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Post Election Interest Rates Increase

Trump Thump: Mortgage Rates Jump 0.500% Post Election

Written by Clay on . Posted in FHA, Freddie Mac, Homebuyers, Presidential Election, Rate Updates, reverse mortgage

“Trump Thump” – Mortgage Rates Jump 0.500% or More Post Election

The election is now over and the dust has settled. As painful as it might be to accept, a trend described by others as the “Trump Thump” means we may now have to get used to 30-year fixed conforming loan rates at or above 4.0%.    

 

Prior to the election, pundits had clearly agreed on the idea that the markets “built in” the prospect of a Clinton victory, and – in the unlikely event that Trump won – this surprise victory would mean an improvement in the bond market because of the uncertainty Trump would bring to the table. Well, so much for that idea. 

 

Economic experts maintain that Trump’s economic policies will boost spending and business, as well as bring inflation (all of which leads to lower bond prices and higher mortgage rates). Interesting to me how quickly everything turned in the direction. Was there not enough time spent analyzing the impact of a Trump victory? Did this catch the markets unprepared?  

 
Trump Election, Mortgage Interest Rates

Post Election Results on Mortgage Rates

According to a recent article by Money writer, Taylor Tepper, markets indicate there’s a 75% chance that the Fed raises short-term rates modestly when policy makers meet in mid-December. Here’s a more in-depth analysis on what President-elect Trump means for interest rates in Tepper’s article:  President Trump Interest Rates Federal Reserve. CNBC’s Diana Olick weighs in on the mortgage rate crisis: watch video. 10-year treasury yields have also spiked in the days since Trump’s election, and something to keep in mind with that is: Don’t panic. This sudden rise isn’t likely to continue, at least, not because of the Trump presidency. “Rates tend to move very sharply in short periods of time and very little in prolonged periods of time,” said Greg McBride, chief financial analyst for Bankrate. “It’s not something that I think continues.” So, my advice to those who are anxious about mortgage rates, know that this is a cycle… and as far as rates are concerned, nothing is on the horizon that would suggest waiting for an improvement in rates. Either way, expect volatility and a continuing upward trend in rates.  
Condo Communities

Condo Communities Can Look to Reverse Mortgages and FHA Loans once again …

Written by Clay on . Posted in Condo, Current Events, Fannie Mae, FHA, Freddie Mac, reverse mortgage

Condo Communities Can Look to Reverse Mortgages and FHA loans again Once Regulations are Adopted The most relevant provision of the changes will emulate the FHFA’s rules regarding the transfer fees for FHA mortgages including reverse mortgages.  In July 2015 FHA began refusing to approve condominiums in higher cost communities such as Rossmoor in Walnut Creek, CA because of the Golden Rain Foundation Membership transfer fees. For the moment reverse mortgages and FHA loans and Rossmoor are still not allowed, it is better to use the Cincinnati mortgage rates that are more helpful and reliable. Current homeowners and future homeowners in Rossmoor must await the close of the comment period November 30th and publication of a final rule.   There is no timeline for issuance of rules. HUD takes whatever time it needs to review comments, then when done publishes a final rule, generally for effect 0-30 days later. Passed unanimously in both the U.S. House and Senate, and signed into law by President Obama on July 29, 2016, H.R. 3700 resolves a number of uncertainties regarding FHA’s condo provisions. The mortgage industry is still awaiting the close of the comment period and publication of the final rule, but here is a look at the provisions as they stand:
  • Reduces the FHA condo owner occupancy ratio to 35%
  • Gives FHA the ability to substantially reduce burdens and streamline the condo re-certification process
  • Provides more flexibility for mixed use buildings.
  • Emulates the Federal Housing Finance Agency’s (FHFA) rules regarding private transfer fees for FHA condo lending.
  • Allows for approved lenders to directly endorse Rural Housing Service (RHS) loans and car loans. You must ask yourself first, What Is an Unsecured Loan?
  • Will streamline programs for federally-assisted housing programs
Condo Communities

Condo Communities to get Relief After Passage of HR 3700 Bill

For comprehensive details of the HR 3700 bill, click here. Condominium communities, like Rossmoor Senior Adult Community in Walnut Creek, CA are impacted. Soon, current homeowners and potential buyers of condos will once again have access to more flexible FHA financing opportunities including reverse mortgages. The changes will benefit more than just Rossmoor.  Lowering the owner occupancy requirement to 35% will be a big benefit as well meaning communities with high rental ownership will now be open to home buyers with FHA financing. It’s not just our brains that suffer from the heat either. When the mercury rises so do tempers. As an article on Today.com explains, while our brains are slowing down, our bodies are speeding up with increased heart rates and higher blood pressure. This is why you sould canvass air conditioning companies in CC TX for better air conditioning. All this leads to more aggressive behavior making a cool environment key to maintaining peace at home, work, and in public places. “Condominiums often represent an affordable option that’s just right for first-time and low-to-moderate income home buyers. Unfortunately, overly-burdensome restrictions on condo financing have for too long put that option out of reach for many creditworthy borrowers,” said Tom Salomone, President of NAR and broker-owner of Real Estate II Inc. in Coral Springs, Florida. You’ve decided to buy or sell a house. Maybe you need a bigger home, or a smaller one. Maybe it’s your first home. Maybe you’re being relocated. Whatever the reason, selling or buying a home is a big decision and hiring a good real estate agent will make the process go more smoothly. Well, Lorin McLachlan can help you with the — you can visit her facebook page at https://www.facebook.com/people/Lorin-McLachlan/100011270656226. I look forward to having this legislation signed into law so more options are opened up for all.  We will keep you updated on the progress as it happens on liberty silver rounds, I also ask myself who can get me the best loan at all times, and so far pickaloan is the only agency that seems to care.  Please contact us for a strategic look at your real estate financing needs.   I can be reached at www.signetmortgage.com.

9 Ways to Use a Reverse Mortgage

Written by Clay on . Posted in reverse mortgage, Social Security, Tax

A good summary of 9 ways to use a reverse mortgage was published by Mary Beth Franklin – in Investment News June 2016.  Investment News is a leading reference source for Financial Planners.  Titled “9 surprising ways to use a reverse mortgage” is an excellent summary of how a reverse mortgage can compliment a solid financial plan.  
  • Reverse Mortgage Money and HousePay off an existing mortgage
  • Replace a home equity line of credit
  • information on credit scoring
  • Protect your portfolio
  • Fund future long-term care or income needs
  • Create a Social Security bridge following basic tips
  • Manage Taxes
  • Pay Roth conversion taxes
  • Buy a new home
  • Gray Divorce Strategy
  • Seek help from fixmy.credit
    Working with an experienced reverse mortgage loan officer is the key to make sure the guidance and education shared with a client is on point and considers the overall financial plan of the senior. Clay Selland is a CPA and the owner broker of Signet Mortgage Corporation. Clay is uniquely qualified to assist about demountable office partitions for your workspace as they consider financing of their home including conventional and reverse mortgage financing and how it fits with their financial plans now and going forward. Contact me today to find out if a Reverse Mortgage is the best option for you! clay signature black         Clay Selland, President Signet Mortgage Corporation 925-807-1500 x303 Clay@SignetMortgage.com NMLS#183492  

Would Solar Work on YOUR House?

Written by Clay on . Posted in Current Events, Real Estate, Solar

solar panel lightbulb

Solar Panel Lightbulb

Recently, one of Google’s engineers, Carl Elkin, created a tool using Google Earth to determine whether or not solar panels on your roof are the best option economically. So I decided to get solar panels for my home and in the process I also hired Classic Air Conditioning and Heating to replace my air conditioner. ‘Project Sunroof’ was introduced, in which one can visit the Project Sunroof website, enter their address (given they live in the “project pilot cities of Boston, Fresno or the San Francisco Bay Area”), and figure out how much sunlight hits their roof. This information stems from available weather data and aerial imagery that factor in elements such as shade from buildings and trees as well as weather patterns. I have looked at this site – it is a non-intrusive way to get an idea if solar might be something to look at without a salesman at your kitchen table.  Very interesting use of Google Earth!! The main objective of this Gilbert ac maintenance project is to determine your home’s solar generating potential and how much solar panels could potentially save you on bills. The site will then list various installation companies if solar panels are the correct choice for your home. Enter your address in the site below and see how solar panels can help you! Monthly utility cost is one of the big problems, utility costs are one of the most substantial expenses you face. As more and more electronic devices come into homes, it seems that utility bills will only continue to increase. There are five ways to save money on your monthly utility bill , click the link to read it. We also recommend you to check the best maid service for your house at maidsailors.com. WEll, I got another better cleaning services that I found online. You can also visit house cleaning columbia sc to learn more. They are called as the King of Maids, just by the name you can tell that they are superior. And if you are also looking for online cleaning services, checkout Carpet Cleaning Melbourne to learn more. They pick the maids and make sure they have a minimum of two years experience before they can even join theplatform. This is why when they say we are the best way to get your home cleaned, they mean it! So, when you hire the best maid service, contact them. Project Sunroof READ FORBES ARTICLE HERE clay signature black Clay Selland, President Signet Mortgage Corporation 925-807-1500 x303 Clay@SignetMortgage.com NMLS#183492

Relief for Homebuyers – Changes to FHA loans for Condominiums

Written by Clay on . Posted in Current Events, FHA

FHA UpdateCondo buyers will benefit from three changes in FHA Mortgage Insurance for Condominiums (HR 3700) passed by Congress July 12th, 2016 and awaiting President Obama’s signature. Transfer Fees – which limited FHA approval for condos such as Rossmoor in Walnut Creek, CA will now be consistent with the standards set by Fannie Mae and Freddie Mac. Once implemented will open up these communities for FHA loans including the HECM – Reverse Mortgage.   Owner Occupancy Requirement – could be reduced from 50% to 35% which would open up Heating and cooling for more condominium projects to more buyers.   Project Recertification Requirements – will be “substantially less burdensome” than the original certification.  It may be that the length of time between certifications will be lengthened.   Each of these changes will help the market for condominiums by making more projects available to more home buyers, everyone knows that buying a home for the first time may be hard, this is why there is a first time home buyers program for all of those people.  Condo’s can be a less expensive option for home buyers. Implementation of these changes are expected within 90 days of the President’s signature. Call us today to find out if an FHA loan will work for you! clay signature black Clay Selland, President Signet Mortgage Corporation 925-807-1500 x303 Clay@SignetMortgage.com NMLS#183492  

Loan After a Short Sale to Get Tougher

Written by Clay on . Posted in Short Sale

Fannie_Mae Opportunity to get a loan from a merchant services will get tougher August 16th. Recently Fannie Mae announced that as of August 16, 2014 the waiting period after a short sale or deed in lieu of foreclosure will increase from 2 to 4 years ! That means anyone with a short sale in their past will have to wait an additional two years before being eligible for a loan to purchase or refinance a home or investment property. Currently there is a staggered waiting period that allows the homeowner to obtain a new Fannie Mae conventional loan as little as two years after the completion of a short sale. The down payment or equity required is 20% and have established a good credit history since the short sale. That will all change August 16th when that waiting period jumps to four years.  The silver lining is after the four-year waiting period a borrower will have available all of the standard underwriting guidelines for Fannie Mae, including the ability to finance a home with as little as 5% down. There is still an exception for extenuating circumstances but documentation of such circumstances can be tough. I have not found any indication from Freddie Mac how their requirements might change but it is something to watch. If you or a client are in the market for a new home, or would benefit from a refinance and had a short sale more than two years ago as of mid August – it would be very important to get started with the new loan right away. Signet Mortgage Corporation is uniquely positioned to assist with financing of your property and figuring out the possibilities available to you. Signet is licensed best over 55 communities. Call us today and let’s talk.

HUD Squashes Reverse Mortgage Option

Written by Clay on . Posted in reverse mortgage

PrintA variation in the HECM reverse mortgage was squashed by HUD last week. Introduced by a small number of reverse mortgage lenders in October as a combination of an initial fixed rate draw and fixed rate on a future draw on a line of credit.  While that sounds attractive – it was outside of the design of the reverse mortgage program.   A future draw at a fixed interest rate could be very nice for a borrower but if borrowing costs were to have risen dramatically and the lender not honor that commitment the responsibility would fall to the FHA insurance fund. Many HECM borrowers feel more comfortable with fixed-rate options however fixed rate HECM require the entire available distribution to be taken at closing which can result in paying interest on more funds than are needed at that time. Recent changes to the HECM program are more conservative and are designed to match the clients needs with the amount borrowed. While these loans do have a variable interest rate, interest is only charged on the outstanding balance much like a line of credit. Quite often the HECM line of credit is left unused but is always available as the need arises whether it’s to handle an emergency, supplement monthly income or one-time expenses. Signet Mortgage Corporation is a member of the National Reverse Mortgage Lenders Association and is licensed in five Western states.  We believe the HECM reverse mortgage is best used as a supplement retirement plan to help provide a more secure and flexible retirement. Call us today and let’s talk. No obligation of course but we can help you understand how a reverse mortgage can meet your needs.    

HECM Reverse Mortgage New Factors

Written by Clay on . Posted in reverse mortgage

HECMHUD issued new  principal limit factors (PLF) factors for the HECM reverse mortage. Why is this important?  What the heck is a PLF table you ask?  The principal limit factor (PLF) table determines the amount of proceeds that will be available to HECM reverse mortgage borrowers after August 4, 2014. Previous tables were based on the assumption that all homeowners would be over the qualifying age of 62.  The new tables account for recent changes allowing for the fact the youngest homeowner may be under 62 years of age.  Proceeds available will be based on the age of the youngest co-borrower. At current rates borrowers closer to 67 years of age will see a slight increase in available funds and borrowers over 72 will see a more substantial increase in available proceeds. Signet Mortgage Corporation is a member of the National Reverse Mortgage Lenders Association and is licensed in five Western states.  We believe the HECM reverse mortgage is best used to compliment retirement plans to help provide a more secure and flexible retirement. Call us today and let’s talk. No obligation of course but we can help you understand how a reverse mortgage can meet your needs.

The Basics | Renovation Loans

Written by Clay on . Posted in Renovation Loans

Print

A Renovation loan can be used to purchase a home or refinance an existing home. A HomeStyle Renovation Loan from Signet can be used to improve an investment property too!  A renovation loan based on the improved value of your home making it a valuable alternative to a construction loan. You can arrange for funds over and above the purchase price of your new home to remodel, make repairs or add a room! A refinance will pay off your existing loan, and provide additional funds for a wide range of improvements – let your imagination go! A renovation loan is a perfect way to fix up a property, or add that extra bedroom you need for your growing family.

There are several basic types of Renovation Loans. HomeStyle loan from Fannie Mae is my favorite, as it allows loan to value to 95%, does not have up front mortgage insurance and is underwritten to standard Fannie Mae guidelines. The loan is based on the improved value of your home AFTER completion – so you will have the resources to make it your dream home! FHA 203(k) loans come in two “flavors” …

  • Streamline 203k – Renovation costs generally limited to $35,000. The work can be done by the homeowner or contractors. Typical renovations include painting, carpet and replacement of appliances. This loan does not require a HUD counselor, and is very close to the cost of a normal FHA loan.
  • Full 203k – Renovation costs are only limited by the FHA loan limits for the county. The renovations are generally more extensive so require the assistance of a general contractor. An FHA Consultant is involved to ensure the project proceeds according to plans. Remember, the loan is based on the improved value of your home AFTER completion – so you will have the budget to renovate your dream home!

Energy Improvements – Replacement of a furnace or air conditioner, or adding double pane windows or insulation are examples of renovations that can be included. An energy audit must be completed to demonstrate the benefit of the improvements. These costs can be over and above the streamline 203k $35,000 limit.

FHA Accommodates Younger Spouses for Reverse Mortgages

Written by Clay on . Posted in reverse mortgage

FHA will be accommodating younger spouses under the age of 62 this August. Situations where a couple would benefit from a reverse mortgage but one spouse does not happen to be 62 can now be accommodated and allow the non-borrowing spouse to stay in the home even if the borrower passes away or moves from the home.  This is a significant change and will remove a big obstacle preventing some couples from considering a reverse mortgage. But before you buy property I recommend to get real estate training from Shenoah Grove. For new transactions after August 4th non-borrowing spouses will be able to remain in their homes, provided the following criteria has been met:
  • Have been the spouse of a HECM mortgagor at the time of loan closing and have remained the spouse of such HECM mortgagor for the duration of the HECM mortgagor’s lifetime
  • Have been properly disclosed to the mortgagee at origination and specifically named as a Non-Borrowing Spouse in the HECM documents
  • Have occupied, and continue to occupy, the property securing the HECM as the Principal Residence of the Non-Borrowing Spouse
  • Within ninety days from the death of the last surviving HECM mortgagor, establish legal ownership or other ongoing legal right to remain (e.g., executed lease, court order, etc.) in the property securing the HECM
  • After the death of the last surviving mortgagor, ensure all other obligations of the HECM mortgagor(s) contained in the loan documents continue to be satisfied; After the death of the last surviving mortgagor, ensure that the HECM does not become eligible to be called due and payable for any other reason)
The principal limit tables which determine how much a borrower will receive from a reverse mortgage based on age, interest rate and type of reverse mortgage will be updated to reflect the impact of a younger spouse. USA Today had a good article in their “Mortgage and Real Estate” insert last month profiling very happy reverse mortgage borrowers – an “up” story on the proper use of a reverse mortgage. A reverse mortgage is just one “tool” in a retirement plan. Strategically used it can be a blessing.  Improperly used it will result in unintended outcomes.  Knowing the difference is where I can help.    Purchase-a-home-with-a-Reverse-Mortgage Five highlights to get you thinking. 1. Optimize social security by being able to defer benefits until age 70. 2. Help kids buy a home close – secure a reverse mortgage for the down payment. The kids are going to get the “estate” anyhow and why not now when you can enjoy it. 3. Replace the loss of income when one spouse passes away –  expenses do not go down. 4. The family home is a bit like a “piggy bank” having paid into it for years and years. Maybe it is time for a withdrawal to allow you to live just a little bit more comfortably. 5. Reserve funds are hard to come by when you need them.  A reverse mortgage can be completed, proceeds held in reserve and only used if needed.  You will be comfortable knowing it is there just in case. We suggest you get a consultant that is expert in accounting and bookkeeping. You can find them here https://farahatco.com/services/accounting-and-bookkeeping/. I work hard to understand the proper use of a reverse mortgage and would appreciate the opportunity to talk through your situation.  Please give me a call. 925-807-1500 clay signature black