What's an FHA loan?

One of our objectives as a title insurance agent is to educate the public about home ownership.  One of America's most popular lending programs is supported by the Federal government and commonly called the FHA loan.  Here's a primer on these loans: A Primer on FHA Loans

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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What is a short sale?

A short sale occurs when a property is worth less than the amount of the mortgage debts.  But there’s a price to be paid.  As this story from NYT.com points out:

“Borrowers who owe more than their homes are worth can sometimes get out from under by negotiating a short sale with their lender. But short-sellers are branded as higher-risk borrowers, so new loans won’t come quickly or easily.”

“Fannie Mae requires a waiting period of at least four years for short-sellers who can only put down 10 percent on their next home. The waiting period is shortened to two years for borrowers who can come up with 20 percent.”

“Fannie does allow the four-year period to be cut in half for borrowers who can document that their loan default was a result of “extenuating circumstances.” The agency defines these circumstances as one-time events that were beyond a borrower’s control, such as job loss, medical bills, or a financial hit from divorce. Borrowers must also be able to show that they had no reasonable option other than to default.”

We are always on our toes when presented with a short sale.  Is the sale an arm’s length transaction?  Has all financial information about the sale been properly presented to the lender?  Have the final closing numbers been approved by the short lender?

We have the expertise to get you through a short sale.  Call us.

The full article can be read here.

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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What is a reverse mortgage?

Have questions about a reverse mortgage?  Want to know about a reverse mortgage?  Here's a great definition from Wikipedia-

A reverse mortgage is a home loan that provides cash payments based on home equity. Homeowners normally "defer payment of the loan until they die, sell, or move out of the home." Specific rules for reverse mortgage transactions vary depending on the laws of the jurisdiction.

In a conventional mortgage, the homeowner makes a monthly payment to the lender. After each payment, the homeowner's equity increases by the amount of the principal included in the payment. In a reverse mortgage, a homeowner is not required to make monthly payments. If payments are not made, interest is added to the loan's balance. Although the "rising loan balance can eventually grow to exceed the value of the home," "the borrower (or the borrower’s estate) is generally not required to repay any additional loan balance in excess of the value of the home."

Regulators and academics have given mixed commentary on the reverse mortgage market. Some economists argue that reverse mortgages allow seniors to smooth out their income and consumption patterns over time, and thus may provide welfare benefits. However, regulatory authorities, such as the Consumer Financial Protection Bureau, argue that reverse mortgages are "complex products and difficult for consumers to understand," especially in light of "misleading advertising," low-quality counseling, and "risk of fraud and other scams." Moreover, the Bureau claims that many consumers do not use reverse mortgages for the positive, consumption-smoothing purposes advanced by economists.

Is a reverse mortgage right for you?  We can help you determine if it is.  Contact us.

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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Mortgage loan requirements getting tighter

From Realty Times,

The number of homes purchased with a home loan has been dropping steadily since May, according to RealtyTrac. Instead, cash is king for many reasons. As mortgage rates began creeping up, some homebuyers started opting to purchase with all cash. And that trend may continue as new loan requirements become more strict. [Emphasis added.]

However, new guidelines are going into effect when the QM, Qualified Mortgage, rules are activated. For instance,

One of the guidelines’ requirements is that borrowers must have a maximum debt-to-income ratio of 43 percent. Debt-to-income ratios have already been in place but the new rules won't allow for any compensating circumstances. That means that not even a significant downpayment or a large cash reserve will be allowed to offset a higher debt ratio.

The incentive to follow these guidelines is huge for the lender. If the mortgages don't meet the QM guidelines, the lender will be required to hold the loan as opposed to selling it to Fannie Mae and Freddie Mac.

 If you want to learn more, read New Loan Requirements For Getting A Mortgage

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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Paying for Foreclosure Delays

As the New York Times reports, everything comes with a price.  That includes new mortgage loans.  The price is higher fees because of the high foreclosure rate. 

The Federal Housing Finance Agency announced last month that, because the stress in housing markets has eased, it was eliminating the across-the-board adverse-market fee instituted in 2008 to help cover the costs of high rates of delinquencies. The fee, applicable to all mortgages bought by Fannie Mae or Freddie Mac, is 25 basis points, or 0.25 percent of the mortgage loan amount.

Yet, fee remains in effect in New Jersey and New York.

At the end of the day, the fee is supposed to soften the cost of foreclosures (to lenders) by creating more revenue when the loan is booked.  The report, linked below doesn't really offer any solutions to the problem.

The New York Times report is found at Paying for Foreclosure Delays - NYTimes.com and the The Federal Housing Finance Agency is here.

For your next commercial real estate transaction, house purchase, mortgage refinance, reverse mortgage, or home equity loan, contact us. We can help. Located in Fairfield, NJ, we are the title insurance agent that does it all for you.

For your next title order or

if you have questions about what you see here, contact

Stephen M. Flatow, Esq.

Vested Land Services LLC

165 Passaic Avenue, Suite 101

Fairfield, NJ 07004

Tel 973-808-6130 - Fax 973-227-0645

E-mail sflatow AT vested.com

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