A check-up on all things changing

Finally, the warm weather is here! We can play outside, wear less clothing (good if you are 6 months pregnant like me), and enjoy all Texas springtime has to offer! Spring is also a time for cleaning. You may want to keep reading……

FHA on April 5 (Monday) will increase the upfront mortgage insurance funding fee + .50%. That is $500 for every $100,000. Since it is rolled into the loan, and amortized, the payment increase is only $3.00/mo. Not too drastic. Also, the seller contribution allowable goes from 6% to 3%. This will most impact lower priced homes (example: under $150,000) where 3%, or $4500 will not cover all costs and escrows required. Any FHA case numbers that are obtained before the 5th will be covered, regardless of closing date.

There is a rumor that seller financing may go away. This is a topic I need to investigate more, but will surely keep you posted. That would truly put a dent in transactions. If any of you know anything about this, I would appreciate feedback.

Apparently buried deep within the Health Care Bill (Section 9015, p.2000) is language that would take effect on 1/1/2012, in which the Medicare tax (3.8%) would apply to capital gains, dividends, rents, royalties, interest, etc for those singles earning >$200,000 . TRANSLATION: a 3.8% tax on the capital gains from the sale of your home. Basically this confirms the rumor as we know it: those top earners will bear many of the brunt of mistakes from the past.

The Congress went on ‘break’ without passing the budget for FEMA! It was an oversight (????) and basically, if you are in a flood zone, and set to close before April 12 when Congress returns, you cannot close. Some lenders will allow closing, and some will not . So if you have a transaction in a flood zone, be sure to communicate with your lender quick, to see if this will affect you. At Patriot, we are covered on our transactions.

RATES ARE ON THE RISE- slowly but surely, as we anticipated, the Congress safety net for mortgage backed securities ended March 29. For the last week, rates have inched up slowly , about .25% total. What is more on the horizon to come? No one knows. Signals of recovery are still mixed (keeps rates low), while at the same time, it is obvious no one wants to buy our debt (tbill auction sales have been very weak- which is bad for the rates). We will continue to keep you posted.

One thing does remain the same among all this change! Patriot Bank Mortgage employs the best of the best loan officers and operations staff, and we strive every day to close on time, and even early! We can close in a min of 8 days (since we must allow 7 days for federal disclosures), and are very supportive of our local real estate community.