USDA Rural Housing Update: Fundings Dry Up Across the Country

By Jay Hurst | Published: May 21, 2010

USDA guaranteed fundings are still on hold due to congress inability to come to agreement on how the future of the program should be funded. Should the borrow be required to pay a 3.5% funding fee or the current 2% funding fee. This has very large implications for low-to moderate income rural home buyers. There is not yet a time table set for when these are back available.

http://www.mortgagenewsdaily.com/channels/community/153074.aspx

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Financing for Texas Vets, Activated Reserve & Guard Members

By Jay Hurst | Published: April 23, 2010

TEXAS VET AND DISABLED VET LOAN – is sponsored by the Texas Veterans Land Board and is provided to Texas Vets in recognition of their military service. This program offers especially low rates for disabled vets.
Get a Texas Vet Loans as low as 4.41% (disabled vets) 4.91% (non-disabled vets) as of today. 100% financing available with standard VA funding fee.

The Veterans Housing Assistance Program (VHAP) provides financing up to $325,000 toward the purchase of a home to qualified Texas veterans.
The term of the loan can be 15, 20, 25 or 30 years.

The Texas Veterans Loan is for loans to purchase a home and is not a refinancing program. You can qualify for this program if you: (1) listed Texas as the home of record at the time of entry into the military; (2) have been a legal resident of Texas for at least twelve consecutive months prior to applying for a loan; or (3) are on active military duty, stationed in Texas, and have changed your state of legal residency to Texas.

The Texas Veterans Housing Assistance Program provides financial relief (0% INTEREST) if you get a Texas Vet Loan to buy a home and you are called up for active duty.
If you are a Reserve or Guard member and you are called up for active duty, you pay only principal and escrow on your home loan. There is a three month grace period after deactivation before interest resumes and for nine months following the grace period, the interest rate will be no more than six percent.

For more info on this program, please contact Jay@moneysafe.com

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Regulation of home equity lending help Texas avoid brunt of real estate crisis?

By Jay Hurst | Published: April 17, 2010

quote:

But there is a broader secret to Texas’s success, and Washington reformers ought to be paying very close attention. If there’s one thing that Congress can do to help protect borrowers from the worst lending excesses that fueled the mortgage and financial crises, it’s to follow the Lone Star State’s lead and put the brakes on “cash-out” refinancing and home-equity lending.
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A cash-out refinance is a mortgage taken out for a higher balance than the one on an existing loan, net of fees. Across the nation, cash-outs became ubiquitous during the mortgage boom, as skyrocketing house prices made it possible for homeowners, even those with bad credit, to use their home equity like an ATM. But not in Texas. There, cash-outs and home-equity loans cannot total more than 80 percent of a home’s appraised value. There’s a 12-day cooling-off period after an application, during which the borrower can pull out. And when a borrower refinances a mortgage, it’s illegal to get even a dollar back. Texas really means it: All these protections, and more, are in the state constitution. The Texas restrictions on mortgage borrowing date from the first days of statehood in 1845, when the constitution banned home loans.

“Delinquency and foreclosure rates are significantly lower in Texas,” says Scott Norman of the Texas Mortgage Bankers Association. “The 80 percent loan-to-value limit — that’s the catalyst for a lot of this.”

I tend to thing you should be able to do want you want with your own property (assuming someone is willing to lend of course)but I do not think there is any doubt that the 80% loan to value limit kept borrowers out of trouble in Texas. Of course, Texas never had the extreme run up in value of Arizona, California, Nevada etc but there would have been plenty of borrowers who would have taken up 90%/95% of the paper value  out of their homes. To make the matter worse, these loans would have been lousy subprime loans that would currently be in foreclosure here in Texas.

http://www.washingtonpost.com/wp-dyn/content/article/2010/04/03/AR2010040304983.html

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Why did Texas survive the real estate crisis?

By Jay Hurst | Published: April 4, 2010

Intersting Washington Post article credits Texas tough home equity lending restrictions as saving the Texas real estate market. Home equity lending is restricted to 80% of the market value of the home. In many parts of the country, home equity became a piggy bank with home owners extracting paper value as soon as they could. Of course, as real values plummeted , this put the borrowers underwater. In 2006, 88% percent of mortgages purchased by Freddie Mac were at least 5% higher then the balances being refinanced.

http://www.washingtonpost.com/wp-dyn/content/article/2010/04/03/AR2010040304983.html

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No equity? No problem. Refinance program up to 125% loan to value

By Jay Hurst | Published: March 25, 2010

Homeowners with little or no equity in their homes still have time to take advantage of the Government’s Home Affordable Refinance Program.

The HARP program is designed for borrowers with underwater mortgages but who are otherwise qualified and responsible borrowers. This program allows borrowers to refinance their primary residences up to 105% loan to value and in some cases a second lien up to 125% loan to value. Investment properties are eligible up to 90% first lien loan to value, with a second lien allowable up to 105%.

Your loan must be held by Freddie Mac or Fannie Mae to be eligible for this program. The large majority of mortgage loans are held by one of these organizations so this program is available to most borrowers.

This program offers the following benefits:

  • Historically low interest rates;

  • Streamline process with less paperwork that traditional loans;

  • No minimum credit score needed (but you must be current on your mortgage payments);

  • No out of Pocket Costs… All closing costs can be rolled into the loan;

  • No appraisal required (in most cases); and

  • No mortgage Insurance (provided that your current loan does not have MI)

To find out if you are eligible for this refinance program, check to see if you loan is owned by Fannie Mae or Freddie Mac. Just type your address in to the following sites:

If you home is listed on either site, contact Jay Hurst at jhurst@agsreward.com to get started on your refinance.

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Home buyer tax credit extended yet again?

By joelg | Published: December 30, 2009

“Jaret Seiberg, a managing director at Concept Capital, a research firm in Washington, says the odds favor yet another extension of tax credits for home buyers. Those credits initially were set to expire Nov. 30 but then were extended to cover home-purchase contracts signed by April 30, 2010.

“Congress might extend the credit through Nov. 30 or phase it out over six to 12 months, Mr. Seiberg speculates, adding: “We believe a phase-out is most likely because it would benefit housing markets but let Democrats argue they are fiscally responsible because they have designed an exit strategy that weans consumers off the subsidy.”

Read more on WSJ.COM

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