Jeff Moran asked:




There are many FHA home loans that offer benefits for both refinancing and buying a home. Years ago, FHA mortgages were only considered for first time homebuyers. While FHA loans are great for 1st time homebuyers, they are also good mortgages for refinancing and purchasing.

One notable feature of a FHA mortgage is that they are available for borrowers with less than perfect credit. FHA guidelines do not use credit scores as the primary function for underwriting like most conventional lenders do when considering qualifications. Consumers with low fico scores, even past bankruptcies being reported by credit repositories, like Tran Union, Equifax, and Experian.

Most FHA lenders underwrite and approve home loans based on debt to income ratio and the proposed borrowers ability to repay the mortgage. Another benefit for government lending is that lenders and brokers assume very litle risk because our HUD insures FHA loans against defaults.

With FHA loans, you will be obligated to document your income, employment and provide letters of explanation regarding any late payments and derogatory credit. If you need cash out, the FHA lender will want a letter explaining how you intend to use the cash.

Any way you look at it FHA loans have become the recommended option for borrowers with no equity to refinance. In addition homeowners with poor credit scores will be advised to consider FHA mortgage loans because there are very little subprime options available today and the few non-prime options out there typically carry high rates with excessive pre-payment penalties. FHA mortgages don’t have pre-pay’s and the mortgage rates with FHA remain low compared to subprime or non-conforming rates.

Edgar

lady_bella asked:


We are again trying to refinance our home. Just after a couple of months, the comp value (hearing this from a lender), went down again another 50 grand.

I heard that Bush signed a Housing Bill. Who the heck is this suppose to help? And what does this entail?

We are on an ARM right now and when we got this loan, it was only because we were under the understanding, and reassurance that we could refinance to a fixed rate. Now we can’t.

If this ARM on our house takes place, we cannot afford the fluctuating pmt. And God only knows what kind of pmt it will be. And it will start to take affect in January.

I talked with my dad tonight, and he read somewhere that ppl are losing their homes all over because of this. He also said that he read somewhere that some ppl are buying second homes, and walking away from their first because of how the housing market is. How is that possible?

Is it possible to walk away from one house, and buy another?

This is really straining and emotionally draining on my husband and I. Not to mention putting a damper on our relationship. How can we get through this? How has anyone gotten through this?

Help please…any advice will be welcomed. Thank you.
Thanks to everyone who has extended such kind words and who has sent me a personal message with extra detail info. I really appreciate it, and I wish there was a way I can give ‘best answer’ to each of you, as you all have great advice! God Bless you all!

Anthony

Sand’N'Sable asked:


First, I am not currently in default on my mortgage. We have just had a really hard time paying it each month. So we applied for the Making Home Affordable Refinance program. After months of faxing in paystubs and harship letters..etc, we finally got some news today. They sent us a Moratorium Letter which says that we have 4 months to not pay our mortgage, but then we are “supposed” to pay the balloon payment. The Wells Fargo rep told me that 99% of people CANT pay this so they tack it on to the principle and work something out then.. Please help. Should I accept this moratorium??

Sean

I love rain and alcohol! asked:


I live in a old house that is falling apart. We just refinanced for the third time about 7 months ago. We owe 100,000 for the house and it is only worth 50,000. We pay 1,100 a month in mortgage and we really can not afford that. They just raised our payment up 200 on a 7% fixed rate. We do not want this house anymore, we do not want to negotiate anything. We found something for rent for 400 bucks a month so we will rent that. If we just walk away from our home will they be able to seek a jugement against us? We live in the state of Missouri but our lender is from Florida. Our lender is Taylor Bean and Witaker. Will they garnish our wages? If so how long will it take for them to start garnishing our wages? Will they send us something in writing before they start garnishing our wages so we will have a warning? Thanks for your answers!
I have had this house five years. We refinanced thinking that we will get a lower fixed rate, but that is not how it happened. They told us our ARM was about to go up so like fools we signed into this contract. Our payment was only 20 dollars lower now here it is seven months later and they said our taxes and insurence went up which raised our payment 200, which I think is unfair. We received 750 at closing.
These people also charged us 450 at closing for an appraisel which I did not see happening.

Debra

Rebecca Sparenberg asked:




Looking to refinance your mortgage? Well stop, don’t rush; there are a few things you should consider before refinancing. With mortgage rates at an all-time low, refinancing can save you thousands of dollars. However, if you rush into a new rate without negotiate for the best deal or you don’t understanding all the details of your new mortgage you could end up losing money.

Is Refinancing Right For You?

A general rule is that refinancing becomes while if the current interest rate on your mortgage is at least two percent higher than the prevailing market rate. However, depending on your loan amount, you might choose to refinance a loan that is only one-point-five percentage points higher then the current rate.

When choosing to refinance, consider is how long you plan to stay in your house? Given the costs of the refinancing, it usually takes at least three years to fully realize the savings from a lower interest rate. Refinancing is only good idea if you intend to stay in your house long enough to make the additional fees worthwhile.

Remember To Shop Around

The most common mistake homeowners make when refinancing their mortgage is they fail to shop around. Would you buy a new car without first checking out the competitions prices?

Call two or three lenders to compare their interest rates and closing cost, then compare then to the terms offered by your current lender. Comparing offers allows you to get a better idea of what rate you may be able to qualify for. It also puts you in a better negotiating position with the lenders.

Once you receive offers, pay close attention to the interest rate, points, and closing costs. Talk with the loan officers and see if you can negotiate a better interest rate. Most often, the initial rate offered is not the best a particular lender can offer.

Consider All The Cost

There is no such thing as getting your cake and eating it too. It is important to understand that refinancing your mortgage is not free. Consumers need to ask their mortgage originator to provide all costs that will be incurred in order to complete the refinancing process in writing.
There are “no cost” rates available where all of the closing costs are built into the rate, but they usually involve higher rates. This is one of the reasons shopping around is so important.

Many lenders require that you have at least ten percent equity in your home, but there is usually at least one lender willing to underwrite loans in which the borrower has only five percent equity. Nonetheless, beware low equity loans can involve relatively high mortgage insurance costs.
In most cases, a homeowner should plan on paying an average of three to six percent of the outstanding principal in refinancing costs. One way of saving on some of these costs is to first check with your current mortgage lender, they may we willing to wave some of these fees; including the fees for the title search, surveys, and inspections.

Check Your Credit Twice

If your credit history is less than sparkling, it might be worth while to invest sometime into cleaning up your credit before you applying for a home loan. Before you apply for your new mortgage, first check your credit report for any mistakes or outdated information. It’s estimated that 60 percent of credit reports contain some type of incorrect information. Federal law allows consumers to receive a free copy of their credit bureau report each year. Review your report and make any change requests directly with the credit reporting agency.

Depending on your credit score, the process of cleaning up your credit can be as easy as reporting errors on your credit report or as complex as hiring a professional credit counselor to get your finances in order. If your credit problems cannot be fixed quickly you will almost certainly have to pay more than borrowers who have a good credit history. Yet, don’t assume that the only way to get credit is to pay a high price. Ask how your past credit history affects the price of your loan and what you would need to do to get a better price.

Don’t assume that minor credit problems or difficulties stemming from unique circumstances will limit your loan choices to only high-cost lenders. No matter what your credit score, remember the key to finding the best deal or rate is to shop, compare, and negotiate.

Anita

Southern Comfort asked:


Thinking this may be a help to consumers? Wait until you read what the people who you elected are going to do.

First of all this bill is ‘bi-partisan’ and was voted ‘yea’ at 84-12. The Senate has proclaimed it as a package designed to help businesses and homeowners ‘weather the housing crisis.’ The supporters of the bill in the Senate also acknowledge it does little to help borrowers losing their homes.

it actually does nothing to help them at all, there are no provisions for those in duress.

For Builders

The plan gives them large tax breaks. Over a three year period no less.

The same guys who made huge fortunes building homes and condos at inflated prices the last 6 years.

For investors

$7000 tax credits for buying foreclosed properties. This can include big businesses like lenders.

Buying a foreclosed home means going to a foreclosure sale. At this time this will mean 99-100% lenders tax credit as no one else will be there.

$4 billion in grants for communities to buy and fix up abandoned homes.

Grants will probably be given to those that can afford to buy lots of those homes, like large investment firms, lenders, and builders. Local Joe Public will see little of this in my opinion

For the oil companies and their ‘renewable energy divisions.’

$6 billion in unrelated tax breaks. This tax break goes against the Senates own rules regarding revenue increases.

Well, you elected corrupt people to lead, what did you expect. The businesses that made the most money in the last 10 years were Oil companies. They are the ones that will get this $6 billion tip. What the heck is this doing in a foreclosure bill?

Other notes

The plan modernizes the FHA to allow more people to refinance into loans back by ‘the depression-era agency.’

So, if you have good credit and payment history, the FHA will be there for you. Of course that helps no one in trouble at all.

Rumors of what the House will do when it receives it.

Try to reject 25 billion in tax breaks to ‘money-losing’ businesses like home builders.

I think, if I were to be cynical, that only ‘money-making’ home builders will get this.

The House seems to want to drop the tax credit for buying foreclosed properties.

Maybe they are afraid too many regular people may be able to buy a foreclosed home?

For the people

$150 billion for pre-foreclosure counseling and stronger loan disclosure requirements.

The only ‘foreclosure counselors’ will be your lenders. The only ones doing disclosure requirements will be your lenders. Lenders, say hello to another 150 Billion, thanks for the memories.

Tax breaks for ‘first-time’ home buyers and investors in low income rental housing.

You could sum this up as ‘Nobody and slum lords.’

A separate house bill would be paired with it that gives $300 billion to refinance loans for 1 million+ homeowners who ‘might face’ foreclosure.

Keyword ‘might’, this means if you are in foreclosure or probably cannot stop heading towards it you will not be eligible. This is a sad joke.

The White House

George Bush, the President, ‘opposes’ the plan but has no plans to veto the final version coming from the House.

Thanks for ‘almost’ George!

The Bush administration countered those plans Wednesday with its own, far narrower, proposal. It would expand an existing FHA program to allow more homeowners who are facing large rate hikes to refinance into more affordable government-insured loans

And this will preclude everyone in trouble or who already faced huge rate hikes

Stella

ruth asked:


I have 2 intrest only mortgage loans (ARM/HELOC) which will come to $2450 per month. I recently got devorced, and finding difficult to afford my mortgage payment, (no late payments yet)but I can afford a payment of $ 2000-2100 per month. I tried to refinance, but I need clossing cost of $12000, its impossible since all my savings are gone. . I really want to keep my house…what shall I do?.. Can my mortgage lender help me? or are there any other ways to get a lower payment?

Elizabeth

Rony Walker asked:




A refinance provides the mortgagor the opportunity to switch to a lower interest rate or transfer his mortgage to another lending company. Transferring your home loan loan refinance is an option when the interest rates are eating up your budget or when the company is not servicing your loan the way you want it. But there are other considerations when thinking of a refinance.

Avoid Monster Companies

If you have been diligent with your monthly mortgage payment for years and the company has provided you the service it promised to deliver, there shouldn’t be other reason to transfer your mortgage to another company. Lower interest rates might propel you to make a switch and if the company cannot give you a lower interest rate, getting a home loan loan refinance from another company is advised.

If your present mortgage company can provide you a lower interest rate, well and good. The process will be faster this time because the company knows your track record. It is also likely that the company will grant your request because it values your business. But if the lender cannot give you a lower interest rate, shop for another company that may be able to have a home loan loan refinance program tailor-fitted to your needs.

However, looking for a home loan loan refinance is not easy. With several mortgage companies out there, be sure you’re getting one that is bound by good business ethics and not one of those monster companies that delay your application for some blurry reason purportedly to review and process your paper.

Don’t be impressed with glossy advertisements of smiling men and women promising you fast and dependable service. Do your research well before doing any business with them. This is especially true when you’re dealing with a company out of state. Check out the company’s track record with the Better Business Bureau. If the company is littered with complaints, set your sights elsewhere.

Ask Before You Leap

Before you give any commitment, ask the companies if they charge for early loan payment and if they can give you a three-day period for rescission. Most people are not aware that they can back out of a home loan loan refinance when their gut tells them they are not getting the refinance they want.

The loan agent must tell you about this, but usually they don’t. During the three-day period, you have time to review your mortgage documents after closing. You have until midnight of the third day to make up your mind. Fax them your cancellation and address this to the broker, lender, and the company. Follow this up with telephone calls just to be sure they know your decision and are informed of the faxed cancellation.

Knowing your right to a rescission takes off the pressure from the bullying tactics of monster companies. To protect your right to a rescission, do not allow the agent or the broker to force you to falsify your information. This will work against you and you’ll find yourself trapped to a home loan loan refinance you will be unhappy with for years.

Be Informed

All prospective homeowners and those with mortgages should not shelve the opportunity to learn about the mechanics and processes of the mortgage transactions. Being well-informed arms you to deal effectively with loan agents and help you protect your rights as a consumer.

Getting another mortgage company then is not always about getting a lower interest rate for your home loan loan refinance. It’s also about protecting yourself against the unscrupulous practices and bullying tactics of mortgage companies.

Bryan

45387 asked:


to my own place until June 2009 due to financial restraints. We have 3 children. Child support/alimony is basically nonexistent as we share funds for the children more than send specific payments. He does cover my rent & utilities, however, since I moved out.

I worked for 1 month during 2009. My ex- worked for 10 mos then started receiving unemployment & attending school for which he gets VA benefits.

The final factor is that we own a home & a 2nd home which we rent out. Both of our names are on the mortgages to these homes, as we are still working through the refinance process with the lenders.

Last year we filed jointly, with him as head of household & claiming the children & myself. This year, I moved out right at the breaking point for being able to claim myself or for him to claim me.

In this situation, who should claim the children? Should I allow him to claim me or might I get a better return claiming myself & possibly the children? And how should we handle who claims to houses & rental income?

I could run 5 different scenarios using tax software, but am trying to save time by asking on Yahoo Answers. Thanks!
OK, seriously? There isn’t a single tax preparer on Yahoo Answers that can give me a basic overview on how to handle a divorce situation? Please don’t offer up corny websites or throw-in the towel answers. Thanks!
Also, my moving out can be dated either as before the 6 month mark or after. My apartment lease was signed in April ‘08, but I didn’t officially move out until the end of June.
What if…..I claim the rental income/rental mortgage interest while he claims the house we own, as he still lives there?

In our divorce decree,. it says we alternate years as to who claims the kids. He took them last year, so I’ll take them this year.

In this situation, I’ll claim myself.

Splitting it like this, just black & white….does that sound reasonable?

Lois

TAT asked:


It becomes government policy that everyone should have the opportunity to own a home. The government cajoles private lending institutions into making irresponsible loans with promises to buy those loans and shield the financial institutions from liability. Financial institutions that don’t go along with the lending frenzy are punished. There’s a rush to buy homes as the government-guaranteed loans flood the landscape. High demand forces home prices up. People see increasing home values and are convinced they can still their loans when the interest rates increase by simply refinancing. The bubble starts to burst when some borrowers realize that they aren’t going to be able to repay their loans and the refinancing isn’t available. Home values crash. Lenders and homeowner find themselves upside down. Financial institutions once worth billions crash and burn.

Anita