance or mortgage insurance

Please give me a call if you’d like to take a look at your own financial situation and see what your options are.

As always, there is no obligation.

Getting a mortgage these days can leave YOU feeling overwhelmed and helpless. If only there was a way to know that you’re getting honest, accurate information to make informed, educated decisions about YOUR mortgage.

 I don’t know about you, but I really dislike buying a car. I dislike the whole process. There is a whole lot that goes on behind the scenes that I don’t understand. I never know if I can believe what the salesman is telling me. I never know if I’m getting a good deal or being taken advantage of.

Perhaps that is why I approach helping people get mortgages a little differently. I think that it’s important for you to have all of the information you need to make a wise decision. It’s your mortgage – you’re the one who is going to live with it for possibly the next 30 years.  You need to be certain that you’ve gotten the best mortgage to fit your needs, structured in the correct way to help you achieve all of your financial goals.

I believe that getting a mortgage doesn’t have to be a painful experience. You don’t have to simply turn over all of your personal and financial information and then just hope for the best…hope that your loan originator knows what they are doing – hope they are telling you the truth – hope they have given you the best advice on which loan option to choose – hope they know the best time to lock in your rate … Instead, once given the information you need, you can choose how to structure your mortgage and what rate to choose. I have the tools to help you do just that. Let me show you what I mean…

Things aren’t always as they seem.

If you’re not familiar with the terminology and the loan process,

how will you know if you are getting a good deal, or being taken advantage of?

(by the way… the man squatting in the picture above isn’t holding anything in his hands. All of the water, the drain, and the hose and reel– just a chalk drawing.)

When you work with me, I won’t just tell you what loan options you have and which one will be best for you – I’ll SHOW YOU.

Do you know the answer? Which is better – a lower rate with higher fees, or a higher rate with lower fees?

I won’t just quote you a rate and fees, I’ll SHOW YOU how much you will save each month and over the life of the loan.

Then YOU make the decision as to which loan option is best for you.

Should you ask the seller to help you with your closing costs? Or would it be better to ask them to help you buy down the rate instead? What is the best way to structure your offer so that you’ll save the most amount of money? I’ll SHOW YOU what the different options will mean to you in dollars and cents, and then YOU decide what is best.

Is now a good time for you to buy? Or would it be better to wait in case home prices decrease? I won’t just give you my opinion, I’ll SHOW YOU the numbers in black and white. Then YOU make the decision.

  How will you know who has the best rate? Is spending your time and energy rate shopping with several different lenders the only way to know? How will you know the best time to lock in the rate? I won’t just tell you what the markets are doing – I’ll SHOW YOU.

…and I’ll SHOW YOU which lenders are raising their rates, and which ones are lowering their rates – in real time. Then YOU decide when it’s the best time to lock in your rate.

Getting a mortgage doesn’t need to be a frustrating experience that leaves you feeling helpless.

I won’t ask you to trust me, I’ll earn your trust, by giving you the information you need to make informed, educated decisions about your mortgage.

FHA (Federal Housing Authority) is the government agency that provides federally insured mortgages. The majority of people buying homes these days use an FHA mortgage because it is the only option they have. FHA mortgages only require a 3.5% down payment, are more flexible with credit history and score, and have less expensive mortgage insurance than conventional loans. Most homebuyers don’t have a large down payment and usually have less than perfect credit. Conventional loans in Washington state currently require a 10% down payment and the mortgage insurance, although no upfront insurance required, is more costly per month.

Things are changing, though. FHA is committing to tightening their guidelines, and will be announcing the new changes as soon as January. Here are some of the changes that are being discussed:

1. Increasing the down payment requirement from 3.5% to 5%
2. Reducing the amount that sellers can contribute towards their closing costs from 6% to 3%
3. Increasing the amount of mortgage insurance required – both the upfront insurance and the monthly premium amount
4. Increasing the minimum credit score
5. Increasing the interest rate for borrowers with lower credit scores

In addition to the changes being planned for FHA loans, Fannie Mae is also tightening their guidelines, as well. As of December 12, 2009, the following underwriting guidelines will be in place for all mortgages, including both conventional and FHA.

1. Minimum credit score of 620
2. Maximum debt-to-income ratio (total monthly debt divided by total monthly gross income) of 45% (up to 50% for very strong borrowers) -note- Currently there is no set debt-to-income limit. I have seen ratios of up to 67% get an approval.

Underwriting guidelines continuing to tighten. If you are considering buying a home, but are waiting for home prices or rates to come down even more, you may find that you’ve waited so long that you no longer qualify. Rates are the lowest that they have been in 50 years. Home prices may never be this low again. It’s time to put every penny you can into savings, get your credit score up as high as possible, and make your move now. (Whatever you do, DON’T try and improve your credit score on your own! Please give me a call and I’ll be happy to go over your credit report with you.)

It’s important to keep old revolving accounts open, even if you are not using them. 15% of your overall credit score is determined by the length of history. If you close the accounts that you have had for a long time, you will shorten your credit history, thereby lowering your score.

30% of your score is determined by your balance to limit ratio. The higher the balances you are carrying in comparison to your credit limit, the lower your score will be. The credit bureaus recommend keeping your balance to below 30% of the total available limit. If you close accounts, you are lowering your overall credit limit, again, causing a negative effect on your score.

Banks and credit card companies are not making it easy. They have begun lowering credit card limits in the past couple of years, which has automatically made the balance-to-limit ratio higher for anyone carrying balances on their cards.

The government is putting limits on how much the banks and credit card companies can hike up their rates that will take effect in February. Because of this, they are raising their rates now. You have probably received a letter from your credit card companies informing you of the rate hike and giving you a choice to “opt out”. The letters state that if you “opt out”, your rate will not be raised, but your account will be closed. Please keep in mind how this will affect your score when deciding whether or not to keep your account open. If you have had the accounts for a long time and they have a substantial credit limit, the effect on your credit score could be dramatic. The best option would be to transfer the balance to another account, or pay it off if possible, and keep it open.

Navigating the credit scoring system is quite a task these days. The best way to keep a high score is to use each card frequently – at least once every 2 months, but pay the balance off in full. And whatever you do, don’t close old accounts!

Your credit score is made up of 5 components.

1. 35% – Payment History
a. On-time payments
b. Length of time that has passed since the most recent negative item

2. 30% – Credit Balance to Credit Limit Ratio
a. Keep your balances below 30% of the available limit

3. 15% – Length of Credit History
a. The longer the history, the better

4. 10% – Type of Credit
a. Ideal credit profile consists of 3 – 5 revolving credit cards, a mortgage account, an auto loan, and a line of credit

5. 10% – Inquiries
a. Inquiries stay on the report for 2 years but only affect the score for 1 year
b. Auto and mortgage inquiries occurring within a 45 day period are treated as 1
c. Many inquiries don’t count: personal, promotional and job related, insurance & account reviews

Whatever you do, be sure you are making your payments on time, especially if you plan on applying for a mortgage in the near future. The recent history carries the most weight – a 60 day late from 1 year ago will not have as much negative impact on your score as a 30 day late 2 months ago. When applying for a mortgage, your credit history from the most recent 12 months will have the most weight and impact on your score.