Gulf Coast Associates' Blog: Mortgage Information

Fannie Mae has announced they will begin paying 3.5% towards closing costs or an equivalent amount for the purchase of new appliances for buyers purchasing a property from their foreclosure inventory. According to Terry Edwards, executive vice president for credit portfolio management, "attracting qualified buyers to the market and reducing the inventory of vacant homes is critical to stabilizing neighborhoods and helping the market recover."

Obviously, Fannie is looking to try and clear some of the roughly 50,000 properties it currently has available for sale in its inventory. The offer is available to any "primary owner occupied purchase" that closes on a property listed on their website - www.homepath.com - prior to May 1, 2010. In addition, many of…

After a year of struggling mightily to find mortgage financing options, buyers of Florida condominiums could see loans become easier to obtain under a program announced last Thursday by Fannie Mae. According to executive vice president Karen Pallotta, "The new program is meant to help Florida's distressed condo market as Fannie Mae continues to provide liquidity to the broader housing market in general.

Fannie plans to comprehensively review hundreds of condominium projects statewide that may not meet its current eligibility criteria for financing because of occupancy problems or high delinquency rates on homeowner association dues. The review will look at a the individual condo project's occupancy level, association dues, financial stability and property…

Last week, the U.S. Department of Housing and Urban Development (HUD) announced that FHA-insured homeowners experiencing problems caused by defective drywall may be eligible for assistance to help them rehabilitate their homes. In addition, HUD's Community Development Block Grant (CDBG) Program may also be a resource for local communities to help families facing financial hardship while trying to combat the ongoing problem.

Declaring defective drywall to be a FHA Type 1 Special Forbearance, FHA Commissioner David Stevens said "We're instructing our FHA mortgage lenders nationwide to extend temporary relief to allow these families time to remove problem damaging drywall and repair their homes." "We want to remove additional pressures for these families as…

In the last 24 hours, the Obama Administration has tried once again to put pressure on the lending industry to do a better job of helping distressed mortgage holders.

Yesterday they announced two new plans by the Treasury Department. The first is designed to basically try and shame the major loan servicers into doing more to move loan modification through the pipeline. Whether or not posting a weekly list of companies that are lagging in the administration's loan modification program is just mere political posturing or an actual process motivator remains to be seen. Their second plan regarding short sales and deeds in lieu of foreclosure may actually hold more real promise for the housing industry.

The program's official name is the Home Affordable…

Yesterday, The Federal Housing Administration (FHA) announced several significant policy changes that are intended to help improve their increasing exposure to risk. Seems that rising defaults have hit the FHA's reserve funds hard; in fact, according to the Mortgage Bankers Association, 7.8% of FHA's loans were 90 days or more late or already in foreclosure at the end of the second quarter. While that's equal to the national average for other loan programs, it's up from 5.4% a year ago for FHA. In addition, the increased mortgage-based losses have pushed the agency to the point it is in danger of having its reserves fall below the 2% threshold mandated by Congress. Some officials believe it could happen before the end of this month. Options for the agency…

According to their annual loan closing costs survey, Bankrate.com had Florida ranked number two (tied with New York City) behind only Texas for being a high loan closing cost state. The new ranking was a step up for Florida after two years of being ranked in the number three position. So, while prices may be falling in Florida, home buyers will have to spend more to close on their new home purchases.

The study compared charges for loan origination fees, title and closing costs on a single family home purchase with a 20% down payment and a 30 year fixed rate mortgage of $200,000. It excluded taxes, other governmental fees and escrow fees. Nationwide, the average loan closing costs this year totaled $2,732, down from $3,118 in 2008.

This year's top ten…

Beginning August 15, FHA borrowers will be able to apply to reduce their monthly mortgage payments by seeking a loan modification through their current lender or loan servicer under the new FHA-Home Affordable Modification Program (FHA-HAMP). The Helping Families Save Their Homes Act of 2009 allows FHA to give qualified FHA-insured borrower's the opportunity to reduce their monthly mortgage payment by modifying the mortgage through the new program.

The program will permanently reduce a family's monthly mortgage payment through the use of a partial claim, which defers the repayment of mortgage principal through an interest-free subordinate mortgage. FHA-HAMP will allow lenders to set aside up to 30% of the total principal balance until the house is sold or…

Hardly a few days go by that we don't get an inquiry from either one of our industry peers or a prospective client as to why they can't get mortgage financing for their recent condo purchase. The reasons are many and in most instances very confusing. Especially if you're talking about buying a condo in Florida.

Since the majority of our lending business is now done within this state, I'm going to focus on the problems we are facing here with getting financing for a condo. However, many of the same problems exist in other areas of the country and thus may be applicable to your business too.

Primary residence and second home condo purchases are treated quite differently. The reasons for this are many and entirely too convoluted to go into in a blog post.…