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Monday Morning Mortgages>
Monday Morning Mortgages
October 5, 2009
Investor (Non-owner) Financing Highlights
Current guidelines for investment financing:
Minimum FICO 620
LTV max purchase (add 3 pts to rate) 80%
LTV purchase best pricing (add 1.75% to rate) 75%
LTV max refi 75%
LTV max cash out 70%
Loan over $417k LTV max 65%
Loan over $417k minimum FICO 740
Seller concession limit 2%
Income allowed from new property 75% of appraisal rent survey
Rate for an investment property purchase today with 25% down payment is 5.0% with 1% loan origination. See current rates at www.SonomaCountyHomeLoans.com.
Purchase Appraisal Inspections
Based on the great informative discussion led by HUD certified appraiser Jennifer Rennia last Wednesday in Finance 101, here are some tips to remember before sending the appraiser out to inspect a property. Attending to these items BEFORE the appraisal will avoid a reinspection for all HUD reviewed appraisals (FHA).
1. Have water and utilities turned on
2. Water heater must be double strapped
3. If there is a pool, it should be filled and covered prior to appraisal photo (Note: pools do NOT require fences)
4. ANY peeling paint interior should be smoothed out and sealed with primer
5. Smoke detectors should have working batteries
6. Fireplace needs to either be working or closed off
7. No standing water interior; stop leak, dry up water, lay down a shelf mat
8. On exterior of property, no toxic materials; paint cans, oil bins, dead cars
9. Kitchen stove is only required if it is a built-in, per HUD guidelines
10. Windows with bars must have latches
11. Access to attic and crawl space
Fast & Easy Rehab Loan Highlights
The FHA 203(k) Streamline Rehab Loan is easy to use for those fixer-upper listings. Here are some items to remember:
• Eligible Improvements
o Roof, upgrade kitchen/bath including appliances, incomplete remodels, pest/mold/lead remediation, carpet, paint, windows, doors, energy upgrades, decks, patios, septic/well repairs, landscaping
• Improvements up to $35k
• Owner occupied only (typical FHA guidelines)
• 3.5% down payment of sale price, plus improvements
• 1-2 units
• Purchase or refi
• No structural or additional square footage or pool work
USDA Rural Development Financing
100% financing, no MI? Yep, for “rural areas” like Healdsburg, Sebastopol, Cloverdale, Windsor, all Russian River area, Graton, and Sonoma Valley along Hwy 12. This is a gov’t insured loan for owner occupied single family homes with household incomes up to $92,000 and assets of less than 20% of purchase price.
• Min FICO 620
• Max DTI 47%
Pre-Approval Documents
What docs does a borrower have to submit for a preapproval? Here’s the current list.
• Last 30 days of paystubs
• Last 2 months of all statements, all pages, for all asset accounts (checking, savings, retirement, annuities, investments)
• Last 2 years of w-2s or 1099s
• Last 2 years of federal tax returns all schedules
• Borrower Authorization (to pull credit)
• Loan applications, sections III, IV, VIII, IX
• $15 for credit report
• Driver’s license and Social Security card
Rates
Rates continue to be excellent. The 10 year Treasury Note is down to 3.20% and the stock market is digesting negative economic recovery news. This is a slow week in data, so expect rates to float around the same.
Today's Rates (see current days throughout the day with APR calculations at
www.sonomacountyhomeloans.com
WITH ONE LOAN POINT
Conforming (<= $417,000)
30 Year 4.5%
5/1 ARM 3.75%
5/1 ARM IO 3.875%
Jumbo Agency ($417,001 - $662,500 in Sonoma County)
30 Year 4.875 %
FHA Conforming (<= $417,000)
4.875%
FHA Jumbo (to $520,950)
5. 125%
Super Jumbo (<= $3 million)
30 year fixed 7.125%
3/1 ARM 4.625%
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