Anti-flipping rules attempt to slow the home buying process down in order to prevent fraud.

In the aftermath of the real estate melt-down, FHA imposed “anti-flipping” rules.  These rules were designed to slow the buy-then-sell process down and help catch or prevent fraud.

Basically, if you wanted to buy a home using FHA financing, the seller of that home would have to own it for a minimum of 90 days before you could make an offer on it.  FHA then loosened those guidelines so that if the seller of a property were a bank (i.e. foreclosure), the anti-flipping rule would be waived.  In February2010, in an attempt to help move excess inventory off the real estate market, FHA put a temporary suspension on the anti-flipping rule.  Essentially, someone could buy a home one day, then turn around and sell it the next day, even if the buyer was using FHA financing.

Not much has been said about “anti-flipping” in the conventional lending world.  Fannie Mae and Freddie Mac have never imposed a 90-day waiting period to avoid flipping.  However, many buyers are surprised to find out that some lenders and, more importantly, many mortgage insurance companies have often set their own rules.

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How soon can I get rid of my Mortgage Insurance?

For our long-time readers, you are aware that the rules in the mortgage and real estate industry are always changing.  Many of the policies and guidelines that were applied several years ago – or even several months ago – have now changed… and will continue to change.  This is the case with regards to the rules dictating the removal of monthly Mortgage Insurance.  The current guidelines are below: Read the rest of this entry »

“200,000 could lose out on the homebuyer tax credit”

This was the headline in today’s CNNMoney.com article.  Homebuyers that have a signed purchase agreement dated on or before April 30^th must close on their transaction by June 30^th in order to qualify for the homebuyer tax credit – $8,000 for first-time homebuyers, and $6,500 for repeat buyers.  The problem is many of the properties that are being purchased are either REO (aka. Bank-Owned Properties) or they are Short-Sales – where a seller is attempting to sell the home for less than what is owed.  Both of these types of transactions can take longer than expected.  If you don’t close by June 30^th, you get NOTHING!

Congress still working on a tax credit extension

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Congress is considering an extension of the homebuyer tax credit.

The time that it takes to close on your home mortgage has continued to lengthen over the last several years.  There are many factors that contribute to this inconvenience including increased underwriting standards, banks overwhelmed with foreclosures and short-sales and government-imposed regulations.  Thankfully, it looks like Congress is aware of these common delays.

In The Wall Street Journal article: Congress Considers Tax-Credit Extension of Some Home Buyers, Nick Timiraos explains the need for extending the closing deadline of June 30^th:

“Congress last fall extended an $8,000 tax credit for first-time home buyers and added a smaller $6,500 credit for current homeowners who were buying a primary residence. To qualify for the credit, buyers had to sign purchase contracts by April 30 and must close on the transaction by June 30.

“But there are so many transactions in the pipeline that the companies responsible for handling the sales, including mortgage lenders, appraisers and title insurers and real-estate brokers, say the last-minute home-buying rush in April has created bottlenecks.

“On Thursday, Senate Majority Leader Harry Reid (D., Nev.) said he would back a measure to extend the June 30 closing date to Sept. 30 for buyers who had met the April contract deadline.”

This is good news for every qualified homebuyer that signed a purchase agreement on or before April 30, 2010.

“Mortgage Rates at New Lows, Thanks to Europe’s Debt Crisis.”

Well, that’s the headline from today’s CNBC.com article, “Mortgage Rates at New Lows…”  Now I may be called an eternal optimist, but the truth is, when the stock market takes a beating it often results in lower interest rates.  And, with lower interest rates it makes housing more affordable.  But, in the words of Reading Rainbow’s LeVar Burton, “you don’t have to take my word for it.”

“It’s the best time in our generation to buy,” says Mark Zandi, chief economist at Moody’s. “It may be the best time in any generation. Mortgage rates are so low and with homes prices down and lots of inventory, you couldn’t pick a better time to buy or re-finance.”

As the rules continue to change in the mortgage and real estate industries, proceed with caution.  Make sure you’re working with a seasoned Realtor® and Mortgage Loan Officer, because what you qualify for today may not be what you qualify for in a month or two.

22031 Woodbine Street NW, Oak Grove, MN

3 Bedrooms | 4 Baths | 2-Car Garage | Spacious 4,103 sq. ft. | on 2.6 wooded acres!  

Welcome to 22031 Woodbine St NW in Oak Grove.

 This wonderful 3 bedroom, 4 bath 2-story home sits on 2.6 wooded acres overlooking the tranquil Rum River. 

Enter the front door, and you are greeted by vaulted ceilings, two-story windows with custom window treatments, and oak hardwood floors. The living room flows into the formal dining area, which overlooks the wooded yard, leading to the river front. Built-in cabinetry enhances the formal dining area. Read the rest of this entry »

With cash tight these days, Mortgage Insurance can help you buy a home with less money down.

For many homebuyers, the thought of mortgage insurance makes their nose crinkle.  But on average, a homebuyer can purchase a home 10 years sooner with mortgage insurance and a small down payment; compared to the time it would take to save enough for a 20% down payment to avoid Mortgage Insurance.  Saving 20% for a down payment on a home is usually the biggest barrier to homeownership.  Mortgage Insurance allows borrowers to buy a home with as little as 3.5% down for an FHA loan or 5% down for a Conventional loan. 

What is Mortgage Insurance?  Read the rest of this entry »

VA Mortgages and USDA Rural Development Loans Are Still 100% Financing!

Everyone knows that FHA loan are great for first-time homebuyers.  They offer a low down payment of 3.5%, and with a subsidized mortgage insurance premiums, the monthly payments are very low.  Unfortunately, with the increased popularity of FHA loans, some industry professionals have forgetten to ask the most basic questions: Read the rest of this entry »

So you thought the tax credit expired…

Most professionals in the Real Estate and Mortgage industry will tell you that the home buyer tax credit – $8,000 for first-time home buyers and $6,500 for repeat home buyers – expired on April 30, 2010.

In fact, the tax credit was actually extended for some!  Read the rest of this entry »

Finance more with FHA.

As a result of the American Recovery and Reinvestment Act of 2009 (ARRA), which was signed into law on February 17, 2009, the Federal Housing Administration (FHA) has increased their loan limits for 2009!  To read the most recent Mortgagee Letter 09-07 released on February 24th (along with Mortgagee Letters from previous years), please visit:

http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/2009ml.cfm

Also, for a complete schedule of FHA loan limits in your current area, please click below:

FHA Mortgage Limits

For the 7 county metro area of Minneapolis and St. Paul, including Hennepin County, the FHA loan limit has been increased back up to $365,000 (up from $318,550).  This means with a 3.5% down payment (required by FHA in most cases), you could purchase a $378,000 home!  This is going to help a lot of Pre-Approved homebuyers in Maple Grove, Plymouth, Rogers, Champlin and the surrounding areas in Minnesota.

Please, call us if you have further questions regarding this change.