Remember if you go into contract by April 31st 2010 you get a $8,000 tax credit from the IRS. This is really an amazing once in a lifetime type of deal. You literally get a $8,000 check from the IRS. And if you are VA eligible you can get a VA loan with 100% financing.
One item to remember is that you have to live in the property for 36 months as your primary residence or your have to pay the tax credit back. However there are certain exceptions. If you are a military member and you are transferred to a different part of the county within the military, you may be exempt from this rule.
Also, you must have not owner a primary residence in the last 3 years to qualify for the full $8,000 credit. But even if you currently do own your primary residence and you are buying a new home, you can still qualify for a $6,500 tax credit.
Just think with a zero down 100% financing VA loan you can actually get a check for $8,000 to buy. You can actually make $8,000 by buying. This could be used to pay down debt, furnish your property, make improvements such as remodeling a kitchen or bathroom, or just put in the bank!
So if VA loan benefits and can get a VA loan, you may want to consider looking into it. Some advantages to VA loans:
- VA is the only major 100% financing, zero down home financing option available today
- VA loan credit scores do not have to be perfect to get the best VA interest rates
- Interest rates VA loans are STILL at historic lows
- VA loan limits in California cities like San Jose, San Francisco, Los Angeles, San Diego and more can get up very high to above $800,000 with zero down
- The guidelines to qualify VA loan are much more flexible than conventional and FHA loans
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions or want to apply for a VA loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and VA specialist)
858-922-7899
Important Item About $8,000 Tax Credit for VA Borrowers is a post from: VA,FHA and Conventional Loans 858-922-7899
FHA has announced few recent changes in the underwriting guidelines to qualify for a FHA loan and some changes with the FHA PMI (mortgage insurance).
1. Starting April 2010, FHA will require borrowers with credit scores less than 580 to put 10% down to qualify for a FHA loan.
This change will not have a major effect as there are not many FHA loans being approved with scores below 580 at this time anyway. As long as your credit score is above 580, you can still have the minimum FHA loan down payment of 3.5%. The best FHA loan interest rates and easiest/fastest loan process are for those FHA borrowers with credit scores of 620 or higher. If your credit score is below 620, give me a call as I will go over your credit with you and give you analysis as to how you can quickly raise your credit score.
2. Starting April 2010 the FHA loan up front mortgage insurance (UFMI) will increase from 1.75% to 2.25%.
This FHA mortgage insurance is paid to FHA to help insure FHA loans against default. This change affects all FHA borrowers who put down the minimum 3.5%. The FHA UFMI is rolled into the new loan balance so it is not paid out pocket (unless you elect to pay it out of pocket). So for example on a $300,000 loan, the old FHA up front mortgage insurance would have been $5,250, making your new loan balance at close $305,250. Starting April 2010, the FHA mortgage insurance on a $300,000 loan will be $6,750, making your loan balance at close $306,750. Talk to your CPA at close at this entire up front mortgage insurance may be tax deductible for you.
3. Starting April 2010, FHA will reduce the amount a seller can credit the buyer for closing costs in a FHA purchase loan to 3% from 6%.
Often when you purchase a property you can ask the seller to pay some or all of your closing costs. Starting April 2010 the maximum the seller will be able to credit you is 3%. The FHA is adding this rule to prevent sellers from inflating their prices so they can make large credits to buyers.
Some general highlights of FHA loans:
- FHA loans in California (certain counties) can go all the way up to $729,750
- FHA loan credit scores do not have to be perfect
- Conventional loan vs FHA…most conventional loans require 10% down and have much stricter credit score requirements and conventional loans require a 41% debt-to-income ratio with <20% down where FHA loans have a 56% debt-to-income ratio
- FHA loan interest rates are at historic lows STILL!
- You can still get a $8,000 tax credit from the IRS if you sign a contract to purchase by April 31st 2010
- FHA loan down payment is only 3.5% and ALL of that can be a gift from a relative
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions at all about getting approved for a FHA Loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and FHA specialist)
858-922-7899
If you are a VA eligible borrower you may want to take advantage of today’s incredible home prices in California and rent out your current primary residence and buy a new home to live in with a 100% financing VA loan. Remember, if you currently have a VA loan on your current home, you can’t get a second VA loan until that current VA loan is paid off. But if you do not have a VA loan and you are eligible for VA lending, what a great opportunity to use your VA benefits and buy a home with 100% financing at today’s bargain prices in California.
Here’s how it works. VA lending guidelines are very special in that they allow the VA borrower to use a lease on their current home to offset the housing payment to qualify VA loan. So if you current house payment is $2,500/mo and you can lease it up for $2,000, generally you can use 90% of that $2,000/mo lease amount to offset the $2,500 housing debt. And it will have to make sense to the VA underwriter that you plan to live in the new house. If you are moving from a very large house to a very small house they may question that. Or if you are moving further away from work they may question that. It has to make sense.
FHA loans and conventional loans are much more stringent. If a borrower wants to rent out their current home to buy a new home, they must have at least 25% equity in the home in order to count the proposed rent to help qualify for the new loan. So basically, unless they have 25% equity, they must qualify for the new FHA or conventional loan with BOTH housing payments. This is very difficult for most. But VA borrowers are very lucky in that VA does not have this 25% equity rule.
So take advantage of today’s low prices in California and get a California VA home loan on a new house you plan to occupy.
Some great advantages of VA loans:
- Maximum VA loans and jumbo VA loan up to $962,500 in the San Francisco Bay Area Counties, $593,750 Los Angeles, $437,500 San Diego, $593,750 Orange County (feel free to call for your county limit)
- VA loan credit score can be as low as 600 for 100% financing, you don’t need perfect credit
- VA loan interest rates for 30 year fixed loans STILL at historic lows
- VA lending has the most generous debt-to-income ratios – VA loans can allow upwards of 55% ratios where conventional with <20% down is 41% with min 720 credit
- Second VA loan (and third, fourth, etc…) available if you have paid off your first VA loan
- 100% financing on VA loans and the seller can pay all your closing costs, so you can buy with almost zero out of pocket
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions or want to apply for a VA loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and VA specialist)
858-922-7899
Renting Out Your Current House and Get a VA Loan On a New House in California is a post from: VA,FHA and Conventional Loans 858-922-7899
With current FHA loan guidelines, a borrower cannot qualify for a FHA loan unless that property has been owned by the seller for more than 90 days. So if an investor buys a property and fixes it up, they have to wait until the 91st day after they took ownership to go into contract with a FHA buyer. But now FHA has changed this rule and there is now no time limit a seller must have owned a property to qualify FHA loan.
This is a very good change for getting FHA loans in California and being able to get your purchase offer accepted. Many sellers were choosing to accept purchase offers with conventional loan vs FHA because of this rule. There are many investors in California that are purchasing properties at foreclosure trustee sales for cash and fixing them up to sell on the market. This represents a lot of the inventory available in the market right now. This rule change will help FHA borrowers be competitive against buyers making all cash offers and conventional loan offers.
This rule change takes affect February 1st 2010. FHA still will have some rules around flipping properties such as:
- All transactions with seller owing less than 90 days must be arms-length. No indentity of interest between buyer and seller or other parties participating in the transaction
- In cases where the sales price is 20% above the sellers original acquisition price and the seller purchased less than 90 days ago, the property must meet specific conditions
This rule change you help buyers out there be much more competitive to get an FHA home loan in California.
Some other great highlights of FHA loans in California below:
- Maximum FHA loan in many parts of California is $729,750
- FHA loan approval with up to 56% back end debt-to-income ratios (conventional loans with <20% down have a 41% max debt-to-income ratio)
- FHA loan interest rates fixed for 30 years STILL at historic lows
- FHA loan credit score does not have to be perfect
- FHA loan down payment is only 3.5% and that can be a gift from a relative (conventional minimum down is mostly 10% and you need a 720 credit score and 41% debt ratio)
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions at all about getting approved for a FHA Loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and FHA specialist)
858-922-7899
When you get a VA loan to purchase a house the great thing is your are getting 100% financing, there is no down payment. This is the #1 of many VA loan benefits available only to veterans and active military. There is no other mainstream loan available that is 100% financing no money down.
However, when you get a VA loan to purchase a home, there are still closing costs to be paid. These VA loan closing costs are items such as:
- Escrow fees
- Title insurance
- Home insurance premium
- Property tax reserves collected by the lender
- Interest for the remainder of the month your are closing in
- Lender fees
- Appraisal fees
- Home inspection fees
First off, one great thing with VA lending is that when you get a VA loan, the seller must pay the escrow fee and the lenders processing and underwriting fee. Those are fees the VA borrower is not allowed to pay. However, there are still a significant amount of closing costs that remain that will have to be paid before closing on your house. Sometimes as much as 2-3% of the loan amount. There are still some ways to get around having to come out of your own pocket for closing costs. The #1 best way is to ask the seller to credit you 3% of the purchase price for closing costs. You can work with your real estate agent to write this into your purchase offer. If you can negotiate this, then you can have a no money down 100% loan AND not have to pay ANY closing costs! The nickname for this loan is the VA “no-no”. No money down, no closing costs.
Some other nice advantages of VA homeloans:
- To qualify for a VA Loan credit does not have to be perfect, even if you think you have bad credit you may still qualify for a VA loan
- 100% financing with VA lending – VA offers the only zero down loans today
- VA loan interest rates are at historic lows – the U.S. Government is artificially pushing down rates to stimulate the economy so take advantage of it while you can!
- $8,000 home buyer tax credit available until April 2010!
- VA homeloans allow the seller to credit you for all of your closing costs – so this + 100% financing means you can buy with almost no money out of pocket
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions or want to apply for a VA loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and VA specialist)
858-922-7899
How to Get Around Closing Costs When You Get a VA Loan To Purchase in California is a post from: VA,FHA and Conventional Loans 858-922-7899
Below are the maximum FHA loan amounts for the larger cities in California. These are the highest loan amounts you could go to in purchasing a home with a FHA loan in California. 1 unit refers to a condo or single-family home, 2 unit refers to a duplex, 3 unit a triplex and 4 unit a fourplex.
- FHA loan San Francisco: 1 unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- FHA loan San Jose, Oakland, Fremont, Hayward: 1 unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- FHA loan Los Angeles: 1 unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- FHA loan Sacramento: 1 unit $580,000, 2 units $742,500, 3 units $897,500, 4 units $1,115,400
- FHA loan Santa Ana, Irvine, (Orange County): 1 unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- FHA loan Riverside, San Bernardino, Ontario: 1 unit $500,000, 2 units $640,100, 3 units $773,700, 4 units $961,550
- FHA loan San Diego:1 unit $697,500, 2 units $892,950, 3 units $1,079,350, 4 units $1,341,350
- FHA loan Fresno: 1 unit $381,250, 2 units $488,050, 3 units $589,950, 4 units $733,150
- FHA loan Santa Barbara: 1 unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- FHA loan Santa Cruz, Watsonville: 1 unit $729,750, 2 units $934,200, 3 units $1,129,250, 4 units $1,403,400
- FHA loan Redding: 1 unit $423,750, 2 units $542,450, 3 units $655,700, 4 units $814,900
- FHA loan Vallejo, Fairfield: 1 unit $557,500, 2 units $713,700, 3 units $862,700, 4 units $1,072,150
- FHA loan Santa Rosa: 1 unit $662,500, 2 units $848,100, 3 units $1,025,200, 4 units $1,274,050
So those are the maximum FHA loan for various cities in California. If you don’t live in one of these area and would like to know the FHA max loan for your area, just give me a call or email. Remember if you buy a 2, 3 or 4 unit property and occupy one of the units as your primary residence, you can use the rental income from the other units you don’t occupy as income to qualify.
And here are some highlights to remember about FHA loans:
- To get a FHA loan credit score does not have to be perfect
- FHA loan interest rates are at historic lows
- You can use gift funds for FHA loan down payment
- Maximum FHA loan is $729,750, so you can get a FHA loan in expensive parts of California like Los Angeles, San Jose, San Francisco and San Diego
- Debt-to-income ratios on FHA loans are allowed up to 55% where conventional loans require 41% with less than 20% down
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions at all about getting approved for a FHA Loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and FHA specialist)
858-922-7899
The USDA (United States Department of Agriculture) Home Loan is a very little known 100% financing home loan available to people buying homes in rural areas of California and the rest of the U.S. This is another option for those who qualify for VA loan, but may already have a VA in place and need another 100% financing solution (you can only have one VA loan at a time). There are many locations that are surprisingly considered “rural” according to the USDA. Even locations that are less than one hour from major California cities such as San Diego, Los Angeles, San Francisco, Fresno, Riverside, and San Jose. The USDA home loan program is really a tremendous loan program that not many home buyers utilize because they just plain haven’t heard about it!
Some highlights of USDA Home Loan:
- 100% financing, ZERO down payment needed
- No monthly mortgage insurance (unlike FHA and conventional loans (with <20% down) that carry monthly mortgage insurance
- Excellent 30 year fixed interest rates at historic lows
- You do not have to be a first time buyer to qualify for a USDA loan
- Seller can pay for all your closing costs
Here are some additional requirements of USDA Home Loans:
- Your income needs to be within 115% of the area median income
- A USDA loan is only allowed on your primary residence
- USDA loans are for purchases only, not refinances
Below are some selected areas in California that qualify for USDA Loans. This is not an exhaustive list, just a sampling:
San Diego County
- Alpine, Ramona, Valley Center, Campo, Julian, Rainbow, Pauma Valley
Riverside County
- Desert Hot Springs
- Coachella
- Sun City
- Winchester
- Idyllwild
San Bernardino County
- Lake Arrowhead
- Big Bear
Imperial County
- Almost the entire county
Sonoma County and Napa
- Windsor, Healdsburg, Guerneville, Calistoga, St. Helena, and much more
Contra Cost, Alameda, Solano
- Byron, Rio Vista, Isleton
Placer, Sacramento, San Joaquin, El Dorado
- Lincoln, Auburn, Ripon, Lathrop
Central Valley Counties
- Tehachapi, lots of the towns surrounding Bakersfield, Fresno, Modesto, Merced, Redding and more qualify
Monterrey, Santa Cruz, San Luis Obispo, Santa Barbara, Ventura
- Boulder Creek, Scotts Valley, Moss Landing, Prunedale, San Juan Bautista, Paso Robles, San Miguel, Morro Bay, Solvang, Santa Ynez, Carpentaria, Ojai
So if you already have a VA loan on one property and you would like to get 100% financing, inquire about 100% USDA financing.
So give us a call or email today if you have any questions about USDA Rural Development Home Loans. Direct 858-922-7899 and email rob@affinity-financial.com.
Warm Regards,
Rob Chomentowski
Sr. Loan Officer
858-922-7899 (direct)
USDA Home Loans Only Other 100% Financing Available Besides VA Loans is a post from: VA,FHA and Conventional Loans
Many economists and prognosticators in the business world are predicting that FHA loan interest rates, as well as conventional loan (and all mortgage interest rates) could rise in 2010. Prognosticators have been wrong so many times at predicting the direction of interest rates so you have to take what they say with a grain of salt.
Most of the people in the business world predicting a rise of rates in 2010 are basing their argument that the Federal Reserve is going to stop purchasing Mortgage Backed Securities in March 2010. The Fed has been buying billions in MBS over the last year in an effort to stimulate the U.S. economy. The general thinking is the Fed has been artificially holding down 30 year fixed interest rates to artificially low levels around 5% and below 5% the past year. If the private market has to step in and buy MBS after March 2010, many believe rates will have to rise in order to attract these investors. How high they will need to rise is anyone’s guess. Possibly to 5.5% or 6%, but no one really knows for sure. And it’s not a given they will rise at all. Depending on the direction of the economy, who knows the Fed could extend their buying program. Much depends on the direction of the economy. One thing is pretty much for sure though, if we get a lot of good news about the economy in 2010, the FHA loan interest rate on the 30 year fixed will rise. Because not only will the Fed stop it’s purchasing program, speculation will start rising that the Fed will raise interest rates to keep inflation in check. When the Fed raises the Federal Funds Rate, it generally causes 30 year fixed mortgage rates to rise.
Here are some payments on a $300,000 FHA loan with different interest rates:
4.75% rate $300,000 loan=$1,564/mo
5.25% rate $300,000 loan=$1,656/mo
5.5% rate $300,000 loan=$1,703/mo
6% rate $300,000 loan=$1,798/mo
And here are some highlights to remember about FHA loans:
- To get a FHA loan credit score does not have to be perfect
- FHA loan interest rates are at historic lows
- You can use gift funds for FHA loan down payment
- Maximum FHA loan is $729,750, so you can get a FHA loan in expensive parts of California like Los Angeles, San Jose, San Francisco and San Diego
- Debt-to-income ratios on FHA loans are allowed up to 55% where conventional loans require 41% with less than 20% down
Give me a call (858-922-7899) or email (homeloan8@gmail.com) if you have any questions at all about getting approved for a FHA Loan.
Warmest Regards,
Rob Chomentowski
Sr. Loan Officer (and FHA specialist)
858-922-7899