Mortgage & Finance
HARP Guidelines: An Update On Eligibility Requirements
November 19th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies
Further info on the HARP program guidelines.
You may benefit from checking out this program.
Tuesday, Fannie Mae and Freddie Mac communicated new lender instructions for the government’s revamped HARP program. This may trigger loads of refinancing activity, so The Kathy O’Neal Team wanted to share this information.
You may already know that HARP stands for Home Affordable Refinance Program. The new changes are intended to give “underwater homeowners” an opportunity to refinance at today’s low mortgage rates.
Since the program’s launch two years ago, it has helped fewer than 900,000 homeowners.
The new and improved version may reach many more. We’ll see.
There are 4 primary criteria to apply for HARP:
- The existing mortgage must be guaranteed by Fannie Mae or by Freddie Mac
- The existing mortgage must have been securitized by Fannie Mae or Freddie Mac prior to June 1, 2009
- The mortgage payment history must be perfect going back 6 months
- The mortgage payment history may not include more than one 30-day late payment going back 12 months
For HARP applicants, loan-level pricing adjustments are waived in full for loans with terms of 20 years or fewer; and maxed at 0.75 for loans with terms in excess of 20 years.
This should significantly lower mortgages rates for HARP applicants — especially those with credit scores below 740.
An additional benefit: HARP applicants are exempted from the standard waiting period following a bankruptcy or foreclosure, which is 4 years and 7 years, respectively.
These two benefits should greatly widen the net of potential HARP participants.
But there are a few provisions which exclude some potential applicants:
- The “unlimited LTV” feature only applies to fixed rate loans or 30 years or fewer. ARMs are capped at 105% loan-to-value.
- Applicants must be “requalified” if the proposed mortgage payment exceeds the current payment by 20%.
- Applicants must benefit from either a lower payment, or a “more stable” product to qualify
Remember also that HARP is a one time deal. It can’t be used twice.
Fannie Mae and Freddie Mac will have minor variations, so work with your loan officer on these eligibility standards.
And if you need help getting a good lender I can provide a few referrals, as well as help you in any aspect of your home buying or selling goals. Email or call us anytime! I also invite you to view our Testimonial Video.
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New HARP Program Guidelines
October 30th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies
Recently the Federal Home Finance Agency announced significant changes to its Home Affordable Refinance Program Monday. The HARP (Home Affordable Refinance Program) was initiated to help “underwater homeowners” get their home refinanced.
There are over a million homeowners nationwide – and many home owners here in Chantilly and the Northern Virginia area - who might be helped by these changes. Given the historically low interest rates, it is wise to know about this program.
There are four basic qualifying criteria:
- Your current home loan must be guaranteed by Fannie Mae or Freddie Mac
- Your home must be a 1- to 4-unit property
- You must have a perfect mortgage payment history going back 6 months
- You may not have had more than one 30-day late payment on your mortgage going back 12 months
One of really big features of the updated program is that the government is waiving loan-to-value requirements on HARP loans. Homeowners’ participation is no longer restricted by their home’s appraised value. Actually, the new HARP doesn’t even require an appraisal, in most situations.
Under the new HARP program guidelines, an underwater mortgages can be refinanced without LTV limit or penalty.
According to the government’s official press release, lenders are expected to be offering the program as of December 1, 2011.
If you want to check it out, start by seeing if your loan is backed by Freddie or Fannie. Here is where you can go for that:
- Fannie Mae loan lookup : http://www.fanniemae.com/loanlookup/
- Freddie Mac loan lookup : https://ww3.freddiemac.com/corporate/
You can also call your lender directly.
If being underwater is not an issue, but you are looking for a few reputable lending sources, of course, let me know and I will be glad to provide you with a few referrals.
If you are home buying or home selling in the Northern Virginia area, please know I am always here for you!
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Time to Refinance My Home?
October 18th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies
Many Chantilly and Northern Virginia home owners, like those elsewhere, have wondered about refinancing their home, given the amazingly low prevailing interest rates.
If this has been on your mind, take a few moments to view this Today Show video. Even though this was aired in September, I think you will most of the info current.
One of the key questions of course, is whether the costs of doing a refi outweigh the benefits.
Key points include :
- Lower rates mean higher costs. At least check out the slightly higher-rate option from your bank.
- Falling home values may make it harder to refinance in the future. Your window of opportunity may be now.
- If you have had a 30-year loan for many years, consider a 15-year mortgage to avoid “resetting” your term.
You will find lots of quality information in this short video.
If you need a quick reading on the current market value of your Northern Virginia home, or if you want a refeerral to a few quality loan officers, please let me know. We are always here for you!
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Taking Advantage of Low Interest Rates
September 14th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies
Chantilly and Northern Virginia area home owners, as well as home buyers and sellers, know that interest rates are low.
But be aware that getting a home loan or doing a refinance is only one way to take advantage of these historic lows.
Take a look at this short video from NBC’s The Today Show to hear about a half-dozen ways to benefit, such as:
- A quick way to refi a car loan
- Balance transfers between credit cards with teaser rates lasting up to 20 months
- Move some savings to an “online” bank where savings rates are higher
The Fed has asserted that the Fed Funds Rate will be held near 0.000% probably until mid-2013. Why not use it to your advantage if you can.
Also, a reminder that MARKET SNAPSHOT will give you prices of homes sold in your Northern Virginia neighborhood.
And if you are considering buying or selling real estate, we invite you to hear what others are saying about The Kathy O’Neal Team.
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How To Select a Top Northern Virginia Real Estate Agent You Are Comfortable With
April 10th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies
If you are a Northern Virginia home buyer or seller, and would like to know how to select a real estate agent that will be the right choice for you, take the time to carefully watch this video.
- Want a simple set of criteria on selecting a top real estate agent ? Check out this video.
We wanted to give you objective criteria on how to make a really smart choice of real estate agent. It is a major decision, and not everyone already has an agent they know, trust, and respect.
So if you want to reap the benefits of making a good choice, engage in a little “due diligence” and find out what you should avoid and what you should seek out.
I can tell you unequivocally based on over 23 years of working experience, that there are huge differences in the quality of agents. What you do not know can definitely hurt you when it comes to real estate.
Watch this video from start to finish. We would love for you to contact us after watching it, but whatever you do, after seeing this video you will have a set of criteria that we think informed consumers should know about.
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Military Home Buyers : Down To 3 Weeks to Take Advantage of Up To $8,000 in Tax Credits
April 8th, 2011 categories: Buyer Strategies, Mortgage & Finance
Just a reminder for qualified military or federal employees who are eligible. We are down to 3 weeks from Saturday as the deadline for taking advantage of the federal home buyer tax credit.
It allows you to claim up to $8,000 in federal income tax credits.
We described some of the key details in a previous post, but here is a reminder that time is running out.
Eligible persons include members and spouses of the uniformed services, members and spouses of the Foreign Service, and don’t forget intelligence community employees who served at least 90 days of qualified, extended duty service outside of the United States between January 1, 2009 and April 30, 2010, and their spouses.
As an eligible person, you must be under contract for a new home on or before April 30, 2011, with the home’s closing occurring on or before June 30, 2011.
If you are a repeat buyer you must have lived in your “main home” through 5 of the last 8 years in order to be considered eligible.
Here are some of the other key eligibility criteria that the property and the buyer must conform to:
- Can’t purchase home from a parent, spouse, or child
- Can’t purchase home from an entity in which the seller is a majority owner
- Can’t acquire home by gift or inheritance
- Sale price can’t exceed $800,000
- Buyers can’t earn more than $125,000 as single-filers; $225,000 as joint-filers
You’ll find the complete program description on the IRS website.
If you are relocating to Northern Virginia, or are in the area and want to see if you can still find a property within the deadline time, let me know and I will be glad to assist with more information. We are always here for you!
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Military Personnel: The $8,000 Tax Credit is still an option
March 15th, 2011 categories: Buyer Strategies, Mortgage & Finance
Just in case you were not aware, for certain members of the military, and for certain federal employees, there’s just about 6 weeks left to take advantage of the buyer tax credit. (A little less time than the graphic indicates).
Eligible persons include members of the uniformed services, members of the Foreign Service, and intelligence community employees who served at least 90 days of qualified, extended duty service outside of the United States between January 1, 2009 and April 30, 2010.
Also, the spouses of anyone fitting the above categories are eligible.
The tax credit ranges up to $8,000 for first-time home buyers, and up to $6,500 for existing homeowners. Existing homeowners must have lived in their “main home” through 5 of the last 8 years to be eligible.
There is a two stage process to claim the credit. First, you must be under contract for a new home on or before April 30, 2011. In addition, the home’s closing must then occur on or before June 30, 2011.
No date exceptions from the IRS.
Furthermore, both the buyer(s) and the property must meet these minimum eligibility requirements:
- The home can’t be purchased from a parent, spouse, or child
- The home can’t be purchased from an entity in which the seller is a majority owner
- The home can’t be acquired by gift or inheritance
- Each buyer must meet tax credit eligibility standards
- The home sale price may not exceed $800,000
- Buyers may not earn more than $125,000 as single-filers; $225,000 as joint-filers
You can look at a complete program description on the IRS website.
Another important point: the IRS is giving eligible buyers a tax credit as opposed to a deduction. This means that a taxpayer qualifying for the full $8,000, and for whom the “normal” 2011 federal tax liability is $8,000, will have zero federal tax liability in 2011.
For additional information regarding your tax credit eligibility, call an accountant. Speaking with a tax professional is often worth the cost. And if you need a few referrals on this, let me know.
And if you live in the Northern Virginia area, or are relocating into the area, and need help figuring out what properties might work for you, I invite you to be in contact, as well as to use the resources on this site and our other main site. My team and I are here for you!
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Fed Minutes Say Lower Unemployment And Higher Growth For 2011 and 2012
February 16th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies
If you watch the Fed minutes, the last release was its January 25-26, 2011 meeting minutes.
Fed Minutes are detailed recaps of the Federal Open Market Committee meetings. They are not a trivial matter, as they help shape national monetary policy.
The minutes are a clue book about the direction of policy-making. Right now they are saying the potential for food and energy inspired inflation is a minor economic risk, but indicated a willingness and capacity to act it that assessment changes. Many economists feel that the Fed will not start adjusting the Fed Funds Rate until late this year, or early next year.
What does all of this have to do with real estate in Chantilly and Northern Virginia? Well, interest rates have been creeping up over the past few months, but they are still extremely attractive. We always counsel our buyers and sellers based on the set of factors that are unique to their goals and current realities. At any given time, there are always some advantages and disadvantages to the prevailing real estate market.
The critical thing when making important decisions like putting your home on the market, buying a home, or any other real estate transaction is to look beyond the immediate moment and make decisions that have wisdom and insight. You can never foretell what the next year will bring. But you can make common sense decisions that have staying power. That is what we help our buyers and sellers do. Let us know if we can help you.
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Getting your credit card interest rate down
January 19th, 2011 categories: Home Life, Mortgage & Finance, Uncategorized
Want to get your credit card interest rate down in preparation for buying your Chantilly or Northern Virginia home?
Take a few minutes to listen to David Bach’s practical suggestions.
In this 4-minute video from NBC’s The Today Show, you will get quick advise on things you can do pretty easily. And it may well result in more money in your pocket each month.
Some of the ideas covered in the video include:
- Compare your current rate to the rate offered to new customers. Ask the lender for “new customer rate” if it’s lower.
- If your credit score has improved since application, ask for an interest rate more reflective of your current credit score.
- Be very considerate to the person you talk to….it may make all the difference, and it certainly won’t hurt.
It may take some persistence. Don’t be put off if you don’t succeed on the first try. Stay with it and you may very well get this done.
And if you are among the Northern Virginia area home buyers who are starting their search, we’d love for you to use any of the many resources on our other real estate web site, as well as this one.
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Comparing Adjustable and Fixed Rate Mortgages
January 16th, 2011 categories: Buyer Strategies, Mortgage & Finance, Seller Strategies, Uncategorized
ARM home loans are definitely not for everyone. Approach them with lots of awareness and caution.
That said, there may be some situations where they should be at least considered.
Compared to a fixed rate mortgages, current ARM pricing is very attractive. Freddie Mac’s weekly Primary Mortgage Market Survey places the 5-year ARM mortgage rate lower than the 30-year fixed rate mortgage by 1.02 percent.
For a $250,000 home loan, a 1.02 difference means a payment savings of about $149 monthly.
Here are a few situations where it may be smart to at least look at ARM options::
- Buying a new home with the intent to sell within 5 years
- Currently financed with a 30-year fixed mortgage with plans to sell within 5 years
- Interested in low payments; comfortable with longer-term rate and payment uncertainty
Also to consider, if you are a homeowners with an existing ARM that is due for adjustment, you may want to refinance into a new ARM, if only to push the first adjustment date farther into the future.
We always recommend you confer with your loan officer about your options. If you need a few referrals, we always have a few loan professionals that have served our clients well, and will be happy to give you their contact information. Let me know if this would be of any help.
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