 Ups and downs. Last week, for example, we had two reports go in opposite directions. The news came on Tuesday that Existing Home Sales headed up 2.0% in October, sailing over the 5.50 million threshold to a way better than expected 5.60 million annual rate and putting those sales up 5.9% over a year ago. This up news was followed by some down data. New Home Sales fell 1.9% in October, landing at a 563,000 unit annual rate. However, thanks to strong prior months, new home sales are still up 17.8% from a year ago.
Also up is the conforming loan limit for 2017, which the Federal Housing Finance Agency raised to $424,100 in most of the U.S., and $636,150 in high-cost counties. Finally, we must comment on the recent up direction of mortgage rates. Some in the media seem greatly concerned that this could be a down for the housing recovery. The fact is rates are still extremely low by historical standards, and future hikes are forecast to be small, all good for buyers. Plus, many economists are expecting faster economic growth, which will expand jobs, accelerate wage gains and drive up the home ownership rate, all good for sellers. We're up for that. Review of Last Week On Black Friday, a day famous for its door busters, the three major market indexes wound up record busters. The blue chip Dow, the broadly-based S&P 500 and the tech-heavy Nasdaq all racked up three weeks in a row of stock market gains, setting new record highs. This uptrend in stocks has happened since the election, as investors are betting that President-elect Donald Trump's economic proposals will create higher levels of economic growth. Shouldn't be too hard. The last eight years have seen the economy growing annually at an average 1.1% rate, versus the 3% to 4% growth it was doing before. Wednesday, FOMC Minutes revealed the Fed felt "relatively close" to raising rates at the last meeting. Wall Street interpreted this as a December rate hike, so there wasn't much reaction in the markets, as investors have already priced that into their stock valuations. Economic data included Durable Goods Orders up a nice 4.8% in October, plus the housing reports covered above. And consumers are pitching in. Online sales on Thanksgiving Day hit $1.15 billion, a 13.6% gain over last year. Interestingly, $449 million of that revenue was spent on mobile devices, 58.6% more than a year ago. Shoppers are busting records too and they are doing it on the go! The week ended with the Dow UP 1.5%, to 19152; the S&P 500 UP 1.4%, to 2213; and the Nasdaq UP 1.5%, to 5399. The selling surge in bonds eased up some, but prices still moved down as yields, and rates, moved up. The 30YR FNMA 4.0% bond we watch finished the week down .37, at $105.13. Freddie Mac's Primary Mortgage Market Survey for the week ending November 23 had national average 30-year fixed mortgage rates moving higher for the second week in a row but they are only a tad above where they were a year ago. Get the Insider Track on Interest Rates! This Week’s Forecast The Pending Home Sales measure of contracts signed on existing homes is predicted up a bit in October, though not as much as the month before. Personal Spending is also expected up, showing consumers continue to help the economy. But Core PCE Prices should remain quiet, which could quiet the Fed next month. Jobs are also forecast to grow at a quiet pace in November, with just 180,000 new Nonfarm Payrolls. Wage growth should also have quieted to a 0.2% uptick in Hourly Earnings. The Week’s Economic Indicator Calendar Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates. Economic Calendar for the Week of Nov 28 – Dec 2 Nov 29 08:30 GDP - 2nd Estimate Nov 29 10:00 Consumer Confidence Nov 30 08:30 Personal Income Nov 30 08:30 Personal Spending Nov 30 08:30 Core PCE Prices Nov 30 09:45 Chicago PMI Nov 30 10:00 Pending Home Sales Nov 30 10:30 Crude Inventories Nov 30 14:00 Fed's Beige Book Dec 1 08:30 Initial Unemployment Claims Dec 1 08:30 Continuing Unemployment Claims Dec 1 10:00 ISM Index Dec 2 08:30 Average Workweek Dec 2 08:30 Hourly Earnings Dec 2 08:30 Nonfarm Payrolls Dec 2 08:30 Unemployment Rate Federal Reserve Watch Speculative Forecasting Federal Reserve policy changes in coming months: It is difficult to find an economist who does not think the Fed will hike a quarter percent at its next meeting. We will soon see in two and a half weeks. Note: In the lower chart, a 94% probability of change is only a 6% certainty the rate will stay the same. Current Fed Funds Rate: 0.25%-0.5% After FOMC meeting on: Dec 14 0.5%-0.75% Feb 1 0.5%-0.75% Mar 15 0.5%-0.75% Probability of change from current policy: After FOMC meeting on: Dec 14 94% Feb 1 94% Mar 15 95% Call me now, 303.668.3350 or click here to apply! Apply Now! Get the Insider Track on Interest Rates! Cheers! Scott Synovic Nations Reliable Lending, LLC Colorado's Mortgage Expert www.scottsynovic.com 303.668.3350 Direct NMLS: 253799 / NRL NMLS: 181407 Regulated by the Division of Real Estate  The surprises, they keep on coming. The week before last, the nation faced the biggest election surprise in history, and since this is the first time the leader of the free world will be a real estate tycoon, last week's surprise seemed to fit right in.
Housing starts shot up and incredible 25.5% in October, to a 1.323 million annual rate, the fastest pace in nine years. This gain totally offset the drop in September. The two month average of 1.189 million starts is likely close to the underlying trend. Home building activity is indeed volatile, but October's 25.5% spike was still the largest monthly percent gain in more than 30 years. The single family part of the market zoomed ahead by 10.7% for the month and now sits 21.7% above where it was a year ago. October's rate represented a sizable increase, it's still well below the 1.5 million units a year housing analysts are looking for. The chief economist at an online listing site said, "housing starts are only about 66% of their 50 year average" (adjusting for the number of U.S. households.) He added, "Clearly, the home building sector represents an industry that has potential to grow." Building permits in October hit a 1.229 million annual rate, up 0.3%. And just think, now we'll have a licensed broker in the Oval Office. Review of Last Week Stocks saw their second straight week of post-election gains, bringing the S&P 500 into what one analyst called "the neighborhood of its record high." Nice neighborhood, that. Why this strong uptrend in the market after Donald Trump's surprise Presidential victory? Analysts say many investors feel Trump's policy proposals could spur our economy back to the growth rates we once enjoyed. That would mean more jobs and higher wages. It could also mean inflation and higher interest rates. But a little inflation is okay if people are making more money and the Fed is only talking about hiking by a quarter percent, then sitting on that for a while. For now, almost no one sees the economic recovery reversing, just continuing to plod slowly ahead. This was documented last week by the usual mixed bag of reports. We received the terrific Housing Starts data covered above, joined by Retail Sales climbing 0.8% in October. But manufacturing still falters, with production flat and capacity down a bit. The Consumer Price Index (CPI) is up 1.6% annually, but wages need to keep up with that price inflation and, unfortunately, cash earnings of all workers are up only 1.2% the past year. Initial Unemployment Claims fell to 235,000 and Continuing Claims finally came in under the two million level. The week ended with the Dow UP 0.1%, to 18868; the S&P 500 UP 0.8%, to 2182; and the Nasdaq UP 1.6%, to 5322. Over in the bond market, prices continued losing ground, with Treasuries leading the way down. This then pushed yields and interest rates up. The 30YR FNMA 4.0% bond we watch finished the week down .72, at $105.50. National average 30-year fixed mortgage rates moved higher in Freddie Mac's Primary Mortgage Market Survey for the week ending November 17. This Week’s Forecast Reports on October Existing Home Sales and New Home Sales are expected to reveal some slippage, though not a lot. The other thing to watch is Wednesday's release of the FOMC Minutes from the Fed's last meeting. We will look for more indications of their now widely expected December rate hike. The stock and bond markets are closed on Thanksgiving and close early Black Friday. The Week’s Economic Indicator Calendar Weaker than expected economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and rising loan rates. Economic Calendar for the Week of Nov 21 – Nov 25 Nov 22 10:00 Existing Home Sales Nov 23 08:30 Initial Unemployment Claims Nov 23 08:30 Continuing Unemployment Claim Nov 23 08:30 Durable Goods Orders Nov 23 10:00 New Home Sales Nov 23 10:00 U. of Michigan Consumer Sentiment Nov 23 10:30 Crude Inventories Nov 23 14:00 FOMC Minutes Federal Reserve Watch Speculative Forecasting Federal Reserve policy changes in coming months: Fed Chair Janet Yellen's testimony last Thursday before Congress made more that 9 out of 10 economists feel certain we'll see a rate hike from the central bank next month. Note: In the lower chart, a 95% probability of change is only a 5% certainty the rate will stay the same. Current Fed Funds Rate: 0.25%-0.5% After FOMC meeting on: Dec 14 0.5%-0.75% Feb 1 0.5%-0.75% Mar 15 0.5%-0.75% Probability of change from current policy: After FOMC meeting on: Dec 14 95% Feb 1 96% Mar 15 96% Call me now, 303.668.3350 or click here to apply! Apply Now! Get the Insider Track on Interest Rates! Cheers! Scott Synovic Nations Reliable Lending, LLC Colorado's Mortgage Expert www.scottsynovic.com 303.668.3350 Direct NMLS: 253799 / NRL NMLS: 181407 Regulated by the Division of Real Estate  The Holiday Season and the Real Estate Market
According to the National Association of Realtors, existing home sales rose strongly in the month of September however the upcoming winter and holiday months are typically a slower time of year for the real estate industry. This can work to the buyer’s advantage. Fewer real estate transactions can translate to less competition, more motivated sellers, quicker mortgage underwriting turn around times and several other advantages. I have outlined why the holiday season could be the ideal time to buy a home. 1. Less Buyer Competition The winter months come with less than favorable weather conditions for would-be home buyers. This means fewer people are looking to purchase homes and there is less buyer competition. This may minimizes multiple offer situations and bidding wars as we so often see in the Colorado real estate marketplace. Lower demand could equate to more negotiating power for buyers. 2. Serious Home Sellers Most are busy this time of year with family, friends and festivities and not inclined to trying to sell their home. As a result, holiday home sellers are serious. They may be more willing to negotiate. Sellers usually show additional flexibility in areas such as price and other facets of the transaction. Sellers may also make concessions to get their home sold. They may leave items behind and that riding lawn mower in the garage could be yours. Be cautious, though, when home buying in the winter. Sellers will “stage” their homes to sell and during the holiday season, it’s very easy to let your emotions take over. Christmas trees, Christmas presents and the joy that comes along with the season - it's east to imagine your family opening presents in a tastefully decorated home. Studies show that staged homes sell 73% faster. Make sure you’re buying the home and not the feeling. 3. Faster Mortgage Loan Origination Traditionally, the holiday months tend to be slower for mortgage lenders. While slower business is not so favorable for the lender, it can be great for the home buyer. As a result of fewer loans loans in the "pipeline" this could translate to quicker underwriting turn around times. A quick, efficient loan origination process and closing date could help you negotiate a better deal on the home you are buying. 4. Tax Advantages For New Homeowners One of the biggest reasons that many buyers make the leap from renting to buying is for the tax benefits. If you wait until January to buy, you will not realize the tax advantages until the following year. Closing by December 31th can mean tax benefits for home buyers, like deductions for mortgage interest, property taxes and perhaps some closing costs. Always be sure to consult with a tax adviser for professional advise before filing. The mortgage associated tax deductions can be significant for homeowners, especially in the beginning months of your mortgage. 5. Greater Home Affordability Home prices are typically at 12 month lows in December. This translates to lower home prices whereby allowing buyers to purchase more home for less money. As mentioned, holiday home sellers are generally more motivated about getting their homes sold. Sellers typically know that the winter months are not necessarily ideal for selling their home. As such, there is usually a specific reason that, instead of doing some holiday shopping or attending a holiday party, they are trying to sell their house. Whatever the reason may be, the timing could be perfect for making an offer on your dream home. The holidays are upon us and for home buyers looking for additional holiday bargains, now may be the perfect time to get your dream home at a discount. Call me today for an excellent real estate agent recommendation at 303.668.3350, get the insider track on mortgage interest rates, or apply now! Cheers! Scott Synovic Nations Reliable Lending, LLC Colorado's Mortgage Expert www.scottsynovic.com 303.668.3350 Direct NMLS: 253799 / NRL NMLS: 181407 Regulated by the Division of Real Estate  As both President Barack Obama and losing candidate Hillary Clinton said, we must come together to support the President-elect Donald Trump as he prepares to take on the world's most powerful and difficult job. Bond traders are viewing a Trump presidency as one that will create very positive economic growth and the economic growth may be accelerated due to lower tax rates, repatriation of corporate cash parked overseas, regulatory reform, a national budget etc., however it is not our job to speculate. The truth is that it is too early for anyone to come up with anything more than pure speculation on any specific issue.
However, it is comforting to note that most observers expect the overall recovery in housing to continue. Some even see it speeding up. Switching to present data, a home price index reports sellers in October priced their homes only 1.15% higher than the appraised value, the fourth month in a row that gap has narrowed. Finally, the National Association of Realtors expects existing home sales to end 2016 at a 5.36 million pace, their best since 2006. Review of Last Week When it came to predicting the election, pundits and pollsters and got it wrong. Wall Streeters who warned that a Trump victory would be negative for stocks also got it wrong. Once it became clear that Mr. Trump would win, Dow futures slid 800 points however when the market opened Wednesday, after an initial hiccup, stocks bumped up 257 points. Similar deal on Thursday, and even after a quieter Friday, the blue-chip Dow ended at a new all-time record high, posting its best week in five years. The broadly-based S&P 500 and tech-y Nasdaq also notched serious upward moves for the week. Basically, investors realized that a Republican president and Congress could lead to lower tax rates, less regulation and fiscal stimulus around infrastructure spending, all positive moves for businesses, jobs and the economy. Let's hope so. What little economic data we got was okay, as Initial Unemployment Claims fell to 254,000 and Continuing Claims were up a bit but still down near the 2 million mark. University of Michigan Consumer Sentiment spiked up in its initial November reading but the Federal Deficit was -$44 billion in October. Finally, the election upset did not upset rate hike expectations, as a few Fed members said they were ready to move in December. The week ended with the Dow UP 5.4%, to 18848; the S&P 500 UP 3.8%, to 2164; and the Nasdaq UP 3.8%, to 5237. Friday, Veterans Day, the bond market was closed and it sure needed a breather after prices fell for two days straight as investor money shot back into surging stocks. The 30YR FNMA 4.0% bond we watch finished the week down .92, at $106.22. Freddie Mac's Primary Mortgage Market Survey for the week ending November 10 reported national average 30-year fixed mortgage rates edging up. Remember, mortgage rates can be extremely volatile, so call me direct at 303.668.3350 to help navigate through the process. This Week’s Forecast The important Retail Sales report is expected to show growth in October. That month's Housing Starts are also forecast up, heading toward 1.2 million. The Consumer Price Index of inflation is also predicted up, which is what the Fed wants to see for a December rate hike. But manufacturing still is not too solid, with the Philadelphia Fed Index looking to decline, although national Industrial Production and Capacity Utilization numbers should be slightly up. Economic Calendar for the Week of Nov 14 – Nov 18 Nov 15 08:30 Retail Sales Nov 15 08:30 NY Empire Manufacturing Index Nov 15 10:00 Business Inventories Nov 16 08:30 Producer Price Index Nov 16 08:30 Core PPI Nov 16 09:15 Industrial Production Nov 16 09:15 Capacity Utilization Nov 16 10:30 Crude Inventories Nov 17 08:30 Initial Unemployment Claims Nov 17 08:30 Continuing Unemployment Claims Nov 17 08:30 Consumer Price Index Nov 17 08:30 Core CPI Nov 17 08:30 Housing Starts Nov 17 08:30 Building Permits Nov 17 08:30 Philadelphia Fed Index Federal Reserve Watch Speculative Forecasting Federal Reserve policy changes in coming months. Nothing in the results of the election or its aftermath has dissuaded economists from thinking the Fed would finally pull the trigger on a small rate hike in December, then stop there for a while. Note: In the lower chart, an 81% probability of change is only a 19% certainty the rate will stay the same. Current Fed Funds Rate: 0.25%-0.5% After FOMC meeting on: Dec 14 0.5%-0.75% Feb 1 0.5%-0.75% Mar 15 0.5%-0.75% Probability of change from current policy: After FOMC meeting on: Consensus Dec 14 81% Feb 1 82% Mar 15 84% Call me now, 303.668.3350 or click here to apply! Apply Now! Get the Insider Track on Interest Rates! Cheers! Scott Synovic Nations Reliable Lending, LLC Colorado's Mortgage Expert www.scottsynovic.com 303.668.3350 Direct NMLS: 253799 / NRL NMLS: 181407 Regulated by the Division of Real Estate  Chair Janet Yellen doesn't touch rates and doesn't elaborate.
This left the pundits speculating over a Fed policy statement that said to expect rates to remain historically low "for some time." Still, most economists think a December rate hike is a certainty however the Fed's latest statement did downgrade its view of household spending from "growing strongly" to "rising modestly" and one member who voted for a rate hike in September now voted against it. Of course, the Fed Funds Rate is not a mortgage rate, although a hike from the Fed can eventually affect mortgages. Nonetheless, the chief economist at a major aggregator of real estate data commented, "I think we'll see rates rise from dirt cheap to a very low level as we move into next year." Younger buyers are finally showing up in the housing market. The National Association of Realtors (NAR) chief economist said that in the past year, "those under age 35 made up 61% of first time buyer transactions." He added that their increased presence "greatly depends on supply improvements and if wages can finally awaken from their sluggish pace of growth." Review of Last Week Stocks ended the week before the election with all three indexes decidedly down, the S&P 500 and the Nasdaq posting losses for the second week in a row. This is normal stock market reaction to a close Presidential race and this year's has recently tightened. Do understand this has nothing to do with any political leanings on Wall Street. Investors simply hate uncertainty, and more observers are now saying the White House prize is up for grabs. Economic data remains uncertain too, with the ISM Index of manufacturing activity up a bit, but ISM Services down for that part of the economy supplying more than 80% of U.S. jobs. Speaking of jobs, Friday's employment report got the usual mixed reviews. October saw 161,000 new non farm payrolls, and there were upward revisions to prior months, yet these numbers barely cover population growth. The household survey, which includes small businesses (the big engine for new jobs), showed a reduction of 43,000 for the month. And the unemployment rate dipped to 4.9%, but that was with 195,000 leaving the labor force. The report's brightest spot was the 0.4% rise in average hourly earnings, and many feel the Fed will take that as a sign they can raise rates next month in spite of an economy that grew at just a 1.4% annual rate in Q2. The week ended with the Dow down 1.5%, to 17888; the S&P 500 down 1.9%, to 2085; and the Nasdaq down 2.8%, to 5046. Bond traders focused on the negative rather than the positive in Friday's jobs report, sending Treasuries and other issues higher. The 30YR FNMA 4.0% bond we watch finished the week UP .08, at $107.14. National average 30-year fixed mortgage rates went up in Freddie Mac's Primary Mortgage Market Survey for the week ending November 3, but remain below where they were a year ago. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information. This Week’s Forecast Forgive the sad joke, but the October Federal Deficit is one of this week's few economic reports, and no one expects to hear that Washington is suddenly operating in the black. Tuesday is Election Day and the markets will no doubt react to the results, especially given the paucity of economic data. Friday, November 11th, the stock market is open, but the bond market is closed in observance of Veterans Day. The Week’s Economic Indicator Calendar Weaker than expected economic data tends to send bond prices up and interest rates down while positive data points to lower bond prices and rising loan rates. Economic Calendar for the Week of Nov 7 – Nov 11 Nov 09 10:30 Crude Inventories Nov 10 08:30 Initial Unemployment Claims Nov 10 08:30 Continuing Unemployment Claims Nov 10 14:00 Federal Deficit Nov 11 10:00 U. of Michigan Consumer Sentiment Federal Reserve Watch Speculative Forecasting Federal Reserve policy changes in coming months An overwhelming majority of economists see the Fed hiking by a quarter of a percent in December, but holding the rate there, clear through the March meeting. Note: In the lower chart, a 67% probability of change means there's only a 33% certainty the rate will stay the same. Current Fed Funds Rate: 0.25%-0.5% After FOMC meeting on: Dec 14 0.5%-0.75% Feb 1 0.5%-0.75% Mar 15 0.5%-0.75% Probability of change from current policy: After FOMC meeting on: Consensus Dec 14 67% Feb 1 69% Mar 15 70% Call me now, 303.668.3350 or click here to apply! Apply Now! Get the Insider Track on Interest Rates! Cheers! Scott Synovic Nations Reliable Lending, LLC Colorado's Mortgage Expert www.scottsynovic.com 303.668.3350 Direct NMLS: 253799 / NRL NMLS: 181407 Regulated by the Division of Real Estate  About The HomeReady™ Mortgage
HomeReady™ is a mortgage program created in December 2015. The HomeReady™ mortgage loan is backed by the U.S. government via Fannie Mae. HomeReady™ allows a down payment of 3% and permits "income pooling" for all members of a household. This means that income from grandparents, parents, relatives, and working children can all be used to help qualify for a home loan. For many families, this can mean the difference between getting approved for a loan and getting turned down. HomeReady™ can also be used for a refinance, allowing up to 95% loan to value (LTV) in some cases. In order to be eligible for the HomeReady™ program:
If you meet the above criteria, you may be HomeReady™ eligible. HomeReady™ Questions and Answers: Is HomeReady™ for first time home buyers only? No, the HomeReady™ mortgage loan can be used by first time and also repeat buyers. Is HomeReady™ the same thing as the MyCommunityMortgage? No. HomeReady™ is a new mortgage program as of December 2015. It is not the same as a MyCommunityMortgage (MCM) and in some respects, HomeReady™ can be viewed as a replacement. The MyCommunityMortgage program was retired by Fannie Mae in late 2015. Do I have to call Fannie Mae in order to apply for a HomeReady™ mortgage? No, you do not have to call Fannie Mae to get a HomeReady™ home loan. Fannie Mae has authorized its approved mortgage lenders to issue HomeReady™ loans. Call me today, 303.668.3350 or Apply Now! Do I need to have excellent credit to use the HomeReady™ program? The HomeReady™ mortgage program is available to homeowners who have a credit score of 620 or better. I do not have a credit score. Can I still use the HomeReady™ program? Yes, you can still utilize the HomeReady™ mortgage loan program if your credit score is not reporting. The program allows for the use of non traditional trade lines to establish credit history including utility bills and most other accounts that require monthly payment. What are interest rates for the HomeReady™ loan? Interest rates for a HomeReady™ mortgage loan are the same as interest rates for a "traditional" loan. Can I use the HomeReady™ mortgage loan for a condominium? Yes, HomeReady™ mortgage loans can be used for condominiums. Can I use the HomeReady™ mortgage loan for a co-op? Yes, HomeReady™ mortgage loans can be used for co-ops. Can I use the HomeReady™ mortgage loan for a manufactured housing? Yes, HomeReady™ mortgage loans can be used for manufacturing housing. Can I use the HomeReady™ mortgage loan for a multi-unit home? Yes, HomeReady™ mortgage loans can be used for 2, 3 and 4 unit homes. They cannot be used for a residential building zoned for 5 units or more. What is the HomeReady™ program's minimum down payment requirement? The HomeReady™ mortgage program is a low down payment loan requiring a minimum down payment of three percent. Can my down payment on a HomeReady™ home be a cash gift from a relative? Yes, your down payment on a HomeReady™ loan can be a cash gift from a relative, a spouse, a girlfriend or boyfriend, or a fiancé/fiancée. The money does not need to be yours. What fixed rate mortgage options do I have with the HomeReady™ loan program? Borrowers using the HomeReady™ loan program have access to a complete mix of fixed rate mortgage products, including the 10 year fixed rate mortgage; the 15 year fixed rate mortgage; the 20 year fixed rate mortgage; and, the 30 year fixed rate mortgage. What adjustable rate mortgage options do I have with the HomeReady™ loan program? Borrowers using the HomeReady™ mortgage have access to adjustable rate mortgage (ARM) products, including the 5 year ARM; the 7 year ARM; and, the 10 year ARM. Can I use HomeReady™ to refinance? Yes, you can use HomeReady™ loan to originate a rate and term refinance however you may not use the program to do a cash out refinance. My parents live with me. Can I use their income to help qualify for a mortgage? Yes, this is the purpose of the HomeReady™ loan program. You are allowed to use the income of a person living in your home to help you qualify for your home loan. My children live with me. Can I use their income to help qualify for a mortgage? Yes, this is why the HomeReady™ mortgage program was created. The income of a person living in your home can be used to help you qualify. Can I use income from someone whom is not my parent or child with the HomeReady™ program? Yes, when using the HomeReady™ mortgage program, you can use the income of anybody living in your home to help get mortgage qualified. This can be your aunt, your uncle, a brother or sister, a friend, or anyone else. If I use the income of somebody living in my house to help qualify for the HomeReady™ loan, does that person need to be on the mortgage application? No, you do not need to include other people on your HomeReady™ mortgage application even if their income is used to help you qualify. In order to use another person's income on your application, you will only need to show that person's proof of income and a signed statement indicating their intent to live with you for a period of at least 12 months. Do I have to show a history of co-habitation in order to use a relative's income for my mortgage approval? No, prior co-habitation is not required in order to use a relative's income on your HomeReady™ mortgage application. You are only required to show a signed statement which indicates your co-habitant's intent to live in your home for a period at least 12 months. Is there a maximum allowable number of co-habitants with the HomeReady™? No, the HomeReady™ program does not limit the number of relatives living in one home, nor the number of relatives whose income is used to help qualify for the program. How much of my own money do I need to bring to closing with the HomeReady™ program? You are not required to bring any of your own money to closing with the HomeReady™ mortgage program. Your down payment can be gifted to you from a third party, and you can have the home seller pay for your closing costs using an option known as seller concessions. Is there a maximum debt-to-income ratio with the HomeReady™ mortgage? Yes, the HomeReady™ program limits borrowers to a 50% debt to income ratio. Does the HomeReady™ mortgage loan require private mortgage insurance (PMI)? Yes, the HomeReady™ program requires borrowers to pay private mortgage insurance (PMI) when they borrow more than 80% of the home's value. Is it true that private mortgage insurance (PMI) costs for the HomeReady™ program are lower than with other conventional loans? Yes, the HomeReady™ program features lower mortgage insurance costs than other conventional loans, including the other three percent down program, the Conventional 97. How long must I pay private mortgage insurance under the HomeReady™ program? HomeReady™ is a conventional mortgage loan via Fannie Mae, which means that you are required to pay private mortgage insurance until your home's loan-to-value (LTV) reaches 80% of the original purchase price, or 80% of the home's market value. HomeReady™ loans are available in low income census tracts. What is a "low income census tract"? A low income census tract is an area in which the median household income is at least 20% below the average median household income for an area. Homes in low income census tracts are eligible for HomeReady™ regardless of their annual household income. HomeReady™ loans are available in high minority census tracts. What is a "high minority census tract"? A high minority census tract is an area in which the minority population is at least 30%, and in which the median household income is less than the median household income for the area. Can I use the HomeReady™ loans if I don't live in a low income census tract or a high minority census track? Yes, you can use the HomeReady™ program even if you do not live in a low income census tract or a high minority census tract so long as your household income is not above the area median income. My household is not considered low income. Can I still use HomeReady™? Yes, you can use HomeReady™ if your household is not considered "low income" so long as you are buying a home in a low income census tract. There are no maximum or minimum income restrictions for borrowers with homes located in low income census tracts. I earn a large income, but I live in a low income census tract. Can I use HomeReady™? Yes, regardless of your income, if your home is in a low income census tract, you can use the HomeReady™ mortgage loan program. Can I still use HomeReady™ if I am not considered a "minority"? Yes, you do not need to be considered a minority to use the HomeReady™ mortgage loan. HomeReady™ is available to everyone who qualifies. What's the smallest down payment allowed with HomeReady™? The HomeReady™ program requires a minimum down payment of 3% of the purchase price. Can I use boarder income to help get approved for HomeReady™? Yes, the HomeReady™ program allows a borrower to use boarder income to help get qualified. Boarders must have a 12 month history of living with you and contributing income. Do I have to take homeowner counseling courses as part of the HomeReady™ mortgage program? Yes, homeowner counseling is required with the HomeReady™ program. Classes are provided online and can be completed in 4-6 hours. I have taken homeowner counseling courses previously. Can I apply my completion certificate toward HomeReady™? Yes, you can use the certificate from your previous homeowner counseling course as part of your HomeReady™ mortgage application, so long as the course was completed within the last six months. Note that beginning October 1, 2016, prior certificates must be renewed. The HomeReady™ mortgage program is designed to help more U.S. households get approved for low down payment loans. Borrowers can use income from relatives and non relatives for purchase and refinance home loans. How do I get started with the HomeReady™ mortgage loan program? Call me now, 303.668.3350 or click here to apply! Apply Now! Get the Insider Track on Interest Rates! Cheers! Scott Synovic Nations Reliable Lending, LLC Colorado's Mortgage Expert www.scottsynovic.com 303.668.3350 Direct NMLS: 253799 / NRL NMLS: 181407 Regulated by the Division of Real Estate |
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Scott Synovic NMLS #253799 with AnnieMac Home Mortgage NMLS #338923
NMLS Consumer Access. AnnieMac Home Mortgage 950 South Cherry Street, Suite #1515, Denver, Colorado 80246 Equal Housing Lender licensed through NMLS Regulated by the Division of Real Estate. Licensed Mortgage Loan Originator in Colorado and California. Not endorsed or sponsored by either state or any government agencies.
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