Wells Fargo Helps First-Time Homebuyers With FHA mortgages

Wells Fargo lowers credit score requirement for FHA mortgages


Wells Fargo announced that effective Jan. 15, 2011, it will accept FHA mortgages for borrowers with credit scores as low as 500.

  • Credit scores ranging from 500 to 579 require a 10% down payment
  • Credit scores ranging from 580 to 599 require a 5% down payment.  
  • A credit score of 600 or higher requires just a 3.5% down payment!



Don’t Just Walk Away…

Many homeowners are struggling today and may be facing a foreclosure. If you or someone you know are facing financial difficulties—whether they are short or long term—Start exploring your options today! Understanding your options that are available can help you find the best solution that works for you and avoid foreclosure.

Even if you haven’t yet missed a mortgage payment, but are worried you might fall behind soon, now is the time to take action. You may be eligible to refinance or modify your mortgage loan, lowering your payment and making it more affordable. Or, if you’ve missed payments and find yourself buried under late fees and past-due amounts, you may qualify for a temporary (or permanent) solution to help you get your finances back on track and avoid foreclosure.

Here are some options:

An agreement between you and your mortgage company to change the original terms of your mortgage—such as payment amount, length of loan, interest rate, etc. You may also be eligible for the government’s Home Affordable Modification Program (HAMP) created to help struggling homeowners.

  • May reduce your monthly mortgage payments to a more affordable amount
  •  Less damaging to your credit score than a foreclosure
  • Stay in your home and avoid foreclosure

A new loan—with new terms, interest rates and monthly payments—that completely replaces your current mortgage. Even if your home value has decreased or you owe more than your home is worth, you may be able to refinance your loan as part of the government’s Home Affordable Refinance Program (HARP).

  • Make your payment more affordable by lowering your interest rate or adjusting the terms of your loan
  • Creates no negative activity or event on your credit history
  • Stay in your home and avoid foreclosure

Repayment Plan
An agreement between you and your mortgage company that lets you pay the past due amount—added on to your current mortgage payments—over a specified time period to bring your mortgage current.

  • Resolve your delinquency
  • Catch up on your past due payments over an extended period of time
  • Less damaging to your credit score than a foreclosure
  • Stay in your home and avoid foreclosure

Don’t just walk away from your home. There ARE better options. The most important thing is to AVOID FORECLOSURE—and options may be available to assist you if you are ready to leave your home. Some options may even offer CASH ($$$) incentives to help you move and transition into different housing. Now is the time to take action before it’s too late and a Short Sale might just be your best option!

Short Sale
A short sale is the sale of a home for less than the balance remaining on your mortgage. If your mortgage company agrees to a short sale, you can sell your home and pay off all (or a portion of) your mortgage balance with the proceeds. You may also be eligible for the government’s Home Affordable Foreclosure Alternatives Program (HAFA).

  • Eliminate your remaining mortgage debt
  • Assistance for relocation may be available (Clients who qualify for HAFA may receive $3000)
  • Start repairing your credit sooner than if you went through a foreclosure
  • Minimal damage to credit score compared to foreclosure
  • May be able to to purchase a home sooner (in as little as 2 years) than if you went through foreclosure (at least 7-8 years)

How Does a Short Sale Work & What Is The Whole Process About?
If you qualify for this option, the process is similar to a normal real estate sales transaction. You will work with a real estate agent to market and sell your home. However, your mortgage company will also be working with you and your real estate agent every step of the way to:

  • Set the sale price (based on current market value)
  • Collect financial information and negotiate with other lien holders (i.e., your second mortgage company) if applicable
  • Review acceptable offers
  • Agree to the terms of the sale once a buyer is in place
  • Work with the buyer’s real estate agent and mortgage lender to finalize the sale.
  • In some cases, you may be eligible to receive relocation assistance to use toward your moving expenses and to make the transition to new housing easier.
  • A Short Sale may take up to 120 days, but this could be shorter or longer depending upon your specific situation.

The main objective is to AVOID FORECLOSURE and to put any financial problems you had, behind you and allow you to move on with your future with a fresh New Start!

Our Consultation is 100% FREE and in most cases, our real estate services and all closing costs are covered by the Lender. My team has closed thousands of short sales in the past few years and have the experience and training needed to complete and finish the transaction successfully and on time.  I am Short Sale & Foreclosure Certified by the National Association of Realtors and also a Certified HAFA Specialist.  Contact me today so I can be there to help! Michael O’Rourke, GRI, SFR


Why Ask For an FHA Loan?

There are lots of reasons to ask your lender for an FHA loan instead of taking a conventional or an expensive and risky sub-prime mortgage loan. Why not take advantage of the many benefits and protections that only come with FHA:

  • Easier to Qualify – Because FHA insures your mortgage, lenders are more willing to give loans with lower qualifying requirements so its easier for you to qualify.
  • Less than Perfect Credit – Even if you have had credit problems, such as bankruptcy, its easier for you to qualify for an FHA loan than a conventional loan.
  • Low Downpayment – We have a low 3% downpayment, and that money can come from a family member, employer or charitable organization. Other loans don’t allow this.
  • Costs Less – Many times, FHA loans have competitive interest rates because the loans are insured by the Federal Government. Always compare an FHA loan with other loan types.
  • Help You Keep Your Home – The FHA has been around since 1934 and will continue to be here to protect you when the others walk away. Should you encounter hard-times after buying your home, FHA has many options to help keep you in your home and avoid foreclosure.

There is more to buying your home then the monthly house payment. Why not ask for an FHA loan that will help you buy your house and keep it too? Tell your lender you want an FHA loan for all the reasons above- FHA is a wise choice.

7 Ways to Clean Credit

Getting the loan that suits your situation at the best possible price and terms makes homebuying easier and more affordable.

Here are seven ways to boost your credit score:

1. Know your credit score
Credit scores range from 300 to 850, and the higher, the better. They’re based on whether you’ve paid personal loans, car loans, credit cards, and other debt in full and on time in the past. You’ll need a score of at least 620 to qualify for a home loan and 740 to get the best interest rates and terms.

You’re entitled to a free copy of your credit report annually from each of the major credit-reporting bureaus, Equifax, Experian, and TransUnion. Access all three versions of your credit report at http://www.annualcreditreport.com. Review them to ensure the information is accurate.

2. Correct errors on your credit report
If you find mistakes on your credit report, write a letter to the credit-reporting agency explaining why you believe there’s an error. Send documents that support your case, and ask that the error be corrected or removed. Also write to the company, or debt collector, that reported the incorrect information to dispute the information, and ask to be copied on any materials sent to credit-reporting agencies.

3. Pay every bill on time
You may be surprised at the damage even a few late payments will have on your credit score. The easiest way to make a big difference in your credit score without altering your spending habits is to diligently pay all your bills on time. You’ll also save money because you’ll keep the money you’ve been spending on late fees. Credit card or mortgage companies probably won’t report minor late payments, those less than 30 days overdue, but you’ll still have to pay late fees.

4. Use credit carefully
Another good way to boost your credit score is to pay your credit card bills in full every month. If you can’t do that, pay as much over your required minimum payment as possible to begin whittling away the debt. Stop using your credit cards to keep your balances from increasing, and transfer balances from high-interest credit cards to lower-interest cards.

5. Take care with the length of your credit
Credit rating agencies also consider the length of your credit history. If you’ve had a credit card for a long time and managed it responsibly, that works in your favor. However, opening several new credit cards at once can lower the average age of your accounts, which pushes down your score. Likewise, closing credit card accounts lowers your available credit, so keep credit cards open even if you’re not using them.

6. Don’t use all the credit you’re offered
Credit scores are also based on how much credit you use compared with how much you’re offered. Using $1,000 of available credit will give you a lower score than having $1,000 of available credit and using $100 of it. Occasionally opening new lines of credit can boost your available credit, which also affects your score positively.

7. Be patient
It can take time for your credit score to climb once you’ve begun working to improve it. Keep at it because the more distance you put between your spotty payment history and your current good payment record, the less damage you’ll do to your credit score.

Buying at a $100,000 Discount…

How to buy a home at a $100,000 Discount

To crunch down their growing inventory of properties, Fannie Mae and Freddie Mac are scrambling to unload nearly 150,000 foreclosed homes (REO). And that means DEALS! Requiring as little as 3% down, offering to pay a portion of the closing costs and arranging special financing and warranties for repairs and renovations.
The best bargain might be the home’s price. A SmartMoney analysis revealed that buyers could save $100,000 by buying a Fannie or Freddie home instead of similar fair-market properties just a few blocks away.And while many of Fannie Mae and Freddie Mac’s homes are at the lower end of the market and may be in less-desirable areas, a HomePath.com search of Fannie Mae listings revealed that buyers could find properties in good neighborhoods — and for $100,000 less than comparable houses nearby.

 For example, a three-bedroom, one-bath with a backyard, deck and two-car garage in South San Francisco, Ca., was listed for $485,900, nearly $100,000 less than the average listing price in the area, according to Trulia.com. Just blocks away, a similar non-foreclosed home in the same subdivision is listed for $575,000.

Buying a Fannie Mae or Freddie Mac home can be more complex than pursuing an open-market real estate listing. There’s a smaller selection of appealing properties and those tend to sell the fastest. Buyers who plan to live in their Freddie Mac-purchased home will get to see properties for the first two weeks they are on the market — before any would-be landlords or investors. Many bank-owned foreclosed properties are snatched up by cash-stocked investors who can wait out the downturn to sell later at a profit.

Fannie and Freddie homes can be seen inside and out — unlike some regular foreclosure listings. For its foreclosed properties, Fannie Mae will accept down payments as low as 3% on 30-year mortgages at the same interest rates banks are currently offering. And Fannie Mae doesn’t require private mortgage insurance. Fannie Mae also has a special financing program up to $30,000 for any miscellaneous repairs in your new home.

Call or Email me today for more info!

Great NEWS for any First Time Homebuyer

The California Housing Finance Agency is teaming up with the Federal Housing Administration to offer 30-year fixed-rate loans to low- and moderate-income first-time home buyers at below-market rates.

With mortgage rates already at historic lows, eligible borrowers could lock in a CalHFA-FHA loan at around 4 percent.

First-time home buyers using the CalHFA-FHA program also may be able to make a downpayment of as little as 1 percent if they also qualify for CalHFA’s downpayment assistance program.

The loans are limited to $417,000, and borrowers must meet a number of eligibility requirements, including minimum credit score, debt-to-income ratio, and income limits that vary by county and family size.

The state’s budget crisis, along with turmoil in bond markets that fund CalHFA loans, forced the agency to suspend its 30-year fixed-rate mortgage loan and downpayment assistance programs in December 2008.

CalHFA restored its downpayment assistance program in May 2009, and announced a new 30-year fixed-rate mortgage the following month that was limited in scope because it did not rely on bond financing.

“With the disruption in the credit markets over the last two years, we have been limited in our ability to help finance home purchases,” said Steven Spears, executive director of CalHFA, in a press release. “This new program offers California families another way to purchase their first home with reliable, fixed-rate financing.”

CalHFA financing is available through approved lenders listed on the agency’s Web site at http://www.calhfa.ca.gov/homebuyer/.

Is a Short Sale right for me???