ARAMCO Report - The Mother of ALL Mortgage Blogs!

Good news for homeowners; bad news for buyers

Posted by The Aramco Group on Tue, Jul 28, 2015 @ 14:07 PM

The ever-increasing cost of housing and utilities in San Diego has caused a significant slowdown in overall economic growth. Incomes throughout the county have remained relatively stagnant – causing families to pay a higher percentage of their income to housing.

According to the S&P/Case-Shiller Home Price Index, homes in San Diego have increased 4.8 percent since last year, more than the national average. While this spells good news for homeowners, it also shows that families are growing unable to afford housing in the county. Reports claim that the fundamental issue is regulators indecision to approve new construction to keep up with demand, causing house prices and rent to rocket.

The silver lining is that FHA and VA loans provide low and no-down payment options while mortgage rates remain near historic lows. The conforming no-point 30-year rates are averaging of 4 percent and 15-year fixed rates are averaging 3.25 percent. 

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381-8888 and your question may be featured in an upcoming article.

Topics: home sales, VA Loans, FHA, renting

San Diego Home Buying – Not So Easy

Posted by The Aramco Group on Tue, Jul 14, 2015 @ 14:07 PM

Young San Diegan families looking to buy a home may have to wait longer than previously thought. A study released last week by real-estate tracker Trulia says the median income does not earn you enough to buy a median house in the county.

A household earning $89,000 a year would have to save 10 percent of its income for 18 years before they would have enough for the requisite 20 percent down payment on a $589,000 home – the median-price in the county.

Fortunately, programs like FHA loans allow buyers to purchase with only 3.5 percent down payments. Meanwhile, the Veterans Administration (VA Loans) allows eligible military and veterans to buy a home with zero down. Buyers looking in rural areas also qualify for no down payment purchases through a USDA loan. Furthermore, seniors with large down payments can purchase with a reverse mortgage and easier qualifications with no mortgage payments.

Low mortgage rates make buying even easier. Currently, no point 30-year fixed rates are averaging 4.125 percent and 15-year rates are averaging 3.25 percent.

Do you have a question for Real Estate & Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance, or reverse mortgage via Aramco.Biz, social media (#AramcoReport), or over the phone at (866) 381–8888 and your question may be featured in an upcoming article.

Topics: Down Payment, FHA, Veterans Loan, Low Down Payments

ARAMCO Report - Friday June 5, 2015

Posted by The Aramco Group on Fri, Jun 5, 2015 @ 16:06 PM

Low down payment mortgages in San Diego increase

Approximately 15 percent of the mortgages originated in San Diego during quarter one were special low down payment loans according to ReatlyTrac. That is up from approximately 12 percent in the first quarter of 2014.

Structured low down payment loans like the ones offered by FHA, Fannie Mae, and Freddie Mac are loans with a loan-to-value ratio of 96.5 percent or higher — meaning the down payment is approximately 3-3.5 percent of home’s value. Nationally, the average down payment during the first quarter 2015 for FHA mortgages, for example, was 89.5 percent lower than the average down payment for a conventional loan ($7,609 vs. $72,590) according to RealtyTrac.

Nationally low down payment mortgages made up a larger share of total purchases during the same period, up to 27 Percent from 26 percent one year ago.

The numbers of homebuyers, particularly first time buyers, were running near record lows over the past couple of years according to Chase International brokerage. The growing number of low down payment loans reflects an appetite on the part of lenders and the government to reverse that trend. 

Mortgage applicants will find that conforming no point 30-year mortgage rates average 4.125 percent while 15-year rates average 3.25 percent.

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Topics: 30 year fixed rates, Fannie Mae, Freddie Mac, first-time buyers, FHA, Low Down Payments

ARAMCO Report - Tuesday May 12, 2015

Posted by The Aramco Group on Tue, May 12, 2015 @ 12:05 PM

Mortgages keep getting easier to get 

Mortgage credit has become more available since 2012 according to the Mortgage Bankers Association (MBA). The MBA’s Mortgage Credit Availability index went up 0.5 percent in April 2015 to 122.0 points.

The Mortgage Availability Index is benchmarked to how available mortgages were in March 2012, so scores above 100 mean that mortgages are more available than they were at that time, and a positive change of score in April 2015 means that mortgages are more available than in the preceding month.  

The biggest expansion in mortgage availability was due to the expansion of government insured mortgage programs — especially the FHA’s 203K program. The FHA 203K lets qualified borrowers add the cost of any voluntary or necessary renovations to a home to their mortgage balance at the time of purchase with only one mortgage and one loan closing. A first-time homebuyer could use the program to purchase an existing home that may have been outside their reach before.

Potential homebuyers will find conforming no point 30-year fixed mortgage rates average 3.875 percent. Meanwhile, 15-year rates are closer to 3.125 percent. Contact ARAMCO if you have any questions about the FHA 203K program.

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: 30 year fixed rates, mortgage, MBA, 203K, Loan, FHA, Mortgage Bankers Association, Mortgage Credit Availability Index

ARAMCO Report - Wednesday May 6, 2015

Posted by The Aramco Group on Thu, May 7, 2015 @ 09:05 AM

Share of People applying Gov-Backed mortgages increases

 

The share of total mortgage applications nationally that were used to apply for government-backed purchase loans— such as FHA, VA and USDA backed mortgages—increased 3.5 percent in the week that ended May 1st, 2015 to 26.7 percent of total applications from 25.6 percent the week prior according to the Mortgage Bankers Association (MBA).

Each one of these mortgages is insured by a particular agency from the federal government, and that allows the lender to usually offer better terms. For example, the average interest rate for FHA-backed 30-year fixed rate mortgages was 3.70 in the week ending May 1st, 2015 (with a 20 percent down payment) compared to an average of 3.93 percent for non-FHA mortgages for the same terms.

Veterans can use their VA loan to purchase a home with no down payment or refinance their existing loan up to 100 percent of their home’s value. With FHA loans, a first-time homebuyer can buy a home with a 3.5 percent down payment while seniors over the age of 62 can use a reverse mortgage to eliminate their monthly mortgage payments or purchase a new home with no monthly mortgage payments. 

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: Reverse Mortgage, home buying, 30 year fixed rates, VA Loans, FHA, Mortgage applications, Refinancing, refinance, Home Loan

ARAMCO Report - Wednesday April 29, 2015

Posted by The Aramco Group on Wed, Apr 29, 2015 @ 15:04 PM

New rules in effect for reverse mortgage

The FHA implemented new rules for the reverse mortgage on April 27, 2015. To strengthen the reverse mortgage program and give it more longevity, the FHA regulations have been changed to address the roughly 10% default rate nationwide on property taxes and insurance payments that threatened the program and put tax payers at risk.

The reverse mortgage is open to potential borrowers and their spouses 62 and over, and grants access to the equity in their homes as cash without monthly mortgage payments.

The good news is that, despite the new requirements, it is still a lot easier to qualify for a reverse mortgage than it is to qualify for a traditional mortgage. Unlike traditional mortgages there is no maximum debt to income ratio requirement and no minimum credit score requirement. There is still an analysis of your residual income and of your credit, but these standards are easier to achieve.

Home buyers and homeowners refinancing with traditional mortgages will find that conforming no point 30-year first rates average 3.875 percent while 15-year rates average 3.125 percent.

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: Reverse Mortgage, HECM, financial assessment, Reverse Mortgage Program, 30 year fixed rates, retirement planning, FHA

ARAMCO Report - Monday April 6, 2015

Posted by The Aramco Group on Tue, Apr 7, 2015 @ 15:04 PM

Four million mortgage loans went “missing” in the U.S. between 2009 and 2013. That is how analysts at The Urban Institute described the number of mortgages that could have been entered into if lenders were accepting similar levels of creditworthiness from potential borrowers as they did in 2001. Lenders have implemented their own credit overlays on top of more stringent post-crisis lending standards from FHA, Freddie Mac and Fannie Mae. The 2008 crash even made households with excellent credit more rare: credit ratings of 720 and above among borrowers are 8.9 percent less likely as compared to 2001. Medium and low-credit households were hit even more remarkably. Borrowers with scores between 661-720 and with scores less than 660 are 37 percent and 75.8 percent less likely, respectively. That means that households with exemplary credit are still the primary movers of the recent mortgage market rebound. Meanwhile conforming no point 30 year fixed mortgage rates average 3.75 percent while 15-year rates average 3.0 percent.

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: credit, 30 year fixed rates, Fannie Mae, Freddie Mac, Urban Institute, FHA, Credit Rating

ARAMCO Report - Wednesday March 4, 2015

Posted by The Aramco Group on Thu, Mar 5, 2015 @ 11:03 AM

According to the US Census Bureau, homeownership rates in 2014 were the lowest they have been in over 20 years. Those who are 65 or older had an extremely high homeownership of 79.5%. This highlights the significance of the upcoming FHA changes to the reverse mortgage program in April. Meanwhile last week mortgage applications rose as interest rates dipped. Conforming no point 30 year fixed rates average 3 7/8ths with 15 year rates closer to 3 1/8th. And now for something completely different… You probably didn’t know that the letter “E” used to designate a failing grade! But it was phased out by the 1930’s over fear of students interpreting it to mean “Excellent”! 

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: Interest Rates, home ownership, home ownership rate, 30 year fixed rates, FHA

ARAMCO Report - Thursday February 26, 2015

Posted by The Aramco Group on Fri, Feb 27, 2015 @ 10:02 AM

The big news of the day in the mortgage market was on the FHA insured Reverse Mortgage product. HUD’s Mortgagee Letter 2015-06 announced that the March 2nd deadline for the implementation of the new financial assessment rules had been extended to April 27th. After that date, seniors getting a reverse mortgage will need to have their income credit and assets documented and verified to get a reverse mortgage. Meanwhile regular conforming no point 30 year fixed mortgage rates average 3 7/8ths with 15 year rates closer to 3 1/8th. And now for something completely different… Did you know that the U.S. has 19 aircraft carriers? The rest of the world combined have only 12 aircraft carriers.

For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: Reverse Mortgage, financial assessment, HUD, aircraft carrier, FHA, Mortgagee Letter

ARAMCO Report - Thursday February 19, 2015

Posted by The Aramco Group on Tue, Feb 24, 2015 @ 11:02 AM

According to Realty Trac last year the share of home buyers using low down payment loans plunged to an 11 year low. But the new 3% down payment Fannie Mae and Freddie Mac loans as well as a big reduction in the FHA mortgage insurance premium is expected to boost the numbers for 2015. Meanwhile housing inventory continues to tighten nationwide with total listings year over year, down by 8.7%. Conforming no point 30 year fixed mortgage rates now average 3 7/8ths with 15 year rates closer to 3 1/8th. And now for something completely different… Did you know that owning an electric car in Norway grants you free public parking, free ferry trips, and even the right to drive in bus lanes?

 For more information on a home purchase, refinance, or a reverse mortgage, visit our website at Aramco.Biz or call me at (877) 700-0942. This is Mehran Aram with today's ARAMCO Report.

Ask Mehran Aram

Topics: RealtyTrac, Down Payment, Norway, inventory, Mortgage Insurance Premium, 30 year fixed rates, Fannie Mae, Freddie Mac, Electric Car, FHA, Housing