Amy Swaney, CMB ~ Citywide Home Loans ~ NMLS#209752 ~ BK#0116254

Saturday, April 24, 2010

Short Sales and Future Borrowing Capacity, Financial Vocabulary, and Feeling Mavericky!

“A government that is big enough to give you all you want is big enough to take it all away.” ~Barry Goldwater


FNMA Updates the Future Eligibility of Borrowers After a Pre-Foreclosure Event

In an April 14, 2010 Selling Guide Update, FNMA reports, “To support overall market stability and reinforce the importance of borrowers working with their servicers when they have difficulty repaying their debt, FNMA is updating policies regarding the future eligibility of borrowers to obtain a new mortgage loan after experiencing a preforeclosure event.” A preforeclosure event is defined as a preforeclosure sale, short sale, or deed-in-lieu of foreclosure.

As of July 1, 2010 all loans sold to FNMA must document that the borrower has met the minimum required waiting period to be eligible for a mortgage loan after a preforeclosure event. The waiting period commences on the completion date of the preforeclosure event, and will vary based on the maximum allowable LTV and CLTV ratios and occupancy of the property.

Preforeclosure Event        Waiting Period for New FNMA Loan
Preforeclosure Sale            80% LTV – 2 Years
Short Sale                         90% LTV – 4 Years

Deed in Lieu                     Maximum LTVs per Loan Product – 7 Years

Preforeclosure Event
w/Extenuating
Circumstances*                   Waiting Period for New FNMA Loan
Preforeclosure Sale           90% Maximum LTV – 2 Years
Short Sale
Deed in Lieu

* Extenuating circumstances are nonrecurring events that are beyond the borrower’s control that result in a sudden, significant, and prolonged reduction in income or a catastrophic increase in financial obligations. If a borrower claims that the event is the result of extenuating circumstances, the lender must substantiate the borrower’s claim. Examples of documentation that can be used to support extenuating circumstances include documents that confirm the event (such as a copy of a divorce decree, medical reports or bills, notice of job layoff, job severance papers, etc.) and documents that illustrate factors that contributed to the borrower’s inability to resolve the problems that resulted from the event (such as a copy of insurance papers or claim settlements, property listing agreements, lease agreements, tax returns (covering the periods prior to, during, and after a loss of employment), etc.). The lender must also obtain a letter from the borrower explaining the relevance of the documentation. The letter must support the claims of extenuating circumstances, confirm the nature of the event that led to the bankruptcy or foreclosure-related action, and illustrate the borrower had no reasonable options other than to default on their financial obligations.

Speaking Financial
When you turn on the news…admit it you still watch the news…do you feel like you must have been missed that day in school when they taught Economics and the Financial Markets? More and more often so many of the stories require a dictionary to understand, so I thought I would give you a down and dirty guide to recent terms you may have heard relating to the financial industry so you will be able to impress your friends (or more importantly understand your friends) in your next cocktail party conversation.

Derivatives: An asset that derives its value from another asset, also known as the “underlying’ asset. A derivative is a financial instrument or in simple terms, an agreement between two people or two parties, that has a value determined by the future price of something else. Think of a derivative as a bet on the price of something. For example, you might bet your friend on the price of a gallon of gasoline. If the price in one year is less than $3.00 a gallon, your friend must pay you $1. If the price is more than $3.00 a gallon, you must pay your friend $1. Therefore, the underlying in the agreement is the price of a gallon of gas and the value of the agreement to you depends on that underlying.

Hedge: A position established in one market in an attempt to offset exposure to price fluctuations in some opposite position in another market with the goal of minimizing one's exposure to unwanted risk. The market values of crude oil fluctuates constantly as supply and demand for it varies. If you ran an small commercial airline and knew that the price you must charge for your flights were based upon the price of jet fuel, so you forecast what the price will be in the future. If the price of jet fuel drops, you stand to make a lot of unexpected money, but if the actual price increases, you could be ruined. Airlines use “futures contracts” and “derivatives” to “hedge” their exposure to the price of fuel. The futures contract is an agreement to buy certain crude oil at a certain date in the future for a certain fixed price. You have “hedged” your exposure to gasoline prices; thus you no longer care whether the current price rises or falls, because you have a guaranteed a price in the contract. Airlines know that they must purchase jet fuel for as long as they want to stay in business, and fuel prices are notoriously volatile. By using crude oil futures contracts to “hedge” their fuel requirements Southwest Airlines was able to save a large amount of money when buying fuel as compared to rival airlines when fuel prices in the US rose dramatically after the 2003 Iraq war and Hurricane Katrina.

The Wonderful World of Politics

I’m back from DC and learned a lot. We even had the chance to meet with the Maverick himself. Read the details of my trip by subscribing to my blog www.amyswaneycmb.blogspot.com.

A man was walking down the streets of Washington DC one night. All of a sudden a mugger sticks a gun in his ribs and says. Give me all your money.
He replied, "Do you realize I am an important member of congress?"
The robber said, "In that case give me all MY money!

I want to be the lender of choice for your customers so if I can be of assistance to you or your clients, please feel free to contact me at amy@amyswaney.com

Sunday, April 18, 2010

When Your Day Starts with a Maverick and Ends with a Flake

I have this completely dysfunctional relationship with Washington DC.  As much as politics enfuriate and disgust me, I am completely drawn like a moth to the flame of the amazing power that this city and its inhabitants posess.  My fascination of the history here is only thwarted by the fascination of the history being made here. As I return home to Arizona, I have had the opportunity to reflect upon the experiences of the week, process the overwhelming amount of political stimuli I was subjected to and focus my thoughts to the enormous battles we face as an industry trying to eradicate ourselves from the massive mistakes of the past.

The education packed week began with the Certified Mortgage Banker (CMB) Society Meeting and a tremendous presentation by HUD's Single Family Program Director, Meg Burns, who dispelled many of the journalistic myths about FHA.  She began with the topic of FHA's financial health.  As FHA has been pushed to the forefront in the financial crisis, with it's market share exploding from less than 5% to more than 30% of the business in the blink of an eye, it's mandated 2% capital requirement was not met.  The press has blamed this on increased defaults and has spread fear of a threat to the insurance fund.   The truth is that as FHA's portfolio has grown, so has the amount of the mandated capital reserve requirement.  The reports of  a significant increase of defaults has also not been accurately reflected in the press to account for the year over year increase in sheer volume.  In fact, the credit quality of FHA's portfolio has significatly increased over prior years by almost a 50 points in average FICO scores.  FHA has addressed the need to increase capital reserves by recently implementing an increase in the Up-Front FHA MIP from 1.75% to 2.25%.  They are also supporting the FHA Reform Bill which would allow them to increase the annual (monthly) premium and reduce the up front premium. 

I was also able to hear from several key members of Congress.  Rep. James E. Clyburn (D-SC), who's role as the Majority Whip is to track the sentiment among party members for key legislation supported by the party's leader, spoke about understanding the difference between a bi-partisan bill and a bi-partisan vote.  Both Rep. Paul Kanjorski (D-PA) and Senator Bob Corker (R-TN) spoke specifically to the topic of the massive regulatory reform bills being passed between the House and the Senate.  Rep. Kanjorski, who chairs the House Sub-Committee on Capital Markets, Insurance and GSE's, spoke about the need to implement what has become known a as the Volcker Rule.  This proposal was initiated by Economist and former Federal Reserve Chairman Paul Volcker to prohibit a bank or institutions that owns a bank from engaging in proprietary trading that isn't on behalf of its clients.  It would also prohibit a bank from owning or investing in a hedge fund or private equity fund, as well as limits the liabilities that the largest banks could hold. 

Senator Corker who sits on the Senate Banking Committee spoke of his experiences of working with Chariman Dodd to create a bi-partisan regulatory reform bill but was "left at the alter" so to speak, when the Democrats pulled the plug on bi-partisan work to consummate a bill that would quickly make it out of committee.  “It is pretty unbelievable that after two years of hearings on arguably the biggest issue facing our panel in decades, the committee has passed a 1,300-page bill in a 21-minute, partisan markup. I don’t know how you can call that anything but dysfunctional,” were Senator Corker's sentiments.  His main concerns for the senate bill fall into three areas, 1) lack of consumer protection, 2) poor underwriting in the past has only been addressed through risk retention rules that limits the leverage that the secondary market provides and 3) the fact that risk retention is a good soundbite but it will shut down liquidity in the market.  The Senate bill is expected to be put to a floor vote as soon as the end of this month.

Finally, the Assistant Secretary for Financial Institutions for the US Treasury, Michael Barr commented on comprehensive financial reform.  Currently, there are 7 different agencies that regulate the mortgage process, it is Mr. Barr's opinion that there needs to be a strong regulatory body to fill in the gaps of the fragmented oversight.  He also feels that additional regulation is required of the financial markets to address the derivative market and contain swaps, an investment equivalent of the "Don't Come" line bet in craps.  He thinks regulatory reform needs to also address the concept of "Too Big to Fail" with regulation in place to break down entities that can be sold off, if they are not compliant.  This is something that would be paid for by fees assessed to the companies by the government. 

Mr. Barr also proposes that lending institutions need "skin in the game" and explains that they must have risk retention to avoid making "risky" loans.  None of this is to overshadow individual state regulation but add a federal standard "floor" that would allow states to regulate above and beyond.

It only took listening to Assistant Treasury Secretary Barr to get my passions riled enough to spend the entire next day raising awareness and the mortgage industry's concerns with 7 of the 10 Arizona political leaders in DC.  In full campaign mode, John McCain wlecomed us with similar concerns over the far-sweeping Senate Regulatory Reform Bill as did the representatives from Jon Kyl's office.  On the House side, revenue concerns were raised with the tax credit extension as well as an additional extension for the private mortgage insurance deduction which will sunset this year.  Ending the day, we met with Rep. Jeff Flake, who is one of my personal favorites, to review the concerns with HR 4173, the reform bill that is so fully supported by the administration and the Treasury (at least Mr. Barr from the Treasury) and elicits tremendous concerns for me. 

My anxiety is that of Risk Retention and the antecdotal message of "skin in the game."  Ask any mortgage banker and they will tell you, we already hold skin in the game through buy-backs, reps and warrant requirements of lenders, FNMA/FHLMC and our warehouse lenders.  Although this is presented as a risk control measure for risky underwriting decisions in the secondary market, it is blanketed to ALL mortgage lenders.  New rules from the banking regulators and the SEC will require creditors to retain at least 5 percent of the credit risk associated with any loans that are transferred, sold or securitized.  Thus a mortgage origination entity must capitalize 5% of their originations.  In lay terms, if a locally owned mortgage company originated $1,000,000 in loans in a month, they must have $50,000 held aside.  $10,000,000 a month would need $500,000 for risk retention.  This is in addition to all the capital reserve, net worth and regulatory requirements already in place.  Not only will that force most, if not all, independent mortgage lenders out of the business, it will create another liquidity crisis for the large depository lenders as there will be additional capital will be required.  How do you think that capital will be raised? By increasing the required profit for each loan which translates into much higher costs to the consumer.  Many see this as a massive move to eliminate competition by the big banks, but I feel that the banks will suffer as well.  Just imagine your only option for a loan being Wells Fargo or Bank of America.

The other fear is the creation of one more entity created to monitor and regulate the mortgage industry.  There are already 7 regulatory bodies who impact our business and the lack of communication and cooperation between them has already damaged our economy.  The time, energy and cost that a new organization would generate does not fix the problem of the regulatory enforcement deficiencies that we have.   As Rep. Marsha Blackburn expressed this morning on "Meet the Press", the Goldman Sachs lawsuit is a prime example of what went wrong in our country.  What Goldman is accused of was a violation of CURRENT regulatory law of which is overseen by the SEC.  We already have too many regulators not enforcing the already complicated patchwork of laws that we have, and the fix is to add another regulator?

I understand the concern of "Too Big to Fail." We certainly don't want to bail out any more corporate entities with taxpayer money, however, creating a reserve in which banks must pay fees to fund ultimately has the consumer paying that expenditure anyway through increased fees and costs passed along by the banks.  I would agree to keep the requirement that says "Be a Bank or Be a Hedge Fund, it's your choice but you can't be both."  Just don't try to fools us simple consumers that it won't cost us any money. 

I will wrap up by repeating what I predicted in an article for AAR in February, the landscape of real estate finance in the future has not yet been finalized.  The decisions that are made in Washington DC today and in the near future will determine how it will look.  My commitment to being a voice for my industry, my customers and myself is once again solidified through my exasperation of the political process.  I can't reiterate enough the importance of individual involvement.  Don't let your future be determined by those like Michael Barr who wish say "I'm with the government and I am here to help."

I want to be the lender of choice for your customers so if I can be of assistance to you or your clients, please feel free to contact me at amy@amyswaney.com

Saturday, April 10, 2010

Sim Plify, Do You Have An Opinion on HVCC and Real Estate from A-Z

Sim Plify

You may have attended one of the many GFE/HUD-1 Classes that I have presented throughout the state and heard me talk about a cute and crafty sign in my sister’s house that says, “Sim plify” (SIM Pliffy). When asked about what that meant, she stated “Well, only I could expand (increase) “simplify””. I, of course, disagree. The government does a DARN GOOD job of it themselves.

In an additional effort to simplify the already confused topic of the new “Good Faith Estimate” HUD has once again expanded the guidance to lenders of how to comply with RESPA by releasing their April 2, 2010 revision to their FAQ’s making the grand total 62 pages…so far. Can you say, “Con Fusion?”The topic of Preapprovals and Preapproval Worksheets were one of the biggest changes. A warning for the faint of heart, the language used in the following paragraph many be confusing, perplexing, baffling and downright bewildering. Below is the additional guidance issued in the HUD FAQ’s.

"The following…address preapprovals. For the purposes of these questions, a preapproval is a document issued by a lender stating that a consumer qualifies for a specific loan amount. A preapproval is intended to assist a consumer who is shopping for a house by enabling the consumer to enter into a purchase contract that does not contain a financing contingency." (What???...Sorry, I digress)

"A preapproval is never to be used as a substitute for a GFE. If an applicant has chosen a property to purchase and the loan originator is willing to qualify the applicant for a specific loan amount, then a loan originator should issue the applicant a GFE that facilitates shopping for a loan, not just a preapproval used to shop for a property. For example, a lender may never issue only a preapproval to an applicant seeking to refinance his or her loan; the lender must also issue a GFE."

33) Q: Can a loan originator provide a GFE without a property address?

A: Yes, a loan originator can determine that a property address is not one of the required pieces of information that the loan originator needs in order to issue a GFE. It is important to note that a loan originator must consistently apply its policy on the information it deems necessary to issue a GFE, and the RESPA rule requires a loan originator to issue a GFE whenever it receives information sufficient to complete an application for a GFE. As a result, if a loan originator received an application for a preapproval and that application included all of the pieces of information that the loan originator requires to issue a GFE, the loan originator must issue a GFE and all of the rules that govern the GFE process would apply. In addition, if a GFE is issued without a property address, the future receipt of the property address is not a changed circumstance that would allow the loan originator to issue a revised GFE.

WAIT A MINUTE!!! So now doesn’t that directly contradict the previous FAQ’s numbers 4, 23 and 24?

4) Q: When does a loan originator have to issue a GFE?

A: A loan originator must issue a GFE no later than 3 business days after the loan originator receives an application or information sufficient to complete an application. Application is defined as the submission of a borrower‘s financial information in anticipation of a credit decision relating to a federally related mortgage loan, which shall include the following: (1) borrower‘s name, (2) borrower‘s monthly income; (3) borrower‘s social security number to obtain a credit report; (4) property address; (5) estimate of value of the property; (6) loan amount and (7) any other information deemed necessary by the loan originator.

23) Q: May a loan originator issue a GFE if the loan originator has not received one of the six pieces of information included in the definition of an application (borrower‘s name, borrower‘s monthly income, borrower‘s social security number, property address, estimate of the value of the property and mortgage loan amount sought)?

A: An application includes information the loan originator requires the borrower to submit in anticipation of a credit decision. If a loan originator issues a GFE, the loan originator is presumed to have received all six pieces of information.

24) Q: Are loan originators permitted to process a loan without all six pieces of information included in the definition of an application?

A: Yes. Loan originators may process a loan after they have issued a GFE and the borrower has received the GFE and has decided to proceed with the loan. It is presumed that, prior to issuing a GFE, a loan originator has received all six pieces of information.

So you are probably as clear on this additional guidance as lenders have been. You may, however, hear lenders say that they can issue GFEs now without a property address. Per HUD, this has to be the Lender’s standard of practice and the costs cannot change purely based upon an identified address. I would not expect lenders to jump on this bandwagon with such clear contradiction in guidance. You should still be wary if loan officers are
issuing LSRs stating that there has been a GFE issued without a contract in place.

Do You Think HVCC has Impacted the Real Estate Recovery?

Do you have an opinion about HVCC? Good or Bad? I want to know. I have been asked to sit on an Ad Hoc Committee to determine a position, for or against the continuation of HVCC. I want to hear from you, those who are in the trenches every day, as to whether you feel HVCC has personally impacted your business. I want to have real-life experiences to share with the committee to bring to light…or de-mystify…the here say of whether HVCC has brought quality up, helped or hurt the economics of real estate sales…or maybe there has been no impact at all. Please direct your comments to me at amy@amyswaney.com. This is your chance to say how you feel and have someone listen!

Don’t Miss Real “Estate from A-Z” on KFNN 1510 TOMORROW…SATURDAY, APRIL 10 at 9:00am with Bill Ashker and Roger Nelson

Want to hear the latest about HAMP, HAFA, RESPA, FHA and other lending topics? Please tune in to hear my interview with Bill and Roger. It should be informative, entertaining and a whole lot of fun! I promise…I won’t tell any of my jokes!

Ok, a blonde walks into a building and goes up to a lady and says "Can I have a cheeseburger, fries and a shake?"

The lady looks at her dumbfounded and says

"Miss, this is a library."

So the blonde moves closer and whispers,

"Can I have a cheeseburger, fries and a shake?"

I want to be the lender of choice for your customers so if I can be of assistance to you or your clients, please feel free to contact me at amy@amyswaney.com.

Thursday, April 1, 2010

Enhancements to HAMP Modifications and FHA Refinance Options

Last Friday, the Administration announced adjustments to both the Home Affordable Modification Program (HAMP) and to the Federal Housing Administration (FHA) programs. It is hoped that these adjustments will better assist responsible homeowners who have been affected by the economic crisis through no fault of their own. These are two separate programs with two separate sets of enhancements to help consumers further avoid the possibility of foreclosure. (Sorry for the length…a lot of information!)

Home Affordable Modification Program Enhancements

The “Making Home Affordable Program” (MHA) is part of the Obama Administration's broad, comprehensive strategy to get the economy and the housing market back on track. The Making Home Affordable Program offers four options for homeowners:

(1) refinance through the Home Affordable Refinance Program (HARP),
(2) modification of first and second mortgage loans through the Home Affordable Modification Program (HAMP) or
(3) Second Lien Modification Program (2MP) and
(4) offer of alternatives to foreclosure through the Home Affordable Foreclosure Alternatives Program (HAFA).

These enhancements target those who qualify and demonstrate a financial hardship. The amendments to the program will provide temporary mortgage assistance to some unemployed homeowners, encourage mortgage servicers to write-down mortgage debt as part of a HAMP modification, allow more borrowers to qualify for modification through HAMP, and help borrowers move to more affordable housing when modification is not possible. These enhancements are broken down as follows:

Temporary Assistance for Unemployed Homeowners While They Search for Re-Employment

• Mortgage payments can be reduced to an affordable level for a minimum of 3 months, and up to six months for some borrowers, while eligible homeowner looks for new job. (Monthly Payment set at 31 percent of monthly income or less while homeowner is unemployed via forbearance plan.)

• Temporary assistance plan offered for a minimum of 3 months, and up to six months for some borrowers, subject to investor and regulator guidelines, ending when borrower becomes re-employed or scheduled assistance period expires. (Borrowers who become re-employed during the scheduled assistance period and whose mortgage payment is greater than 31 percent of their new gross monthly income must be considered for HAMP.)

• Servicers participating in the Making Home Affordable Program are required to offer assistance to all unemployed borrowers who meet eligibility criteria:
1) house is owner-occupied
2) loan balance is below $729,750
3) loan was originated before January 1, 2009
4) Borrower submits evidence that they are receiving unemployment insurance (UI) benefits
5) Borrower requests temporary assistance in the first 90 days of delinquency

• At the end of the temporary assistance period, homeowners who have a mortgage payment greater than 31% of their monthly income MUST be considered for a permanent HAMP modification.

• To receive the permanent HAMP modification, homeowners must be current on assistance plan payments, must verify qualifying income with standard documentation, and must meet all other HAMP underwriting requirements including the net present value (NPV) evaluation.

• If the scheduled assistance period ends without re-employment, the homeowner may be considered for HAMP alternatives to foreclosure including short sales and deed-in-lieu of foreclosure.

Requirement for HAMP Participating Servicers to Consider Alternative Principal Write-down Approach

• Requirement for all “FNMA/FHLMC Owned” and other HAMP Participating Servicers to consider an additional modification approach including more principal write-down for HAMP-eligible borrowers that owe more than 115 percent of the current value of their home.  (To check to see if your servicers is participating in HAMP even if the loan is NOT owned by FNMA or FHLMC…see attached list of participating servicers)

• Alternative principal reduction allows some underwater homeowners to reduce principal balance of their stages in stages over three years, if they remain current on payments.

Under this approach:
1. Servicers assess the NPV of a modification that starts by forbearing principal balance as needed over 115 percent loan-to-value (LTV) to bring borrower payments to 31 percent of income;
2. If a 31 percent monthly payment is not reached by forbearing principal to 115 percent LTV, the servicer will then use standard steps of lowering rate, extending term, and forbearing additional principal.
3. Servicers will initially treat the write-down amount as forbearance and will forgive the forborne amount in three equal steps over three years, as long as the homeowner remains current on payments.

• For borrowers who have already received a permanent or are in trial modification, and are still current on payments at the time when the program is available (later in 2010), servicers will be required to retroactively consider extinguishing an amount of principal balance in the same amount that would have been forgiven under the new alternative approach.

Increased Principal Write-down Incentives

• To further encourage principal write-downs, the Treasury is also increasing the incentives that it provides for loans extinguished or partially extinguished in conjunction with the HAMP Second Lien Program.

• In exchange for all principal write-downs under HAMP at the time of a loan modification lenders will receive between 10-21 cents for every dollar of principal reduction.

Helping Homeowners Move to More Affordable Housing

• Increase of incentives to provide more homeowners with foreclosure alternatives

1. Increase payoffs to subordinate lien holders who agree to release borrowers from debt to facilitate greater use of foreclosure alternatives including short sales or deeds-in-lieu.
2. The new payoff schedule allows servicers to increase the maximum payoff to subordinate lien holders to 6 percent of the outstanding loan balance
3. doubles from $1,000 to $2,000 the incentive reimbursement that is available to investors for subordinate lien payoffs, subject to an overall cap of $6,000.
4. Increase servicer incentive payments from $1,000 to $1,500 to increase use of foreclosure alternatives
5. Encourage additional outreach to homeowners unable to complete a modification.
6. Double relocation assistance payment for borrowers successfully completing foreclosure alternative to $3,000 to help homeowners who use a short sale or deed-in-lieu to transition more quickly to housing they can afford.

FHA Program Adjustments to Support Refinances for Underwater Homeowners

The Administration also announced adjustments to Federal Housing Administration (FHA) programs that will permit lenders to provide additional refinancing options to homeowners who owe more than their home is worth because of large falls in home prices in their local markets. These adjustments will provide more opportunities for qualifying mortgage loans to be responsibly restructured and refinanced into FHA loans as long as the borrower is current on the mortgage AND the lender reduces the amount owed on the original loan by at least 10 percent.

FHA Refinance Option for Underwater Homeowners – Encouraging Responsible Refinance (*Please note that the program details are not yet available-thus not currently offered.)

• This is a voluntary option for both lenders and borrowers
• Encourages lenders and borrowers to work together when appropriate to restructure debts
• Qualifying first lien mortgage loans must have a minimum write-down of at least 10 percent and total mortgage loan to value on the home can be no greater than 115 percent after the refinancing
• Eligible underwater loans are refinanced into new FHA loans on FHA terms for full documentation, income ratios, and complete underwriting

Terms of FHA refinancing:
  • The new FHA loan will be equal to no more than 97.75 percent of the value of the home
  • Combined mortgage debt must be written down to a maximum of 115 percent of the current value of the home
  • Standard FHA mortgage insurance premium structure will still apply
  • Mandatory principal write-down by lender of at least 10 percent of unpaid principal balance as part of refinance
  • Affordable monthly mortgage payments to facilitate affordable homeownership
  • New monthly mortgage payment at current low FHA interest rate
  • Total monthly mortgage payment, including for second mortgage, will not be greater than approximately 31 percent of income, and total debt service including all forms of household debt will not be greater than approximately 50 percent except for some borrowers with especially strong credit histories
  • Existing lenders can retain second mortgages on the property, but only up to a combined 115 percent of the current value of the home
  • If there is an existing mortgage that is not extinguished, holders must agree to re-subordinate and write off any amount over 115 percent of the current value of the home
  • Homeowners must be current on their existing mortgage payment
  • Homeowner must occupy the home as their primary residence and fully document their income
  • Homeowners must qualify under standard FHA underwriting guidelines
Ha Ha
‘What kind of work do you do?' a woman passenger enquired of the man travelling in her train compartment.
'I'm a Naval surgeon,' he replies.
‘My word!' spluttered the woman, 'How you doctors specialize these days.'

I want to be the lender of choice for your customers so if I can be of assistance to you or your clients, please feel free to contact me at amy@amyswaney.com