Archive for the 'Mortgage Programs' Category
Buyers opting for little-used type of FHA loan
February 22nd, 2011
Written by Frost Mortgage
More people taking advantage of loan program that allows home buyers to borrow money needed for improvements
The Federal Housing Administration’s 203(k) loan program has been around for decades, but it’s been little used due in part to a lack of awareness. That’s beginning to change as a result of the realities of the housing market.
Many of the foreclosed properties that weigh on the market are in bad shape through neglect by the previous owner or months of vacancy. That makes them unattractive to prospective buyers who lack the time, expertise or money to repair them.
The 203(k) program, which is backed by the federal government, allows buyers to finance the costs of the needed repairs into the rest of the loan. The lender pays the contractor when work is completed. FHA loans, which have been used in about a third of Fredericksburg-area housing purchases of late, require down payments of 3.5 percent and mortgage insurance.
BY BILL FREEHLING
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Advantages Of An FHA Loan
February 18th, 2011
Written by Frost Mortgage
The FHA loan’s main advantage is that it helps the home owner secure a better rate from lenders. Actually, these Federal Housing Administration loans aren’t loans, because the only thing they do is insure it. But this works out very well because the mortgage then has a low down payment and closing cost, not to mention the drop in credit thresholds.
In other words, the lender is able to provide lower interest rates for those who may not even have qualified for the mortgage. Thing is that the rates vary based on a person’s credit history and score. But those able to provide Federal Housing Administration insurance are pegged on a level that’s normally only available for people with a higher credit score.
Another notable difference is that lenders demand sizable down payments in case the real estate market drops further down and property values crash again. Under such circumstances, the only way to get low down payment loans is with the help of the Federal Housing Administration. It helps that the closing costs are also part of the financing.
In fact, there’s a lot more that can be done with an FHA loan. In addition to the home purchase, the finance can also include repairs and remodeling costs. Even energy saving improvements are valid expenses.
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New FHA 203k Qualified Loans Make Remodeling Your Home Possible
January 13th, 2011
Written by Frost Mortgage
Amidst economic turmoil a new program eases the pain of financing a remodel or rehabilitation project. A Federal Housing Administration qualified 203k loan provides homeowners with a one-stop shop financing option. In the past it was far more difficult to procure financing for a remodeling project, requiring as many as three different loans for one home remodel.
Contact a Frost Mortgage Loan Officer today to see if you qualify for this great prgram!
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Foreclosure Relief For Seniors
January 11th, 2011
Written by Greg Frost
If you are over 62 and are facing foreclosure on your home, Frost Mortgage may have a way for you to save your home and eliminate your mortgage payments for the rest of your life.
The Frost Mortgage Senior Saver loan program uses the FHA Reverse Mortgage, which does not require a credit score. If you and your co borrower are over 62 and you have at least 50% equity in your home, Frost Mortgage can help you save your home and eliminate mortgage payments for the rest of your lives, right up until the day before your current lender completes the foreclosure process.
“The government finally got something right when they designed this mortgage program. It truly solves one of the ugly crises of our times….our senior population losing their homes in the wake of the economic crises” says Greg Frost, Sr., President of Frost Mortgage Banking Group. “Seniors who stayed the course, didn’t speculate with their equity, and didn’t use their home as an ATM are being rewarded by this excellent government insured mortgage.”
(Greg Frost wrote an article on the advantages of reverse mortgages for New Mexico Business Weekly in 2007; you can click here to read it.)
If you or someone you know could be helped by the reverse mortgage program, please contact us today. We’ll be back in touch with you quickly.
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What kind of federal mortgage programs does the government have for assistance of home owners?
January 4th, 2011
Written by Frost Mortgage
The federal government does not administer mortgages on its own, however, the Federal Housing Association (FHA), under the US Department of Housing and Urban Development (HUD) offers several insurance programs to assist single families with purchase of their home loans. Some of them are:
Section 203(b) Mortgage Insurance
The purpose of this insurance program is to provide insurance for a single family to refinance/buy a primary residence. A mortgage lender provides the funds and the insurance is provided by HUD.
Section 203(b) Mortgage Insurance for Disaster Victims
As the name suggests the purpose of this insurance program is to help victims of a major disaster, who have lost their homes, to get mortgages and become homeowners again. Any citizen who has lost their home in a presidentially declared disaster area is eligible to apply for this program.
Section 255 HECM Program
The Home Equity Conversion Mortgage is a reverse mortgage insurance program for senior citizens above the age of 62. What happens in this program is that a homeowner who has paid or nearly paid their mortgage is allowed to borrow money against the equity of the house from an FHA approved lender, and the loan is insured by the FHA. Lenders recover their principal, plus interest, when the home is sold.
Section 203(k) Rehabilitation Mortgage Insurance
The purpose of this program is rehabilitation and repair of single family properties for general community and neighborhood development. The idea is to provide homeowners with quick access to cash for home improvements/repairs. The repairs have to be first identified by a FHA appraiser for qualification to this program.
Energy Efficient Mortgage Program
The Energy Efficient Mortgage program (EEM) helps homeowners to finance the addition of energy efficient appliances and features to their homes by rolling the costs into the FHA insured home purchase or refinancing mortgage. The FHA encourages lenders to finance borrowers who wouldn’t otherwise qualify for affordable, conventional loans (e.g. first time homebuyers) and to homeowners in poorer neighborhoods.
Call one of our Licensed, Loan Officers today to learn more about these great programs.
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What Is an FHA Reverse Mortgage?
December 30th, 2010
Written by Frost Mortgage
Federal Housing Administration (FHA) reverse mortgages allow homeowners to access cash from the equity they’ve built up in their property over the years. Those over the age of 62 with either a fully paid-off mortgage or very few payments left on the loan may qualify for an FHA Reverse loan. In essence, this program works like a traditional reverse mortgage, but exists through the U.S. Department of Housing and Urban Development (HUD) and is insured by the FHA.
How an FHA Reverse Mortgage Works
Receiving Payments: Once you qualify for an FHA reverse loan, you can tap into your equity and receive payments in a variety of ways: You can choose a lump sum payment, use the equity as a separate line of credit or receive monthly installments, as long as you still live in the home. Plus, it’s always possible to change the payment structure mid-way.
Paying Off the Loan: An FHA reverse mortgage gets paid off as follows: The homeowner secures a loan and the lender recovers their principal, plus interest, when the home is sold. Anything leftover after the sale of the home goes to the homeowner or survivors. Doing this through HUD will ensure that if the sales proceeds are not enough to pay off the debt, HUD will pay the lender the difference.
Older people requesting a FHA reverse loan can borrow a larger percentage of their home’s value. The ultimate size of the loan is determined not only by the age of the applicant, but the current interest rate and the value of the home. Of course, before committing to any loan, thoroughly research all of your options to be sure it’s right for you.
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New Mortgage Rules Help Seniors
October 21st, 2010
Written by Frost Mortgage
New reverse-mortgage rules from the Federal Housing Administration (FHA) may help senior homeowners in need of retirement cash. Congress recently passed legislation extending the limit on these federally-insured mortgages to $625,500. Under the new rules, the mortgages aren’t limited by credit score or income requirements and only require homeowners to maintain the existing property.
In addition, changes have also been made to the FHA’s Home Equity Conversion Mortgage, allowing owners to borrow smaller amounts against their property than would have been available under the previous legislation.
Read more: http://www.creditfyi.com/News/new-mortgage-rules-help-seniors-123.htm#ixzz131jirwYo
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New HUD Protocol Offers Older Adults More Information and Deeper Financial Assessment, Using Tools and Materials Developed by NCOA
August 5th, 2010
Written by Frost Mortgage
WASHINGTON, Aug. 4 /PRNewswire-USNewswire/ — The U.S. Department of Housing and Urban Development (HUD) now requires all HUD-approved reverse mortgage counselors to provide their clients with the National Council on Aging’s (NCOA) 28-page consumer booklet on reverse mortgages. In addition, counselors must complete an extra level of financial assessment to help prospective borrowers gain a greater understanding of financial risk and other factors that may impact their loan.
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Great news for FHA lenders from Congress
June 29th, 2010
Written by Frost Mortgage
Federal Housing Administration (FHA) lenders will be exempted from new “risk retention” rules, which is great news for companies who issue loans insured by the government.
National Mortgage News reports that
[t]he legislation finalized by the conference committee late last week would require originators to retain at least 5% of the credit risk in loans they securitize unless the assets meet a “qualified mortgage” test. All loans backed by the FHA, the Department of Veterans Affairs or the Rural Housing Service will automatically meet that test.
This is a complex time to be in the FHA-backed mortgage business, but the opportunities are huge for those who are eager to learn to succeed as branch partners or loan officers.
Frost Mortgage has been a leader in FHA lending since 1991. If you’re looking to step up, take a look at our mortgage partner offering–we think you’ll find it’s the best in the business.
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Video: Catch the latest dish on our new commercial
June 3rd, 2010
Written by Frost Mortgage
Here at Frost, we believe there are a few fundamental things that bring true joy to life. One is our homes, of course. Another is our food. That’s why we’ve become such big fans of New Mexico’s Hot Chefs. Have a look and then give us a call to see what we can whip up for you.
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