Judy Boyle

Making Home Affordable Website Answers Consumer Questions

Uncle Sam gets an A+ for the new website released last week to promote the details of President Obama's Making Home Affordable Program. Now it is very easy to see if you qualify for the programs just by going to the website at www.MakingHomeAffordable.gov and exploring the handy interactive self-assessment tools, calculators, and lists of helpful resources.

The website prominently notes that the program is free to participants. As noted right here in this blog, foreclosure scams are big business these days. There is no need to pay any money to anyone to see if you qualify and get help. If you don't qualify, the website points you to free resources to help you find alternatives. (The Making Home Affordable program aims to help two groups of homeowners who are making a good faith effort to stay in their homes:

• Borrowers who want to refinance but are unable to because the value of their home has fallen.

• Borrowers who cannot make their mortgage payments because their interest rate has increased or their income has fallen.

TAX CREDIT LINK:

http://www.federalhousingtaxcredit.com/2009/index.html

BUY WORCESTER NOW PROGRAM:

www.buyworcesternow.com

Just taking a survey because I searched through Active Rain and didn't see the answer to my question regarding Real Estate Owned (REO) properties:

Does anyone have any success stories in which the bank agreed to make repairs? My specific question deals with the likely presence of lead paint in a house built in 1890. The buyers have a two-year-old and another one on the way. The house has been on the market for over one year and the buyers are wondering if the bank would consider bringing the home into compliance if lead paint is detected.

I have advised them that it is not likely but that you never know until you try. Again, I would just like to open up the floor for any success stories. Thank you.

I have a client who is thinking about purchasing a parcel of land here in Massachusetts to build a house on. These clients have asked me to help educate them on the prospect of building a modular home. I have not been through this process before so I would appreciate any comments, reviews and/or recommendations about the process...what to expect...what to look out for etc.

Feel free to contact me offline at judyboyle1@verizon.net if you'd prefer but I am most interested to learn more about the process, the industry, and the companies that assemble these manufactured homes. Thank you!

Happy Spring to All!

We had a beautiful day in Boston today...sunny and 70. The Boston Marathoner's are loving the New England weather forecast for Monday....Rainy in the 50's. Gosh, I love New England!

In previous posts, I have tried to gently share some of my "English Major Knowledge" and I am told that my tips are relevant and practical. Today, for a limited time only, I am offering to proofread your marketing materials FOR FREE. Locally, I charge anywhere from $25 to $50 per document, or $35 per hour. I am working on building my business nationwide and would love to help YOU LOOK GOOD!

If you are nervous about sending your materials to the printers, are trying to impress some high profile clients and aren't sure about your grammar skills, go ahead and let me be your second set of eyes. You have nothing to lose and, again, my services are FREE for a limited time.

Enjoy the rest of the weekend and may all of your meetings end up in escrow!

Judy Boyle

Weichert Realtors

Northborough, MA

Mortgages insured by the Federal Housing Administration can be a lifeline for low-income or high-risk borrowers. These loans have tiny down-payment requirements, competitive rates and easy credit-score hurdles.

In fact, terms are so attractive that some may ask why all home buyers don't use FHA mortgages. Well, a lot more of them do. Since the housing bust began, FHA lending has soared to account for 20% of the total dollar volume in home loans - up from just 3% in 2006.

There were 384,451 home purchase loans issued during the first two months of 2009, nearly four times the pace of 2008 when 631,649 were issued, and far more than the 278,393 issued for all of 2007. The number of authorized FHA lenders skyrocketed 500% over the past two years.

"FHA stays active in volatile and declining markets, continuing to make mortgage credit available to borrowers, even when private mortgage providers are withdrawing," said the Secretary of Housing and Urban Development, Shaun Donovan, in Senate Appropriations Committee testimony on Thursday. "During difficult times, it is critically important to have an entity like FHA play this role - offering families access to near-prime rate financing."

FHA loans are especially attractive for homebuyers with steady incomes who cannot scrape together a 20% down payment because FHA lenders will finance up to 96.5% of the home price. According to Maryland-based mortgage consultant Allen Hardester, the other attractions of FHA loans include:

• A better loan modification program. The agency has a long history of helping borrowers who fall behind on payments. In two-thirds of default cases the agency figured out a plan to keep borrowers in their homes. And 90% of those mitigations were still working after two years.
• They're cheap to refinance. FHA loans can be easily - and often cheaply - converted to similar FHA mortgages if interest rates drop.
• Borrowers with weak or limited credit histories may still qualify. Mortgage applicants can have very short credit histories or a late payment or two on their records and still get approved with low interest rates. The FHA guidelines set the credit score minimum at 620, but exceptions may be made for people with even lower scores.
• Low rates. For months, interest rates on FHA loans have been lower than conventional loans. Plus, rates don't vary with credit score; you pay the same whether you're a 620 or a 700.

Although these loans target low- and moderate-income Americans, there are no income restrictions. However, FHA does limit the amount that can be borrowed, based on area home values. For example, the most that can be borrowed in a high-cost area such as New York City is $729,750; meanwhile, in Buffalo, N.Y., a purchaser can borrow no more than $276,250. Check the cap limits in your home town.

In addition, borrowers must pay an up-front insurance premium totaling 1.75% of the loan, which goes into FHA's fund for repaying lenders if borrowers default. So if you take out a $200,000 loan, you would need $3,500 at closing, in additional to normal costs. Otherwise, there are few restrictions to getting an FHA loan. However, there is a perception that they are difficult to obtain. And they once were.

Few lenders would originate FHA loans during the housing boom because the underwriting and appraisal process was so strenuous. "If there was a crack in the sidewalk, they wouldn't approve the loan," said George Hanzimanolis, a mortgage broker in Pennsylvania and past president of the National Association of Mortgage Brokers.

That all changed a few years ago when HUD rethought its guidelines. Now, the process can be nearly as fast and painless as conventional loans. The one class of borrowers who may be slightly better off with conventional mortgages are ones with very high credit scores who make substantial down payments. Keith Gumbinger, of HSH Associates, a publisher of mortgage information, said they may save an eighth of a point on their rates.

By Les Christie, CNNMoney.com staff writer