Can Millenials Afford To Buy A Home?

Do 46 Million Millennials Know They Are Mortgage Ready?

 

Many have written about the millennial generation and whether or not they, as a whole, believe in homeownership as part of attaining the American Dream.

Millennials have taken longer to obtain traditional milestones than the generations before them, such as getting married, having kids, and buying a home. However, that does not mean that they do not still aspire to achieve those things.

History shows that people tend to buy their first home around age 30. Nearly 5 million millennials will turn 30 in the next two years. This will continue to fuel demand for housing.

This is also one of the many reasons why the millennial homeownership rate has continued to grow over the past few years. 48.4% of Americans between the ages of 30-34 now own a home.

There are over 46 million millennials (33% of the generation) who are considered “Mortgage Ready”,meaning they meet the qualifications to be approved for a mortgage today!

• a FICO Score ≥ 620
• a Back-End Debt to Income Ratio ≤ 25%
• no Foreclosures or Bankruptcies in the last 7 years
• no severe delinquencies in 1 year

Rob Chrane, CEO of Down Payment Resource, commented on the findings of the report,

“We now know there are millions of buyers with the income & credit necessary to qualify to buy a home. The biggest question is:

Do they know it? …Unfortunately, many renters don’t investigate homeownership simply because they don’t believe it’s an option.”

The good news is that more and more millennials are realizing that they can afford a home now. Even so, more can be done to increase awareness of low down payment programs to attract even more of this generation.

New data from realtor.com shows that in December, millennials accounted for 42% of all new home loans originated in the month. This is more than any other generation.

Bottom Line

If you are one of the many millennials who may be “Mortgage Ready” but are unsure what your next steps should be, contact me (or a local real estate professional) who can help guide you on your path to homeownership.

What Credit Score Do You Need To Buy A House?

Unsure about your credit score? Read on!

 

There are many misconceptions about the credit score needed to buy a house. Recently, it was reported that 24% of renters believe they need a 780-800 credit score to be considered for a mortgage. The reality is they are misinformed!

Only 25% of the Americans have a FICO® Score between 740 and 800. Here is the breakdown according to Experian:

• 16% Very Poor (300-579)
• 18% Fair (580-669)
• 21% Good (670-739)
• 25% Very Good (740-799)
• 20% Exceptional (800-850)

Randy Hopper, Senior Vice President of Mortgage Lending for Navy Federal Credit Union said,

“Just because you have a low credit score doesn’t mean you can’t purchase a home. There are a lot of options out there for consumers with low FICO® scores,”

There are many programs available with low or no credit score requirement. The Federal Housing Administration (FHA) now requires a minimum FICO® score of 580 if you want to qualify for the low down payment advantage. The US Department of Agriculture (USDA) does not set a minimum credit score requirement, but most lenders require a score of at least 640. Veterans Affairs (VA) loans have no credit score requirement.

As you can see, none of them are above 700!

It is true that the average FICO® score for all closed loans in January was 726, but there are plenty of people taking advantage of the low credit score requirements. Here is the average FICO® Score of closed FHA Loans since April 2012 according to Ellie Mae:As you can see, that number has been dropping for the last seven years. As a matter of fact, the average FHA Purchase FICO® Score reported in January 2019 was 675!

One of the challenges is that Americans are unsure about their credit score. They just assume that it is too low to qualify and do not double check. Credit.com confirmed that only 57% of individuals sought out their credit score at least once last year.

FICO® reported,

“Since October 2009, the average year-over-year FICO® Score has steadily and consistently increased, from a low of 686 in 2009 to the latest high of 704 as of 2018.”

Here is the increase in the average US FICO® Score over the same period of time as the graph earlier.

Bottom Line

At least 84% of Americans have a score that would allow them to buy a house. If you are unsure what your score is or would like to improve your score in order to become a homeowner, give me a call, and we will have your credit score professionally checked with all FOUR credit bureaus, and then formulate a plan to help you become a happy home owner!

 

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What If I Wait A Year To Buy A Home?

National home prices have increased by 5.4% since this time last year. Over that same time period, interest rates have remained near historic lows which has allowed many buyers to enter the market and lock in low rates. As a seller, you will likely be most concerned about ‘short-term price’ – where home values are headed over the next six months. As a buyer, however, you must not be concerned about price but instead about the ‘long-term cost’ of the home. The Mortgage Bankers Association (MBA), Freddie Mac, and Fannie Mae all project that mortgage interest rates will increase by this time next year. According to CoreLogic’s most recent Home Price Insights Report, home prices will appreciate by 4.8% over the next 12 months. What Does This Mean as a Buyer? If home prices appreciate by 4.8% over the next twelve months as predicted by CoreLogic, here is a simple demonstration of the impact that an increase in interest rate would have on the mortgage payment of a home selling for approximately $250,000 today: Bottom Line If buying a home is in your plan for this year, doing it sooner rather than later could save you thousands of dollars over the terms of your loan. Name(required) Email(required) Website Comment(required) Submit Δ

Blind Trust In Email Could Cost You Thousands- Even Your Home!

May 4, 2017

If you are buying or selling a home, NEVER forget to CALL THE CLOSING ATTORNEY (OR GO IN PERSONALLY) TO GET WIRE INSTRUCTIONS. DO NOT RELY ON AN EMAIL FROM ANYONE (The Attorney, your Realtor, your lender). I have shared this before, and it is scary stuff. This is becoming more prevalent, and it even happened to one Charlotte couple recently. Please share with anyone thinking about buying or selling a home! This IS happening, folks!

Provided as an excerpt from an article written by KrebsOnSecurity on April 17, 2017

Blind Trust in Email Could Cost You Your Home

The process of buying or selling a home can be extremely stressful and complex, but imagine the stress that would boil up if — at settlement — your money was wired to scammers in another country instead of to the settlement firm or escrow company. Here’s the story about a phishing email that cost a couple their home and left them scrambling for months to recover hundreds of thousands in cash that went missing.

It was late November 2016, and Jon and Dorothy Little were all set to close on a $200,000 home in Hendersonville, North Carolina. Just prior to the closing date on Dec. 2 their realtor sent an email to the Little’s and to the law firm handling the closing, asking the settlement firm for instructions on wiring the money to an escrow account.

An attorney with the closing firm responded with wiring instructions as requested, attaching a document that had the law firm’s logo and some bank account information that was represented as the seller’s account number. The Little’s realtor sent the wire on Thursday morning, the day before settlement.

“We went to closing at 1 p.m. on Friday, and after we signed all the papers, we asked the lawyers if we were going to get back the extra money we had sent them, because they hadn’t be able to give us an exact amount in the wiring instructions. At that point they told us they had never gotten the money.”

After some disagreement, both legitimate parties to the transaction agreed that someone’s email had been hacked by the fraudsters, and was used to divert the wired funds to an account the criminals controlled. The hackers had forged a copy of the law firm’s letterhead, and beneath it placed their own Bank of America account information (see screen shot above).

The owner of the Bank of America account appears to have been a willing or unwitting accomplice — also know as a “money mule” — recruited through work-at-home job schemes to receive and forward funds stolen from hacked business accounts. In this case, the money mule wired all but 10 percent of the money (a typical money mule commission) to an account at TD Bank.

Fortunately for the Littles, the FBI succeeded in having the resulting $180,000 wire transfer frozen once it hit the TD Bank account. However, efforts to recover the stolen funds were stymied immediately when the Littles’ credit union refused to give Bank of America a so-called “hold harmless” agreement that the bigger bank wanted as a legal guarantee before agreeing to help.

Charisse Castagnoli, an adjunct professor of law at the John Marshall Law School, said banks have a fiduciary duty to their customers to honor their requests in good faith, and as such they tend to be very nervous legally about colluding with another bank to reverse payment instructions by one of their own customers. The “hold harmless” agreement is usually sought by the bank which received a fraudulent wire transfer, Castagnoli said, and it requires the responding bank to assume any and all liability for costs that the requesting bank may later incur should the owner of account which received the fraudulent wire decide to dispute the payment reversal.

“When it comes to wire fraud cases the banks have to move very quickly because once the wires make it outside the U.S. to foreign banks, the money is usually as good as gone,” Castagnoli said. “The receiver or transferee usually insists on a hold harmless agreement because they’re moving the money on behalf of their own account holder, kind of going against their own client which is a big ‘no-no’ when you’re a fiduciary.”

But in this case, the credit union in which the Littles had invested virtually all of their money for more than 40 years decided it could not in good faith provide that hold harmless agreement, because doing so would stipulate that the credit union affirms the victim (the Littles) hadn’t willingly and knowing initiated the wire, when in fact they had.

“I talked to the wire dept multiple times,” Mr. Little said of the folks at his financial institution, Atlanta, Ga.-based Delta Community Credit Union (DCCU). “They finally put me through to the vice president of loss prevention at the credit union. I’m not sure they even believed all that was going on. They finally came back and told me they couldn’t do it. Their rules would not allow them to send a hold harmless letter because I had asked them to do something and they had done it. They had a big meeting last week with apparently the CEO of the credit union and several other people. Then they called me on Monday again and told me they would not could not do it.”

The Littles had to cancel the contract on the house they were prepared to occupy in December. Most of their cash was tied up in this account that the banks were haggling over, and so they opted to get a heavily mortgaged small townhome instead, with the intention of paying off the mortgage when their stolen funds are returned.

“We canceled the contract on the house because the sellers really needed to sell it,” Jon Little said.

The DCCU has yet to respond to my requests for comment. But less than a day after KrebsOnSecurity reached out to the credit union for comment about the Littles’ story, the bank informed the Littles that the other bank would soon have its hold harmless letter — freeing up their $180,000 after more than four months in legal limbo.

The Littles’ story has a fairly happy ending, however most of the other few dozens stories previously featured on this blog about wayward mortgage, escrow and payroll payments wound up with the victim losing six figures at least.

One of the more recent advertisers on this blog — Ninjio — specializes in developing custom, “gamified” security awareness training videos for clients. “The Homeless Homebuyer,” one of the videos Ninjio produced for a government client seems appropriate here: It features an animated FBI agent breaking the bad news to some would-be homeowners that their money is gone and so are their dreams of a new home — all because everyone blindly trusted unsecured email for what is essentially a high-risk cash transaction.

I like the video because its message is fairly stark and real: You could get screwed if you don’t take this seriously and proceed carefully, because once the money’s gone it usually stays gone. Check it out here:

So here’s what you need to know if you or anyone you know, love or even like are about to buy or sell a home: Never wire money based on the say-so of one party to the transaction made via email. You simply don’t know if their account is hacked, so from a self-preservation standpoint it’s best to assume it is.

Agree in advance who will contact whom — preferably by phone — on settlement day to receive the wiring details, and who will manage the wiring process. Never trust bank account details and payment instructions sent via email. Always double or even triple check any instructions for wiring money at settlement. Confirm all wiring instructions in person if possible, or else over the phone.

By the way, these same precautions can help make organizations less susceptible to CEO fraud schemes, email scams in which the attacker spoofs the boss and tricks an employee at the organization into wiring funds to the fraudster.

The Federal Bureau of Investigation (FBI) has been keeping a running tally of the financial devastation visited on companies via CEO fraud scams. In June 2016, the FBI estimated that crooks had stolen nearly $3.1 billion from more than 22,000 victims of these wire fraud schemes.

Castagnoli said many credit unions and small banks don’t have the legal staff with the clearance to make calls on whether to issue a hold harmless agreement, and so they usually try to punt on that when requested. Were she in The Littles’ position, Castagnoli said she would have called the head of the credit union and demanded assistance.

“If the head of the bank wouldn’t do it, I’d call my congressperson or a state banking regulator,” she said.

If you’re selling or buying the home yourself and somehow also in charge of wiring money, consider using a Live CD approach (all of these “live” Linux distributions will just as happily run on USB-based flash drives). I have long recommend Live Linux usage as a smart option for small businesses to avoid paying dearly when a Windows banking trojan snarfs their business banking credentials.

 

Garage Door Security Tips To Prevent A Break In Or Theft

October 14, 2015

You have checked all the windows to make sure they are closed and locked, doubled-checked the doors, let the neighbors know you are out of town, informed the mail so it does not pile up out front, and activated all the passive security systems in your home. However, one area is often overlooked as you pull out of your garage and leave; the garage you just left.

The modern-day garage is a favorite place for thieves to gain access to your home.

There are three main types of garages that your home may have and each one requires its own safety measure. The first two are attached garages, and they can be divided into two categories: 1) the front of the house garage that faces the street and 2) the rear garage, which is out of view from the street.

The third type of garage is the detached garage. It is particularly dangerous if it is not secured properly because it allows a staging ground for thieves to enter the premises.

Here are a few pieces of advice that will help protect your home:

Use Your Garage. Park your car inside the garage when it is not being used or if you are leaving by other means. Many people leave their garage door opener in their car and all it takes is something like a broken window in your car, which can give a thief access to your home. To combat this, you can also make sure to remove the remote if you leave your car outside of the garage.

Disable the Electric Motor. If you are leaving for an extended period of time, detach your electric garage door opener. This is usually a very simple thing to do. Most electric garage door openers have a rope or chain you pull down to disconnect the electric motor from the chain that operates the door. This protects you in two ways. First, if a thief used a frequency scanning device to obtain your code, it will be of no use since it is not operable. Second, it would require a thief to physically go to the door, which the neighbors could see.

Bolt It. Use a manual sliding bolt-style lock on the inside of your garage door that can only be opened from the inside.

Keep It In Good Condition. Make sure the garage door is properly functioning and that there is no damage to the panels which a thief can use to get in.

Keep It Contained.– Do not leave important items in the garage and make sure to lock the door into your home. If thieves do break into the garage, you want to make sure that is all they can access. Place a deadbolt and anti-kick device on the door which leads to the garage from the home on a connected garage.

For the detached garage make sure you follow the same principles as if it was connected to your home. If the garage is out of view it is even more important. Most importantly, do not keep valuables in your garage.

 

Kristen Haynes, Broker In Charge, GC, CMRS 

Platinum, Multi Million Dollar Producer, Selling Carolinas Real Estate since 1992 

Direct: 704-905-4062    Toll-Free: 1-877-372-2252

Email: khaynes@newhomesnc-.com    Web: www.NewHomesNC-SC.com

http://www.fivestarprofessional.com/profiles/281817

START YOUR HOME SEARCH, TODAY!

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 Copyright 2015 New Home Buyers Brokers / Realty Pros

       

Should We Get A Loan Pre-Approval Or A Loan Pre-Qualification?

July 24, 2015
Copyright 2015 New Home Buyers Brokers / Realty Pros

WHAT’S THE DIFFERENCE BETWEEN A LOAN PRE-APPROVAL AND A LOAN PRE-QUALIFICATION?

There is a big difference between obtaining a full “loan pre-approval” or having a quick “loan pre-qualification” letter from your lender.

1. Your pre-approval letter is far more reliable than a pre-qualification letter. Receiving a basic loan pre-qualification letter is easy. You simply provide basic financial information to a lender and wait a few minutes for the letter to be sent back to you. Obtaining a “pre-qual” from a random mortgage website is just as easy- just enter some information, click “submit” and voilà you are pre-qualified.

A pre-approval letter, on the other hand, involves verification of the information. Rather than taking your word on faith, the lender will ask for documentation to confirm your employment, the source of your down payment, and other aspects of your financial circumstances. Granted, a pre-approval is more time-consuming than a pre-qualification, but the additional due diligence is exactly why the pre-approval carries more weight with sellers when submitting an offer.

Think of the difference between and IOU note and an actual check. With the first, a seller hopes that they can count on your offer to be valid and with the second, they know that your offer is backed by the word of your lender. When the home you want is on the line, you don’t want to take chances against other, stronger offers.

2. You know how much money you can borrow. You likely have a rough idea of how much you would feel comfortable paying each month for your home mortgage. However, there’s no effective way to translate that monthly payment into a specific maximum mortgage amount because other factors such as down payment percentage, mortgage insurance, property taxes, adjustable interest rates and so on may not be part of your original calculation. Being pre-approved takes the guesswork out of how much you hope to borrow depending on your income, debts and credit history.

3. You will have more leverage when negotiating with the seller! Sellers prefer to negotiate with pre-approved buyers because they know you are financially qualified to obtain the loan needed to close on their home. You will feel more confident about making your offer with a pre-approval letter and that can make all the difference in negotiating the price and extras! A pre-approval letter is an especially favorable point in a multiple offer situation.

4. Your real estate agent will consider you a serious buyer and will be prepared to go to contract immediately when you find the right home. A pre-approval letter signals to your real estate agent that you’re a well-qualified buyer who is serious about purchasing a home and that they need to be prepared to write up an offer at any time. The increased likelihood of a closed sale, and not just months and months of “hauling and hoping” will naturally motivate your agent to devote more time and energy to you, rather than to less serious, qualified buyers.

5. A pre-approval doesn’t take more of your time, but changes the order in which you send in your paperwork. Obtaining pre-approval is simply starting the paperwork earlier – it’s not extra paperwork. It also alleviates stress after you make an offer. In order to buy your home, you will have to collect all your financial documents for your loan officer. Whether you do that before you find a house, or wait until the pressure is on once you are under contract is up to you.

Here are some additional tips on things to avoid during the home buying process to assure your transaction goes as smoothly as possible:
• Don’t apply for new credit of any kind
• Don’t close credit card accounts
• Don’t max out or over charge existing cards
• Don’t consolidate debt
• Don’t change or quit job
• Don’t make any large deposits into accounts
• Don’t make any large purchases
• DO stay current on existing accounts

Our Agents here at New Home Buyers Brokers / Realty Pros have been selling Carolinas Real Estate since 1992. We have the experience and know-how to educate you on all things necessary for you to find, build, mortgage and buy the home of your dreams. We’ll explain the process and will be there to guide you every step of the way.

Call or contact us today to get any questions answered about the mortgage loan or home buying process!

  Kristen Haynes, Broker In Charge, GC, CMRS 

Realtor / Broker NC / SC since 1992  Platinum, Multi Million Dollar Producer

Direct: 704-905-4062  *  Toll-Free: 1-877-372-2252

Email: khaynes@newhomesnc-.com  *  Web: www.NewHomesNC-SC.com

START YOUR HOME SEARCH, TODAY!

Are you shopping for a new home online? I’d like to introduce you to the Home Buyers Scouting Report® (HBSR) provided by Home Buyers Marketing II, Inc. With the HBSR you can search for all the available homes for sale in this market that match your personal search criteria.Click on the link, below, to start your search or contact me for more information.

Please call us or use the contact form, below, for additional information or with questions on the home buying or mortgage pre-qualification or pre-approval process:

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Weekly Mortgage Snapshot and Economic Forecast

 

Mortgage rates mostly leveled off last week, with limited data for markets to digest. The biggest news

of the week came from Europe, where the European Central Bank announced a quantitative easing

program to purchase sovereign debt of member countries. There is debate as to whether this program will make much of an impact; with some arguing that it will keep pushing money to the US.

Markets will have plenty to chew on this week, with some major economic reports and a meeting of

the Federal Reserve. Many analysts are hoping that the Fed will bring some additional clarity as to

whether it intends to begin increasing rates this summer. It is not likely that we will receive much

more guidance from this meeting. However, if the Fed does seem likely to begin increasing rates this

summer, then rates may start slowly moving upward now. On Friday, the first estimate of 4th quarter

GDP is due. Expectations are for a drop from the 5.0% of the 3rd quarter. If we are surprised again,

and GDP was much stronger than expected, rates are likely to begin pressing upward.

Worth Remembering Gen Y in the Burbs or the City?

Nothing’s better than the

wind to your back, the

sun in front of you, and

your friends beside you.

Aaron Douglas Trimble

A new survey from the National Association of Home Builders has thrown more doubt on what many economists and city planners have assumed, that is, that those born in the 1980’s and 1990’s prefer to live in the city. The recent survey found that 66% of survey Gen Y’ers want to live in the suburbs, 24% want to live in rural areas and 10% want to live in a city center. The most predominate reason was a desire to have a larger home with three or more bedrooms.

Mortgage Rate Watcher

Volatility High 2.00%

4.50% – Average expected 30 year rate for A = credit for first quarter of 2015

Based on: 12 Mn Libor 0.623% 6 Mo Libor 0.357% 11th D. COFI 0.686% Prime 3.250% Fed Fund 0.250%

E C O N O M I C S N A P S H O T

Dow Jones 17,672.60 NASDAQ 4,757.88

23-Dec %pt Chg 30-Dec pt Chg 21-Jan % Chg NYSE 10,788.33 S&P 500 2,051.82

Manufacturing: Expanding

Unemployment: Stable

Gross Domestic Product: Economy Expanding

Sales Slowly Growing In The First Quarter, Mortgage Rates To Remain Relatively Stable

FREE DOWN PAYMENT ASSISTANCE AND GRANTS ARE NOW AVAILABLE FOR NC RESIDENTS TO HELP YOU BUY A HOME!

FREE DOWN PAYMENT ASSISTANCE PROGRAMS ARE NOW AVAILABLE IN NORTH CAROLINA FOR QUALIFIED HOME BUYERS!

If your income or the need for down payment assistance has kept you out of the housing market, our home buyer programs can give you the boost you need to own a piece of the “American Dream”!

If you need help with the down payment and closing costs, you may qualify for interest-free, deferred, forgivable second mortgages up to 3% of your down payment or other benefits by using a Qualified Realtor / Broker and Lender, or other assistance programs!

Our Real Estate firm, New Home Buyers Brokers and Realty Pros is one of the qualified Brokers in North Carolina who has the knowledge and experience to help you get FREE Down Payment Assistance to stop throwing your money way in rent and to help you buy the home of your dreams! To see if you qualify for one of the programs, call: Kristen Haynes, Broker In Charge, GC, CMRS at New Home Buyers Brokers: 704-905-4062 (Direct) or 1-877-372-2252 (Toll Free).

   ”Helping You Find Your Way HOME”!

www.NewHomesNC-SC.com or khaynes@newhomesnc-sc.com

 

Here are some of the available programs that you may qualify for:

• The N.C. Home Advantage Mortgage™ offers competitive interest rates along with down payment assistance and reduced PMI rates to save you money on your mortgage payment every month, on top of the down payment, which is up to 3% of the mortgage loan amount for FHA borrowers (which normally will cover almost all of the required down payment), and 2% for Conventional borrowers. This down payment is fully forgiven after 15 years. This can be combined with the Mortgage Credit Certificate, for a “double home buyer bonus”!

• The Mortgage Credit Certificate (MCC) enables first-time buyers to save up to $2,000 a year on their federal taxes.
• For both first-time and move-up home buyers, the NC Home Advantage Mortgage™ provides qualified individuals with stable, fixed-rate mortgages and down payment assistance up to 5% of the loan amount. Even better, repayment of the down payment is required only if you sell, refinance or transfer your home before year 15—the down payment assistance is forgiven at 20% per year after 10 years in the home.

  As an added bonus, if you are a first-time buyer or a military veteran, you may also be eligible to combine this program with aMortgage Credit Certificate (MCC) to increase your savings even more! We offer these products statewide through participating lenders.

• The House Charlotte Program provides 10-year, deferred, forgivable loans to qualified Funds can be used to cover your down payment, closing costs, as well as for interest rate buy downs.

• NACA provides credit counseling services, home ownership classes and grants for those who qualify.

• The Good Neighbor Next Door Program is a federal housing program administered by HUD, for Police Officers, Firefighters, EMTs, and K-12 Teachers that offers up to a 50 % discount on the appraisal value of homes in specially designated “revitalization areas”,  as well as “One Hundred Dollar Down” homes that qualify for FHA financing.

The N.C. Home Advantage Mortgage™ 

Available with 30-year, fixed rate FHA, VA, USDA and conventional mortgages, the N.C. Home Advantage Mortgage™ is a perfect match for buyers looking for safe, affordable financing. The mortgages offer competitive interest rates, lower PMI and MIP mortgage insurance rates (saving you more in your mortgage payment every month in MIP and PMI fees), AS WELL AS the FREE down payment assistance. These programs can be STACKED with other assistance programs for eligible borrowers (Charlotte Housing Partnership or NACA funds, VA loans, or other programs and grants available statewide in North Carolina.

Repayment is required only if you sell, refinance or transfer the home before year 15 of the loan – the down payment assistance is forgiven at 20% per year after you live in the home for 10 years, and fully forgiven at 15 years.

For more information on the Home Advantage Mortgage, click here: http://www.nchfa.com/home-buyers/interest-rates

Am I Eligible For The NC Home Advantage Mortgage With Down Payment Assistance?  

You may be eligible for an N.C. Home Advantage Mortgage™ if:

• you are buying a new or existing home;      
• you are a first-time OR a move-up buyer;
• you buy a home in North Carolina and occupy it within 60 days of closing (this is not for investors who will not occupy the residence as their principal home;
• you don’t exceed the income limits for the person on the loan (not the entire household, as in MCC);
• you are applying for a FHA, USDA, VA or conventional loan through a Participating Lender and meet the sales price limits of the loan type;
• you are a legal resident of the United States, and;
• your credit score meets the basic requirements for the program.
• If you choose an FHA, VA, or USDA loan, you will get 3 % towards your down payment. With conventional loans, you will receive 2 % towards your down payment.
• The down payment can be “stacked” with other federal and state programs and with additional seller concessions towards closing costs, if you qualify, Seller concessions are limited to 3 % with Conventional loans, and up to 6 % with FHA loans.
• Click the link below to see if you qualify via the income limits in your area: http://www.nchfa.com/home-buyers/income-limits

What Properties Are Eligible For This Free ‘Down Payment Assistance’ Program?

• New and previously owned single family homes
• Townhouses
• Condominiums*
• Duplexes*
• Manufactured Homes (only new, never occupied, doublewide or greater manufactured homes on permanent foundations)*

*These property types are only available for FHA, VA and USDA loans, not conventional loans.

The Mortgage Credit Certificate (MCC)

If you are a first-time buyer and meet certain income and sales price limits, you may be eligible for a Mortgage Credit Certificate (MCC) worth up to $2,000 a year in tax savings. This federal tax credit can lower your income-tax liability, dollar-for-dollar, leaving you more money to use toward your mortgage. If you qualify, you will be able to claim 30% of the interest you pay on your mortgage if you purchase an existing home or 50% of the interest for a new home (never occupied) – up to $2,000 for every year you live in your home – as a tax credit on your federal income taxes.

MCCs can be combined with the N.C. Home Advantage Mortgage™ and other “stacked, eligible programs”, increasing the savings on your new home – as well as with any other qualifying lender mortgage program, including some adjustable rate mortgages.

How Does The MCC program work?

Suppose you qualify for an MCC and obtain a 30-year, 4% fixed-rate mortgage of $97,000 for the purchase of an existing home (not new construction). The first year’s interest payment is approximately $3,880. The MCC allows you to take a federal income tax credit of $1,164 ($3,880 x 30%) for that year.

If your federal income tax liability is $1,164 or more after you have taken all other credits and deductions, you receive the entire benefit of the MCC tax credit – $1,164. In figuring your taxes, you also claim a deduction for the remaining 70% of your mortgage interest.

If your federal income tax liability is less than $1,164—for example, $800—your tax is reduced by only $800 that year. However, the remaining credit can be claimed on tax returns for the next three years, if tax liability increases. Note that depending on your individual tax situation, the MCC may not always provide a tax credit benefit to you in a given year depending on your overall tax liability.

You can receive an immediate benefit from your MCC tax credit by filing a revised W-4 (Employee’s Withholding Allowance Certificate) with your employer. In this example, your federal income tax liability would be reduced by $97 a month ($1,164 ÷ 12). The extra $97 increases your take-home pay and helps make your house payments affordable.

The House Charlotte Program

Who Is Eligible For The House Charlotte Program?

Families with incomes that are 110% or less of the HUD Area Median Income are eligible for assistance. Participants must complete a pre-purchase homebuyer education program. The home must be a family’s primary residence and be located in one of designated House Charlotte eligible areas. Maximum purchase price of home is $155,000.

How The Program Works:

You must use a Registered Broker / Realtor and Lender to find and finance a home. Banks apply for the program on behalf of qualified buyers. To find out if you are qualified, contact your approved Broker / Realtor, who can also set you up with an approved lender.

The selected home must be located in one of the approved Charlotte Neighborhood Statistical Areas (NSAs). Each Charlotte neighborhood is further broken down into Neighborhood Profile Areas.  To determine if the property of interest is eligible, and address search must be completed through the mapping application.  Generally, these homes are located in disadvantaged areas that are “up and coming” but still have some growing to do.

Once your Realtor finds you a house in an eligible area, you will then ask your approved lender to apply for the House Charlotte program. You also must complete a homebuyer education program. In order to register for a home buying course, buyers may contact the Community Link or any other HUD-approved Counseling Agency to register for the program. There are income limits and area limits to be approved for this program.

• Provides funding up to $5,000 for families with income above 80% AMI, up to 110% Area Median Income (AMI)House Charlotte Program Image.
• Provides funding up to $7,500 for families with income at or below 80% (AMI)
• Provides funding up to $10,000 for families with income at or below 60% AMI in select House Charlotte areas.
• Provides funding up to $10,000 for buyers who are employed as sworn CMPD police officers. This is a 5-year deferred, forgivable loan.

NACA:

The Neighborhood Assistance Corporation of America (“NACA”) is a non-profit, community advocacy and homeownership organization. NACA’s primary goal is to build strong, healthy neighborhoods in urban and rural areas nationwide through affordable homeownership.

NACA has made the dream of home ownership a reality for thousands of working people by counseling them honestly and effectively, enabling even those with poor credit to purchase a home or refinance a predatory loan with far better terms than those provided even in the prime market.

The NACA homeownership program is one answer to the huge subprime and predatory lending industry. NACA has conclusively shown that when working people get the benefit of a prime rate loan, they can resolve their financial problems, make their mortgage payments and become prime borrowers. NACA’s track record of helping people who have credit problems become homeowners or refinance out of a predatory loan debunks the myth that high rates and fees are necessary to compensate for their “credit risk.”

 NACA has access to billions of dollars of mortgage funds for primarily low- and moderate-income people and people purchasing in low to moderate-income communities.

Eligibility and Program Details:

Purchase and Rehab loans

DOWN PAYMENT: None

CLOSING COSTS: None (paid by lender)

INTEREST RATE: One percent below the prime market rate

Current Interest rate:  30 year fixed (as of )

BUY-DOWN: Funds to Permanently Reduce Interest Rate

One percent of mortgage amount reduces interest rate by one quarter of a percent (.25%). This is a tremendous added benefit.

APPLICATION FEE: None (paid by lender)

POINTS & FEES: None (paid by lender)

Lender Grants: Lenders with NACA provide a grant for low and moderate income (“LMI”) homebuyers and those purchasing in LMI communities that matches a down payment with funds for an additional buy-down. You must become a member, attend Home Counseling sessions and the property must be located in a NACA, Urban Designated Housing area to utilize this program. You lso must use a NACA approved lender and Realtor / Broker.

CREDIT HISTORY:

Perfect Credit Not Required

Member’s personal payment history evaluated without consideration of his/her credit score.

P.M.I.: (Private Mortgage Insurance) None

Membership: (Neighborhood Stabilization Fund) None

OTHER TERMS: No yield spread premium; No pre-payment penalty; No balloon payment; No required credit life, or other unnecessary or overpriced insurance.

The Good Neighbor Next Door Program: 

Law enforcement officers, pre-Kindergarten through 12th grade teachers and firefighters/emergency medical technicians can contribute to community revitalization while becoming homeowners through HUD’s Good Neighbor Next Door Sales Program. HUD offers a substantial incentive in the form of a discount of 50% from the list price of the home. In return you must commit to live in the property for 36 months as your sole residence.

How the Program Works: 

Eligible Single Family homes located in revitalization areas are listed exclusively for sales through the Good Neighbor Next Door Sales program. Properties are available for purchase through the program for seven days.

How to Participate in The Good Neighbor Next Door Program: 

Call a HUD- Approved Broker in North Carolina who will help you check the available listings for your state. Follow the instructions from your Realtor to submit your interest in purchasing a specific home. If more than one person submits on a single home a selection will be made by random lottery. You must meet the requirements for a law enforcement officer, teacher, firefighter or emergency medical technician and comply with HUD’s regulations for the program.

Eligibility Details:

This program is only available to Police Officers, Firefighters, EMT’s, and K-12 Teachers.

Those buyers can get a 50 percent discount off the HUD appraised value of a home in specially designated ares. For example, if HUD lists a home at $100,000, you can buy it for $50,000 provided, you occupy the home as your personal residence for the required occupancy period. If you qualify for any FHA-insured mortgage program, your down payment is only $100 and you may finance closing costs.

You must live in the home for 36 months after the purchase.

The program is available for those with cash or using Conventional, FHA, VA financing.

This program can be “stacked” and combined with FHA financing (even with 203 K or 203 B “Rehab” loans.

If the buyer uses and qualifies for FHA financing, they also might qualify for the “$100 Down Payment” plan. Call your Realtor to see what you qualify for and what is available on the market with this $100.00 Down Payment program (areas are limited).

HUD requires that you sign a second mortgage and note for the discount amount. No interest or payments are required on this “silent second” provided that you fulfill the three-year occupancy requirement.

CREDIT REPAIR COUNSELING COMPANY:

In need of credit repair? Our lenders like www.HOPE4USA.com. They are excellent  and very price conscious compared to other similar companies. They are  for-a fee service provider, but used by many major lenders for credit repair, and are very economical compared to other companies.

Here’s a FREE, informative guide for you from Hope 4 USA, so you can start taking steps to rebuild your credit score so you can purchase the home of your dreams:

 http://www.hope4usa.com/free-credit-repair-toolkit

Ready To Start Searching For Your Next Home? See What’s Out There Today!

Start your FREE Home Search today by calling Kristen Haynes at new Home Buyers Brokers at 704-905-4062 or by downloading this new, FREE App on your Smartphone or Tablet!

To Use This 100 % FREE, “Home Scouting” Home Search App:

1. Go to your phone’s App Store and download the “Home Scouting” application.
2. Enter VIP Code: 7049054062 (no dashes).
3. Create your own anonymous User Name And Password- then you can use it to log in on a desktop, too! It’s that easy!

We are also MILITARY FRIENDLY and support our Armed Forces and Veterans!

Contact Us To See What Programs that YOU Qualify For! It’s 100 % Confidential- and it’s always 100 % FREE!

Call:  New Home Buyers Brokers / Realty Pros, Realtors / Brokers in NC / SC: 704-905-4062 or Toll Free: 1-877-372-2252

Do you have further questions about what programs you qualify for? Call or email us, below:

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Brought to you by:

       Kristen Haynes, Broker In Charge, GC, Certified Military Residential Specialist

Direct: 704-905-4062  or Toll Free: 1-877-372-2252

 Email: khaynes@newhomesnc-sc.com

Web: www.NewHomesNC-SC.com

Copyright © 2016 New Home Buyers Brokers / Realty Pros

Lender’s Credit Score Requirements May Be More Strict Than Necessary

Lenders’ Credit Score Requirements May Be More Strict Than Necessary

FICO scores run from 300 to 850. Wells Fargo recently lowered in minimum acceptable scores for conventional loans to 620 from 660. Could this signal the start of some fresh thinking on credit scores? As Realtors, we certainly hope this is the case. As much as stricter credit scoring models were needed after the banking crash in late 2007, credit has been unreasonably tightened to the point that “good borrowers” were still unable to get loans. This includes First Time Home Buyers, the Self-Employed, and Move-Up Buyers who had to switch jobs or careers due to downsizing during the recession.

Are lenders’ credit score requirements for home buyers this spring too high — out of sync with the actual risks of default presented by today’s borrowers? The experts say yes. We agree.

What experts are we talking about here? The actual developers of the credit scores used by virtually all mortgage lenders. Executives at both FICO, creator of the dominant credit score used in the mortgage industry, and up-and-coming competitor VantageScore Solutions, confirmed that mortgage lenders could reduce today’s historically high score requirements without raising their risks of loss. In the process, many prospective buyers who currently can’t qualify might get a shot at a loan approval. This will be a good thing for buyers and sellers alike, and will help keep the housing market going in the right direction.

Consider this: Consumer behavior in handling credit is subject to change over time, often keyed to regional or national economic conditions. Credit scores that were acceptable risks in the early 2000s — say FICOs in the 640-to-680 range — turned into larger-than-anticipated losers when the recession hit. Now that the housing rebound is well underway and federal regulators have imposed tighter standards on income verification and debt ratios, the high credit score “cutoffs” that virtually all mortgage lenders imposed in the scary aftermath of the crash are stricter than necessary.

FICO scores run from 300 to 850. Lower-risk borrowers have high scores, and higher-risk consumers have low scores. Early in the last decade, a FICO score of 700 was good enough for an applicant to get a lender’s best deals or close to it. Today a 700 FICO just barely makes the grade — 50-plus points below the average score for home purchase loans at Fannie Mae and Freddie Mac, the big investors. Banks now need to package and sell their loans on the secondary market, and if a homeowner defaults on the loan and the Underwriter review team finds something potentially amiss, the bank or lender now has to “buy back” the bad loan. Not something lenders want to do in the aftermath of such past, big bank failures due mainly to bad loans.

  

Joanne Gaskins, senior director of scores and analytics for FICO, said that statistical studies by her company have demonstrated that “the risk of default on more recent mortgage vintages is better than at the onset of recession” — essentially real risk has reverted to the early 2000s. A lot more people pay on time. As a result, she said, lenders can afford to “take a look” at their current strict scoring requirements and consider lowering them without sacrificing safety.

To illustrate how consumer behavior has improved, Gaskins cited one internal study that examined mortgage default data through 2011. At a FICO score level of 700 in 2005, roughly 36 borrowers paid their loans on time for every one who went into serious default. In 2011, by contrast, for every one defaulting mortgage borrower, roughly 91 paid on time. That’s a huge decrease in risk to the lender.

VantageScore Solutions has documented a similarly dramatic improvement in mortgage borrower payment behavior. In an article scheduled for publication this week in Mortgage Banking, a trade journal, Barrett Burns, president and chief executive of VantageScore, offers an analysis based on scores of 680 and 620 from 2003 through 2012. VantageScore’s latest scoring model uses a high risk to low risk scale of 300 to 850.

According to Burns, the probability of default at both score levels was lowest in 2003-05, then soared between 2006 and 2008 as the economy began deteriorating. By 2012, both scores were just slightly higher than 2005’s.

Burns notes that although auto lenders and credit card banks have adjusted their underwriting standards to these important changes in borrower risk, “the mortgage industry has been hesitant.” In an interview, Burns emphasized that mortgage lenders could expand home purchase possibilities for large numbers of consumers simply by lowering score cutoffs. They wouldn’t have to loosen up on their standards on down payments or debt ratios — just their scores.

A study last year by the Urban Institute and Moody’s Analytics estimated that every 10-point reduction in mandatory credit scores on mortgages increases the pool of potential borrowers 2.5%. A 50-point cut in score requirements, researchers found, would increase potential home purchases 12.5% — more than 12.5 million households.

At least one major bank has concluded that lowering scores is the way to go. Wells Fargo , www.wellsfargo.com, recently announced reductions in minimum acceptable scores for conventional loans to 620 from 660. They are joining other major banks in lowering the acceptable score threshold for FHA loans to 600. See the article here from Bloomberg News.

Could this signal the start of some fresh thinking on credit scores, a trend that other large lenders will pick up on? Let’s see. If they do so, it should be a win-win for everybody involved.

Copyright  2014 New Home Buyers Brokers, Inc. / Realty Pros. With excerpts from: Kenneth R. Harney, Washington Post Writers Group

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NEW FICO ‘SCORE NINE’ CREDIT SCORING SYSTEM ANNOUNCED, AND AN FHA LOAN MARKET UPDATE

NEW FICO SCORING SYSTEM ANNOUNCED AND FHA LOAN MARKET UPDATE March 18, 2014 Breaking News. FICO has announced that it will release the next broadly available version of the FICO Scoring System beginning this summer. INTRODUCING FICO ‘SCORE NINE”: Using a new, multi-faceted modeling approach, which combines sophisticated in-house analytic technology with insights gained over 50 years of building credit risk models, FICO ‘Score Nine’ will provide the best-in-class predictive power across all of the major credit product lines—home loans, auto loans, credit cards and personal loans—from loan originations, all of the way through managing and servicing the loan. FICO has also addressed lenders’ concerns regarding score consistency across the three major credit bureaus, and compatibility with previous FICO Score versions to ease adoption. The FICO Score continues to help keep lenders aligned with key compliance objectives and relevant government regulations. The FICO Score is the most widely used credit score in North America. Lenders purchased more than 10 billion FICO Scores in 2013, and 90 percent of all U.S. consumer lending decisions use the FICO Score. WHO WILL UTILIZE THE NEW FICO SYSTEM?: The 25 largest credit card issuers, the 25 largest auto lenders and tens of thousands of other businesses rely on the FICO Score for consumer credit risk analysis and federal regulatory compliance. “To become a widely adopted industry standard, a credit score must work well across industries, across all lending product lines and across the entire credit lifecycle,” said James Wehmann, executive vice president of Scores at FICO. “The major changes in the lending environment over the last few years demanded that we take a different approach to building a score that will continue to perform consistently well in various situations. We devised an innovative approach to developing FICO Score Nine that enabled us to leapfrog our own industry-standard benchmark. Our goal is to continue to support a financial ecosystem that includes lenders, securitization investors, rating agencies, regulators and other stakeholders who need a common risk benchmark.” Source: NAMP Daily – www.nampdaily.com HOMEPATH AND HOME STEPS OFFER FREE CLOSING COSTS AND OTHER INCENTIVES: Government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac recently introduced new incentives to bolster home sales through their HomePath and HomeSteps programs, respectively, which are designed to help the firms liquidate the real-estate owned (REO) properties they hold in their portfolios. Specifically, Fannie Mae is offering up to 3.5% in closing cost assistance on HomePath properties available in 27 states during the FirstLook period. During the FirstLook period, owner-occupant or public entity buyers are able to submit offers on HomePath properties, giving them the opportunity to purchase homes without competition from investors. Fannie Mae recently announced the extension of the FirstLook period from 15 days to 20 days. To be eligible for the incentive, the initial offer must be submitted between now and March 31, 2014, so there’s not a lot of time left to utilize this program (unless it’s extended). Homes using this incentive must also close on or before May 31, 2014. The incentive will offer qualified buyers up to 3.5% of the final sales price to pay closing costs. In addition, home buyers have a choice of $500 incentives they can use towards condominium association dues, flood insurance premiums or the home warranty of their choice. To qualify for these additional incentives, the closing must settle on or before May 30, 2014. The promotion does not apply to investor purchases, auction sales, sealed-bid sales and bulk sales, Freddie Mac reports. Source: MortgageOrb, www.mortgageorb.com For a list of available properties, call your local Realtor or go to: http://www.homepath.com.   AN FHA UPDATE AND PREDICTIONS FOR THE UPCOMING YEAR: Following the first-ever Treasury draw required by the Federal Housing Administration this year, the agency says it is back on stable footing and does not anticipate requiring Treasury assistance in fiscal year 2015. As reflected in the Obama Administration’s proposed budget for the coming fiscal year, both FHA’s forward and reverse lending programs are expected to be cash flow positive with the Home Equity Conversion Mortgage program anticipated to have a negative subsidy rate at -0.23%. A positive credit subsidy indicates the program would require cash to cover losses. In this case, however, the HECM program is expected to perform on its own, slightly above its break-even point. The earlier bailout to the tune of $1.7 billion was largely attributed to losses in FHA’s reverse portfolio. “The budget estimates the Mutual Mortgage Insurance Fund will have a positive capital reserve balance of $7.8 billion,” said FHA Commissioner Carol Galante of the entire fund outlook following the budget release. “We will not require a mandatory appropriation from the Treasury this year.” FHA touted its performance and positive outlook in the coming year, pointing to achievements such as reducing chronic homelessness by 16% and assisting 450,000 homeowners facing foreclosure through loss mitigation assistance in the midst of last year’s budget sequester. “This is more remarkable given the context in 2013,” Housing Secretary Shaun Donovan said. “Given the sequestration that cut across the entire federal government budget, HUD was faced with finding ways to cut 5% from our budget with very little time to prepare and just seven months left in the fiscal year. We made some extremely difficult choices. We’re proud of what we did to provide best possible outcomes.” Source: Reverse Mortgage Daily – www.reversemortgagedaily.com Congress’s lack of progress on reforming the U.S. housing-finance system shouldn’t be “an excuse” to delay rebuilding the market for private-label mortgage securities, a senior U.S. Treasury Department official said recently. “Many investors have told us that they can and want to take mortgage credit risk,” said Michael Stegman, housing-finance counselor to the Treasury secretary, in prepared remarks at a research conference in New York. Adding simplicity and transparency is a key first step, he said. “To get back to an efficient, responsible, and sustainable level of complexity, and to rebuild trust, the new issue non-agency market must first follow a path of greater standardization and transparency,” Stegman said. Federally controlled buyers Fannie Mae and Freddie Mac have been in a conservatorship since 2008, an arrangement that has lingered with U.S. lawmakers disagreed over the appropriate role for government in housing finance. Source: Market Watch – www.marketwatch.com. EASIER QUALIFYING EXPECTED FOR FHA MORTGAGE BORROWERS: First-time and low-income borrowers may have an easier time qualifying for a Federal Housing Administration loan. Ginnie Mae, a government agency that issues bonds backed by FHA loans, reports that the average credit score on FHA-backed loans fell to 680 in 2013, and the average debt-to-income ratio rose to 40.3 percent — both indicators that credit may be easing. In comparison, Ginnie Mae reported in January 2013 that the average score was 701 and the debt-to-income ratio was 38 percent. “The FHA theoretically allows scores as low as 580,” the L.A. Times reports. “But lenders, buffeted by defaulted loans and demands that they buy back troubled loans that they sold, generally have set standards higher since the financial meltdown.” Source: The Los Angeles Times – http://www.latimes.com A Note from Kristen: Actually FHA allows scores down to 500, but requires a down payment of 10% below 580. But many lenders do not want to underwrite loans under 640 (580 is the absolute minimum I have seen here in Charlotte, NC, and those loans also come with higher loan origination fees and interest rates). While many lenders have lowered minimum scores, FHA’s quality assurance initiatives ensure that lenders will still be underwriting their files under a microscope and looking at the loans carefully, because lenders now have to buy back their “bad” or defaulted loans if any errors are found in the original underwriting process.  Copyright © 2014 Realty Pros / New Home Buyers Brokers, Inc. Kristen Haynes, Broker In Charge, GC, CMRS  Web: www.NewHomesNC-SC.com         Name(required) Email(required) Website Comment(required) Submit Δ