Lakeland Real Estate Blog by Petra

 

FHA first shared these changes on August 4th, after it had been approved by Congress and then the President signed off on it on August 11th. FHA has finally come out with the mortgagee letter, ML 2010-28, which puts it officially in writing now.

This mortgagee letter is effective on FHA loans in which the case number is assigned on or after October 4th, 2010. This policy will increase the monthly mortgage insurance and decrease the mortgage insurance premiums for purchase money and refinance transactions, to include FHA streamline refinances.

 

 

 

So what are the major FHA changes regarding mortgagee letter 2010-28? - For terms greater than 15 years -

• LTV's <= 95% will increase the monthly fee to 85 bps  >> Old monthly fee was .50 bps
  

• LTV's >   95% will increase the monthly fee to 90 bps  >> Old monthly fee was .55 bps 

 

And lastly, it will reduce the Upfront Mortgage Insurance Premium, UFMIP, from 225 basis points to 100 basis points.

 

 

How will this affect new homebuyers?

3 quick examples (these examples are putting the minimum down payment of 3.5%)

• On a $275,000 mortgage – the change in payment would be about $70 higher a month

• On a $200,000 mortgage – the change in payment would be about $45 higher a month

• On a $125,000 mortgage – the change in payment would be about $27 higher a month

 

Buyers Beware - If you have your eye set on a specific home, or are negotiating on a property, or are very serious about buying soon, you will have 31 days to make a mortgage application before these new changes take place.

 

 

FYI in regards to Charlie Ragonesi's  comment, #4 - I still don't think that this will move buyers from FHA loans to conventional loanss.  Here is my reason why... please read : FHA loans vs conventional loans  - The buyer's buying power will only decrease by about $10,000 or so. 

 

 

These 2 posts I wrote previously below go into more details about the changes and showing more detailed figures.

 

• Bill H.R. 5981 passes - FHA Mortgages to increase it's annual mortgage insurance premium

• STOP TAXATION? - The new changes for FHA loans are being called : The New Homebuyer Tax

 

 

 

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For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

 

• Zero entry pool
• Two spas
• Top notch Nautilus-equipped fitness center
• Lap pool
• Tennis courts
• Lovely library and computers
• Large ballroom with performances and gala events
• Arts & Crafts
• Media room
• Big Cypress Restaurant for wine and dining
• Barbecue area
• Bocce and plenty of other vibrant activities
• Newly renovated Mediterranian-Style Clubhouse, a hub for a vibrant gathering and much, much more.

• July 2006 – median price $185,000 (-51.41%) – 721 homes sold
• July 2007 – median price $180,000 (-50.06%) – 437 homes sold
• July 2008 – median price $147,575 (-39.08%) – 462 homes sold
• July 2009 – median price $108,000 (-16.76%) – 598 homes sold

• 520 Single family homes - median price $100,000 – 150 Average Days to Closing
• 31 Townhomes, villas and duplex units – median price $55,000 – 138 Average Days to Closing
• 37 Condominiums – median sold price - $70,450 – 119 Average Days on Closing
• 30 Modular, manufactured/mobile homes in park/out of park – median sold price $39,000 – 176 Average Days on Closing

• 307 sold homes were Bank Owned – median price $73,000 – Average Days to Closing 94.
• 95 sold homes were Short Sales – median price $95,000 – Average Days to Closing 280

Lakeland Florida Short Sale and Foreclosure Market Report – July 2010

Previous month: $118,182 (-1.81%) – previous year July 09: $148,233 (-21.72%)

WILL FAMILIES BE DENIED A MORTGAGE IF THE FEMALE MORTGAGE APPLICANT IS OF CHILD BEARING AGE??

ERICA RAMOS POSTS A MUST READ ARTICLE ABOUT what could be a new trend in mortgage discrimination.  The lender was Bank of America.  However, we know how fast trends can spread through an industry.  SEE:  Newest Discrimination: PREGNANCY and Your Mortgage App

Don't forget that a "FAMILY" can be a family of one person.  If a husband and wife can be denied a mortgage if the wife is of child bearing age, WHAT ABOUT SINGLE WOMEN of child bearing age??  

What about the Equal Credit Opportunity Act which prohibits discrimination by familial status (children under 18), and more???

IMO, their actions clearly violated the Fair Housing Act.  My opinion isn't worth a hill of beans and I know it.  However, I am of an age (older than dirt) to remember and have experienced discrimination of the type related in Erica's post.  When I was a young widow with five children, I was denied credit on numerous occasion when trying to buy a home, get store credit, etc. even though I had a higher than average income.  I eventually purchased a home by assuming a VA loan.  The cost of the home was $36,000 and I paid the sellers $6,000 cash (their equity), assumed their mortgage and had a home in Arlington Virginia for my children, one large German Shepherd dog and a giant rabbit. 

I can also remember a time when a wife's income would not be included in the income ratios if she was of child bearing age.  I had thought that those times had long passed, but it appears that good old BofA has decided to bring them back.  I believe that the Cato Institute covered this well in a study about housing and mortgage discrimination. 

My question is, why didn't the couple in Erica's post just get up and walk out when the question was asked?  Why do consumers let vendors get away with these gross insults????

Hey.  Perhaps that underwriter would make loan approval conditioned on the wife being sterilized. . . . or the husband.

 

FROM CATO: 

The Letter of the Law

Two federal laws directly address discriminatory

acts in the mortgage market. The Fair Housi

ng Act proh i bits di s c ri m i nat ion with resp e ct to any

aspect of a housing transaction, including the provision of

mortgage financing. The Equal Credit Opportunity Act

targets discrimination in lending transactions. In addition

to race, both acts identify several other characteristics that

are protected under the law, including gender, marital status,

religion, national origin, familial status, and handicap.

Emphasis added. . . . .   More.

WHAT TO DO?    Contact one of the Fair Housing enforcement groups in the area who will then send "TESTERS" to establish other cases.  Then they file a law suit and IN DISCOVERY, get the internal documents where BofA instructs their loan officers to ask the very questions that they, BofA, asked these mortgage applicants.

A TREND OR A ONE TIME MISTAKE??  That is the question.   Are we facing a time when consumers of child bearing age will be denied equal borrowing opportunity because there is a female of child bearing age in the family?  

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988.

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