ANOTHER FHA mortgage maximum loan limit change
By · Comments11/28/2011
A few weeks ago I made a post about the new San Diego FHA loan limits effective October 1, 2011. Effective immediately HUD has changed the FHA loan limits once again for San Diego and all other counties. The new loan limit is going to help out homebuyers in the higher price ranges because instead of $546,250 the FHA loan limit has been changed back to $697,500 for single family homes.
While the conforming loan limits that Fannie Mae and Freddie Mac have set decreased to $546,250 for San Diego County higher FHA loan limits will help bridge the gap for higher-end homebuyers helping home values in the over $600,000 price range.
San Diego County Loan Limits for FHA
By · Comments
I have received numerous questions lately about what the new San Diego County mortgage loan limits are for FHA, VA and Conventional financing so I decided that this would be a good time to start posting again . Sorry for the extended leave from the Blog but my days (and nights) have been spent pushing loans with both hands. This first post will cover San Diego FHA loans and I will follow up later with the VA and Conventional loan limits.
FHA loan Limits for San Diego County;
Effective October 1st 2011 and through December 31st 2011 the San Diego County FHA loan limit for a Single Family Home or Condo is $546,250.
For a Duplex (2 unit) the limit is set at $699,300.
On a 3 unit (tri-plex) property it is set at $845,300 and for a 4 unit property the limit is $1,050,000.
These limits can be seen “straight from the horses mouth” HERE on the HUD website.
As you can see although the FHA program only allows owner occupied homes to be financed with only a few exceptions a 2,3 or 4 unit property can be purchased as long as a buyer plans to and occupies one of the units. If you have questions about FHA or any other San Diego Mortgage program give me a call at the office @ six one nine 285 two nine 21.
02/23/2011
Many of the ways that we used in the past to increase FICO scores cause more harm than good with the current rules for lending but we do still have a few powerful tools that can increase scores quickly to help you buy your San Diego dream home. One of these techniques is requesting a validation of debt. To be clear I am not saying to dispute items on your credit report at the bureau level because with the new rules a mortgage can NOT be funded with any active disputes showing on your credit report.
As stated in The Fair Debt Collection Practices Act, 15 USC 1692g Sec. 809 (b) anyone can require a creditor to validate a debt that they claim you owe. In this section of the Fair Debt Collection Practices Act it states that a creditor has 30 days to validate the debt that they claim you have or it MUST be removed from your credit report which will in turn raise your credit score. Unless you are completely sure that a bad debt is being reported accurately this technique should be used before paying or negotiation to pay a collection or charge-off account.
Many of the credit reports that I see on a daily basis have incorrect balances for collections, phantom debts and incorrect debt obligations listed on them and by using this technique many of them can be cleared up. With the score increase that this one technique can bring many perspective home buyers may get the FICO score needed to qualify for a mortgage loan and buy a home in San Diego.
For a complimentary credit evaluation or to get a copy of our form letter to send to falsely reporting creditors please call me at 619 285.2921 so that we can help you achieve your goal of owning a home.
San Diego FHA Loan Limits are Unchanged for 2011
By · CommentsFeb 9th 2011
Great news for San Diego home buyers!
H.U.D. has anounced that the loan limits for FHA mortgages in San Diego will stay at last years levels. All home loans under $417,000 or under are considered “conforming” and have the best pricing but for a single family home in San Diego County the maximum loan amount is still $697,500 with up to 96.5% loan to value!
In most cases FHA financing can only be used for owner occupied homes but H.U.D. does allow purchase of up to a 4 unit property with the program as long as the buyer is going to live in one of the units. The San Diego FHA loan limit for a duplex is $892,950, for a tri-plex is $1,079,350 and for a 4 unit building is still at a whopping $1,341,350 all at the same 96.5%.
If you have any questions about using FHA financing for your San Diego home purchase call me at 619-285-2921
January 14 2011
Let me start by stating the fact that 75% of loans in San Diego and across the country are Fannie Mae and Freddie Mac products.
Both GSE’s started with a call “risk-based pricing” to be able to price in risk from borrowers who have lower credit scores. It looks like these fee-based premiums are now for most Freddie Mac and Fannie Mae loans even for borrowers with stellar credit.
Under the new pricing borrower with 800 credit score is putting 24% down will have to pay .25% to fee. To put this in perspective on a $400,000 loan that’s $1000 more in fees. A borrower with a 679 score at 79% loan-to-value would be hit with an astronomical 2.75% fee on the same $400,000 house that’s $11,000 in fees! Some of the other new adders are for condominiums there is a .75% fee and there is an adverse market fee which is pretty much every neighborhood in the country (according to Freddie and Fannie ) of .25%.
I understand the risk-based pricing model is to charge more for borrowers who pose more risk but it seems now that everybody needing a loan is seen as a risk by the GSE’s.
This is only a few of the price increases that make it nearly impossible for San Diego home buyer to get that ” billboard” interest-rate that most companies advertise.
Above is a chart of a few of the price adds that go into effect next week. Please note that none of these ads apply the 10 or 15 year mortgages.
If you or someone you know can use my help or advice on a home mortgage product or guideline please call me at 619-285-2921 or APPLY HERE
You had finally found the perfect San Diego home. It was located where you wanted to live, in the right school district and had all of the amenities. You envisioned growing old in this home.
You were pre approved for your new San Diego Home Loan and did everything you were told to do. You even signed your final loan paperwork and were waiting to get your keys, when it suddenly happened. Loan denied. You can’t believe it! You signed all of your paperwork, paid for inspections, signed at the escrow office…the bank approved your loan for your San Diego Dream home. How could this be?!
Fannie Mae buys most of the mortgage loans in the US so they make the rules. Fannie Mae has a new policy that all loans must have a credit report pulled prior to funding. This is done after underwriting and usually after your loan signing. If you apply for new credit or make big changes with your accounts it could delay your San Diego mortgage loan or worse, get it denied.
We know it’s exciting to buy a new home and equally exciting to go shopping for new appliances but do not do this until you have been handed the keys! This and the clerk offering you 10% off of your new purchase if you put it on their card and its at 0% for a year. Regardless of how good your credit score is heed this warning or you’ll spend years talking about how a washing machine caused you to lose your first home.
Tips to ensure a successful San Diego mortgage loan transaction:
Don’t max out or overcharge existing credit cards – Running up your credit cards is the fastest way to bring your score down, and it could drop up to 100 points overnight. Once you are engaged in the loan process, try to keep your credit card balances below 30% of the available credit limit.
Don’t consolidate your credit card debt onto one low interest card – the balance on the new credit card (after the debt transfer) is under 30% or 50% of your available limit as defined above.
Don’t raise red flags to the mortgage underwriter – Don’t co-sign on another person’s loan, or change your name and address. The less activity that occurs while your loan is in process, the better it is for you.
Stay current on existing accounts – Late payments on your existing home mortgage, car payment, or anything else that can be reported to a Credit Reporting Agency can cost you dearly. One 30-day late payment can cost anywhere from 50 to 100+ points on your credit score.
Continue to use your credit as you normally would – Red flags are easily raised within the scoring system. If it appears you are diverting from your normal spending patterns, it could cause your score to go down. For example, if you’ve had a monthly service for Internet access billed to the same credit card for the past three years, there’s really no reason to drop it now. Again, make your changes after the loan funds.
Now more than ever an experienced San Diego Mortgage Planner is critical to avoid getting your home loan request denied. Call me at 619-285-2921 with any questions you may have about current requirements to get financing for a home purchase.
Yesterday on the radio show (thank you again Jeff for having me on) I mentioned how home buyers who are waiting to see if San Diego Real Estate prices will drop more might be missing the boat on the total cost of waiting. Here is a quick example on how interest rate can affect the total cost of the home more than home value in this market.
Let’s compare a home with a 5% 30 year fixed mortgage and the same property with a 6% mortgage with a 5% reduction in price. For the example below I used a home priced at $400,000 at 5% interest and the same home at 5% less for the purchase price with the higher rate ( where analysts say rates will be by the end of the year) but the example can be modified for any purchase price and rate range. As you can see the higher purchase price and loan amount has a LOWER payment by $105 per month. I understand that $105 dollars is not a huge amount of money but it might as well be a million dollars if it puts a buyer over the Debt-To-Income level that is needed to qualify for the loan.
In this image you can see that over the life of the loan that $105 per month really adds up to $53,730 in net savings. Hopefully at this point you can see the value of the savings and please note that this is at 0% interest so if the savings was properly invested or even just put in a savings account it would be much more (due to compound interest).
Here is where the real magic happens!! If that extra $105 dollars a month was put toward the mortgage payment you can see that the mortgage would be paid off in 26.42 years instead of 30. this would result in a total savings over the house at a “LOWER” price of $95,766.
For more information on how to reduce the total cost of a new loan or your existing loan (without a refinance) give me a call at the office @619-285-2921.
If you are in front of your radio tonight between 6 and 7 tune in to 107.9 FM to hear the radio show. If not you can hear the show live online at www.my1079.com by clicking the listen now button. I will be speaking about San Diego Real Estate and Mortgage market with Jeff Campbell from Jeff Campbell and Associates and we will be taking questions via his e-mail. Send an e-mail with any questions to myfavoriterealtor(at sign)yahoo.com to have your questions answered on the air.
Another appearance on XETV San Diego 6. This time on San Diego Living I was with John Dupree from Jeff Campbell and Associates going over some big reasons that NOW is the time to buy San Diego Real Estate. There are big changes coming for FHA financing, we still have the home buyer tax credit and a program that should be HUGE in the San Diego market 95% condo financing with a conventional loan. We will also be putting on monthly loan modification and Short Sale workshops free of charge.
For more information give me a call at (619)285-2921
Three Big Reasons to Buy in San Diego NOW!
By · CommentsFor everyone that has been waiting for the perfect time to buy real estate in San Diego and get a San Diego home mortgage NOW is the time due to 3 BIG factors.
Loans are going to get a lot more expensive in coming months for a few reasons.
- The federal government has announced that they will stop buying mortgage backed securities as of March 30th
- To take advantage of the 1st time homebuyers tax credit buyers must be in contract by April 30th
- On April 5th FHA will be raising the upfront MIP from 1.75 to 2.25 and there has been talk of also raising the monthly insurance premiums and the amount of down payment needed.
1. The rate reduction plan is going away!
This plan is something that you might not have been aware of, for the past 13 months the FEDs have been spending a huge amount of money to keep mortgage rates low is San Diego and the rest of the country. The money 1.25 trillion (YES WITH A T) dollars that was set aside is almost gone and the government has made the announcement that they will no longer buy the securities to help the market. 
We can’t really guess where mortgage rates in San Diego will go but the Deputy Chief of Freddie Mac said “interest rates are bound to rise to 6% in 2010 because private buyers will demand a higher rate of return on securities than the FED did”. Mark Zandi the chief economist at Moodys has said publicly that 6% “sounds about right”. It is very important for buyers to understand that the rate on a mortgage has much more bearing on cost then the price of a home so later in the week I will be posting an example to show this.
2. You MUST be in contract for your new San Diego home by April 30th to get the $8,000 in FREE government money!
It seems like most people know that to get the incentive to buy a home from Uncle Sam you need to close escrow by June 30th this year but many people don’t know that the property MUST be in escrow by the end of April. The last time the credit was extended the government said that there will NOT be any more extensions of the tax credit so the time to get qualified for your San Diego home mortgage and start shopping for your new home.
3. FHA is losing money by the minute and needs to raise funds!
Some projections are saying that FHA will have to pay out on up to 25% of the loans that they insured in the last 2 years. With already low reserves the FHA needs to increase its cash holdings in order to pay out claims. One way that they are doing this is by increasing their upfront Mortgage Insurance Premium from 1.75% to 2.25% on any FHA loan originated after April 5th. This “small” percentage increase might not sound like much but on a $350,000 San Diego mortgage it is $1750 more paid by the buyer. I’m sure like me you can think of a million other things to spend that money on 
. This week HUD is also asking Congress to increase the monthly mortgage insurance and down payment requirements for the FHA program.
Later in the week I will also be posting an example of how this will affect monthly and over all payments.
If you have any questions about this information or any other San Diego mortgage or real estate questions feel free to give me a call at (619)285-2921