Rates are unbelievable - High 3's!!

It can be a really tough decision when contemplating whether or not to lock in to a rate when obtaining a mortgage. Generally, when rates are as low as they've been, the conventional wisdom would say to lock - why risk it when the pressure is for rates to go up, at least theoretically.

Well, they keep going down. Fortunately, for those clients who were locked in the last 30-45 days, we've been able to negotiate with the investors to get their rates down. A really great option that we, as brokers, are able to offer.

Now to the good stuff - currently, rates are ridiculously low:
- 30 year fixed conventional rates as low as 3.75%
- 30 year fixed FHA and VA rates as low as 3.75%
And of course rates are even lower for shorter terms, such as 15 years.

One may ask a next logical question like: should I lock if the trend is for rates to keep going down? Well, we'd say the conventional wisdom still suggests that if you're in the market for a mortgage, either to refinance your existing mortgage or to buy a new house, it would be a bit risky to pass on these rates for the hope of them going even lower. Especially when there is the option of renegotiating the rate if it decreases enough from where you happen to be locked.

As always, feel free to contact us if you'd like to discuss your mortgage needs. (505) 830-9685.

Buying Fixer-Uppers

Click on the article to link. This is a good article about the FHA 203(k) loan, which is really the primary loan available for people wanting to buy a property and roll into the loan the fix up costs. You should know that they are a pain in the butt, bottom line (no pun intended). However, it is there for you if you want to roll the costs into the loan. More work? Yes. Other options? None.

Cost of FHA loan to increase in early September

For anyone who is considering a new FHA loan, which includes taking advantage of the historically low rates through an FHA Streamline refinance (see past posts on this subject), you would be wise to get started now.

Congress just passed H.B. 5981 and it's expected to be signed by the President shortly. This bill gives the FHA the power to hike monthly premiums (mortgage insurance premiums) it charges to consumers. Currently the monthly premium is .55%/year, which translates to about $46 for every $100,000 financed. It is expected that HUD will raise the premiums initially to .9%, which will add about $30/month for the same $100,000 financed. The bill also give HUD the authority to raise the monthly premium to a factor of 1.55%. Given the authority, you can be sure it's coming.

There is a positive element to the bill. Presently, in addition to the monthly premiums, HUD charges the borrower 2.25% of the loan amount as an Up Front Mortgage Insurance Premium charge on every FHA loan - this Up Front premium will most likely be reduced to 1%.
The net effect of these changes will be an increase in the cost of an FHA loan. The planned effective date of these changes is September 7th, so again, if you're someone who's been considering refinancing and FHA loan, do it NOW. As always, we'd be happy to answer any questions you have.

Please Call Us Before......

We sometimes hear from clients who've considered refinancing with the lender currently servicing their loan. Let us just say - please call us first.

We just spoke to an existing client who had been contacted by their current lender/servicer about the possibility of refinancing. After a review of their situation, they were told they're not eligible for a refinance at this time. However, that's not true at all. They are eligible for an FHA Streamline (we referred to these in our last post). This program, combined with the offer we're making, will save them at least $200 per month, AND, we will pay ALL of their closing costs.

Not sure why the existing lender/servicer didn't mention this to them. Maybe they can't offer it, maybe they're not aware of it, who knows? Either way, we're grateful for the opportunity to serve them again and will vastly improve their current situation because of our steadfast commitment to ensuring we are on top of the latest opportunities of our industry.

You Must Call Us If You Have An FHA Loan

Do you currently have an FHA OR VA loan? If so then you need to be sure and take 2 minutes to call us. You may qualify for an FHA/VA program that will not require any appraisal at all, will cost you absolutely nothing to do ($0 in closing costs), and lower your monthly payment. Give us a call at 830-9685 (ask for Kim Kissane) so we can quickly analyze if you qualify. You can also email Kim at Kim@MyPremierAdvisors.com.

FHA Increasing Fees

Click on the title to link. The news just gets better and better. HUD announced today that it is going to raise the upfront Mortgage Insurance Premium (MIP) from 1.75% of the loan amount to 2.25% sometime this spring/summer. Although this amount is rolled into the loan and is not a direct cost out of your pocket, it does raise the loan amount which, consequently, raises the payment.

Further, they are petitioning Congress to increase the monthly mortgage insurance premium, which would also increase the payment. So qualifying will, potentially, become more difficult now. FHA says, "Not everybody should own a home." Really? Daaaahhh! Maybe that explains a big reason for the mess we are in now. Of course not everybody should own a home. So the answer to that in their mind...make it harder for those who should own a home to buy one. That makes sense.