Archives for June 2014

Applying For a VA Loan: Less Red Tape Than You Think

June 27, 2014 By Sean Zalmanoff

If you have sacrificed a portion of your life to ensure that the rest of us can continue to live freely in ours, then you are entitled to a few perks.

Especially when it comes to securing a home for you and your family in the country you fought so hard for. A VA loan is remarkably easier to apply for and to get approved for than most veterans realize. Take advantage of this program and allow yourself the joy of home ownership.

How Easy Is Applying For a VA Loan?

The idea of a ton of paperwork could be what is holding you back from applying for a VA loan, but once you start the process you will be amazed at how simple it is. It is even easier than applying for a traditional loan. First of all, there is no down payment requirement for a VA loan, nor is there any requirement for PMI insurance. This type of insurance is usually applied to loans where the buyer has put little or no money down on the house first. Not having that insurance will save you thousands of dollars in fees over the life of your loan.

Another benefit to a VA loan is that you are still entitled to competitive mortgage rates. This is not a bait and switch program where you are lured in by incentives only to realize that your rate will be significantly higher than on a traditional mortgage. With a VA loan, you are entitled to shop around for the best deal on an interest rate.

How To Apply For a VA Loan

There are five basic steps to follow if you wish to take advantage of the VA mortgage:

Obtain a certificate of eligibility. This is easily done by filling out VA Form 26-1880, which should be readily available at your local VA office or even online. This certificate lets your lender know what you are entitled to as a veteran.
Choose the perfect home for your family and sign a purchase agreement.
Ask for an appraisal on the home from the VA. The lender will often take care of this for you.
Apply for your mortgage through the lender. This can be going on simultaneously with the home appraisal to help expedite the process. If the lender is VA approved like Sean Z, then the loan can be approved before the VA has a chance to review the loan application so long as the appraisal is complete.
Close on the home and move your family in.

In addition to the perks mentioned above, a VA loan can be up to 100% of the assessed value of the home. In addition, there is generally a limit on how much of the closing costs the buyer may assume.

A VA loan is simply a guarantee to a lender that the loan is protected by them in the event that the buyer is unable to make payments. It is a win-win mortgage for everyone involved and one that should be used by all of those brave men and women who are entitled to it. Call USA Mortgage at (314) 361-9979 for more information.

Photo credit: Chris Bohn via Flickr

Pave a Path To Your New Home Using Fannie Mae’s HomePath Program

June 26, 2014 By Sean Zalmanoff

While the allure of the low price of a foreclosed home is appealing to homebuyers, getting approval for them is not always easy.

Many buyers look towards a home that has been foreclosed as an inexpensive path towards home ownership. The bank holding the deeds to these properties are usually anxious to have you take them off of their hands and have dropped the price drastically to encourage that. The trouble is, some lenders are reluctant to shell out money for a home that may have been left in need of repair.

The Fannie Mae HomePath Program

This is where HomePath comes in. Fannie Mae is the owner of many of the foreclosed homes in St. Louis. In order to assist a buyer, they have put into effect a mortgage program that does not require a home inspection, PMI insurance, or an appraisal. The only catch is that the property must be owned by them. This program began in 2009 to help Fannie Mae unload the thousands of properties it suddenly held the keys to.

As with all Fannie Mae loans, a HomePath loan is not financed by them. They are simply offering insurance to your lender as an incentive to get them to finance for you. What they do is set the guidelines for the mortgage broker. In the case of HomePath, this means as little as 3% down for a buyer who is interested in living on the property and ten for an investor.

In addition, HomePath can also authorize a loan that fits in the monies needed to make repairs on the property. This is a slightly more complicated process that involves an appraisal of the property based on its value after the renovations are complete. A home buyer may receive up to 97% of the estimated home value as cash to fix the house up.

How To Find a Foreclosed Home

Shopping for a home through HomePath requires that the buyer choose only from the homes listed on the HomePath website. This list is constantly being updated, so if you don’t find the home of your dreams today, just check back again in a few days. Purchasing a home this way eliminates the need for a real estate agent and their subsequent fees.

The Mortgage Loan Process

Not every lender is approved to offer loans through HomePath the way Sean Z is. With his vast experience with this type of loan, him and his team will be able to walk you through the entire process. The first 15 days of a home’s listing is for people who are interested in being owner occupants only. This allows them to bid on homes without having to compete with the deep pockets of investors.

This is truly a unique program that benefits all sides of the sale and even the neighbors of these homes who are possibly losing home value as an empty, foreclosed home sits next to theirs. Talk to The Sean Z Mortgage Team at USA Mortgage at (314) 361-9979 today to see how you can work this program for yourself.

Photo credit: Taber Andrew Bain via Flickr

How Information From the Fannie Mae Survey Can Help Save the Economy

June 23, 2014 By Sean Zalmanoff

According to a recent survey conducted by Fannie Mae, the majority of respondents still believe that the economy has not fully recovered.

This belief is having an adverse effect on home sales in St. Louis and across the nation. Springtime is usually greeted by an influx of anxious consumers wanting to buy a home. Despite low interest rates, that trend has been significantly lower this year than in the past. The Fannie Mae survey shows that people are still reluctant to buy a home, citing the lagging economy and a decrease in household income. Only 21% of those surveyed were able to say that they are making more money now than they were this time last year.

Fluctuations In the Economy Still a Huge Concern

Chief economist and senior vice president of Fannie Mae, Doug Duncan, was quoted as saying that it is these concerns over economic stability and income growth are taking its toll on what should be the busiest time of year for a St. Louis real estate agent. Despite a trend in lower interest rates over the last two years, the Fannie Mae survey shows that fluctuations in the economy are still a huge concern for St. Louis residents and that it is these concerns that are holding them back from buying and selling homes.

National Housing Survey

Each month, Fannie Mae puts out a National Housing Survey to gauge consumer’s feelings about housing and the state of the economy. Since most of the questions are geared towards real estate, homebuilders use the information to ascertain their risk at the present time and mortgage REITs will use the data to forecast prepayment speeds and the effect consumer sentiment will have on the economy. The monthly phone survey polls 1,000 random Americans and asks them over 100 questions whose answers are used to track changes in consumers attitudes.

It is surveys such as these that aide realtors and lenders both to bring in potential homebuyers and help give the housing market in St. Louis the boost it desperately needs. Knowing the fears and concerns of the average consumer allows lenders like Sean Z to make provisions and ease the minds of their clients before the application process even begins.

Will Housing Prices Go Down Payment?

For example, this month’s survey shows an increase in the amount of people who believe that house prices will go down over the next few months. In knowing that this feeling could be the cause of a consumer’s reluctance, the lender can take steps to show that the low interest rates being offered right now will offset any possible savings they could receive if they wait those twelve months for home values in St. Louis to drop again.

Professional lenders and real estate agents are looking over this information carefully to find ways in which to entice new consumers into home ownership. One of the best ways to help stimulate the economy is with home purchases; meanwhile, the lagging economy is what is causing consumers to shy away from buying right now. For more information, call Sean Z Mortgage at (314) 361-9979.

Photo credit: Bradley Gordon via Flickr

Decline in Down Payment Requirements is Good News for St. Louis

June 3, 2014 By Sean Zalmanoff

Lower down payment requirements may make it easier for potential new homeowners to qualify for a mortgage.

First-time home buyers find it easier with a lower down payment.

Growing concerns over what appears to be a nationwide decline in home sales, both for existing and new homes, has lending companies and banks scrambling to find ways, such as lower down payment requirements, to lure potential buyers into a mortgage. If mortgage companies and banks can entice new business, there will be a boom of home sales that will benefit everyone.

Current Mortgage Rates

With current mortgage rates for St. Louis homeowners still hovering below 4.5 percent, now is still a great time to get locked into a mortgage. The Federal Reserve has already announced its intention to slow down its acquisition of mortgage bonds, meaning it is very unlikely that we will see mortgage rates fall any lower than that. Talk with Sean Z and his team of lending professionals to get your approval for the TBD mortgage program now, before those rates begin their expected ride upwards.

The low mortgage rates currently being offered by lenders should be enough to encourage new home ownership, but St. Louis residents are still dragging their feet. Housing is affordable right now; the lenders just need to figure out how to sell more mortgages.

Lower Down Payment Requirements

The acceptable amount for a down payment on a 30 year fixed rate mortgage is generally supposed to be 20 percent. The trend now has lenders accepting as little as 15 percent as an incentive to encourage St. Louis residents to buy homes. With the current low mortgage rate, and this new low down payment plan, lenders are hoping more potential buyers will be encouraged to start looking for a new home.

The downside to this is that it has the potential to suck the economy right back down, if not monitored carefully. Lenders and borrowers both should be concerned about the homebuyer’s ability to make payments on the loan before they close on a new house. That’s the beauty of a program like the Sean Z TBD mortgage plan. The fatal flaw that brought the housing industry to its knees, was the lending companies concern over the value of the house over the borrower’s means to make payments.

The TBD Mortgage Program

The TBD mortgage program shifts the focus away from the home and onto the borrower where it belongs. It does not really matter what the home is worth, if the new home owner cannot make the monthly payments. If the current trend of lower down payments continues and is coupled with approvals based on the borrower, disaster can be averted and more St. Louis residents can benefit from home ownership.

The trend for lower down payments is nationwide, with some states reporting banks asking for less than 13 percent of a home’s value as a down payment. So long as the buyers are also being qualified, the housing industry should continue to see growth.

Call SeanZMortgage at (314) 361-9979.

Photo credit: Diana Parkhouse via Flickr

St. Louis Mortgage, USA Mortgage, Mortgage Rates

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