Hello, my name is Greg Phillips. I have been a Mortgage Loan Officer since 1999. I created this blog to give people an outlet that was easy to read and understand. Most of the articles on this site are written based on my professional experience. I hope you enjoy reading my blog.
FHA Rural Regulatory Improvement Act of 2011 – Tougher Guidelines
Posted: 25th May 2011 by Greg Phillips in UncategorizedThe government is working on some new legislation that could play a key rule in further housing industry turmoil. As consumers, realtors, and mortgage professionals push for lending expansion to assist with short term housing market recovery, it appears our government is leaning toward the opposite. The FHA Rural Regulatory Improvement Act of 2011 is in the begining stages and currently seeks to do the following:
- Raise the minimum down payment requirement from 3.5% to 5%
- Prohibit buyers from financing their closing costs
Additional meetings will be held to discuss addtional legislation that could be added to the bill. The goal of this bill is to provide more stability and lessen the risk that the government is exposing itself too. On April 18, 2011, changes went into affect to increase FHA MIP and UFMIP to boost the FHA insurance reserves used to pay claims on bad loans to lenders. These changes have caused homebuyers payments to increase on FHA loans.
This legislation aims to reduce the number of loans that default. The more cash a home buyer put’s into a home out of their own pocket, the higher the change is that they will not default. Currently, a home buyer could obtain a gift from a relative for the 3.5% down payment and the seller could pay all of their closing costs or what most will define as financing the closing costs. It is unclear whether any changes will be proposed that eliminate or restrict allowing gift funds or seller paid closing costs, but I would anti
USDA Rural Housing Update On Funding And Fee Clarification
Posted: 30th August 2010 by Greg Phillips in UncategorizedThis question is asked quite a bit in the industry. “Why are lenders still not offering this program?” In a letterdated 8/23/2010 Tammye Trevifio helps clear up some of the hold up at USDA.
The Rural Housing Preservation and Stabilization Act of 2010 allotted up to $30,000,000,ooo (thirty billion) for the 2010 fiscal year. The 2010 fiscal year ends on September 30, 2010. So, there is funding available.
The bill also has changes to the fees involved in these loans.
Currently, there is a 2% Funding Fee. This was raised to 3.5% on purchases and 2.25% on refinances. They also imposed an annual premium of .50% which affects a borrowers monthly payment.
Very few lenders have opened the doors back up on Section 502 loans. I would expect that to change before the fiscal year ends.
.Restoring American Financial Stability Act of 2010 – Financial Stability Act of 2010
Posted: 21st July 2010 by Greg Phillips in AnnouncementsPresident Obama signed this bill into law today. It is the biggest financial reform bill passed since the great depression. The Senate passed this bill on a 59 to 39 back on May 20, 2010. The bill is over 800 pages! It is intended to stop the bleeding on Wall Street by imposing tougher regulations. It will affect business both large and small. There is so much in the bill it would take a 1600 page blog post to explain it all!