The jumbo property market in Texas is in much better shape than most markets around the country. However, sales are still slow in the upper end for a few reasons. But, one of the least discussed is the large down payment and reserve requirements for jumbo mortgages. The down payments required are generally 20%-25% of the purchase price. A large chuck of money on a 800,000 purchase. But, the limiting factor for a lot of would be buyers are the reserve requirement needed on top of the down payment. Reserves are defined as liquid cash left over after down payment and closing costs. Most lenders are requiring 12-24 months of Principal, Interest, taxes and insurance. Let’s assume a 800k purchase with 20% produces a Principal, Interest, Taxes and insurance payment of 5600. This means a 800k purchase requires at least 160k for the down payment and 67,200 in cash to meet the reserve requirement for a total of over 227k needed in cash.
Let’s compare that to the jumbo mortgage product offered by Moneysafe.com and DfwJumbo.com in the Dallas-Fort Worth metroplex. For qualified borrowers, only 10% down is required up to 875K. Only 6 months of reserves are required. This cuts the cash needed from the borrower in half, from over 227k to 116k. By any ones calculation, 116k is much easier to come up with then 227k. And the 30 yr fixed rates start as low as 5.25% with only 10% down. If you are in the market to buy a jumbo property or if you are marketing a jumbo property for sell please contact jhurst@moneysafe or call Jay Hurst at 214 824 2986 for how we can help.
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%.
To be eligible for this program your loan must be held by Freddie Mac or Fannie Mae. The 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
Streamlined process with less paperwork than 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)
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:
Non-conforming loans or Jumbo loans are loans with higher dollar amounts which may not be sold to Fannie Mae or Freddie Mac. A Texas Mortgage that is above the conforming loan limit of $417,000 for the year 2010 is considered to be a Jumbo loan.
Non-conforming Texas Mortgage loans often come with a higher rate because they are considered a higher risk. If you work with a major Fannie Mae or Freddie Mac lender that sell a majority of their loans to Wall Street you will likely receive a higher rate on your Texas Home Loan.
However, if you work with a smaller Texas Home Mortgage lender you will likely receive a lower rate since these lenders hold loans on their own books. Also these lenders typically have more flexible terms since they are not selling their loans to Wall Street.
At MoneySafe.com we work with several local Texas Jumbo Home Loan lenders and welcome the opportunity to help you with your Texas Home Loan.
The Good Neighbor Next Door Sales (GNND) program is a federal revitalization initiative through HUD that provides homeownership at a substantial discount to qualified buyers. Under this Texas Home Loan program, HUD offers a 50% discount on the list price of a qualified home as long as the buyer commits to live in the property for a minimum of 36 months and maintains the property as the sole residence. Law enforcement officers, pre-K through 12th grade teachers and firefighters/EMTs that are employed full-time by federal, state or local governments are eligible to participate in the Texas Home Mortgage Good Neighbor Next Door Program.
Eligible single family homes located in HUD-designated revitalization areas are listed exclusively for sales under the GNND program. Interested qualified buyers can contact their local HUD office for a listing of properties in their area.
Under this Texas Mortgage program, the eligible home is offered at a 50% discount off the HUD appraised value. The buyer may use FHA, VA, or conventional mortgage or cash to purchase the home. HUD requires you to sign a second mortgage for the remaining 50% of the appraised value. No interest or payment is required on the second mortgage if you live in the house for the entire 36 month occupancy period. If you fail to remain in the house for the full occupancy period you may be required to pay a pro-rata portion of the discount.
Visit www.MoneySafe.com for low Texas Mortgage Rates on the Good Neighbor Next Door Sales Program.
Question: What Is the Good Neighbor Next Door (GNND) Program?
Answer: A program to strengthen America’s communities offered through HUD. The Good Neighbor Next Door Program offers HUD owned single family (one-unit) homes at a 50% discount.
Question: Who is eligible for the GNND Sales Program?
Answer: Law enforcement officers, teachers and firefighters/emergency medical technicians who meet all other requirements of the program.
Question: How does the discount work?
Answer: You can get a 50 percent discount off the HUD appraised value. For example, if HUD lists a home at $100,000, you can buy it for $50,000 provided you occupy the home as your personal residence for the required occupancy period.
Question: How can I finance the purchase of the home?
Answer: You may use Texas Home Mortgage Programs such as FHA, VA, or conventional mortgages, or cash. You are required to sign a Second Mortgage and Note on the discounted amount (which is $50,000 in the example above). No interest or payments are required on this “silent second” mortgage if you live in the home for the entire 36 month occupancy period. You may be required to pay a pro-rata portion of the discount to HUD should you fail to fulfill the three year occupancy requirement.
Question: What is the Occupancy Period?
You must live in the home as your sole residence for a full 36 months.
Question: Can I sell the GNND home after 3-years?
Answer: Yes. After you live in the GNND home 3 years, you can sell the home and keep any equity and/or appreciation.
Question: Do I have to use a real estate broker or agent to buy a GNND home?
Answer: Yes.
Question: Do I have to be a first time homebuyer?
Answer: No. However, you may not own any other residential property at the time you submit your offer to purchase a home and for one year previous to that date. For example, if you submit an offer to purchase a home on July 1, 2010, you may not have owned a home during the period from June 30, 2009.
Question: Where are these homes located?
Answer: The HUD homes are located in designated Revitalization Areas throughout the US.
Question: Is the appraised value of the home negotiable?
Answer: No. You must offer the exact HUD list price when bidding on any GNND property. Then you get a 50 percent discount off that list price.
Question: What if I leave the employment that made me eligible during the Occupancy Period?
Answer: Nothing as long as you live in the home for 3 years. When you purchase the home you provide a good faith intention to remain employed as a law enforcement officer, teacher or firefighter/emergency medical technician for one year beginning with your purchase. Do no attempt to participate in the program if you know in advance that you will not be employed for at least one year.
Question: What happens if I fail to honor the 3-year Occupancy Period?
Answer: HUD can demand repayment of the discounted amount on a prorated basis. That means you would have to repay 1/36th of the discount you received for each month that you did not occupy the home.
Question: How does HUD enforce the 3-year Occupancy Requirement?
Answer: The participant must certify he or she is living in the home as a sole residence at the time of purchase and each year after. HUD can conduct spot checks to make sure the home is your sole residence at any time during the 3-year period. You also must sign a note and mortgage for the discount amount.
Blog
The jumbo property market in Texas is in much better shape than most markets around the country. However, sales are still slow in the upper end for a few reasons. But, one of the least discussed is the large down payment and reserve requirements for jumbo mortgages. The down payments required are generally 20%-25% of the purchase price. A large chuck of money on a 800,000 purchase. But, the limiting factor for a lot of would be buyers are the reserve requirement needed on top of the down payment. Reserves are defined as liquid cash left over after down payment and closing costs. Most lenders are requiring 12-24 months of Principal, Interest, taxes and insurance. Let’s assume a 800k purchase with 20% produces a Principal, Interest, Taxes and insurance payment of 5600. This means a 800k purchase requires at least 160k for the down payment and 67,200 in cash to meet the reserve requirement for a total of over 227k needed in cash.
Let’s compare that to the jumbo mortgage product offered by Moneysafe.com and DfwJumbo.com in the Dallas-Fort Worth metroplex. For qualified borrowers, only 10% down is required up to 875K. Only 6 months of reserves are required. This cuts the cash needed from the borrower in half, from over 227k to 116k. By any ones calculation, 116k is much easier to come up with then 227k. And the 30 yr fixed rates start as low as 5.25% with only 10% down. If you are in the market to buy a jumbo property or if you are marketing a jumbo property for sell please contact jhurst@moneysafe or call Jay Hurst at 214 824 2986 for how we can help.
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%.
To be eligible for this program your loan must be held by Freddie Mac or Fannie Mae. The 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:
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 your home is listed on either site, contact Jay Hurst at jhurst@agsreward.com to get started on your refinance.
Non-conforming loans or Jumbo loans are loans with higher dollar amounts which may not be sold to Fannie Mae or Freddie Mac. A Texas Mortgage that is above the conforming loan limit of $417,000 for the year 2010 is considered to be a Jumbo loan.
Non-conforming Texas Mortgage loans often come with a higher rate because they are considered a higher risk. If you work with a major Fannie Mae or Freddie Mac lender that sell a majority of their loans to Wall Street you will likely receive a higher rate on your Texas Home Loan.
However, if you work with a smaller Texas Home Mortgage lender you will likely receive a lower rate since these lenders hold loans on their own books. Also these lenders typically have more flexible terms since they are not selling their loans to Wall Street.
At MoneySafe.com we work with several local Texas Jumbo Home Loan lenders and welcome the opportunity to help you with your Texas Home Loan.
The Good Neighbor Next Door Sales (GNND) program is a federal revitalization initiative through HUD that provides homeownership at a substantial discount to qualified buyers. Under this Texas Home Loan program, HUD offers a 50% discount on the list price of a qualified home as long as the buyer commits to live in the property for a minimum of 36 months and maintains the property as the sole residence. Law enforcement officers, pre-K through 12th grade teachers and firefighters/EMTs that are employed full-time by federal, state or local governments are eligible to participate in the Texas Home Mortgage Good Neighbor Next Door Program.
Eligible single family homes located in HUD-designated revitalization areas are listed exclusively for sales under the GNND program. Interested qualified buyers can contact their local HUD office for a listing of properties in their area.
Under this Texas Mortgage program, the eligible home is offered at a 50% discount off the HUD appraised value. The buyer may use FHA, VA, or conventional mortgage or cash to purchase the home. HUD requires you to sign a second mortgage for the remaining 50% of the appraised value. No interest or payment is required on the second mortgage if you live in the house for the entire 36 month occupancy period. If you fail to remain in the house for the full occupancy period you may be required to pay a pro-rata portion of the discount.
Visit www.MoneySafe.com for low Texas Mortgage Rates on the Good Neighbor Next Door Sales Program.
Question: What Is the Good Neighbor Next Door (GNND) Program?
Answer: A program to strengthen America’s communities offered through HUD. The Good Neighbor Next Door Program offers HUD owned single family (one-unit) homes at a 50% discount.
Question: Who is eligible for the GNND Sales Program?
Answer: Law enforcement officers, teachers and firefighters/emergency medical technicians who meet all other requirements of the program.
Question: How does the discount work?
Answer: You can get a 50 percent discount off the HUD appraised value. For example, if HUD lists a home at $100,000, you can buy it for $50,000 provided you occupy the home as your personal residence for the required occupancy period.
Question: How can I finance the purchase of the home?
Answer: You may use Texas Home Mortgage Programs such as FHA, VA, or conventional mortgages, or cash. You are required to sign a Second Mortgage and Note on the discounted amount (which is $50,000 in the example above). No interest or payments are required on this “silent second” mortgage if you live in the home for the entire 36 month occupancy period. You may be required to pay a pro-rata portion of the discount to HUD should you fail to fulfill the three year occupancy requirement.
Question: What is the Occupancy Period?
You must live in the home as your sole residence for a full 36 months.
Question: Can I sell the GNND home after 3-years?
Answer: Yes. After you live in the GNND home 3 years, you can sell the home and keep any equity and/or appreciation.
Question: Do I have to use a real estate broker or agent to buy a GNND home?
Answer: Yes.
Question: Do I have to be a first time homebuyer?
Answer: No. However, you may not own any other residential property at the time you submit your offer to purchase a home and for one year previous to that date. For example, if you submit an offer to purchase a home on July 1, 2010, you may not have owned a home during the period from June 30, 2009.
Question: Where are these homes located?
Answer: The HUD homes are located in designated Revitalization Areas throughout the US.
Question: Is the appraised value of the home negotiable?
Answer: No. You must offer the exact HUD list price when bidding on any GNND property. Then you get a 50 percent discount off that list price.
Question: What if I leave the employment that made me eligible during the Occupancy Period?
Answer: Nothing as long as you live in the home for 3 years. When you purchase the home you provide a good faith intention to remain employed as a law enforcement officer, teacher or firefighter/emergency medical technician for one year beginning with your purchase. Do no attempt to participate in the program if you know in advance that you will not be employed for at least one year.
Question: What happens if I fail to honor the 3-year Occupancy Period?
Answer: HUD can demand repayment of the discounted amount on a prorated basis. That means you would have to repay 1/36th of the discount you received for each month that you did not occupy the home.
Question: How does HUD enforce the 3-year Occupancy Requirement?
Answer: The participant must certify he or she is living in the home as a sole residence at the time of purchase and each year after. HUD can conduct spot checks to make sure the home is your sole residence at any time during the 3-year period. You also must sign a note and mortgage for the discount amount.