Reverse Mortgage To Purchase
As we get more and more baby boomers in the age of 62 and above, we are seeing a significant increase in Reverse Mortgage to purchase homes in Boise and Meridian, and for the most part, outlying areas.
I just wanted to cover one of the most confusing items for sellers when the Buyer is doing a Reverse Mortgage to purchase, closing cost.
A Builder/Seller CAN NOT pay for any closing cost, prepaids, HOA, utilities that are typically on a closing statement.
And even further, Builder/Seller can’t split the Closing and Escrow fee, and the Seller/Builder can’t pay for the owner’s title policy as well.
This can get pretty confusing, as lenders will ask that the purchase contract be written up this way. In most cases, we as lenders will then ask that the purchase price be reduced by these amounts, for the closing and escrow fee and Owner’s Title Policy. That way the seller/builder will net out the same amount as if they were directly paying for those fees.
We do quite a few HECM or Reverse Mortgage for purchase, if you have an question about this pretty cool product to purchase a home, please do not hesitate in calling or emailing.
I also have quite a few questions answered on my HECM-Reverse Mortgage web page, link here:
http://www.375loan.com/reverse_mortgage/
VA Mortgage: Buying another home with a VA Mortgage.
Veteran Administration loans are the BEST loan available, hands down! And obviously, the borrower needs to be Retired, or Honorably Discharged or Active member of a branch of the military. You can find more qualification here: http://www.375loan.com/loan_products/va_home_loans/
But did you know, a VA home owner is able to get another home, and turn their existing VA home Loan into a rental!
It is all about remaining VA Entitlement and purchase price.
First of all, a Veteran needs to have enough entitlement left over after the purchase of their 1st home.
What is entitlement, well that is the amount the Veterans Administration will guarantee a loan. This is a pretty complex calculation, as with any government program. But here is a quick run down:
A VA loan guarantees 25% of the loan amount, so on a $200,000 loan, the VA guarantees the lender $50,000 of the loan. In case of a Foreclosure, the VA will pay up to $50,000 worth of negative equity after the foreclosures. 
The Maximum amount the VA will cover, in Idaho, is a loan amount of $424,100, with the VA on hook for 25% of that or $106,025.00.
Now if a VA Veteran owns a home, say in Mountain Home for $200,000 and the VA is on the hook for $50,000 then $106,025 - $50,000 = $56.025.00 is remaining to purchase another home, or basically the Veteran can purchase another home, say in Meridian or Boise, Idaho, for $224,100.00.
The VA also puts a minimum on a purchase price of the home loan to $144,100. This means that our VA Veteran can purchase a home, with a mortgage in Meridian or Boise, Idaho between $144,100 and $224,100.
The VA veteran needs to qualify for both home mortgages, unless they rent the old home. In this case, we would need a minimum 1 year rental agreement and copy of the renter’s deposit check, and proof that the renter’s check was deposited into veterans account.
Then, the lender would be able to take 75% of that rental payment, and put that against the mortgage payment. Thus, offsetting the current mortgage.
And don’t forget, Veterans may or may not have a Veterans Funding Fee, more information about VA funding fees can be found here: http://www.375loan.com/loan_products/va_home_loans/va_funding_fee/
Moral of this story, the VA home loan is THE BEST loan on the market today, VA mortgage rates are LOW, VA loan fees are LOW, and Veterans are eligible for multiple loans. Call us today and let us answer all of your questions of VA mortgages.
And don’t forget we can do VA Mortgage down to a 500 FICO score!
Mortgage rates: Going up in Boise & Meridain!
Well up until today, mortgage rates were in a pretty good trading range, with a pretty defined ceiling, the 100 day moving average, and a well-defined floor, the 200 day moving average. But as I have indicated in past blogs, mortgage rates were being dictated by 2 new events, North Korea, and Tax reform.
Last night, Senate passed a $4.0T budget, that also included language that was need to do the Trump Tax Reform plan, and it passed, now it goes to conference to bang out the difference between the Senate version and the House version, which is expected to pass.
This, once again, sent the stock market to new record highs, and thus a major selling of bonds, thus taking bond yields to new highs as well.
Another thing to start watching is who is going to be nominated as the next Federal Reserve Chairperson. Current, a dove, Janet Yellen has been running thing, since taking over for Bernanke. Will be get a more hawkish person, thus raising interest rates faster to cool off the economy, or a dove, which will be more status quo, gradually raising rates. Time will tell, and bond prices will swing!