Paramount Equity Mortgage under heavy scrutiny #business #mortgage


#paramount mortgage

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Paramount Equity Mortgage under heavy scrutiny

Washington state intends to revoke the company s license, and Oregon will investigate its advertising

Thursday, July 24, 2008

The Oregonian Staff

Washington mortgage regulators announced Wednesday they intend to revoke the license of Paramount Equity Mortgage, a Roseville, Calif. firm that has blanketed Northwest radio stations with commercials promising cheap and easy mortgages.

Oregon mortgage officials are also looking into Paramount’s advertising.

The Washington Department of Finance accused Paramount of charging and collecting unearned fees, charging consumers to buy down interest rates without actually reducing the rates, failing to make required disclosures and making state and federally required disclosures in a deceptive manner. The department said it will fine Paramount $500,000.

“Paramount failed to make proper disclosures in almost every loan we reviewed,” said Deb Bortner, director of consumer services for the finance department.

In addition, the state had a problem with Paramount’s claim that it would pay to have its customers’ homes appraised. Paramount covered the cost of an appraisal and then charged its clients a series of fees, Washington officials claimed.

Paramount officials denied any wrongdoing.

“We believe these allegations are completely unjustified, and we look forward to defending ourselves against all charges,” the company said in a written statement.

If Paramount and Washington regulators can’t negotiate a settlement, the charges will be heard by an administrative law judge.

Paramount made more than 1,700 mortgage loans to Washington borrowers in 2007, collecting more than $8.7 million in fees.

Among the individuals named in the Washington action is Hayden “Hayes” Barnard, Paramount’s president, co-owner and spokesman in the company’s ubiquitous commercials.

Oregon regulators are also looking into Paramount but are restricting their probe to the company’s ads. Oregon has not launched a formal investigation into the company’s operations, though it has received seven consumer complaints and several questions about its advertising, said Lisa Morawski, spokeswoman for the Oregon Department of Consumer and Business Services.

The Oregon department’s mortgage division adopted new rules in May aimed at preventing “bait-and-switch” and other misleading advertising.

Paramount Equity Mortgage under heavy scrutiny

Washington state intends to revoke the company s license, and Oregon will investigate its advertising

Thursday, July 24, 2008

The Oregonian Staff

Washington mortgage regulators announced Wednesday they intend to revoke the license of Paramount Equity Mortgage, a Roseville, Calif. firm that has blanketed Northwest radio stations with commercials promising cheap and easy mortgages.

Oregon mortgage officials are also looking into Paramount’s advertising.

The Washington Department of Finance accused Paramount of charging and collecting unearned fees, charging consumers to buy down interest rates without actually reducing the rates, failing to make required disclosures and making state and federally required disclosures in a deceptive manner. The department said it will fine Paramount $500,000.

“Paramount failed to make proper disclosures in almost every loan we reviewed,” said Deb Bortner, director of consumer services for the finance department.

In addition, the state had a problem with Paramount’s claim that it would pay to have its customers’ homes appraised. Paramount covered the cost of an appraisal and then charged its clients a series of fees, Washington officials claimed.

Paramount officials denied any wrongdoing.

“We believe these allegations are completely unjustified, and we look forward to defending ourselves against all charges,” the company said in a written statement.

If Paramount and Washington regulators can’t negotiate a settlement, the charges will be heard by an administrative law judge.

Paramount made more than 1,700 mortgage loans to Washington borrowers in 2007, collecting more than $8.7 million in fees.

Among the individuals named in the Washington action is Hayden “Hayes” Barnard, Paramount’s president, co-owner and spokesman in the company’s ubiquitous commercials.

Oregon regulators are also looking into Paramount but are restricting their probe to the company’s ads. Oregon has not launched a formal investigation into the company’s operations, though it has received seven consumer complaints and several questions about its advertising, said Lisa Morawski, spokeswoman for the Oregon Department of Consumer and Business Services.

The Oregon department’s mortgage division adopted new rules in May aimed at preventing “bait-and-switch” and other misleading advertising.


Mortgage Qualifier Calculator Toronto #reverse #mortgage #info


#mortgage qualifier

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Mortgage Qualifier Calculator

Are you tired of renting, and are now looking to purchase your first home? Making the first step towards owning a home is scary for many people, but understanding the requirements for a mortgage can help you avoid many of the mistakes made by first-time buyers.

The first step in buying your home is determining your budget. The mortgage qualifier calculator will show you how much you can afford if you fill in the entry fields correctly and click on the “Click to Calculate” button to view a complete amortisation schedule of the mortgage payments.

Here are some useful definitions:

Annual Income – For married couples, this refers to the total combined gross annual income. Generally, it is the combined gross annual income for the applicant and his/her co-borrower. Include all income before taxes, including bonuses, base salary, commissions, tips, overtime, investment income, rental income, child support, alimony, etc.

Annual taxes – This includes income taxes, property taxes, and any other taxes you and your partner are currently paying. The income tax is the annual tax placed on your income by the government, and can vary based on income, location, and other factors. If you are currently paying property tax on your home, the annual amount should also be included.

Monthly Condo Fees – This is the monthly fee charged for your condominium that you’re currently incurring.

Monthly Heating Cost – This is the total monthly payment for your current home’s heating bill. Although there are other monthly costs associated with properly running a house, such as cable, telephone, gas, water, etc. they are not incorporated in the calculation. However, you can include them for a more accurate estimate of your monthly payment.

Monthly Mortgage Details

Mortgage Payment (principle and interest) – This refers to the monthly principle and interest payment for your mortgage, and does not include the amounts for maintenance or property taxes.

Property Tax – This is the monthly property tax that you expect to pay on the home you want to purchase.

Monthly Condo Fees – Unlike the previous condo fees, this amount refers to the fee that you expect to incur with ownership of the home. Usually, 50 percent of your condo fee is added to your Gross Debt Service (GDS) when calculating the maximum mortgage you qualify for.

Monthly Heating Costs – The total monthly payment for the heating bill for the home you’re purchasing. You may choose to include other essential costs for running the home, such as water, cable, phone, etc.

Total Costs – This refers to every cost that you currently incur, including your monthly car loan payments, credit card payments, other loan payment, as well as the total closing costs, including the total upfront costs to close your loan, filing and appraisal fees, and any other miscellaneous fees paid.

Monthly Income Required (Approximate) – An estimate of how much you can afford to borrow in order to buy a home.

Like any estimate, the result of Mortgage Qualifier Calculator is based on some rules of thumb and rounded figures. Also, the calculator is meant to be a self-help tool for your personal use, and is not intended to offer investment advice. So, make sure to seek personalised advice from our qualified professionals regarding your personal finance issues.

Try these online tools to help make financial decisions that are right for you. Call us at 416-969-8130 if you need help, or would like more detailed information.

Income may not be necessary to qualify. Please call us for a personal consultation.

Related Links


Balloon Mortgage Calculator: Commercial – Investment Property Calculator #online #mortgages


#balloon mortgage calculator

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Balloon Loan Calculator

Calculate Your Business Loan’s Monthly Payment Schedule

This tool figures a loan’s monthly and balloon payments, based on the amount borrowed, the loan term and the annual interest rate. Then, once you have calculated the monthly payment, click on the “Create Amortization Schedule” button to create a report you can print out.

Everything You Need to Know About Balloon Mortgages

A Balloon mortgage is a loan that doesn’t wholly amortize over the life of the home loan, resulting in a balance at the conclusion of the term. Consequently, the final payment is substantially higher than the regular payments. Obviously, the majority of homeowners who choose this type of financing plan on either refinancing prior to the term ending, or selling the property. A balloon mortgage requires monthly payments for a period of 5 or 7 years, followed by the remainder of the balance (the balloon payment). The monthly payments for the time period prior to the balloon’s due date are generally calculated according to a 30 year amortization schedule.

Why a Balloon Loan?

A balloon mortgage is often chosen by individuals who want to have low, fixed monthly payments, with the end goal being to sell the property (often investment properties), at a profit prior to the balloon payment coming due.

What Are 15 Year Balloons Used For?

A 15 year balloon is a form of home loan in which the homeowner makes principal and interest payments for 15 years. Subsequently, at the conclusion of the 15 year term, they are required to pay the amount of money still owed. The 15 year has also become a preferred loan choice for a second mortgage in a piggyback agreement. It’s becoming more and more common for borrowers that put less than 20% down to opt for piggyback options instead of purchasing mortgage insurance. A piggyback can be a first mortgage for 80% of the home’s value and a second mortgage for 5% to 20% of value, depending upon how much the borrower puts down as a payment. In some cases the second mortgage is an adjustable rate; however an increasingly common option is the 15 year balloon.

Paying Off Your Loan Early Vs. Conserving the Money

Property owners who have the available resources to make a partial or full early payment on their balloon amount have the advantage of selecting from a number of different options. Your best option is dependent on your financial goals and any other investment or savings options you have. One of the main variables that determine whether it’s a better idea to pay off the balloon ahead of time is the interest rate on the loan in comparison to the interest that could be earned from investing the money elsewhere until the balloon is due. If the loan carries a higher interest rate, you would save money by paying the balloon off early. It’s important to keep in mind that an early balloon payoff requires that you pay not only the balloon amount, but any principal reduction that would be included in the regular monthly payments that are yet to be paid. One last consideration with investing or paying down your loan would be the tax implications. People in a higher tax bracket have to earn a significantly larger rate of return in the market for the after-tax returns to match the yield on paying off their debt early .

Refinancing a Balloon Mortgage When You’re Underwater

A mortgage debtor with a balloon balance higher than the property value faces challenging problems. Since no other lender will refinance an underwater home, either their current lender will need to refinance it or the homeowner will be pushed to default. In some cases an offer might be presented by the lender to extend the term of the loan for an additional 5 years at the same rate.

If you’re underwater, keep in mind that your current lender is aware that you don’t have any other option but to default, a fact that would inflict a substantial loss on the lender. A considerably better result from their standpoint would be to refinance which would keep your payments coming in and give you an opportunity to pay off your mortgage. In some cases the lender may be willing to modify the terms of your loan as well, relieving your payment problems. Basically, whatever deal emerges, you’ll be able to negotiate and if your lender understands that you see your choices as either defaulting on your mortgage or refinancing at terms you can handle, they’ll more than likely be reasonable.

Advantages Disadvantages

Advantages

If you’re wondering why a homeowner would decide on a balloon mortgage instead of a fixed or adjustable-rate mortgage. the answer is that balloon mortgage rates come at a discounted APR, making them a more affordable alternative early in the term. An example would be that if you don’t plan on keeping the property (or loan) for more than a few years, a balloon would be a viable option. That being said, there are always associated risks.

Disadvantages

The obvious negative aspect is the uncertainty at the conclusion of the loan term. For instance, after 7 years, the existing balance is owed. Just imagine if your property drops in value, leaving you owing more than the remaining balloon payment – you’d have a big problem on your hands if you can’t refinance or execute a short sale. This wouldn’t be the case if you had an ARM or fixed rate loan. ARMs may adjust higher, established by their caps which limit the amount the payments can rise, providing a certain level of protection. Even if you’re underwater on your loan, thanks to the caps, your payments will probably be manageable. Fixed rate home loans have the same payment throughout the life of the loan.

What is a Negative Amortization Balloon Mortgage?

Negative amortization develops when the monthly payment is less than the interest due which causes the loan balance to increase instead of decreasing. ARMs that permit negative amortization could increase the affordability of the home as well as provide lower interest rates, if the interest rates don’t rise consistently. As with just about everything else regarding finance, the benefits come with risks.

In conclusion

The most important thing you should do before you decide on a home loan is to evaluate all of your options and consult with a trusted mortgage broker/lender. You just might be surprised to find that today’s fixed rate loan rates may be better than a ARM or balloon mortgage and without as much risks.

2007 – 2016 www.MortgageCalculator.org | Contact Us


What Heirs Need to Know About Reverse Mortgages-Kiplinger #home #loan #rates #today


#reverse mortgages

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What Heirs Need to Know About Reverse Mortgages

Death of the borrower triggers the loan payoff, but the estate and heirs will never owe more than what the home is worth.

If you have a reverse mortgage, let your heirs know. Soon after you die, your lender must be repaid. Heirs will need to quickly settle on
a course of action.

See Also: Tighter Rules on Reverse Mortgages

If one spouse has died but the surviving spouse is listed as a borrower on the reverse mortgage, he or she can continue to live in the home, and the terms of the loan do not change. At the death of the last borrower, though, adult children and other nonspouse heirs must pay off the loan. They can keep the property, sell the property or turn the keys over to the lender—and their decision is “usually driven by whether there’s equity left in the property,” says Joseph DeMarkey, a principal member of Reverse Mortgage Funding.

A reverse mortgage allows seniors age 62 or older to tap their home equity. Nearly all reverse mortgages are federally backed Home Equity Conversion Mortgages. The homeowner doesn’t make payments on the loan while living in the house, but the loan becomes due at the death of the last borrower.

Heirs get an initial six months to deal with the loan payoff. And it’s to their advantage to move as quickly as possible. Until the loan is settled, interest on the balance and monthly insurance premiums will continue to eat into any remaining equity.

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The good news for heirs is that reverse mortgages are “nonrecourse” loans. That means if the loan amount exceeds the home’s value, the lender cannot go after the rest of the estate or the heirs’ other assets for payment. “The estate can never owe more than the value of the property,” says Gregg Smith, president and chief operating officer of One Reverse Mortgage.

The difference is covered by federal mortgage insurance, which the borrower pays while holding a HECM. If there is leftover equity after the loan is paid off, that money goes to the estate.

When the last owner dies, the estate’s executor should contact the lender. (Lenders keep track of databases that note deaths and will send a notice to heirs if records indicate the last borrower has died.) Loan proceeds disbursed as monthly payments will stop. If the borrower took a line of credit, that line will be closed.

When It Makes Sense to Keep the House or Sell

Within 30 days of notification, the lender will send a federally approved appraiser to determine the home’s market value. The amount that’s due to the lender is the lesser of the reverse mortgage loan balance or 95% of the appraised market value of the home.

Say the appraiser determines the home is worth $200,000 and the loan balance is $100,000. To keep the house, the heirs need to pay the loan balance of $100,000. If the house is sold, the heirs get any equity above the $100,000 loan balance.

But say the home declined in value during the housing slump and the loan now exceeds the home’s appraised value—the home is appraised for $100,000, but the loan balance is $200,000. To keep the home, the heirs will need to pay $95,000—95% of the $100,000 market value. The heir doesn’t have to pay the full balance; the government insurance covers the remaining loan amount.

If the heirs decide to sell this house, the home must be listed at a minimum of the appraised value. (The 5% difference helps cover the costs of selling.) Because all sale proceeds go to pay off part of the loan and real estate fees, the estate receives no equity. The government insurance picks up the difference on the loan.

But if there is no potential equity, heirs may decide to simply hand the keys to the lender and avoid the hassle of trying to sell the home. Known as “deed in lieu of foreclosure,” the heirs sign the deed over to the lender. “If the property was underwater, the heirs may have no interest in selling it or keeping it,” says Diane Coats, senior operational oversight specialist for Generation Mortgage.

Heirs can request up to two 90-day extensions. To get that full year, they must show evidence that they are arranging the financing to keep the house, or they are actively trying to sell the house, such as providing a listing document or sales contract.

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Editor’s Picks From Kiplinger


Balloon Loan Calculator #mortgage #calculator #excel


#balloon mortgage calculator

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Balloon Payment Calculator
With Payment Schedule

For that feature, please use the Time Value of Money Calculator. This calculator will support balloon loans and you ll be able to set origination date, payment dates and balloon date to any date desired.

If you click on above link, scroll down the page and please see tutorial nos. 7 and 8:

Balloon Payment Calculation
Calculate the balloon amount

Balloon Loan Calculation
Calculate the periodic payment required to result in a specified balloon

If you try this calculator, I would be very interested to know how you make out.

#2 there is already a calculator on this site that will allow you to have a balloon payment and set the 1st payment date (or any payment date for that matter). Please see:

This calculator is our most flexible calculator. However, it may take some getting use to. To that end, there are 25 tutorials listed at the bottom of the page. Please see #7 and #8. (Note, the tutorials still have not been updated to reflect the new look, but the basic functionality between the old calculator and new one is the same. Ask question on that page if something isn t clear.)

#1. This is where I get a chance to sell you something. The C-Value! program will create a schedule and export to Excel. If you are using Windows you may want to consider using it. It costs $19.95. (Works in a very similar way to the above calculator.)

Thanks for the comment.

Not with this particular calculator. However, the Time Value of Money calculator will let you set dates (even setting the date individually for all payments should that ever be needed).

Depending on whether the regular payment is unknown or the balloon payment about is unknown, scroll down the page and see the tutorial #7 or #8 for examples.

If you have any question about its use, you can ask them on that page.

(Some calculators on this site do not offer date options so that they are smaller and work better on smaller devices. Additionally, for some requirements, setting dates is an unnecessary hindrance.)

I need to run several payment schedules with fixed payment amounts but I also need to choose the loan date (05/01/16). It seems all your calculators assume a loan date of the first of next month (04/01/16). Can you recommend another calculator?

Thanks for asking. I see you found it, but for the benefit of others, the amortization schedule allows the user to select a loan date and first payment date.

I ll also point out that since you were looking at the balloon payment calculator, the the amortization schedule won t support balloon loans. However this calculator, Time Value of Money will allow you to set the loan date and have a final balloon payment. (Note, the tutorial listed at the bottom of the page, still need to be updated. Hopefully they will be completed within the next two weeks.)

Gary Spray says:

How can I change the first payment date. The autocalc started in 6/1/2016 with first pymt due 7/1/2016. I need it to start with 1st pymt 6/1/2016.

Thank you for any info and assist.

This calculator is designed for rapid entry and therefore it is not possible to specify dates.

But, I do have a calculator that will handle balloons and give you full control over the dates. Please use the Time Value of Money calculator.

And see these tutorials:

Please let me know how you make out. If the TVM calculator doesn t meet your needs, tell me why, because I have one more idea as well.

Can you please add smart phone support? Tried on both a window phone and android but was able to edit any numerical fields. Only the drop down fields.

I ve got to try to get a hold of an Android device to try this. As far as I know, the site should work well with any modern device handheld, tablet or desktop. I ve personally tested with iPhone, iPad and all popular desktop browsers.

With Android, does it have next/previous buttons? Or tab/shift tab? If so, please try this. Rather than touch the screen and try to edit, use the keys to go to the next input and then try to type. My hunch, that will work.

In general, for edit to work, the number has to be selected OR type the backspace key to clear first.

Please let me know of any of these things help.

Comments, suggestions questions welcomed. Cancel reply


Reverse Mortgage #fixed #mortgage #rates


#reverse mortgages

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Get Free Reverse Mortgage Information

Important Information: Reverse Mortgages are neither “endorsed” nor “approved” by the Federal Government. The FHA (Federal Housing Administration) provides certain insurance benefits for lenders and borrowers in connection with the lender’s HECM loans; the FHA does not make or originate loans. The owner(s) retain title to the property that is the subject of the reverse mortgage until the person sells or transfers the property and is therefore responsible for paying property taxes, insurance, maintenance and related taxes. Failing to pay these amounts or failure to maintain the condition of your property may cause the reverse mortgage loan to become due immediately. A reverse mortgage is a complex loan secured by your home. Whether such mortgage makes sense for you depends on your financial situation and needs. For these reasons, we strongly recommend that you consult with a qualified independent housing counselor, family members and other trusted advisers before making this decision. This website is not from HUD or FHA and was not approved by HUD or any government agency.

iReverse Home Loans, LLC originates reverse mortgages in Alabama, Alaska, Arizona (MB-0919584), Arkansas, California, Colorado, Connecticut, Florida, Illinois, Indiana, Iowa, Kansas, Louisiana, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Nevada, New Mexico, Ohio, Oregon (ML-5378), Pennsylvania, South Dakota, Tennessee, Texas, Utah, Vermont (1164-MB), Virginia, Washington and Wisconsin.


Define: Upside-Down Loan #mortgage #payment #calculators


#upside down mortgage

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Upside-Down Loan

A loan secured by a collateral that has depreciated in market value and is worth less than the balance owed. For example, if you owe $5,000 on a car that is only worth $4,000, the loan is upside down.

More On Upside-Down Loan

With an upside-down loan, the collateral that secured the loan is worth less than the money owed on it. This is relatively common during the early years of car loans because cars depreciate so rapidly that it is easy to owe more on a car than it is worth. Borrowers can also be upside down on a mortgage due to a combination of falling home prices and lack of equity.

How it happens
Upside-down loans are most common in auto loans. New cars are not necessarily a good investment. As soon as you drive your new car off the lot, its value drops significantly. Therefore, it is common to owe more on a car than it is worth in the first couple of years, and the longer the term on your loan, the longer the period of time you will be upside down.

A long-term loan can be tempting. It is appealing to keep your monthly car payments as low as possible. However, since you pay so little toward principal each month, you pay a lot of extra interest. And, since you are not paying down as much of the principal, so your loan becomes upside down quickly. Later, when you go to trade-in the car, you may find that you owe the lender a few thousand dollars even after the trade-in.

How to avoid an upside-down loan.
There are a few things you can do in order to avoid owing more than your car is worth. You can get pre-qualified for an auto loan before you go car shopping.

Chances are you can find a much better rate and term than the car dealer would offer you, and that can help. Another option is to use a home equity loan rather than a car loan to buy your vehicle. You probably can get a much better interest rate since the loan is secured with your home, and the interest should be tax deductible. With this option, keep in mind that the equity you borrow will no longer be available to you upon the sale of your home. Also, think about making a large down payment that will cut the size of your principal and reduce the likelihood that you will end up with an upside-down loan. Finally, be smart. Don’t overspend on a car. It will not keep its value, and you are only in it for limited time. Buy what you can afford so that you are not tempted by terms that quickly turn into an upside-down loan.


Greentree Mortgage Company: Mortgage Refinancing Online #home #mortgage #payment #calculator


#greentree mortgage company

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Greentree Mortgage Company

Greentree mortgage company Things like your social security number and details such as your recent addresses and owners are important. greentree mortgage company The house and lot that you purchase through a mortgage loan will be used as collateral for your loan. greentree mortgage company

greentree mortgage company

Greentree mortgage company Even if investment in one of them is not the government secure investor confidence is very high due to the quasi-government organization. greentree mortgage company There is also the option of purchasing a rental property as an apartment building. greentree mortgage company

greentree mortgage company

greentree mortgage company

Greentree mortgage company A plan of adjustable or variable mortgage has a variable changes over time according to the rates. greentree mortgage company How the mortgage rates are determined can help you conduct the best percentages in a market where the lowering of rates by as little as 0.125% can mean thousands of dollars in savings for the borrower. greentree mortgage company


Minimum FHA Credit Score Requirement Falls 60 Points #2nd #mortgage #rates


#fha mortgage requirements

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Minimum FHA Credit Score Requirement Falls 60 Points

Minimum Credit Score For Home Loan

The minimum credit score for a home loan is 500, however, it’s possible to get a mortgage loan with no credit score at all. FHA loans require no credit score; and, VA loans, USDA loans, and conventional loans each require a minimum credit score of 620. Exceptions can be made to minimum credit score policies for borrowers with reasonable cause.

Minimum FHA Credit Score Drops 60 Points

It’s getting easier for borrowers to get an FHA-backed home loan.

Major lenders will now approve FHA mortgage applications for borrowers with FICO scores of 580. It marks a 60-point improvement over 2014, when FHA lenders required 640 FICO scores or better to get approved.

The news comes at a time when FHA loans are in demand.

The program’s 3.5% downpayment minimum is among the most lenient for today’s home buyers; and underwriting requirements on an FHA loan are flexible and forgiving.

FHA loans account for close to one-quarter of all loans closed today.

FHA Loans Allow 3.5% Downpayment

FHA loans are an important component of the U.S. housing and mortgage market.

FHA loans are loans which are insured by the Federal Housing Administration and made available to U.S. buyers and existing homeowners.

The FHA was formed in 1934 and it exists to provide affordable housing to Americans. Today, it’s the largest insurer of mortgage loans worldwide.

The Federal Housing Administration doesn’t actually make loans. Rather, it insures loans made by the nation’s banks, providing protection against default and loss.

In order to gain the FHA’s protection, lenders must only make sure that the loan in question meets the lending standards as set forth by the FHA.

The FHA’s rule book is known as the “FHA guidelines” and it describes all allowable loan traits, as well as the going terms of an Federal Housing Administration-backed loan.

For example, FHA guidelines state that home buyers must make a minimum downpayment of 3.5 percent against a home’s purchase price; and that buyers can be cleared to buy a home 12 months after a bankruptcy, short sale, or foreclosure .

Guidelines also place limits on the size of an FHA-backed loan, which varies by county.

FHA loan limits range from $271,200 for a single-family home to $1,202,925 for a 4-unit home.

Fewer FHA “Investor Overlays” Means More Approvals

FHA mortgage guidelines define which loans the Federal Housing Administration will, and will not, insure. However, U.S. lenders don’t underwrite loans to the FHA guidelines as they’re written, to the letter.

Lenders impose additional restrictions known as investor overlays which make it harder for an applicant to qualified for an FHA-backed loan.

One such overlay is linked to the FHA Streamline Refinance.

According to the official FHA guidelines, with an FHA Streamline Refinance. lenders are not required to verify income, employment or credit scores. Yet, many lenders choose to verify regardless.

This is because the FHA penalizes banks for making too many “bad loans” and verifications can cut down on defaults.

Another important overlay is linked to your credit score.

The FHA rules state that it will insure home loans for which the borrower has a credit score of 500 or higher. Banks, however, are reluctant to make such loans.

Buyers with credit scores of 500 are highly likely to default in the next 6 months, which would negatively affect a bank’s FHA default rate, leading to fines, penalties, and perhaps, termination from the FHA insurance program.

Beginning in late-2011, most banks enforced a minimum credit score for FHA loans of 640. That minimum score has since been lowered.

U.S. home buyers can now get an FHA loan with credit scores of just 580.

Furthermore, with the domestic economy improving and U.S. housing expanding, it’s not unexpected that minimum FHA FICOs would drop again soon.

What Are Today’s Mortgage Rates?

For today’s U.S. home buyers, the Federal Housing Administration mortgage is among the most lenient and forgiving mortgage programs available. Find out whether you’re FHA-eligible.

Get today’s live mortgage rates now. Your social security number is not required to get started, and all quotes come with access to your live mortgage credit scores.

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.


FirstBank Reverse Mortgage #prequalify #mortgage


#reverse mortgages

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Welcome to FirstBank Mortgage!

Reverse Mortgage Service

Why FirstBank?

Benefits of a Reverse Mortage

Reverse mortgages are generally considered to be a safer option these days. Namely, this is because of the Reverse Mortgage Stabilization Act of 2013, which added more safeguards and put into place more restrictions for lenders. As a result, a number of lenders offer more lucrative terms and reduced upfront cost.

November 4th, 2014 Birmingham, Alabama-based FirstBank Reverse is building its wholesale and correspondent lending services through the hire of Bob Garczewski as reverse mortgage correspondent manager. In his role with FirstBank, Garczerski will lead the reverse.

October 12th, 2014 FirstBank Mortgage Partners last week announced that it has promoted Regional Manager Ed O’Connor to the role of Corporate Director of Marketing and Sales. In his newly expanded position, O’Connor will be responsible for all company-wide marketing.

About FirstBank

Frequently Asked Questions

What is a Reverse Mortgage?

Most Reverse Mortgages are formally known as a Home Equity Conversion Mortgages. These mortgages are sponsored and insured by the Federal Housing Authority (FHA) and the Department of Housing and Urban Development (HUD). A Reverse Mortgage or HECM, allows the borrower to access equity into tax free proceeds that do not require a monthly mortgage payment.

How does a Reverse Mortgage work?

With a Reverse Mortgage, there are no monthly payments from you. As one of your most important assets, your home usually holds a certain amount of equity. Because of this equity, when the time comes someday for the loan to be repaid, the value of the home when sold is able to re-pay the loan. Meanwhile, you are able to live in the home for as long as you like without making payments. Here are additional details on how a Reverse Mortgage works

Will I still own my home with a Reverse Mortgage?

Yes. With Reverse Mortgages, as long as you pay your taxes and insurance and otherwise comply with the loan terms, you will retain ownership of your home. The bank only takes title of your home if you do not meet these obligations. As long as you pay your taxes and insurance and otherwise comply with the loan terms, you remain the owner of the home and may live there for as long as you want.

Is there any risk of losing my home?

No, as long as you fulfill all your obligations of the loan. The obligations for a Reverse Mortgage are that you continue to pay your property taxes, insurance, and keep basic maintenance and repairs. If you do not uphold these responsibilities, the loan becomes due, which may mean the selling of the home to pay the loan. If you uphold these responsibilities and obligations as agreed, you will not lose your home.

How are fee and interest rates calculated?

Many of the fees are the same as with any mortgage. There are some new enhancements to the program that allow for lower fees. Interest rates are flexible, and should be discussed with your our loan specialist to find the right program to fit your financial goals.

How would I receive my Reverse Mortgage funds?

Your Reverse Mortgage funds can be disbursed to you in a few ways. You may receive:

  • Full or partial lump sum
  • Line of Credit
  • Monthly Payments (tenure or modified tenure plan)
  • Combination of any of these

The choice is ultimately yours, but our loan specialist at FirstBank are here to help advise you on the disbursement method that is the best option for your unique situation. Remember, you have the option to change your disbursement method at any time.

Is a Reverse Mortgage a last resort option only? Are Reverse Mortgages only for desperate and poor seniors

This is not at all the case. A Reverse Mortgage can be a very powerful and intelligent strategic financial planning tool. There is no better product more readily available to the senior population in terms of supplementing retirement income and managing retirement risks. However, the Reverse Mortgage should be evaluated and customized to your particular need. At FirstBank, we have dedicated professionals that will work with you and any of your financial advisors to obtain a Reverse Mortgage that is tailored to your overall retirement strategy.

How will the Reverse Mortgage loan eventually be repaid?

Your Reverse Mortgage loan is repaid when the last borrower leaves the home or passes away. What typically happens is that the home is sold and the proceeds pay back the Reverse Mortgage loan. Any remaining equity after the loan is repaid goes to you or your heirs. If your heirs choose to keep the home instead, they can pay back the Reverse Mortgage loan in other ways, such as refinancing the Reverse Mortgage to a conventional mortgage loan.

How do I know if I qualify for a Reverse Mortgage and how much money can I receive?

The qualifications to get a Reverse Mortgage are simple:

  • Be at least 62 years of age
  • Own your home
  • Occupy the home as your primary residence

The amount of money you can receive depends on the following:

  • Your home’s value (as appraised by an independent appraiser)
  • Your age
  • The interest rate on the Reverse Mortgage
  • Any mortgage balance or liens against the property

Instances when the loan becomes due are called “maturity events.” Maturity events include cases when the last borrower:

  • Sells or transfers the home
  • Passes away
  • Does not pay the home’s taxes and insurance
  • Leaves the home permanently or for more than 12 consecutive months
  • No longer occupies the home as the primary and principal residence
  • Defaults under the terms of the reverse mortgage
Will a Reverse Mortgage affect my Social Security, Medicare, or Pension benefits?

No, these benefits will not be impacted, as a Reverse Mortgage is considered loan proceeds and not income. However, Medicaid and SSI may possibly be affected.

What if the loan amount ends up exceeding the value of my home? Will my heirs be responsible for my debt?

Reverse Mortgages are non-recourse loans. What this means for your heirs is that after the last borrower leaves the home, the proceeds from the sale of the home is the only asset that can be taken to pay the loan’s balance. If somehow the loan’s balance ends up surpassing the value of the home, the difference is covered by the Federal Housing Administration’s (FHA) insurance fund. However, if your heirs wish to keep the home, they may choose to do so by paying off the loan in full.

What happens if I pass away during my Reverse Mortgage loan before I receive the full amount of my loan?

If you pass away during your loan, any part of your loan that hasn t yet been sent to you remains as equity in the home that becomes part of your estate. What immediately happens to a Reverse Mortgage after death is that it becomes due, and thus the heirs are usually given about 12 months to sell the home. They also have the option to keep the home by paying off the Reverse Mortgage loan. Otherwise, the home is sold and the proceeds first pays off the Reverse Mortgage loan, and the rest goes to the heirs.

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© 2015 FirstBank Reverse Mortgage Homeowners must be 62 years of age of older, own the home outright, or have a low mortgage balance that can be paid off with proceeds from the reverse loan, must live in the home as a primary residence. Homes must meet HUD s minimum property standards. Borrowers must maintain hazard and flood insurance premiums, property taxes, utilities and make any property repairs. Although there are no monthly principal and interest mortgage payments, interest accrues on the portion of the loan amount disbursed. Reverse mortgages can use up all or some of the equity in your home, the amount you owe on a reverse mortgage grows over time. Must meeting underwriting requirements. Program rates, fees, terms and conditions are not available in all states and subject to change. FirstBank Mortgage is a division of FirstBank. All products and services offered through FirstBank. FirstBank NMLS#472433. This material is advertising by FirstBank and is not from FHA/HUD. This document is not approved by any government agency.