FHA INSURED LOANS

charlesarmbruster · Posted: Tue Feb 19, 2008 4:35 pm Post subject: FHA INSURED LOANS

I'd be interested to know if any members of this Community have had good success in financing their homes with FHA products in the US.
FHA Secure product is also now available, allowing homeowners with recent mortgage lateness caused by interest rate adjustment to gain an upper hand on their situation by refinancing up to 97%LTV with no limit to an existing CLTV if a second-lien holder will resubordinate.
Also: -Treasury Secretary Henry M. Paulson
(Quoted from the Treasury RSS feed.)
"I am impressed with the HOPE NOW Alliance's swift adoption of Project Lifeline. Just last week we saw six servicers take the lead and agree to this initiative. Now that all HOPE NOW members have signed on, more than 90 percent of the subprime servicing market and nearly 70 percent of the entire mortgage servicing market is committed to this coordinated method of reaching more homeowners. Project Lifeline is one more means of helping homeowners, and combined with the other parts of HOPE NOW's outreach, these initiatives can make a measurable difference. I look forward to seeing reports of the impact of these commitments."
AWARENESS IS ALL!

sara · Posted: Tue Feb 19, 2008 9:27 pm Post subject: RE:

Well, charles, I haven't gone for one, so can't really tell you. But I appreciate the intiatives taken by the government to prevent foreclosures. However at the same time, it is a fact that these intiatives do not cover all delinquent borrowers as there are specific criteria to avail these programs.

gmakerley · Posted: Thu Feb 21, 2008 10:07 am Post subject:

we do fha loans all the time in my office. they are better-priced than conforming loans due to the risk-based adjustments for credit score on the conforming products.

there is little difference in the processing and underwriting of these loans. borrowers may have to provide an extra pay stub or bank statement, but that's just "old school" anyway. as for paperwork; yes, there is a little bit additional documentation required, but not onerous.

also, appraisals is appraisals just like "motor oil is motor oil." in the old days, appraisers had to be concerned with all sorts of silly property issues. those have disappeared and the appraisal reports now are identical to conforming appraisals, save for the fact that there is an fha case number attached. and, of course, if there are issues with a property, that will impact a conforming loan equally with an fha.

connecticut also has a bond program that offers first-time homebuyers an exceptional rate (at least until today, when it went to 5.625%), and most of those loans are written under fha guidelines.

there are so many benefits to fha financing compared to conventional financing - better rates in general, forgiveness toward those with lower credit scores - they are a mainstay in our product line.

i still favor my community or flex 100, etc. for my borrowers with high debt, as we can obtain approval (assuming better credit scores) through automated underwriting for ratios well above 50% - something fha doesn't go for.

all things considered, fha financing is well worth learning about and offering to our clientele.

banker0679 · Posted: Sun Feb 24, 2008 4:16 pm Post subject:

FHA is a huge part of any loan officer's business. I write more FHA loans than conventional. Many borrowers have subprime needs, and FHA is there for them. FHA has 3 great programs. FHA for purchase, FHA for rehab purchase, and FHA to save your home. FHA for rehab (203k) is great for those looking at a home that may need renovation when deciding to purchase the home. FHA to save your home (FHA Secure) has been helping a lot of homeowners save their home from foreclosure. FHA for purchase (usually 203b) has been making a lot of borrowers with really low scores & low down payment.

USDA is also a great program, and so is VA.

charlesarmbruster · Posted: Sun Feb 24, 2008 11:16 pm Post subject:

To 'banker0679' -- FHA Secure is a great product, but have you closed any? How are your 2nd lien holders receptive to re-subordination? Are any over 100%CLTV? The FHA trainers I've spoken to have no real experience to relate, and the lenders I speak to have practically set their own product rates as a formality -- meaning they are not selling it.

banker0679 · Posted: Mon Feb 25, 2008 4:44 pm Post subject:

haven't had the opportunity with FHA secure yet.
most of the borrowers were late before the adjustment.

gmakerley · Posted: Tue Feb 26, 2008 9:02 am Post subject:

my suspicion is that fha secure is not going to solve many of our societal ills - will it assist certain borrowers? certainly, i'm sure it will.

however, i think the qualifications for using the product are onerous and not beneficial to the majority of those in or about to be in trouble with their existing mortgages.

interestingly, there are more and more new programs being introduced in various legislative bodies (3 in connecticut this week, in fact) to combat the inherent difficulty in products like fha secure, which became the model for most of the other new "helpful" new programs.

i like what chris dodd is doing - he is reintroducing a program that originated back in the 30s during the great depression; and that was also evident in the 80s. whether it will be the panacea that we are all seeking is another story.

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