Considering an FHA loans to purchase or refinance your home.  Contact your Loan Officer prior to October 4th.  We’ve been talking about, The new hidden price on FHA loans that is equal to a rise in the mortgage interest  rate of one-third of one percent.  This may make the difference on whether someone will be able to qualify to purchase a home or not purchase a home.  It will also make the payment on FHA refinances higher:

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Upfront Premiums (Case Numbers Issued 10/04/2010 and later):

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October 4, 2010, for FHA traditional purchase and refinance products, the upfront premium, shown in basis points below, will be charged for all amortization terms.

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Mortgage Type Upfront Premium Requirement
Purchase Money Mortgages and Full-Credit

Qualifying Refinances

10013PS
Streamline Refinances (all types) 100 BPS

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Annual Premiums

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Effective for FHA loans for which the case number is assigned on or after

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October 4, 2010, FHA will increase the annual premiums collected on a monthly basis. For FHA traditional purchase and refinance products, the annual premium, shown in basis points below, is to be remitted on a monthly basis, and will be charged based on the initial loan-to-value ratio and length ol’the mortgage according to the following schedule:

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LTV Annual Premiums for Loans > 15 Years
= or < 95 percent 85 BPS
>95 percent 90 BPS

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The annual premium for amortization terms equal to or less than 15 years remains unchanged and is collected according to the following schedule.

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LTV Annual Premiums for Loans = or < 15 Years
= or < 90 percent -None
>90 percent 25 131’S

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Cancellation of FHA’s Annual Mortgage Insurance Premiums

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The cancellation policies defined in Mortgagee Letters 2000-38 and 2000-46 remain unchanged.

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The National Association of Realtors released exsisting home sales numbers today and they dropped to 27.2 percent to a seasonally adjusted annual rate of 3.83 million units in July.    This is the lowest level since May of 1995.

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www.paulcantor.info

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We have some stating that inflation may be hitting sooner than expected.  This would mean higher mortgage rates.  Although nobody knows where the bottom of the rate will / have hit, their is no question that mortgage rates are at near all time lows and home owners and home buyers should take advantage of these.  Home affordability is very high.  It is better to buy than to rent.

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Inflation, not deflation, Mr. Bernanke Caixin Online

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www.paulcantor.info

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Thinking about buying a home?  Maybe you should act now.  Proposed  and slated changes to FHA loans will mean it will be tougher and more expensiveto buy a home.  Read this article from MarketWatch:

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Homebuyers beware: Tougher rules for FHA loans – MarketWatch.

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www.paulcantor..info

Inquire about qualifying for an FHA Mortgage

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The worst is over for the housing market according to a Reuter’s article.  It predicts no double dip for housing prices in major US Markets.   A slight increase in values is predicted.  Don’t get the champagne out, unemployment is high, lenders have tightened up guidelines and there is a lot of supply on the market;  it will take some time before we see soaring prices.

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www.PaulCantor.info

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20 Year Fixed Rate Mortgages are becoming the popular choice for many home owners.  Most home buyers and home owners only think fix rate mortgages come in two varieties:  30 year fixed and 15 year fixed.  Actually fixed rate home loan notes are written in many other terms including 4o year fixed, 25 year fixed, 20 year fixed and 10 year fixed rate mortgages.

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Many want a fifteen year loan as the rate is lower that that of a thirty year loan but do not like the payment.  The solution is often the unknown twenty year mortgage.  20 year fixed rate mortgages split the difference between the 30 year and 15 year options for those who can afford to spend more money on their monthly housing payment.

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www.PaulCantor.info

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The mortgage planning process is different than the typical “shopping for a mortgage” experience.

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The typical shopping for a mortgage experience includes:

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Wasting your valuable time trying to save $25/month by comparing rates, fees and closing costs among different lenders.

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Wasting your valuable time trying to baby-sit the mortgage company you’ve reluctantly chosen to work with.

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Being promised one thing and then getting something different.

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Being “sold” on one mortgage product over another.

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The mortgage planning relationship is about you:

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Receiving valuable financial advice and guidance that can literally save you hundreds of thousands of dollars.

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Trusting a professional who is committed, qualified and equipped to deliver what they promise.

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Experiencing a “concierge” level of service when you are in the market to buy a home, refinance your mortgage or make cash flow changes to enhance your lifestyle.

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Implementing a defined financial plan of action in helping you achieve your life goals and dreams.

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Maintaining an ongoing high trust relationship with a team of financial advisors who can help you make necessary changes in your debt, cash flow and home equity planning strategies.

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This is a relationship, not just a transaction. As such, it requires a defined system of accountability in order to work effectively. The Mortgage Planning Process consists of the following five steps:

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1. Establish and define the client-planner relationship.

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Mortgage Planner Should:

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Ask you for information about your financial situation and your time frame for results and success.

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Gather all the necessary documents before giving you the advice you need.
Clearly explain or document the services they will provide to you.

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Explain how they will be paid and by whom. Unless you are willing to pay a flat fee for mortgage and real estate equity advice, mortgage planners are typically compensated through a commission structure set up with the lenders.

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You Should:

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Clearly explain how financial decisions are made in your household and include all the key decision makers in consultations with your mortgage planner. Be prepared to share personal and financial information with your mortgage planner in order for them to be able to advise you on how best to achieve your goals.

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2. Analyze and evaluate your financial status.

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The mortgage planner should analyze your information to assess your current situation and determine what you must do to meet your goals. Depending on what services you have asked for, this could include analyzing your credit situation, real estate equity, debt situation and cash flow.

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3. Develop and present mortgage planning recommendations and/or alternatives.

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The mortgage planner should offer mortgage planning recommendations that address your goals based on the information you provide. The mortgage planner should go over the recommendations with you to help you understand them so that you can make informed decisions. The mortgage planner should also listen to your concerns and revise the recommendations as appropriate.

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4. Implementing the mortgage planning recommendations.

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You and the planner should agree on how the recommendations will be carried out. The mortgage planner may serve as your “coach,” coordinating the whole process with you and other professionals such as CPAs, CFP® professionals, attorneys, Realtors, builders, insurance professionals and other qualified advisors.

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5. Monitoring the mortgage planning recommendations through a quarterly or annual mortgage and equity management review.

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You and the mortgage planner should agree on how you will both monitor your progress toward achieving your goals. During this review, your mortgage planner can adjust their recommendations, if needed, as your life changes. Most often, this process involves periodic assessment of:

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Your fluctuating cash flow needs.

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Changing market interest rates and mortgage strategies.

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Income and career alterations.

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Family changes including:

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Children’s financial needs.

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Caring for elderly parents.

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How your real estate equity and investments are performing from both a cash-flow and “internal rate of return” perspective.

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CMPSinstitute.org

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Low mortgage rates and the financial reform act mean that now is the time to buy a home.

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