might have already been answered - but can you change who you have your mortgage with?

i went through a broker and i'd much rather have the mortgage with the bank that i do everything else with - but not sure if you can actually do that change (especially since it's an FHA loan)

6/4/2013 12:49:44 PM

do you already have your mortgage? It was my understanding that brokers normally sold them off to the bank and transferred your service to the bank as well. I never deal with my broker anymore; just my bank (who subsequently sold my mortgage to Sallie Mae).

6/4/2013 1:04:16 PM

yea, it's with a bank now. it's with bb&t but i wouldn't mind having everything with the bank that my checking and savings are with (that i've been with since i was 16)

6/4/2013 1:09:55 PM

ok. then you'd have to refinance with whatever bank you want to use.

6/4/2013 1:12:23 PM

ooooo ha okay. i really should've learned more about this kind of shit before i bought.

6/4/2013 1:15:49 PM

Don't refi just b/c you want your mortgage with your bank.
I have accounts with half a dozen institutions.
Get used to it.

6/4/2013 1:17:14 PM

oh i'm not gonna do it. i just was thinking it'd be easier.

6/4/2013 1:19:28 PM

It's easier and cheaper to move your liquid accounts to the bank you have your mortgage with if you really want to consolidate.

6/4/2013 1:36:50 PM

Quote :

"Message from the FHA Commissioner FROM THE DESK OF CAROL GALANTE June 3, 2013 FHA and Higher Priced Mortgage Loans With the implementation of Mortgagee Letter 2013-04 on June 3, 2013, the monthly mortgage insurance premium on FHA loans with loan-to-value ratios exceeding 90% will apply for the life of the loan, rather than terminating when the loan amortizes to a 78% LTV. FHA recognizes that this change in policy will increase the annual percentage rate (APR) on FHA mortgages and may result in mortgages that exceed the higher priced mortgage loan standard outlined in Regulation Z. Regulation Z defines a higher-priced mortgage loan (HPML) as a consumer credit transaction secured by the consumer's principal dwelling with an APR that exceeds the average prime offer rate (APOR) for a comparable transaction as of the date the interest rate is set, by 1.5 or more percentage points for loans secured by a first lien, or by 3.5 or more percentage points for loans secured by a subordinate lien. (The escrow account requirements also employ a separate threshold of 2.5 percentage points over APOR for “jumbo” mortgages, but this is not relevant for FHA loans.) To the extent lenders are concerned about the status of FHA’s rulemaking with respect to the Dodd-Frank ability to repay standard and FHA’s qualified mortgage standards, FHA is working to define an FHA QM standard that meets the Dodd-Frank purposes, takes HPMLs into account, and addresses the needs of the marketplace for lender and investor certainty. FHA looks forward to the active engagement of all interested parties in achieving a timely and thoughtful approach to these complex issues. In the near term, FHA understands that mortgages exceeding the HPML threshold will also have to comply with the existing requirements for such loans under Regulation Z. This is currently true for FHA loans that exceed the HPML threshold, but we understand that implementation of ML 2013-04 may cause additional loans to exceed this threshold. We have heard that some lenders have concerns about these existing requirements and, in an effort to address those concerns, have consulted with the Consumer Financial Protection Bureau (CFPB) on the following guidance related to escrow accounts, appraisals, ability to repay and prepayment penalties. FHA expects lenders to fully comply with all applicable requirements for loan origination, including requirements that are established under Regulation Z for HPMLs. We have outlined below where HPML requirements would differ from FHA requirements: 1. Escrow Accounts: Regulation Z requires an escrow account for all first-lien HPMLs. Escrow accounts are also required on all FHA loans. Although the HPML rules generally permit (but do not require) cancellation of mandatory escrow accounts after five years and upon the consumer’s request, FHA does not permit cancellation of required escrow accounts at any time, thus lenders may not cancel escrow accounts on FHA loans whether they are HPMLs or not. 2. Appraisals: The existing Regulation Z does not contain specific appraisal requirements and lenders are expected to continue complying with FHA’s appraisal requirements. Commencing January 18, 2014, Regulation Z’s appraisal requirements will require a full, interior-inspection appraisal for HPMLs with some exceptions. One such exception is for QMs. 3. Ability to Repay: The CFPB has outlined its ability-to-repay requirements in its final rule that will take effect January 10, 2014. In the interim period before those requirements become effective, the repayment ability requirement previously established by the Federal Reserve Board at 12 CFR 1026.35(b)(1), which will move to section 1026.35(e)(1) as of June 1, 2013, continues to apply. FHA has consulted with the CFPB and believes that its requirements, found in the current 4155.1, are sufficient to satisfy the Regulation Z ability-to-repay requirements for those FHA-insured loans that will be HPMLs, with certain exceptions: Streamline Refinances and ARMs may not satisfy the existing, HPML ability-to-repay requirements, depending on how they are underwritten. For example, Streamline Refinances that are HPMLs, and where income or assets relied on are not verified by obtaining confirming documentation, do not meet the ability-to-repay requirements. For these exceptions, lenders must go beyond the applicable FHA requirements to comply with the HPML ability-to-repay requirements. 4. Prepayment Penalties: CFPB has determined that monthly interest accrual amortization, which FHA permits, should be considered a prepayment penalty. However, recognizing that HUD must engage in rulemaking to end this practice, CFPB has stated in its final rule published on January 30, 2013, that monthly interest accrual amortization is not a prepayment penalty for FHA loans consummated before January 21, 2015."

6/4/2013 1:39:03 PM

Re: appraisal.

The appraiser for my house came up the driveway, got out of his car, stood there beside his car and looked around for about 10 seconds, got back in his car, and left.

[Edited on June 4, 2013 at 1:43 PM. Reason : .]

6/4/2013 1:43:21 PM

^^PMI for the life of the loan if you cant put down over 10% of the down payment??? Thats a huge amortized cost adder.

6/4/2013 2:36:16 PM

^^^ That is some straight up bullshit. Who approved that and why? I've never needed/had an FHA loan, but that is basically a tax on the people who do.



[Edited on June 4, 2013 at 3:24 PM. Reason : kl]

6/4/2013 3:22:25 PM

It looks like a social engineering move... Make PMI permanent on less than 10% closing in order to keep the number of less than 10% closings to a minimum. And for those that do, make sure they are paying PMI for a lot longer than they should to help shore up the system as a whole. Not agreeing with it. But I suspect those are the motives.

6/4/2013 4:07:03 PM

That's exactly why I went with an arm over FHA.PMI that high and for the life of the loan Is asinine and really undermines the purpose of fha loans.

6/4/2013 10:28:52 PM

you could also look at it from the point of view that those taking out an FHA loan are of higher risk than those who take out a "regular" loan and as a result, represent a group of people who are more likely to be the cause of situations where PMI funds are used to make up for foreclosures

i am NOT saying that i agree with it...but that view in conjunction with CarZin's are at least a cold, objective reason for why they're doing it

6/5/2013 8:30:13 AM

But the FHA folks have come out recently saying they want to get more people approved to help with the housing recovery and then they drop a rule like this. If their true motives are what Carzin or ^ states, then I can't disagree with the strategy.

PMI is not something that scares away home buyers per FHA research, but the amount these people will pay in PMI over the life of the loan is insane.




[Edited on June 5, 2013 at 9:17 AM. Reason : vb]

6/5/2013 9:16:11 AM

maybe it'll encourage folks to pay down their principal early so they can get to 80% and refinance

6/5/2013 3:49:10 PM

I was looking to this FHA PMI thing more and damn I did not realize how fucking broke the FHA program is. They need to get their books in order so I support them doing something like this if it helps them get out of the red. Ultimately if FHA borrowers don't like it, then save more money and get a normal loan like the rest of us before you buy a home.

6/6/2013 8:37:13 AM

Advice needed:

First time homebuyer. Looking at buying a house around downtown for just over $200k and I have around $7.5k to put down. I have a credit score of 790 or so and shouldn't have a problem getting a decent loan. Looks like I won't be able to avoid PMI though. Suggestions on the best loan to look at?

[Edited on June 12, 2013 at 12:07 PM. Reason : .]

6/12/2013 12:06:27 PM

I'd shop around for a 30 year fixed.

6/12/2013 12:36:43 PM

^^^ That's kind of how I feel. I've never been a big fan of the FHA loans anyway. I guess in theory it helps keep housing prices up by providing more available buyers and I can understand that aspect. But, on the other hand, not everyone is in a situation to own a house and there isn't a reason to subsidize their loan just because they want to own vs rent (other than keeping more available home buyers like mentioned before)

[Edited on June 12, 2013 at 2:21 PM. Reason : ]

6/12/2013 1:57:17 PM

Quote :

"so you're saying when a bank sends an appraiser out to a property(for loan purposes) it doesn't matter if the homes innards have been completely renovated, it's value will still be partly based on what the sister home down the street with ratty carpet,old fixtures and wall to wall wood paneling sold for? seems pretty shitty now I'm worried about my appraisal coming back low based on what zillow and a few other sites are giving me. "

I'm not too pleased with Wells Fargo at the moment. We found a house that came down on their price from 300K to 279K. And it was all in a matter of a few weeks that is was originally put on the market. We looked at the house and loved it. Did our homework and found out that the tax value and last appraisal in 2008 was 308K! And the sellers bought it for 300K. And easily justifiable compared to other homes at similar value/quality. So we offered 269K and they came back with an offer of 275K. Seems a little one side in terms negotiation, but we later found out that this couple is trying to sell quick! In fact they needed to bring to closing an extra 15K in order to close on 275K. My husband and I are both ok with 275K for many reasons I don't want to go into. But regardless, the house went into a short sell and so we were thinking that this would be long and drawn out on the third party bank. Well they did their research and the house appraised for 280K and gave us the okay for the offer. Meanwhile, we are working with Wells Fargo to get our financials in order. Between my husband and I, we would be considered to banks, home buying saints! Everything is flawless and we are bringing 20% down. They send their third party appraiser out and it appraises for 269K! WTF?! So we ask for a revision and apparently this company has a high number of requested revisions so go figure. Nope the cock sucker wont budge on his appraisal. I was so pissed. I looked at the appraisal and this dumbass chooses surrounding houses outside of the neighborhood when one house just sold down the street for 300K! The other houses on his list sold for 269K, 280K and 230K. He looked at the 230K house which was like 5 miles away! He also proceeded to say that hardyplank siding is worth about the same as vinyl when its actually 2% more expensive. Regardless, the guy was a douche. And the bank would only lend us 269K. Whatever, we had some extra cash saved up and decided we wanted to be done with it. We also knew the sellers were in a terrible position and thought in exchange for some of their nice furniture we would just bring the cash to closing and they were very much grateful. Yay, so here are about to close and Wells Fargo still has not gotten their shit together with the financial stuff. In fact its still in underwriting and we are suppose to close tomorrow! Honestly, I am two seconds of just pulling the plug on Wells Fargo and taking all of my accounts with me to another bank. This is just ridiculous that here my husband and I have our shit together and the bank has over a month to get theirs together and we are struggling to get to closing because they're dragging their ass.

\rant from hell!

6/12/2013 4:00:51 PM

Spent 3 months in FHA Streamline Refi with Bank of America.....

6/12/2013 4:15:24 PM

^^ welcome to the home-buying experience. I love owning a home but HATED the home-buying process.

6/12/2013 5:26:28 PM

wells fargo is god awful. worst bank on the face of the earth. DO NOT USE! Going on 4 months after closing, still working through issues.....

6/12/2013 7:20:38 PM

we don't have them for a mortgage but they were godawful as a normal bank. I had used First Union->Wachovia->Wells Fargo and it didn't take long after the switch to WF for us to close our accounts with them.

6/12/2013 7:50:40 PM

really pissed that i'm more than likely going to miss out on <3.5% because DR Horton builders can't get their shit together.

6/12/2013 7:58:23 PM

Quote :

"Advice needed: First time homebuyer. Looking at buying a house around downtown for just over $200k and I have around $7.5k to put down. I have a credit score of 790 or so and shouldn't have a problem getting a decent loan. Looks like I won't be able to avoid PMI though. Suggestions on the best loan to look at?"

Never pay PMI and you certainly don't have to. (unless you think you will only be in the home a brief time, or you think you'll have the escrow built up quickly to get out of it).

If you think it'll be a long term home, do a program that doesn't have PMI (like SECU's ARM). Conversely, do what's called PMI prepayment. For a slightly higher interest rate, they can cancel PMI. It's like buying -1 points and it's absolutely worth it. For the marginally higher interest rate, you free up alot of capitol, which allows you to more than make up the difference in payment.

Even if you can afford the 20% down, I think it's a good idea not to tie it up.

6/13/2013 4:00:46 PM

^ To follow-up with this post..there are several first-time homebuyer programs available. I personally went with the BB&T CHIP program. There are a few requirements (good credit, steady job, certain income). I can give you the name of a great lady to contact if you'd like.

Essentially the program added 1 percentage point but I didn't have to pay any PMI. It's still a basic 30 yr fixed rate conv. loan. My rate still ended up being very good, something like 4.3 or 4.4%. It really made sense when I started looking at the numbers even though I had quite a bit of savings to put towards a down payment.

6/13/2013 4:45:33 PM

and by "certain income" he means relatively low income for the county. once again, the successful are penalized.

6/13/2013 5:41:45 PM

First, why would I go with an ARM if it is a long term house and rates are going up? Seems more risky that way.

CHIP seems nice, but I make too much to qualify.

Looks like having the PMI baked in is the way to go if I'm not planning on paying down my house faster. 10 years of PMI is basically the same as 30 years of having it baked in.

6/13/2013 7:30:35 PM

I just locked in a couple of days ago. Went premium PMI so I wouldn't have to pay, 30 year fixed at 4.125%. 30 days ago, it was closer to 3.625%.

Oh well, them's the breaks. Still glad to be closing in on first home!

6/14/2013 12:13:04 AM

Rates went up. The party might be over for the LOWEST rates ever.

6/22/2013 12:58:15 AM

Quote :

"First time homebuyer. Looking at buying a house around downtown for just over $200k and I have around $7.5k to put down. I have a credit score of 790 or so and shouldn't have a problem getting a decent loan. Looks like I won't be able to avoid PMI though. Suggestions on the best loan to look at?"

Does not compute. Looking at a house for over 200k, but have 7.5k for a down payment?

I understand the reasons some put down the bare minimum. There is logic to having money but not putting it down on the house. I don't play that way, but it is a valid option. But it sounds like you don't have the money at all.

I hesitate to ask what kind of reserve or emergency money you have outside of that 7.5k. I'm guessing it's not a lot, and retirement funds don't count.

What happens if you buy the house with that 7.5k, have little in emergency savings, the housing market takes a hit again, and you lose your job? Then your car (which probably has a loan on it) breaks down and your heater craps out?

You should have sufficient non-retirement money available to you such that those things sound like awful luck, not financial ruin.

What if nothing bad happens, but you find a great job opportunity in another city (or some other reason you want/need to move). You just can't sell your house quickly enough, and you can't afford another rent or mortgage and a move? Would that headache keep you from capitalizing on such an opportunity?

The possibilities are endless. Buying 30 times as much house as your non-emergency cash leaves a lot of room for Murphy's Law to punch you in the face.

This doesn't even mention student loans. But with that kind of cash, and average student and car loans, you might have negative net worth. I'd say spend another year or three living like a college student, and enter home ownership with some peace of mind.

(I recognize you might have no student loans, no car loan, and much more than 7.5k outside of retirement....I'm just going off of what is common)

[Edited on June 22, 2013 at 4:22 AM. Reason : a]

6/22/2013 4:06:50 AM

Ok Debbie Downer

6/23/2013 10:29:09 AM

^

6/23/2013 10:44:38 AM

There are millions and millions of people who are now much more negative than me, because they did exactly what I'm saying not to do.

I was out of work for more than 6 months a few years ago. My transmission failed a month after becoming unemployed. I never lost sleep, and the consequences of the unemployment were minimal. I rebuilt my emergency fund, and everything else to my name was never in danger. All in all, it was a hiccup. That was an amazing upper.

Something like 1/4 of all homes with mortgages are underwater. Most of those people don't have significant savings, inside or outside of retirement. They are one or two very common life events from complete ruin. You think my advice is a downer? That is a downer.

6/23/2013 1:41:18 PM

Ok Debbie Downer

6/23/2013 2:28:29 PM

REALLY hoping these rates come back to around 4% within the next few weeks

6/23/2013 5:05:52 PM

TULIPlovr, first off buying a first home ~200K is quite reasonable. It would be much better to buy a 200K house, vs a 150k condo which would be far harder to resell or ending up stuck in some place you couldn't stand to live. I don't know that guy's scenario, but there are plenty of reasons to put down minimum. If I didn't have 20% to put down to avoid pmi I certainly would have put down the minimum. Because your home (opposed to retirement assets) is not immune to creditors there's very little incentive for me to invest a ton of money into it assuming my rate is fixed. As far as emergency funds go, I have one, although you can't ignore the fact any non interest from a roth ira can be pulled out without penalty, so aside from bankruptcy, I always have that option in the future. Having 20K just sitting around making .01% interest is almost as foolish as having no emergency fund as all. Are you seriously suggesting he shouldn't buy a home in case a wonderful job opportunity arises in the future in some other city? On that note, maybe he shouldn't buy a home in case a comet hits NC or a huge tidal wave covers the state. :-/

6/23/2013 8:08:29 PM

He is a Debbie Downer. According to that way of thinking - why buy anything when you could lose your job and blah blah blah.

Reality - I have savings beyond what I have for a downpayment, a decent 401k, no student loans, and am cleared for a loan closer to $300k (if I had the required 5% downpayment). We just don't want a bigger, more expensive house. Kids aren't in the plan at all, so we don't need the space.

Oh crap.... I have a car loan. Better not buy that house just yet.

6/23/2013 10:14:30 PM

Quote :

"He is a Debbie Downer. According to that way of thinking - why buy anything when you could lose your job and blah blah blah."

Yeah, I can easily see how....

Maybe you shouldn't buy something that is $200,000, illiquid, inflexible, could go down in value, while being unable to handle that equity risk, and a lack of liquidity or flexibility because you're a thousandaire. (Yes, I now know you may not be, but that was the operating assumption of my post)

=

Don't buy anything at all.

Quote :

"Are you seriously suggesting he shouldn't buy a home in case a wonderful job opportunity arises in the future in some other city? "

No, I'm suggesting he shouldn't if he didn't have the money to be able to take that job, or move for some other reason, if he wanted or needed to. I'm not telling anyone they shouldn't buy at all - I'm saying nobody should buy without money.

And people in general are very, very bad at stress-testing their finances, especially in the context of a home purchase.

Quote :

"As far as emergency funds go, I have one, although you can't ignore the fact any non interest from a roth ira can be pulled out without penalty"

I have less in my emergency fund than I otherwise would have, because I know my Roth can be used that way. However, there is a very stiff penalty, in that you can't get the money back in there. If you take 5k out, you cannot add 5k extra later to compensate (assuming you planned to max every year already). It's like losing a full year of eligibility, which is a very real penalty.

And just because money is not in a Roth does not mean that it is in a .1% savings account. And this is beside the point, but even if it were in a savings account, that .1% stands a reasonable chance of outperforming the housing and stock markets over the next few years.

[Edited on June 24, 2013 at 2:27 AM. Reason : g]

6/24/2013 2:26:47 AM

So, you're saying you should only buy a home if you can afford two housing payments at once or are a millionaire (since us thousandaires must live in poverty) ?

[Edited on June 24, 2013 at 10:13 AM. Reason : ]

6/24/2013 10:13:20 AM

Yes, you should be able to afford two house payments for the time it would take to move.

Really, you should be able to afford it without even drawing down on your savings. At any income that is ineligible for CHIP (as the guy said he had), your monthly positive cash flow after all expenses should be at least equal to what one extra house payment would be. That's especially so with no kids. And at the very, very least, you should be able to clear that kind of room in your budget with a few temporary changes.

It doesn't seem like a lot to ask to be able to pay on both, just by lowering or eliminating your other savings goals for that time period. If you can't make that kind of room in the budget at that income, and there aren't even sufficient savings to cover it for a few months and make a move, then something is really wrong.

[Edited on June 24, 2013 at 10:27 AM. Reason : a]

6/24/2013 10:25:06 AM

But what happens when you need to move again?
You really should be able to afford 3-4 house payments at once, right?
But what do I know, I'm just a lowly thousandare

6/24/2013 6:00:19 PM

I like how someone is trolling a Mortgage Thread saying its stupid to buy a house. Only on TWW.

6/26/2013 7:56:57 PM

You people can't read.

6/26/2013 8:18:05 PM

My wife and I bought the condo my mother in law had been renting for 7 years from her landlady. She had been paying $550/mo for 7 years. ($550*12*7= $46,200) So in 7 years she has paid over $46,000 in rent and has nothing to show for it. Her landlord (old) decided she did not want to keep up the place anymore and was going to have her move out so she could sell it.

My mother in law was going to have to move involuntarily (which costs money) and pay 650-700 for a comparable 1 bedroom apt in Cary. So your argument about getting screwed by an unplanned move works both ways. She did not want want to move, no matter where she went the rent would be higher, and she had no control over whether or not she could stay or how much the payment would be.

The mortgage I got is an ARM at 2.75, even if it reaches the cap at the highest it can ever adjust to the payment (including tax and ins) is lower than $550/mo, right now its like $330 including homeowners dues, taxes, and everything.

There are pitfalls to both owning and renting. Some peoples jobs are very unlikely to require them to relocate, and those folks might want the stability of actually controlling the property they live in. There is nothing wrong with that.

There are a lot of people who rent forever and continue to pay an exorbitant amount of their income toward housing even in retirement. Rents are pretty much destined to go up over time, mortgage debt eventually goes away if you plan for it.

My problem with the way the mortgage interest deduction works now is it does reward stupidity in the form of cash out refinances, and equity loans. (both have deductible interest) If you really look at the problem of underwater houses a lot of it is not rooted in the person having and inadequate down payment when buying.....its the banks frivolously lending more against the houses, and the owners milking all of the cash they could out of their house and spending it. The government should not really reward you for buying a brand new car with your house equity but it will.

6/27/2013 12:29:06 AM

4.46 average on fixed 30yr now jesus christ. Almost a half point in a week. Perfect time trying to buy a house now after spending a year getting the clearance approved from my company to move. I hope this shit stops mortgage apps in their fucking tracks so the rates tank. Im tired of hearing this shit about 'its still the lowest rates ever so its a great time to jump in'. Doesnt make me feel any better paying an extra $100+ a month for 30yrs because lenders got a woody listening to the fed.

6/27/2013 3:59:23 PM

It probably doesn't make you feel any better but that rate is still very low historically. If rates go up, the prices will just come down. People still only have certain amount of money to spend on a home.

6/28/2013 9:17:16 AM