Seven Things All Borrowers Should Know About FHA Loans

7 Things All Borrowers Should Know About FHA Loans

FHA Pros, LLC, a national FHA condo approval service, has developed a list of facts speaking to the top misconceptions associated with FHA loans in order to help home buyers better navigate an already confusing market. FHA loans are mortgages issued by qualified lenders and insured by the Federal Housing Administration (FHA).

“We have seen home buyer interest in FHA loans go from practically zero three years ago to upwards of 87% today,” said Christopher Gardner, founder and president of FHA Pros, LLC. “Despite this rapid rise in popularity, many buyers still do not fully understand the benefits of these loans, and we believe it’s time to change that.”

1. FHA loans are not only for lower-income borrowers. FHA loans are available to everyone. There is no maximum income restriction associated with FHA loans, but borrowers do need to substantiate income and assets by submitting proper documentation. This requirement ensures that borrowers are well-vetted and truly able to afford their future homes.

2. FHA loans are not only for first-time buyers. Many people believe FHA loans are available only to first-time home buyers, but this is not the case. Whether borrowers are making their first home purchase or their fifth, they can look to FHA loans as a home financing option.

3. FHA loans are not just small loans; in fact, loan amounts can be as high as almost $800,000. The government recently raised the maximum loan amount from its original cap of $362,790 to $793,750 as a way to help stabilize the housing market. The amount a buyer can borrow varies from county to county though. Later this summer, condo buyers interested in FHA loans can visit www.checkfhaapproval.com [2] to instantly identify FHA-approved condo associations and review maximum loan amounts for a given location.

4. FHA loans are not affiliated with the section 8 housing program. While both programs are administered by the U.S. Department of Housing and Urban Development (HUD), FHA loans have nothing to do with low-income subsidized housing. FHA loans are simply mortgages insured by FHA. This insurance provided by the federal government allows lenders to lend more freely by assuring them that they will be repaid in the event of default. Most traditional lenders, including Wells Fargo & Co., JP Morgan Chase and Citigroup are able to provide FHA loans to their customers.

5. FHA loans are often more affordable than conventional loans. While FHA loans typically offer the same interest rates as other loans, borrowers benefit from a much lower down payment of as low as 3.5%.

6. FHA-approved condo developments are more desirable to buyers. With 87% of home buyers indicating that they plan to use FHA loans, condo associations that are not FHA approved are missing out on a significant pool of prospective buyers. Under rules in place since February 2010, an entire condominium development must now apply to HUD and be granted FHA approval before a buyer can purchase a unit in an association with an FHA loan or before an existing unit owner can refinance into an FHA loan.

Due to the general unwillingness of today’s lenders to extend credit with respect to conventional loans, many borrowers find that FHA is their best bet. Lenders don’t mind lending when the federal government (FHA) assures them of repayment.

Homeowners associations (HOAs) should note that although FHA-insured mortgages might be easier to obtain, they are not “risky” loans, due in large part to the strict “full documentation” requirements placed on borrowers. Individual buyers or sellers can initiate the approval process or current owners can encourage their HOA to apply.

7. FHA loans are assumable. In addition to lower down-payment and credit-qualifying requirements as compared to conventional loans, FHA loans are assumable. This means that when a seller with an FHA loan sells his or her property, the loan and its financing terms (interest rate) can be transferred to the new buyer. This unique feature will certainly make a property more valuable in times of rising interest rates.

“Now, more than ever, buyers and sellers need to understand the options available to them when it comes time to buy a home,” continued Gardner. “At FHA Pros we have worked with countless HOAs, attorneys and individuals to easily and efficiently navigate the historically tricky FHA-approval process.”

Share on Facebook

PenFed Realty Partnership With Exit Slater Realty Creates Opportunities for Mortgage Growth

PenFed Realty, LLC Partnership With Exit Slater Realty Creates New Opportunities for Mortgage Growth

A recent partnership between the former owners of Exit Slater Realtors in San Antonio, Texas and Pentagon Federal Credit Union’s (PenFed) subsidiary, PenFed Realty, LLC (PFR), stimulates a dynamic new rebranding effort for PFR and Slater.

Both parties see this arrangement as a new opportunity to gain significant competitive advantage in the San Antonio market and allows for PenFed to expand their mortgage operations in the region.

“There was no question that Slater met our business model profile, and appeared to be the best fit with our organizational credit union culture,” says Shashi Vohra, Vice President of Business Development, PenFed. “Under PenFed Realty’s current business model, the combination of discount brokerage pricing with the service of a full price brokerage, our partnership with Slater will not only allow us to grow our operations in San Antonio and with the military community, but also continue to provide value to our members.”

The credit union offers a full range of mortgage lending products at competitive rates. One of PenFed’s fastest growing loans is the 5/5 Adjustable Rate Mortgage (ARM) which offers no origination fees, and covers most of the lenders fees.

PenFed Realty, LLC was established in the Washington, D.C. metropolitan area in 2006, and is a full service real estate brokerage firm that is a wholly owned subsidiary of PenFed. The division offers comprehensive real estate services nationwide to both PenFed members and non-members alike.

“During the past four years, we have been successful in expanding the PFR brand by creating regional offices in the Washington D.C. metropolitan area and in North Carolina,” states Vohra. “Our sales volume for PFR increased from $105 million in 2006 to $155 million in 2009. PenFed would like to continue to extend our member discount, 1% buyer and seller rebate, in other regions.”

Exit Slater Realtors was formerly owned and managed by Annette Slater of San Antonio, Texas, and has been in business in the San Antonio area since 1966. Slater will continue to work as the managing broker for PFR in San Antonio along with a team of 35 – 40 independent broker agents.

“This partnership will be a valuable resource for many in the San Antonio community,” says Slater. “PenFed is a powerful voice for the military and we look forward to extending our professional services to that community and others in San Antonio area.”

For more information about PenFed mortgage services and to apply for membership, you may visit PenFed.org or call 800-247-5626.

For more information about PenFed Realty, LLC, you may visit PenFedRealty.com or call 800-350-9115.

About Pentagon Federal Credit Union

Pentagon Federal Credit Union is the third largest credit union in the United States, serving approximately one million members, with assets in excess of $14.5 billion. The credit union provides worldwide service to Army, Air Force, Coast Guard, Department of Defense, and Department of Homeland Security personnel; members of the VFW; employees or volunteers of the American Red Cross; and others in the defense community and their families.

Share on Facebook

Long Island’s Affordable Financial Services Predicts Slow But Steady Recovery For Mortgage Industry

Long Island’s Affordable Financial Services Predicts Slow But Steady Recovery For Mortgage Industry

After a surge in mortgage applications last week in the U.S., Long Island’s Affordable Financial Services predicts a slow but steady recovery for the mortgage industry, which has been adversely affected by the recent slump in the housing market. During the week ended October 2, the Mortgage Bankers Association’s (MBA) index of applications to purchase a home or refinance a loan increased by 16% to 756.3 from 649.6 in the previous week.

“Lower home prices, falling mortgage rates and tax credits for first-time buyers have all contributed to an increase in home sales. This should, in the long term, contribute to a slow but steady growth in the mortgage and real estate industry,” said Brian Leibowitz, Owner of Affordable Financial Services, based in Long Island, New York.

At the same time, the MBA’s refinancing gauge rose by 18 percent, as the number of applicants seeking to refinance loans rose to 66.3 percent of total applications from 65.3 percent, the highest since May this year. “With mortgage rates falling below 5 percent, many applicants are finding refinancing to be an attractive option. They want to lock in the low rates before they start going back up again,” Mr. Leibowitz said.

According to the MBA, the average rate for a 30-year fixed-rate mortgage, excluding fees, averaged 4.89 percent in the week ended October 2. During the three-week period that mortgage rates have fallen below five percent, refinancing demand went up by 38 percent.

However, the fall in rates may be short-lived with the Federal Reserve’s recent announcement that it would slow down on purchases of mortgage-backed securities and agency debt, which may cause mortgage rates to climb back up again. “Refinancing may be a wise decision for many borrowers right now. At current rates, they can save on nearly $134 on monthly payments on a $200,000, 30-year fixed-rate loan,” Mr. Leibowitz said.

For more information, call 1-888-500-0282 ext.209 or visit http://www.affordable-financialservices.com.

About Affordable Financial Services

Affordable Financial Services is a mortgage broker located in Long Island, New York, that provides loan process, refinance, home purchase, debt consolidation, and home equity loan services. The company provides clients with the knowledge they need to make the right decisions to move forward with the loan process. With its highly knowledgeable and professional mortgage consultants and processing department, Affordable Financial Services gives clients the best loans to fit their needs. As an industry leader, the company takes pride in its vast knowledge of the mortgage industry and the products it offers to borrowers. For more information, visit http://www.affordable-financialservices.com/.

Share on Facebook

Lennar Southeast Florida Urges the Time for Waiting Has Passed

Lennar Southeast Florida Urges the Time for Waiting Has Passed – Do Not be Afraid to Buy Now

This weekend the Southeast Florida division of Lennar begins its “Be Afraid, Be Very Afraid” sales event campaign. During this Spooky Fall-themed sales event, the homebuilder is stressing how important it is for any first-time prospective homebuyer still unsure about purchasing a new home to act now and not be afraid to buy brand new right now. With the government’s first-time homebuyer tax credit opportunity expiring on November 30, the time for waiting to buy a new home has passed. If you haven’t owned a home in the last three years you may qualify to receive this government tax credit of up to $8,000*. It’s not a loan, there is no re-payment, but this government stimulus offer comes to a close on November 30.

Right now the Southeast Florida division of Lennar has excellent savings opportunities on brand new ready to move in homes, but new home inventory is quickly disappearing.

This weekend homebuyers can take advantage of Lennar’s Fiscal Year-End Deals that include $0 closing costs on select South Florida residences† and monthly payments starting as low as $991 a month**. The homebuilder’s preferred lender, Universal America Mortgage Company (UAMC), is providing interest rates starting as low as 4.50% (5.02% APR) fixed for life. **

“If you want to get into a brand new home, now really is the time to buy,” said Carlos Gonzalez, President of Lennar’s Southeast Florida division. “New home inventory is declining and these historic incentives will soon be over.”

The Southeast Florida division of Lennar offers a variety of communities to suit every lifestyle, including an almost sold out active adult community. Single-family homes are priced from the upper $100s, townhomes are priced from the low $100s and near close-out high-rise condominiums from the $300s.

Welcome Home Centers and decorated models are open daily 10 a.m. to 6 p.m. For information on Southeast Florida Lennar Communities call 866-380-7557.

Or visit their Web site at Lennar.com. Realtor Participation Welcome.

Disclaimer if required by publication:

First-time homebuyer is any individual (excluding a non-resident alien) who has not owned a principal residence during the past three years and is purchasing the new home as their primary residence. Tax Credit is subject to eligibility requirements. Lennar cannot provide guarantees of actual savings and does not guarantee the homebuyers’ qualification for the federal tax credit. Credit is subject to 3-year ownership requirement. Not tax advice; homebuyers should consult with their tax advisor. Tax laws are subject to change.

†**★Offers are available on select homes, as determined by Lennar, for purchase agreements written by 10/24/09 and applicants must reserve loan funds and closing must occur no later than 11/8/09. **Limited funds are available; offer may change upon exhaustion of funds. Specific FHA loan terms apply and buyer is subject to qualification that includes, but not limited to, a minimum of 3.5% down, a minimum credit score of 620, owner occupancy requirements and/or any changes in investor guidelines or programs. FHA Jumbo loans are not allowed. Monthly payment shown does not include HOA fees, is based on FHA 30-year fixed rate financing at a rate of 4.50% (5.02% APR) with 3.5% down payment and $183,000 sales price. Rates may change or not be available at the time of loan commitment, lock-in or closing if funds are exhausted. Not an offer to enter into an interest rate or discount point agreement and any such agreement may only be made in writing signed by both the borrower and the lender. †Seller will pay closing costs as defined on your Good Faith Estimate, excluding prepaid, subject to seller contribution limits. FL Mortgage Lender License #ML 0700915. Prices subject to change without notice. Contact a UAMC Home Loan Advisor or a New Home Consultant at Lennar for details. Lennar Homes, LLC –CGC 62343. Copyright 2009 Lennar Corporation and Universal American Mortgage Company, LLC. Lennar, the Lennar logo, Universal American Mortgage Company and UAMC logo are registered service marks or service marks of Lennar Corporation and/ or its subsidiaries. 10/09

Share on Facebook

Florida’s Existing Home, Condo Sales Up in September 2009

                     Florida Sales Report - September 2009
                        Single-Family, Existing Homes

                       Realtor Sales              Median Sales Price

  Statewide &
  Metropolitan
  Statistical       September   September   %   September   September    %
  Areas (MSAs)        2009        2008    Chge     2009        2008    Chge
  -------------      -------     -------  ----   --------    --------  ----
  STATEWIDE* (1)     14,419      10,778    34    $142,000    $174,900   -19
  STATEWIDE-YEAR-
   TO-DATE          118,867      93,952    27    $143,600    $196,500   -27
  Daytona Beach         766         536    43    $132,000    $160,000   -18
  Fort Lauderdale       800         611    31    $200,000    $259,300   -23
  Fort Myers-Cape
   Coral              1,321         746    77     $89,700    $141,400   -37
  Fort Pierce-
   Port St. Lucie       572         374    53    $110,800    $138,000   -20
  Fort Walton
   Beach                258         194    33    $198,300    $192,600     3
  Gainesville           149         106    41    $168,500    $188,900   -11
  Jacksonville (2)    1,127         836    35    $139,900    $170,000   -18
  Lakeland-Winter
   Haven                326         284    15    $115,400    $139,500   -17
  Melbourne-
   Titusville-
   Palm Bay             479         430    11    $114,700    $143,900   -20
  Miami                 619         410    51    $190,900    $274,600   -30
  Ocala                 283         183    55     $96,300    $136,500   -29
  Orlando             2,247       1,588    41    $144,100    $182,700   -21
  Panama City           114          90    27    $168,800    $180,000    -6
  Pensacola             275         267     3    $135,000    $146,900    -8
  Punta Gorda           238         153    56    $110,600    $136,900   -19
  Sarasota-Bradenton    781         550    42    $164,000    $200,800   -18
  Tallahassee           158         156     1    $181,200    $177,600     2
  Tampa-St.
   Petersburg-
   Clearwater         2,410       2,174    11    $137,800    $160,500   -14
  West Palm Beach-
   Boca Raton           746         522    43    $242,900    $292,200   -17

     (1) * Statewide figure includes data from the Naples Area Board of
         Realtors; it also includes data from the Marco Island
         Association of Realtors.
     (2) Data from the Amelia Island-Nassau County Association of
         Realtors is not available.

  Editor's note: Sales numbers represent totals of Realtors' closed
  transactions from local Realtor boards/associations within the MSAs.

  This information is based on a survey of MLS sales levels from local
  Realtor boards/associations. MSAs are defined by the 2000 Census.
  Source: Florida Realtors(R) and the University of Florida Bergstrom
  Center for Real Estate Studies.

                     Florida Sales Report - September 2009
                           Existing Condominiums

                       Realtor Sales              Median Sales Price

  Statewide &
  Metropolitan
  Statistical       September   September   %   September   September    %
  Areas (MSAs)        2009        2008    Chge     2009        2008    Chge
  -------------      -------     -------  ----   --------    --------  ----
  STATEWIDE* (1)      5,088       2,870    77    $102,500    $153,500   -33
  STATEWIDE-YEAR-
   TO-DATE           39,682      29,685    34    $109,000    $172,700   -37
  Daytona Beach         140          74    89    $176,900    $237,500   -26
  Fort Lauderdale       861         549    57     $78,300    $129,600   -40
  Fort Myers-Cape
   Coral                309         153   102    $102,900    $185,000   -44
  Fort Pierce-
  Port St. Lucie         97          50    94     $94,100    $140,000   -33
  Fort Walton Beach      91          44   107    $297,700    $300,000    -1
  Gainesville            34          23    48    $133,300    $146,300    -9
  Jacksonville (2)      141          99    42    $108,500    $145,400   -25
  Lakeland-Winter
   Haven                 18           5   260     $70,000    $150,000   -53
  Melbourne-
  Titusville-
  Palm Bay              112         102    10    $120,000    $153,300   -22
  Miami                 611         353    73    $132,900    $212,200   -37
  Ocala                   2           5   -60     $60,000     $57,500     4
  Orlando               587         146   302     $52,600    $108,200   -51
  Panama City            54          29    86    $185,000    $229,200   -19
  Pensacola              48          34    41    $190,000    $180,000     6
  Punta Gorda            29          17    71    $101,700     $85,000    20
  Sarasota-Bradenton    247         119   108    $134,800    $156,400   -14
  Tallahassee            13           5   160    $107,500    $130,000   -17
  Tampa-St.
   Petersburg-
   Clearwater           787         398    98    $107,000    $139,100   -23
  West Palm Beach-
   Boca Raton           632         487    30    $106,700    $139,800   -24

     (1) *Statewide figure includes data from the Naples Area Board of
         Realtors; it also includes data from the Marco Island
         Association of Realtors.
     (2) Data from the Amelia Island-Nassau County Association of Realtors
         is not available.

  Editor's note: Sales numbers represent totals of Realtors' closed
  transactions from local Realtor boards/associations within the MSAs.

  This information is based on a survey of MLS sales levels from local
  Realtor boards/associations. MSAs are defined by the 2000 Census. Source:
  Florida Realtors(R) and the University of Florida Bergstrom Center for
  Real Estate Studies.

Share on Facebook