F.H.A. Loan Information! GREAT!

How to spell “F.H.A.”!!!                                                                               1/28/2011

Today’s conventional interest rates30-year fixed = 4.625%     5/1 ARM = 3.25%

Learning to suggest FHA financing as a possible option for buyers in need of flexibility will be a great tool for you.  You will NOT need to know many specific details of the FHA product – that’s MY job – but it does pay to know that flexibilities do still exist – however limited they may be, these days!

The GOOD:

·FHA offers the lowest down payment possible – just 3.5%.  (USDA and VA still offer 100% financing for those borrowers/properties that qualify.)

·Highest allowable debt ratio – if your buyer has too much debt, FHA can save your deal!

·Low interest rate – often lower than the best conventional!

· Flexible guidelines for receiving gifts for down payment funds – for those buyers with little cash….but PARENTS!!! 

·Flexibility to deal with ‘special credit circumstances’ – FHA allows for letters of explanation that make sense of unusual circumstances on your buyers’ credit report, such as:

o   Credit card payment on credit report has always been paid (and will continue to be) by dad.

o   Ex-husband didn’t make the payments on this item, and we can show proof.

o   Newly-separated buyer can show that soon-to-be-ex-husband is responsible for mortgage payment on marital home.

The BAD:

·FHA financing ALWAYS means mortgage insurance – for at least 5 years.  I view it as the cost of the flexibilities benefiting your buyer.

·This mortgage insurance has TWO components:

o  Up-front fee of approx 1% of their loan amount – this is rolled into the loan amount, so not paid out-of-pocket!

o  Monthly premium is added to the buyers’ payment each month.

FHA scenario from today:

· Purchase of a primary residence, single-family home

· Purchase price - $250,000

· Down payment of just 3.5% (that’s just $8,750), of which $7,000 was a gift from family!

· Buyer had a great deal of debt, including two big cars and student loans.

· Interest rate for a 30-year fixed loan = 4.25%!!!  (that’s NOT a misprint!!!)

· The same scenario with a 20% down payment and a conventional loan would have been 4.625%!  However, this buyer would not have qualified for conventional due to debt ratio and lack of cash, but….FHA SAVED THE DEAL!!!

Let me know your questions about FHA financing today.  

Real Estate Mortgage Network, Inc. NMLS #6521. New Jersey Licensed Lender and Mortgage Banker #L041053. MLS # 322102

R. Roy Dunn (843) 446-4663   Fax: (803) 753-9432     http://www.financingthebeach.com/

Looking to buy? Buy NOW before the RATES RISE!

It's been said that "no news is good news...." And while that can be true, lately many of the economic reports we have seen have been very good news, as they show signs that our economy continues to improve.

Stocks just enjoyed their seventh straight week of gains, due to the positive economic reports that have been streaming in. While this is certainly cause for celebration, an important question we need to consider is what does this mean for home loan rates in the short and long term?

On the one hand, improvement in the economy is good news on the housing front, as once people feel better about keeping their job or getting a new job, home purchasing activity will rise, and values will follow. But on the other side of the coin, as the labor market and economy improve, home loan rates will have to gradually rise as well. And remember, this all ties in with the Fed's plan to inject the full $600 Billion into our economy as part of their latest round of Quantitative Easing, known as "QE2."

Remember, the three part goal of QE2 is to create inflation, lower unemployment, and boost Stock prices - and we are seeing evidence of these goals occurring. Not only have Stock prices improved over the last seven weeks as we discussed above, but December's Jobs Report posted the lowest unemployment rate since May of 2009. And last week, we saw some evidence of inflation as the Producer Price Index (PPI), which measures inflation at the wholesale or producer level, came in higher than expected. While December's Consumer Price Index wasn't quite as hot as the PPI, going forward our increasing budget deficit could cause inflation to spike down the road.

So what's the bottom line if you have been thinking about purchasing or refinancing a home? Home loan rates are still very attractive right now, so call or email me if you want to get started. Or forward this newsletter on to someone you know who may benefit from today's historically low rates.

Monthly Marketing Report for the Grand Strand.

During December, SFR and condo sales were up versus prior year levels.  The increase was driven by a record number of distressed sales (37% of all sales).  This level of distressed activity led to a low median sales price of $169,900 and $109,900 for SFR and Condos, respectively.  For the full year, SFR and Condo sales were up approx. 15% and 20%, respectively.

(Source:  SiteTech Systems)

Local Real Estate Association Monitors Market Conditions

The numbers for 2010 give a hopeful sign that the economy is slowly improving. According to data compiled by Site Tech Systems, SFR sales rose 14.6% from 2009. Condo sales rose 19.3% in the same time period. We will continue to monitor the local market trends and keep you informed throughout the year.

(Source:  Coastal Carolinas Association of REALTORS® 2010 Annual Report)

Tax Deadline Extended!

What's your New Years Resolution

What is your New Years Resolution? If you are looking to buy or sell a home in 2011, let Jason Ryan and Associates make your resolutions come true.

Whenever you are buying a home, it should be a positive experience, and while doing so, you should do some homework first! There is a wealth of information available to you whether you are a first-time homebuyer or not. It makes the process more understandable, keeps you informed and prepares you to make wise decisions.

Jason Ryan and Associates recommend that you work with a professional Real Estate Agents such as themselves. They will save you money and time. Real estate agents with experience, education and results are usually the leaders in the industry.

Jason Ryan and Associates have accumulted a multitude of awards over the years. The most recent award includes the Platinum Club Award which is given by Re/Max International. Only 4% of the Re/Max Network has acheived this prestigious award. Re/Max has nearly 100,000 agents in more than 75 countries who continue to out-produce the competition, averaging more sales than other real estate agents.

Remember, your real estate agent is a professionally trained person that you are engaging to help you make the right decisions. Be an informed homebuyer and Happy House Hunting!

Best regards,
Jason Ryan

Did you know? Why use Re/Max Agents - Jason Ryan & Associates?

Jason Ryan & Associates closed 92 properties in 2010!

Hire 3 Agents for the price of 1.

• Our 1-800 toll-free # is available 24/7.
• Call now to buy or sell your next home!
• 888.360.7263 (360.SAND).
• Client SATISFACTION is our #1 priority!!

How Much Should I Offer on this Foreclosure?

"How much should I plan to offer...I mean...it is a foreclosure! I am sure the bank is dying to get it off of their books."

I am asked this question quite often and 90% of the time, my answer is the same..."If there are multiple offers already on the table... submit your offer quickly and I'd recommended that you offer full price!" 

Let me explain...Banks seek out the help of experienced realtors and appraisers to determine the lowest fair-market value of a property. The property will be priced lower than other homes in the neighborhood, or lower than other condos in the building, because banks are not in the business to sell real estate. If the property needs repairs, the bank will lower the sale price even more, because the costs to make repairs are deducted. If the bank is also looking at other offers in addition to yours, go ahead and make a full-priced offer, you WILL still get a good deal!

If there are no other offers, (you can ask your realtor to gather this information) still go in with a strong offer. I had a property listed with a $200,000 sales price. An agent submitted an offer for their client of $140,000. The bank would not even entertain the offer...the bank didn't even counter! 15% below asking price is a good starting point for submitting offers...if there are no multiple offers. Again, even if you end up paying full price, you still will get a great deal and have instant equity.

If you submit an offer and at the same time, other offers are coming in, you'll be asked to submit a "Highest & Best" offer. This is when you decide how much the property is truly worth to you...offer your maximum purchase price. If your offer is the highest, you win!

One more note...it doesn't matter if you are planning to pay in cash or financing. Although it would seem that a cash offer is better, banks will still take the highest offer presented. On your offer, you'll also want to have a short time frame for closing to take place. 30 days is a good number.

There's still more to learn, so call me at 888.360.SAND for additional advice. In 2010, I sold nearly 100 bank-owned properties. I am an authorized Listing Agent for Fannie Mae HomePath Properties, as well. I look forward to your questions and to helping you find a great deal!