Is An FHA Mortgage Better Than A Conforming One?

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Is An FHA Mortgage Better Than A Conforming One?  Posted: 26 Jul 2011 05:46 AM PDT The FHA is insuring a greater percentage of loans than during any time in recent history. In 2006, it insured roughly 5 percent of the purchase mortgage market. Today, it insures one-quarter. ”Going FHA” is more common than ever before — but is it better? The answer — like most things in mortgage — depends on your circumstance. Like its conforming counterpart, an FHA-insured mortgage is available as a fixed-rate loan and as an adjustable-rate one. Payments are made monthly and come without prepayment penalties. That’s where the similarities end, however, and decision-making begins. For homeowners and buyers across Scottsdale , FHA mortgages carry a different set rules as compared to conforming loans through Fannie Mae or Freddie Mac that can render them more — or less — attractive for financing. For example: § FHA mortgages can be assumed by a subsequent buyer. Conforming loans may not. § FHA mortgages require mortgage insurance, regardless of downpayment. Conforming loans do not. § FHA mortgages do not have loan-level pricing adjustment. Conforming loans do. FHA mortgages also require smaller downpayment requirements versus a comparable conforming mortgage. FHA calls for a minimum downpayment of 3.5%. Conforming mortgages often require 5 percent or more. And, lastly, FHA mortgages are priced differently from conforming ones. Since 2005, the average FHA mortgage rate has been below the average conforming mortgage rate more than 50% of the time, meaning that an FHA mortgage’s principal + interest payment is lower than a comparable Fannie/Freddie loan. Today, conforming mortgage rates are lower. So, which is better — FHA loans or conforming ones? Like most things in mortgage, it depends. FHA-insured loans can be big money-savers or money-wasters. To find out which is best for you, ask your loan officer for today’s market interest rates and study the results. With less than 20% equity, the answer is often clear.     This was sent to me by the Mark Taylor Team at Amerifirst   Lisa Hanawalt A Better Realty .Net 480-655-0904

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Great Networking Meeting this Morning

Today's networking meeting was informative; we talked about the 100,000 homes that have been foreclosed on, However they are not on the market.  So, we chatted on why are the banks are holding them. This is what we came up with.

1. They are so unorganized that they do not know what to do with them

2. They are waiting for the market to recover some for better price point

3. Maybe they have been told to hold them until a certain time, then release them slowly

4. Maybe they do not even know they have all these homes on their books.  

(1-4 is not factual... just what we thought of)

You may not be aware that when the bank has these properties on their books it keeps them from lending, for every dollar they have on their books, they must have a reserve of seven dollars.   

 

Lisa

A Better Realty .Net

480-655-0904

 

 

 

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Coolidge and Florence Arizona

Are you looking for a job prospect?  Take a look at this!  What an opportunity for the area.

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Lisa Hanawalt

A Better Realty .net, Designated Broker

44 South 83rd Place, Mesa, AZ 85208

480-655-0904  fax 1-888-456-4097

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New Short Sale Twist from B of A

Initiating a New short sale with Bank of America on the Equator system.  We all have done it many times. Has anyone gotten the RED screen that tells you to call Customer Care? 

I did today,  well my sellers have a loan that you cannot process in Equator, they will not tell me what type it is because the third party authorization letter cannot be uploaded.  It must be faxed, and then they have up to 5 business days to process and get it in the system.  Great... she says just fax all the paperwork you have.  NOT.. it will just be lost, I am going to get this authorization in... then lets talk to someone and then I will be faxing... yes, faxing .... the pages and pages of documents.

Please let me know if anyone else has had this much fun.

 

Lisa Hanawalt

lisa@abetterrealty.net

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Scottsdale's McDowell Sonoran Preserve

Here is a FYI !

ALERT!

Due to the extreme fire danger, the McDowell Sonoran Preserve will CLOSE at 3:00 p.m. on July 3rd and 4th.  Fireworks and smoking are strictly prohibited in all areas of the Preserve including parking lots.  Violaters are subject to citation per S.R.C. 21-12(b)(7). 

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Power outage mess

We were caught in the power outage that happened in Mesa. I did loose some data, and web stuff.  Some of it went a wee bit crazy..  Just trying to get it all straightened around today

. It has been a slow morning with the 4th of July weekend here. 

You forget how much you depend on certain things, electricity and cooling... The phones went down, and of course the fax machine.  That was the day Qwest had picked for my DSL upgrade, oh yes that went well NOT!  That is another story and not a pleasent one.  I am glad that day is in the past, now just to fix a few things. 

Have a great weekend!

This does make one think maybe we should be solar! 

 

 

 

 

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