Mortgage Credit Report

Mortgage details and things I'm seeing regarding credit:

Forgiveness of debt in a modification is treated the same as short sale.

Wait is four years for conventional loans and three for FHA

Mortgage Credit reports should be read and interpreted by an expert. The lady in the credit union that takes your papers to be processed for a loan can misinterpret or miss read. It is vital to view a mortgage credit report on day one  with regards to derogatory credit events and the proper calculation for seasoning.

·      Fannie Mae only – The foreclosure seasoning can be reduced from 7 years to 4 years if the property is surrendered in the Chapter 7 bankruptcy.  Make sure the property is listed on the Chapter 7 form Debtor’s Statement of Intention and marked as surrendered.  This reduced seasoning does not apply for foreclosures that

occurred prior to the filing of the bankruptcy in which only an unsecured deficiency balance is listed in the bankruptcy.

·         All loan types – A HELOC settled for less than full balance can occur even if there is no short sale or foreclosure.  Lien Holders can be approached with a request to reduce the balance, or the Lien Holder may initiate the settlement.  Determine the property address associated with the HELOC or 2^nd mortgage. Even if the borrower still owns the property, sufficient seasoning will be required as the lender has taken a aloss.  This would be considered a pre-foreclosure situation requiring 4 year seasoing for Fannie or Freddie, 3 year seasoning for FHA or USDA, and 2 year seasoning for VA, from the date of the settlement/foregiveness.

Bad News For HERO and PACE Programs

HERO PACE PROGRAMS IMPORTANT INFORMATION Energy Efficient Improvements What they failed to tell you...

First and foremost, FNMA, FHLMC, nor FHA will not allow these programs to remain on the title policy.  Nor will they allow to subordinate. The subordination they provide does not clear title. These programs cloud title and act like property tax bills in first position

Property owners may not be aware they can't refinance or sell with this on title

Even for a refinance, borrower might not understand the contract with this program.

As an  example of how they appear on the preliminary title report:

Assessments and other matters for the Western Riverside Council of Governments as contained

in a document entitled "Payment of Contractual Assessment Required" and/or "Notice of

Assessment" (California Hero Program), recorded March 11, 2014 , as Document No.

2014000089985 of Official Records.

The HERO and PACE programs were a great thing to reduce energy costs but they stick the property owner with a big mess When the HERO program shows on the prelim it is recorded just as the County Tax Assessor as first in line. They are a cloud on the title.

HERO – “Home Energy Renovation Opportunity” Also known as PACE “Property Assessed Clean Energy”.

These are programs offered by localities to finance residential energy improvements with loans that are generally repaid through the homeowner’s real estate tax bill.

Since they are part of the property tax bill, they remain in first position.  I spoke to FNMA today about this program and HERO’s willingness to subordinate the loan.  FNMA said that their subordination agreement is a “limited” subordination in that they are promising not to foreclosure, but since it is included in the property taxes, they remain in first position and therefore FNMA will not purchase mortgages with the HERO, or PACE (as they call it).  The borrower will need to do a cash out refinance And pay off the HERO.

Fannie Mae and Freddie Mac will NOT allow subordination agreements, they must be paid off in full to have clean title FNMA and FHLMC guides. There is a provision for PACE loans taken out prior to 7/6/10.  If you run into one of these, I would contact Loan Support for guidance.  There have been several conversations with FHA as well and they will not accept.  They too would require a cash out refinance. And pay the debt off at closing the mortgage loan.
Those people who got these programs to insulate, add energy efficient windows or solar from "government" or "county" programs usually have no idea this is a problem.
My Eagle Home Mortgage Website
Books by C G

Mortgage Application

Mortgage Application online step by step description how to begin.
Apply for your FHA, VA, USDA, Jumbo, Conventional Mortgage Loan from your home or office.
Video shows easy link to
http://eaglehomemortgage.com/carolinegerardo/  apply now

We have an amazing number of mortgage products for you.
Perfect credit, a year after foreclosure, foreign national, Super Jumbo
we have it all.
Call C G from 7:00 AM to 7:00 PM seven days a week for answers to your questions
Even if you just need advise how to fix your broken deal we are here to help

FHA VA with low credit scores

Caroline Gerardo Senior Loan Officer NMLS #324982     Office 949-784-9699 eFax 855-883-4303 CarolineGerardo@eaglehm.com http://www.eaglehomemortgage.com/carolinegerardo Committed to Seeing You Home. Eagle Home Mortgage 100 Spectrum Center Drive Suite 500 Irvine CA 92618 NMLS #849059 CA #813I609 Universal American Mortgage Company of California, dba Eagle Home Mortgage of California. Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act. RMLA #4130383, NMLS #252392, NV #3244. Certain restrictions apply. This is not a commitment to lend. Applicants must qualify.

Private Transfer Tax No FHA loan?

cute claw foot tub

New rules may prohibit Freddie Mac, Fannie Mae and Federal Home Loan Banks from buying mortgages in community associations with deed-based, or private, transfer fees. Ladera Ranch is one community in Orange County with these transfer fees (in addition to regular property taxes and Mello Roos). Pretty expensive home buying costs...

HOAs with transfer fees that benefit a condo community (the vast majority) could receive federal mortgage support. HOAs with mandated transfer fees that don’t directly benefit the Whole Association would be unable to obtain federal loans. Private transfer fees—typically a percent of the sale price and specified in the original condo documents—are fees paid when a condo or co-op unit is resold. They are paid from the purchaser to one of four groups: (1) the community association, (2) tax-exempt groups that provide a direct benefit to HOA owners, (3) tax-exempt groups that don’t provide a direct benefit to HOA owners (like the Sierra Club), or (4) third-party developers or investors.

All four types of transfer fees were sanctioned in the initial FHFA proposal; but in the revised proposal, transfer fees that provide “direct benefit” to communities (typically, the first two groups) would be allowed in conforming HOAs.

 “Direct benefit means that the proceeds of a private transfer fee are used exclusively to support maintenance and improvements to encumbered properties as well as cultural, educational, charitable, recreational, environmental, conservation or other similar activities that benefit exclusively the real property encumbered by the private transfer fee covenants.

Lawyers in the U.S. Department of Housing and Urban Development’s office of general counsel have warned FHA that under existing “free assumability” regulations, the agency is not permitted to insure mortgages on properties that come with “restrictions on conveyance” — encumbrances on the title that could hamper transfers. That includes fees required to be paid at the sale of units in communities governed by homeowner associations.

This means mortgage companies and banks cannot finance a home with an FHA loan when a private transfer fee is part of the deal. HUD spokesman Lemar Wooley explains that “private transfer fees violate HUD’s regulations at 24 CFR 203.41, which prohibit ‘legal restrictions on conveyance,’ defined to include limits on the amount of sales proceeds retainable by the seller.
“HUD also requires lenders to convey clear marketable title in exchange for insurance benefits.”
Will HUD, the CFBP and attorneys next crack down on the huge fees Management Companies charge for condo certificates and providing copies of budget, bylaws and CCR’s? These things could be posted for free in pdf format on the HOA website

master bath with glass tile

Streamline FHA Spouse' Credit

Just a quick note to let you know we DO NOT have to pull credit on a non-borrowing spouse in a Community Property State on our Non-Credit-Qualifying FHA STREAMLINE REFINANCE loans.

Non borrowing spouse can have bad or weak credit

Mortgage After Short Sale

Conventional Loan after Short Sale

Fannie Mae is unlike FHA, VA, and USDA where they have different mortgage lending guidelines on getting a conventional loan after short sale and deed in lieu of foreclosure. The Federal Housing Administration, FHA, looks at foreclosure and short sale the same as a regular foreclosure and the waiting period after short sale, deed in lieu of foreclosure, foreclosure is all the same. FHA guidelines on waiting period after short sale, deed in lieu of foreclosure, foreclosure is all three years to qualify for a FHA Loan: Three year mandatory waiting period after the recorded date of a foreclosure and deed in lieu of foreclosure and three year waiting period after the date of the short sale. There is a two year waiting period to qualify for a FHA Loan after bankruptcy. The waiting period starts from the discharge date of the bankruptcy.

PRICKLY SUBJECT  - BUY A HOME AFTER THE CRASH

With Fannie Mae, there is a 7 year waiting period after foreclosure to qualify for a conventional loan. However, to qualify for a conventional loan after short sale or deed in lieu of foreclosure, the waiting period drops to a 4 year waiting period and only a 5% down payment is required. Unlike FHA, VA, USDA, short sale and deed in lieu of foreclosure is treated much differently with Fannie Mae and those who have a short sale or deed in lieu of foreclosure are greatly rewarded than those who have a standard foreclosure.

What happened to 2 year waiting period after short sale with 20% down payment to qualify for Conventional Loan?

If you Google ” Waiting Period to qualify for conventional loan after short sale or deed in lieu of foreclosure”, you will get dozens and dozens of articles the first few pages that highlights that there is a 2 year waiting period to qualify for a conventional loan with 20% down payment. Unfortunately, all of those articles are now not accurate because Google has not updated the correct information or updated blogs from mortgage writers and bloggers. Just this past August, 2014, Fannie Mae has eliminated the 2 year waiting period after short sale and/or deed in lieu of foreclosure to qualify for a conventional loan with 20% down. Many home buyers who were nearing the 2 year waiting period mark after short sale or deed in lieu of foreclosure or trying to save the 20% down payment were just absolutely devastated since Fannie Mae came up with new mortgage lending guidelines on waiting periods after short sale and deed in lieu of foreclosure to qualify for a conventional loan.

FANNIE MAE Guidelines on waiting period after short sale, deed in lieu of foreclosure, foreclosure, bankruptcy

2015 FANNIE MAE guidelines with regards to waiting periods after short sale, deed in lieu of foreclosure, foreclosure, and bankruptcy to qualify for a conventional loan.

WAITING PERIOD AFTER SHORT SALE AND DEED IN LIEU OF FORECLOSURE TO QUALIFY FOR CONVENTIONAL LOAN: 

There is a 4 year mandatory waiting period after short sale and foreclosure to qualify for a conventional loan with 5% down payment and re-established credit after the short sale or deed in lieu of foreclosure with no late payments in the past 12 months. Most mortgage lenders do not want to see any late payments after the short sale or deed in lieu of foreclosure.

WAITING PERIOD AFTER FORECLOSURE: There is a mandatory waiting period of 7 years after foreclosure to qualify for a conventional loan from the recorded date of foreclosure with re-established credit after foreclosure and no late payments in the past 12 months. Most mortgage lenders have investor overlays that require no late payments after the foreclosure.

WAITING PERIOD AFTER BANKRUPTCY TO QUALIFY FOR CONVENTIONAL LOAN: There is a 4 year mandatory waiting period after bankruptcy to qualify for a conventional loan with re-established credit and no late payments in the past 12 months. Most mortgage lenders will have investor overlays where no late payments after bankruptcy will be necessary.

MORTGAGE PART OF BANKRUPTCY: If you had a mortgage part of your bankruptcy or foreclosure part of bankruptcy, there is a 4 year waiting period to qualify for a conventional loan with re-established credit and no late payments in the past 12 months. Many mortgage lenders will have internal mortgage lender overlays where they will require no late payments after your bankruptcy.

FHA CHEAPER Streamline Refinance for Cheaper payment

FHA Reduces Single Family 

Annual Mortgage Insurance Premium 

(MIP) 

Rates for 

Most Title II Forward Mortgages

1/12/2015  Federal Housing Administration (FHA) published 

 Reduction of FHA Annual MIP Rates and Temporary Case Cancellation Authority.

 This Mortgagee Letter implements the 50 basis point (0.50%)
 reduction in FHA’s annual Mortgage Insurance Premium (annual MIP) rates for
 most Single Family Title II forward mortgages 
announced by the President Obama on January 8, 2015. 
 This rate reduction furthers the Administration’s and FHA’s 
ongoing goal to prudently expand access to 
mortgage credit for individuals and families across a range of incomes.

SAVE THOUSANDS OF DOLLARS
1/22/2015 FICO 700 30 year
rate 3.875% APR 3.989
costs for a $400000. loan :
streamline no appraisal
Escrow $510 title $510 recording $110
Underwriting and processing $1295
plus prepaid interest, taxes if due and
hazard if due
NEW MIP is lower RATE is lower
Call for a free quote - you might even
be able to go conventional.



SAVE MONEY


LOWER your monthly


payments!



Call me


(949) 637-8190

30 year rates in the 3's

15 year rates in the 2's

Rates change daily
http://eaglehomemortgage.com/carolinegerardo/

The annual MIP rate reduction is effective for FHA
Case Numbers assigned on and after January 26, 2015
for most Title II forward mortgages with amortization
terms greater than 15 years.


Today’s Mortgagee Letter includes a table which shows
the current and new annual MIP rates by amortization term,
base loan amount, and loan-to-value ratio.
The rate reductions have also been incorporated into FHA’s
Mortgage Insurance Premiums table for forward mortgages.
This updated Mortgage Insurance Premiums
table will be integrated into FHA’s
Single Family Housing Policy Handbook (HUD Handbook 4000.1)
 at the next available update.

Temporary Case Cancellation Authority

FHA will temporarily approve Case Number Cancellation Requests for loans with FHA Case Numbers assigned but not yet closed, to allow mortgagees to obtain the reduced annual MIP rates. Mortgagees must submit Case Number Cancellation Requests under this temporary authority using the submission instructions specific to this temporary authority posted today on FHA’s Case Processing Requirements web page.

Mortgagees may begin requesting Case Number cancellations on January 15, 2015, but must submit all Case Number Cancellation Requests under this temporary authority by 11:59 p.m., Eastern, on February 26, 2015. Mortgagees should not order new Case Numbers under this temporary authority until they have confirmed in FHA Connection that the previous Case Number has been cancelled.

What does this mean?

REFINANCE STREAMLINE ANY FHA loan 

started after the MI rates jumped in 2009
Save money monthly on your MIP premium also
mortgage rates are much lower. Reduce your monthly
payment by refinancing sometimes without an appraisal

Call me even if you already

streamlined you may be able to

refi free for lower monthly payment

(949) 784-9699

Loans in process at a bank?

Cancel and come over to lock at today's rates

old MIP rates

assigned on or after January 26, 2015.
Term 15 Years
New MIP
80b s
85b s 100b s
105b s
45b s
70b s
70b
95b s
Base Loan Amt. $625,500
$625,500

LTV
95.00%

Previous MIP
130b s 135b s
150b s
155b s
Term 15 Years
90.00%

45b s 70b s
70b s 95


NMLS #324982

SAVE money FHA CHEAP MIP and rate

Beach Cottage

SURF's up for FHA refinance

U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

WASHINGTON, DC 20410-8000

ASSISTANT SECRETARY FOR HOUSING FEDERAL

HOUSING COMMISSIONER annouced today cheaper MIP premiums coupled with lower

interest rates can save you on your monthly payments

January 9, 2015

To: All Approved Mortgagees 

GREAT GOOD NEWS ABOUT 

FHA MIP REDUCTION

Reduction of Federal Housing Administration (FHA) annual Mortgage

Insurance Premium (MIP) rates and Temporary Case Cancellation Authority

This Mortgagee Letter (ML) communicates lower annual MIP rates for FHA

Title II forward mortgages and provides opportunity for cancellation of

existing case numbers in order to utilize the MIP rates contained in the ML.

Background Pursuant to its statutory mandate, FHA continuously strives to achieve the

appropriate balance between meeting the housing needs of the borrowers

FHA’s mortgage insurance programs were created to serve and minimizing

the level of risk undertaken relative to the insurance of those mortgages.

FHA has determined that the appropriate balance of its statutory operational

goals now requires a reduction of the rate of annual MIP charged pursuant to

Section 203(c)(2)(B) of the National Housing Act (NHA). As provided in

this ML, the total annual MIP charged pursuant to sections 203(c)(2)(B) and

(C) for most Title II Single Family forward mortgages has been revised as

provided in this ML.

Effective Date This ML is effective for case numbers assigned on or after January 26,

2015.Affected Topic This ML reduces the rate for annual MIP for all Title II forward mortgages,

with terms greater than 15 years, except;

 single family forward streamline refinance transactions that are

refinancing existing FHA loans that were endorsed on or before May

31, 2009; (before the rates were lower)

 Section 247 mortgages (Hawaiian Homelands)

This ML supersedes the annual MIP rates established in ML 2013-4. All

other sections of ML 2013-4 remain in effect.

STREAMLINE FHA REFINANCE 

IF YOUR LOAN WAS CLOSED 

AFTER May 31 2009

INTEREST RATES ARE LOWER 

AND MIP  REFUND/ lower premium

Call to see if you can 

take advantage of this today 

(949) 784-9699

______________________________________________________________

The following table shows the existing and the new annual MIP rates by

amortization term, base loan amount and Loan to Value (LTV) ratio. All

New MIP amounts set forth in this table are effective for case numbers

assigned on or after January 26, 2015.

Term > 15 Years

Base Loan Amt. LTV Previous MIP New MIP

≤ $625,500 ≤ 95.00% 130 bps 80 bps

≤ $625,500 > 95.00% 135 bps 85 bps

> $625,500 ≤ 95.00% 150 bps 100 bps

> $625,500 > 95.00% 155 bps 105 bps

Term ≤ 15 Years

≤ $625,500 ≤ 90.00% 45 bps 45 bps

≤ $625,500 > 90.00% 70 bps 70 bps

> $625,500 ≤ 90.00% 70 bps 70 bps

> $625,500 > 90.00% 95 bps 95 bps

Case

CALL NOW to refinance and save money (949) 784-9699

rates can touch the 3%' s now if your FICO is high

APR 3.99 for conforming FHA with middle FICO of 700

Take advantage of this drop now with cheap rates and

lower MIP

 http://eaglehomemortgage.com/carolinegerardo/ 

Cancellation

To allow mortgagees to obtain the reduced annual MIP rates contained in this

ML for loans in process with active FHA Case Numbers ie: loans not funded, 

FHA will temporarily approve cancellation requests for active FHA Case Numbers

within 30 days of the effective date of this ML.

FHA will provide operational details on case cancellations through FHA Info

notifications and on FHA’s lender information page available at

www.hud.gov/lenders.

No More Flip this House with FHA

I'm taking a hatchet to the flippers.
Those guys with the television shows,
the books on how to get rich flipping
the house of the foreclosed borrower,
the guy with the thousand dollar seminar.

Mine government says no more.
FHA loans will not be allowing the
90 day flip rule anymore.

First time home buyers, FHA buyers
who have little money for down payment or
repairs have been the most likely to buy a
flipped home.

I've heard many a sad story from buyers
of flipped houses.
The house was a meth lab before the flip.
Everything leaks,
nothing is guaranteed
and the new buyer is
stuck not with a pretty
home, but the money pit...

Federal Housing Administration’s Property Flipping Waiver ENDS

Federal Housing Administration’s (FHA) Office of Single Family Housing announced that the temporary waiver of FHA’s regulation that prohibits the use of FHA financing to purchase single family properties that are being resold within 90 days of the previous acquisition, expires on December 31, 2014.  Very little notice, so if you have a house under contract that is a flip you will not be able to close a FHA loan after 1/1/2015 if the contract is dated in 2015.

The waiver applies to all sales contracts executed on or after February 1, 2010, until 11:59 PM, December 31, 2014. FHA deems a sales contract to be executed when all parties to the contract have signed the contract, and the contract is enforceable under the law of the state the property is located. Mortgages that are made on properties in which sales contracts have been executed after 11:59 PM, December 31, 2014, are not eligible for a waiver of the regulation prohibiting property flipping. FHA will not extend the waiver beyond December 31, 2014, no more flip this house 

Section 203.37a(c) lists the sales transactions exempt from this rule. The exempt transactions include sales by HUD of real estate owned (REO) properties under HUD’s regulations in 24 CFR part 291, sales by other federal agencies of REO properties, sales of properties by nonprofit organizations that have been approved to purchase and resell HUD REO properties, sales by state- and federally-chartered financial institutions and government sponsored enterprises (GSEs), and, upon announcement by HUD through issuance of a notice, sales of properties in areas designated by the President as federal disaster areas. The regulation, including its exemptions, is still in effect.

Quick Links and Resources

· Review the Federal Register Notice (Docket No. FR-5397-N-05), “Federal Housing FHA Government loans”, news November 29, 2012 at http://www.gpo.gov/fdsys/pkg/FR-2012-11-29/pdf/2012-28918.pdf

Fat Check for FHA

FHA' s new fat check $ 30 million

HUD write’s itself a blank check on the backs of American Borrowers.

FHA is in the black, in fact they are profitable but they stuck

this thirty million dollar charge in 2015 and God knows 

how much in the future hidden in Senate Bill 2438.

The Senate never voted on the bill, there in the fine print is an 

okay to charge on your back what looks like a four percent surcharge. This is one fat check.

A mere forty dollars per one hundred thousand sounds small

 but not when you do the math. 

In three years it will be nearly a billion dollar bonus to all the 

management of the federal Housing Administration. 

They claim they need new software, but cough cough.

Don't worry, it will only make your mortgage cost more.

Call your Senator and put squash on big spending

for government jobs, unless of course you can 

grab one. 

Wouldn't we all like a starting salary of $155,500? 

Then pay yourself an unlimited bonus…

Full text of Senate Bill 2438 here https://www.congress.gov/bill/113th-congress/senate-bill/2438 

Caroline Gerardo

opinions are my own

Save Money

FREE Galardia Seeds.

For some reason they went crazy this year. I have thousands

of varigated, yellow and peach. No guarantee what color they

will be when you plant them. Call me and I will mail them

locally

 

If you know anyone who has an FHA loan I have a mortgage
product that they can refinance to and get rid of their Mortgage
Insurance Premium (PMI) thus saving hundreds a month.
Save money while the rates are low!

Kale going to seed next

Spring

Spring is here with the first Epi blooming under the gazebo in my back yard.

These plants are such a joy when they bloom. In a few days I will have twenty basketball sized flowers in this pot.

They look like cactus and get gangly in the Fall but are easy to maintain.

Best is you hang them to play keep away from snails.

I don't use snail bait or poison in my garden.

I put out beer or yeast with sugar water to collect slugs and get some of the snails

drunk. Then it is easy to get rid of them.

Did you know that snail slime is very nutrient for skin?

Gross you say, just wait some salon in Newport Beach will be putting

snails on you for a facial. LOL

Some raised bed ideas- galvanized large animal troughs

A method to keep your poppies, delphinium and vegetables away

from the bunnies. We have a bad rabbit problem in Orange County

I believe the drought has brought them all out from the canyons.

I put some metal simple windmills and old CD's on strings to

have some flashy lights to scare them.

The shiny seems to have brought the crows back.

Sigh Just when I made friends with the crows to

stay away from the mourning doves nest.

I took this photo of bougainvillea being dumped. Thought you might

think it funny as I enjoyed it driving home from my office this week.

Mortgage rates are at amazing new lows. I have been busy.

Call for a quote you probably can get out of your FHA loan or Mortgage

Insurance with the increases in property values.

(949) 784-9699

Local Orange County Produce all Organic

If you want to trade seeds - I have:

nasturtiums, forget me nots, indian blanket, cerenthe, heirloom tomatoes, arugula, lavender, and thyme

Niche Mortgage Birdhouse or Castle

How to Close your Problem Mortgage?

ceramic house

Not all houses are the same. Bird houses are each special as well.

Perhaps you went to a bank and they aren't answering your calls?

Perhaps they told your they can't help you with a loan?

We have special niche products to fit your needs.

Eagle Home Mortgage is owned by Lennar Homes

Because we are not a bank, we offer a greater

variety of loan products to help Realtors, Real Estate

Agents, Borrowers and Home Buyers close on time

with the product they want. If you are buying a tiny

birdhouse, a six million dollar home or commercial

project – we have the loan solution for you.

A brief list of some of the out of the box products:

Call and speak with C. G. to fix your stalled or broken deal

wood bird house

- Foreign National Loans, ITIN loans

- Condo/Hotel Loans

- Condos not warrant-able with low owner occupancy or lawsuits

- Financing for more than 10 properties

- Investor products

- Spec. Construction

_ Owner Builder Construction

- Loans closed in a corporation or LLC.

- Grants Gifts MCC CHDAP CHAFA

- Jumbo, Super Jumbo

- FHA 203k remodel

- Reverse Mortgage

- Cooperative

- VA – VA IRRL Streamline

- Higher Debt To Income Ratios

- Fannie DU Refinance

_ Freddie Mac

- Cross Collateralization loans when Borrower

has not sold current residence but finds the

Dream property

I have been a lender twenty five years.

My team can close you quickly

We have in office Underwriters, in office Funding and

in office Document drawing.

What does that mean?

No shipping your file to Minnesota.

No limbo wait turn time.

Experience that will find solutions.

Call me (949) 784- 9699

NMLS #324982

Wooden bird house 

handmade bird house

barn style bird house

GRANTS to Buy a Home in California

Down Payment Grant Gift

Orange County INCOME LIMITS GENERAL NUMBERS

FHA Max                                             

$85,680 Riverside & San Bernardino
$102,360 Orange County
$85,680 Los Angeles County
$91,080 San Diego County

                               

Compare CHDAP, CHFDAP ACCESS Down Payment Assistance Programs – Which is Better?

Compare CHDAP, CHFDAP, ACCESS Down Payment Assistance Programs – Which is Best?

Home buyer down payment assistance loan programs such as CalHFA’s CHDAP, CHF DAP, and the CHF ACCESS program are three of the most popular first time home buyer assistance programs in California.

The CHDAP and ACCESS program all provide 3% assistance that can be applied towards meeting FHA’s 3.5% minimum down payment requirement.

CHF DAP gives grants gifts five percent

I offer all these mortgage loan programs but each is a little different

CalHFA’s CHDAP assistance, CHF’s DAP Grant, and the CHF ACCESS assistance program will help you make better home financing decision that impact you long after you move into the home.

 

	CHDAP	CHFDAP	ACCESS
Assistance Amount	3% – sales price	5% – loan amount	3% – sale price
3% Assistance	Silent 2nd Loan	Grant	Loan Repaid
Qualifying Area	All California	All California	All California
Mandatory Origination fee?	0	1.5%	0
Credit to pay closing costs?	Up to 2%	Yes	Very Limited
DTI Ratio Max Limit	55%	50%	43% – 45%
Minimum Credit Score	640	620	580
First Time Buyer Only?	Yes	No	No
Income Caps? (county)	Yes	Yes	Yes
Income that Qualifies	Household	Borrower	Borrower
Max Loan Amount	$417+	$500	$417k+
90 Day Flips Allowed	Yes	Yes	Yes
Prepayment Penalty?	No	No	No
Max Seller Contribution?	3%	6%	6%
Gift Funds Allowed?	Yes	Yes	Yes
Cancellation Fee?	No	$400	No
$250,000 Purchase	Comparison	===========	========
Assistance Amount	$7,500	$12,500	$7,500
Down Payment Needed	.5% = $1,250	0	.5% = $1,250
Est. % Rate /apr (call for actual current rate)	3.875 / 4.962	4.5 / 5.413	4.5 / 5.183
Rate on 2nd lien	3.25% (deferred)	NA	8.25%
Mtg P&I Payments + MI	$1,405	$1,208	$1,567

Interest Rate: The interest rate comparison is for a 30 year fixed, 660 FICO score, from a time when CHF published their Platinum rate of 4.5%. Rates can vary, but for the most part, the Platinum and ACCESS mortgage rate is .5% to .625% higher than a regular FHA loan. Rates change a couple times a day. This is not a rate quote. This is not a commitment to lend. These programs may be cancelled at any day at will. APR is listed above as second number 

All assistance programs are subject to funding availability

CalHFA CHDAP Down Payment Assistance Program

As you can see, the CalHFA CHDAP home buyer assistance program typically offers you a much lower interest rate, payment, and is the least expensive option between the three assistance programs. Some people say the CalHFA’s CHDAP is the BEST down payment assistance program in all of California.

CHFDAP Down Payment Assistance Program

The CHF DAP program seems like it should be the better program because the 5% grant never has to be repaid, right? CHF Platinum charges an additional 1.5% up. Plus, the interest rate, on average, is .5% higher than CHDAP assistance program.

 

In the $250,000 purchase scenario above, the CHFDAP assistance program gives you $12,500. for the down payment (less than CHDAP or ACCESS), then charges you a 1.5% fee ($3,618), AND you Just because you can use the Platinum assistance program doesn’t mean you should, right? What do you think?

CHF ACCESS Down Payment Assistance Program

The CHF ACCESS program offers the highest interest rate, reduces how much you can qualify for but does cater to borrowers with lower credit scores. However, since the assistance in the form of a 2nd loan (15 yr fxd) that is actually a fully amortizing payment, you’re paying that 3% loan off and building equity faster.

 

Can I Refinance Out of My Higher Rate Platinum or ACCESS Loan in the future?

To qualify for an FHA streamline refinance, FHA has a 5% net tangible benefit requirement test.

 

In five years (after having built enough equity to 80%  assuming 3% gain in value per year -  or if you have additional funds to pay the loan down sooner) you may be able to refinance out of this this FHA assistance loan and into a conventional loan. Of course your value could go down rather than up. There is no guarantee you will have income or credit to refinance at a later date.

 

The Platinum and ACCESS down payment assistance programs are great for people who don't have a family member who can give them a gift or haven't saved enough money on their own, have lower credit scores (but not always), and may feel the only way to purchase is to accept a higher rate and fee home buyer assistance program.

If you can’t get your credit score to 640, or make more than the CHDAP program income cap, you don’t have many options. That’s when Platinum and ACCESS fill a void. I can help you raise your FICO score for free. Don't be urgent to buy with a low score. Call me to get some action paln to raise the score as it will affect your rate and long term payment.

 

THE CONVENTIONAL LOAN PROGRAM IS MUCH BETTER BUT YOU NEED HIGHER FICO

 

5% Grant combined with Conventional loan

Income limit Orange County = $ 93,750 or $7793 monthly

 

FICO score needed  660

Using 43% debt to income ratio as a target

Individuals will have a variety of parameters, FICO, debts, = many factors to

count into qualifying but these are some general numbers

 

$7793 X 43% = $3351 PITI target

 

 $480000  sales price

$456000 loan     

p and I  $ 2310

                                Mi               380

                                Tax              490

                                Insur.           80

 

                          Total   $3260    They could not have any bills with a $ 480000 loan

Seller pays some of closing costs? OR buyer needs about $4000 to close

***

 

$7000 month income X 43%  = $3010 target

$400000 sales price

$380000 loan

                      P and I    $1925

                      Tax               416

                      MI                310

                      Insur              79

                   TOTAL $ 2730   - 3010 they could have $280 in monthly other bills

Seller pays some closing costs or Buyer needs about $ 3800 to close

***

 

$6500 month income X 43% = $2795

        

$375000 sales price

$ 356250 loan

                                P and I   $ 1805

                                Tax               390

                                MI                 290

                                Insur               77

TOTAL $ 2562 - $2795  the could have $ 233 in monthly other bills

 

O.K you made it through all those numbers. I know it sounds confusing. Just call me and we can talk about your scenario. Everyone is unique.

 

Below are some fun pictures I took with my iphone at MIT with my son as your reward for reading.