ARMs Archives - Hanover Mortgages

Apache is functioning normally

December 8, 2023 by Brett Tams

Freddie Mac said today that 92 percent of prime borrowers who held a 1-year conforming adjustable-rate mortgage went with a fixed-rate mortgage when they refinanced during the fourth quarter, up from 85 percent in the third quarter.

The mortgage financier also found that 89 percent of prime borrowers who originally had a conforming hybrid ARM refinanced into a conforming fixed-rate mortgage, up from 84 percent in the third quarter.

“The turmoil in the financial markets that started in August and continued through the fourth quarter led most mortgage lending institutions to tighten their underwriting standards and thus some ARM products were either no longer available or came with more restrictions,” said Amy Crews Cutts, deputy chief economist for Freddie Mac.

“However, even with the financial market problems in the fourth quarter, conforming mortgage rates on all four of the ARM and fixed-rate products tracked by Freddie Mac’s Primary Mortgage Market Survey® fell by roughly one-quarter of a percentage point. With 30-year fixed mortgage rates averaging 6.2 percent over the quarter, many conforming mortgage borrowers found this product very attractive.”

Freddie’s Refinance Product Transition Report also revealed that 83 percent of borrowers who originally had a 30-year fixed mortgage refinanced into another like product during the fourth quarter, up from 79 percent in the third quarter.

Borrowers likely opted for the traditional 30-year fixed loan program because mortgage rates were very similar to those tied to 15-year programs.

More than half of borrowers who originally held a 15-year fixed-rate loan switched to a 30-year when they refinanced, while only 7 percent of borrowers with 30-year fixed-rate loans chose a 15-year when it came time to refinance.

“The difference between 15-year and 30-year fixed mortgage rates is quite narrow at the moment. When these rates are within a half of a percentage point of one another we see borrowers are more inclined to choose the longer amortizing loan because of the large payment difference,” Cutts added.

Just three percent of borrowers with 1-year ARMs switched into a hybrid ARM product in the fourth quarter, down from 8 percent in the third quarter of 2007.

(photo: claudecf)

Source: thetruthaboutmortgage.com

Apache is functioning normally

December 8, 2023 by Brett Tams

Whether you’re a first-time homebuyer or selling and moving into a new house, you will most likely need to take out a home loan to finance your purchase. But choosing a loan can be more complicated than simply picking one off a list — there are myriad considerations that go into selecting and getting approved for the right mortgage.

Military members and veterans can take out a VA loan, which offers advantages like 0% down and no minimum credit score requirement. Still, it’s important to look into the specifics of VA loans and cross-compare with conventional loans to determine the best option for you and whether you should shop around for the best mortgage lenders or the best VA lenders.

This guide will break down the ins and outs of VA and conventional loans, explain their differences and help VA-qualifying homebuyers decide what type of loan to choose.

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What is a conventional loan?

Conventional home loans are any type of mortgage not backed or insured by a government agency like the Federal Housing Administration or the Department of Veterans Affairs. They’re offered by private lenders like banks and mortgage companies, and they typically require a down payment between 3% and 20% of a home’s sale price.

Two government-sponsored enterprises (GSE), Fannie Mae and Freddie Mac, set the guidelines and requirements for conventional loans. Conventional loans will usually require a strong credit history and score — as well as a certain income and stable finances — for borrowers to qualify for competitive interest rates and terms. Borrowers may have more flexibility when it comes to property type and loan amounts compared to government-backed loans.

Types of conventional loans

There are several types of conventional home loans to consider, each with its own terms and requirements.

Conforming vs. non-conforming loans

Conforming home loans have lending criteria set by Fannie Mae and Freddie Mac. These guidelines can include factors like credit and income requirements, down payment minimum, debt-to-income ratios, and more.

Conforming loans usually have lower interest rates because lenders consider them lower risk for their strict standard lending criteria. GSEs set a maximum limit on conforming loans, which can vary depending on location.

Non-conforming loans don’t adhere to the criteria established by Fannie Mae and Freddie Mac. These loans have higher maximum loan limits than conforming loans, often making them necessary for larger loan amounts. For instance, “jumbo loans” are a common type of nonconforming loan for properties that exceed the maximums set by GSEs.

Interest rates are generally higher for non-conforming loans because they are riskier for lenders, who may also demand a bigger down payment than they would for a conforming loan. Eligibility for non-conforming loans can be more flexible and they’re often underwritten manually, which means an underwriter will evaluate your documents and verify whether you’re qualified to borrow.

Fixed-rate vs. adjustable-rate loans

When choosing a home loan, you’ll also have to decide between a fixed-rate loan or an adjustable-rate loan (ARM). Your selection will depend on your financial situation, risk tolerance, and how long you expect to live in the home you purchase.

A fixed-rate loan (aka fixed-rate mortgage) stays the same throughout the entire term, while an ARM’s interest rate can change at designated points of a loan’s term after an initial fixed-rate period. Fixed-rate loans offer more stability, which can help you plan out your expenses and budget more easily. When interest rates are low, they allow borrowers to lock in a favorable rate for the long term.

ARMs often have lower initial interest rates, which means your monthly payments will also be lower during the fixed-rate period. However, interest rate adjustments are unpredictable, and those payments may increase, resulting in higher housing costs.

VA loans explained

VA loans are specifically designed to provide active-duty military, veterans and eligible spouses assistance in purchasing or refinancing a home. They’re backed by the U.S. Department of Veterans Affairs and offer various benefits, but you have to meet specific service requirements and provide a Certificate of Eligibility from the VA.

Key differences between a VA loan vs a conventional loan

There are a few advantages to VA loans, like a $0 down payment and competitive interest rates for eligible veterans and military personnel. While conventional loans are more widely available, you normally have to pay money down and meet more stringent criteria.

Loan eligibility requirements

Qualifying for a VA loan is primarily tied to your military service record and status. Active-duty service members, honorably discharged veterans, National Guard and Reserve members who meet service requirements and certain surviving spouses are typically eligible.

You will also need a Certificate of Eligibility from the VA as proof of your service. VA loans tend to be more flexible than conventional loans regarding credit requirements, but lenders can still look into your credit history and income to determine whether you can afford the loan you’re applying for.

The home you buy with a VA loan has to meet the VA’s standards for safety and habitability, and it must be your primary residence.

Conventional loan requirements vary but are typically more strict than government-backed loans. You will usually need a credit score of at least 700 to get the best interest rates. The stronger your credit history, the more likely you are to qualify — be prepared to provide documents that show proof of income, bank statements and more to prove financial stability.

You’ll also need to meet property standards for conventional loans and pay for an appraisal to determine the property’s condition and value.

Loan closing costs and fees

VA loans require a funding fee in most cases, a one-time payment that depends on factors like service status and whether you used a VA loan in the past. The amount of your fee depends on the amount of your loan and the type of loan you get.

Conventional loan closing costs also depend on the type of loan you get, your loan amount and where you live. Closing costs typically vary between 3% and 6% of your loan amount and can include appraisal fees, attorney fees and processing fees you pay your lender to process your loan.

Down payment requirements

Minimum requirements for conventional loan down payments usually start between 3% and 5% of a home’s sale price, though paying 20% is considered ideal by many lenders and can reduce the cost of your monthly mortgage payment.

VA loans do not require any down payment, which can make homeownership more affordable for qualifying borrowers. Paying money down can, however, reduce your funding fee and decrease your monthly mortgage payment and interest.

Loan limits

Loan limits are adjusted periodically to accommodate changes in the housing market — the baseline conventional conforming loan limit in the U.S. for 2023 is $726,200, according to the Federal Housing Finance Agency. It’s higher in Alaska and Hawaii ($1,089,300) because average home prices are more expensive in those regions.

The standard limit for VA loans also increased to $726,000 in 2023 for most U.S. counties.

Mortgage insurance requirements

With a conventional loan, if your down payment is less than 20%, your lender may require Private Mortgage Insurance (PMI) for protection against default. This adds to your monthly costs but can be removed once you reach a loan-to-value ratio of about 80% or lower.

VA loans do not require PMI or any other type of ongoing mortgage insurance.

Property restrictions

The condition and characteristics of a property can impact whether you qualify for a conventional loan. Requirements vary, but typically, you must ensure the property meets specific safety and habitability standards — so if there is significant damage to the foundation or roof, you may be denied or need to make repairs before closing.

An appraisal is required to determine the property’s value and confirm that it meets lender and loan-to-value ratio requirements. Property type matters, too: Most single-family loans in sound condition qualify for conventional loans, but eligibility can vary for condominiums, townhouses or multi-unit properties.

Lenders usually require homeowner’s insurance to protect their investment, especially if the home is in a high-risk area. You’ll need to ensure there are no issues with the home’s title like outstanding liens or disputes.

Many of the same property requirements apply to VA loans, although there are some differences. The property you’re purchasing must be your primary residence and satisfy the VA’s Minimum Property Standards, which concern areas like structural integrity, roofing, HVAC, plumbing and more. You will need to have a VA appraisal to assess the property’s value and confirm that it meets the Minimum Property Standards set by the VA.

Other requirements specific to VA loans include stipulations regarding distance to military facilities and private road access. The lender may impose additional safety restrictions if you purchase a home near a military facility, such as an airfield. Properties located on private roads must be accessible year-round and well-maintained, and you will need to have a written road maintenance agreement.

Resale and refinancing

If you want to refinance with a conventional loan, lenders will evaluate your eligibility by looking at your credit score, income stability and debt-to-income ratio. In most cases, you can refinance as soon as you want, although you may have to wait several months to refinance with the same lender.

You’ll sign the new loan agreement, replacing the old one, if you are approved. There is no time requirement for reselling a home after purchasing it with a conventional loan.

Homeowners with a VA loan looking to refinance can do so with VA-backed cash-out refinance loans or the Interest Rate Reduction Refinance Loan (IRRRL).

Both refinancing options require you to wait about 240 days, or six to seven payments, whichever period is longer. The VA does not impose any time requirements if you have a VA loan and want to resell your home.

The benefits of a VA loan vs conventional loan

A VA loan can offer distinct advantages compared to a conventional loan, but only for active service members, veterans and qualifying spouses. Conventional loans typically require down payments of at least 3%, whereas VA loans do not.

Unlike conventional loans, VA loans can further reduce monthly costs because they don’t require private mortgage insurance and often have more lenient credit score requirements.

The benefits of a VA loan

No down payment required
No private mortgage insurance required
More lenient lending criteria
VA funding fee can be rolled into the loan amount, reducing upfront costs
Access to VA cash-out refinance and IRRRL loans
Low interest rates

More stringent appraisal process
Potentially longer closing timeline

The benefits of a conventional loan

Accessible to a wider pool of borrowers
Fewer property use restrictions
Competitive interest rates
Beneficial for buyers with strong credit
Diverse term options and potential for lower total interest cost

Down payment usually required
PMI requirements for down payments less than 20%
Stricter qualification requirements

Is a VA loan better than a conventional loan?

For those who qualify, VA loans can be more advantageous than conventional loans because of their low interest rates and no down payment requirement, which can mean significant long-term savings. Not having to pay any money down also makes homeownership more affordable for many people entering the market for the first time.

VA loans typically don’t require PMI, and they feature more lenient lending criteria than conventional loans, making them a better option for borrowers with a limited credit history.

Finally, including the VA funding fee in the loan, can reduce the upfront expense of buying a home.

Summary of Money’s VA loan vs conventional loans

Veterans, active duty military and some spouses can use a VA loan or a conventional loan when making a home purchase.

Conventional loans can benefit homebuyers with strong credit and enough money to make at least a 20% down payment. But with VA loans, there is no down payment or PMI requirement, which can lead to major savings on monthly mortgage payments.

VA loans aren’t as customizable as conventional loans, and it may take longer to close on a house because VA loans have a stricter appraisal process. However, the advantages of a VA loan, which typically include low interest rates and more lenient lending criteria, may outweigh these drawbacks.

Source: money.com

Apache is functioning normally

December 7, 2023 by Brett Tams

Compliance, CRM, LOS, Servicing, Workflow, Internal Audit Products; Non-QM and Jumbo News

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Compliance, CRM, LOS, Servicing, Workflow, Internal Audit Products; Non-QM and Jumbo News

By:
Rob Chrisman

Tue, Dec 5 2023, 11:33 AM

My cat Myrtle doesn’t have a lot of rizz, and there are those that will argue that no cat has any charisma whatsoever. But plenty of marketing people do, or can create it, and even if you’re not in marketing, there are some clever marketing people out there. Creative minds as well, and if you’re looking for a Christmas present, here are the “best inventions of 2023” per Time Magazine. There is also cleverness and creativeness in the modular home manufacturing industry, probably far outpacing the ability of state and local government to issue permits. Meanwhile, lenders are facing a winter trying to figure out if they are in the “Survive until ‘25” camp or the “Grow more in ‘24” mindset? The credit industry is reeling as lenders grapple with soft versus hard pulls, renegotiating pricing, and bundled deals. And for some reason LO comp continues to be unsettled: dual comp, MLOs as real estate agents, transferring pipeline data when changing jobs, different fee structures within the same state, and so on. (Today’s podcast can be found here, and this week’s is sponsored by nCino, makers of the nCino Mortgage Suite for the modern mortgage lender. nCino Mortgage Suite’s three core products, nCino Mortgage, nCino Incentive Compensation, and nCino Mortgage Analytics, unite the people, systems, and stages of the mortgage process. Hear an interview with Mayer Brown LLP’s Holly Spencer Bunting on RESPA happenings and how the industry can get to better regulation.)

Lender and Broker Products, and Services

Out with the old; in with the new! One of the things we most look forward to in December (besides the holidays, of course!) is the opportunity to envision and plan for a great future. We’ve curated a killer panel of industry execs who will share best practices and their favorite secrets to help you usher in 2024 at the highest possible note. TrustEngine’s Dave Savage hosts Dustin Owen of Waterstone Mortgage and Brian Covey of Revolution Mortgage in “Chaos to Clarity”, a sure-to-be deliciously juicy webinar that will inspire and energize you to end 2023 with a bang and move powerfully into the new year. Register now to save your seat!

What’s an internal audit anyway and do you need one? An internal audit acts as a third line of defense for your mortgage operation. It provides comprehensive assurance based on the highest level of independence and objectivity to evaluate the effectiveness of management’s internal controls. This function should advise your mortgage operation on plans to achieve the company’s strategic, operational, financial and compliance goals. An effective internal audit should go far beyond just checking a compliance box; it should be an integral part of protecting your company. If you want to ensure you’re adhering to regulatory requirements and demonstrating good faith business practices, a Richey May internal audit is a good fit. If you’re looking to be Fannie Mae approved in the future or want to maintain your approved status, it’s required. If you’re unsure whether you need an internal audit, ask one of Richey May’s experts today or learn more here.

“Is it a challenge getting what was promised out of your current subservicer? New regulations are always moving the compliance goal posts and your customers are craving the newest technology and high-quality customer experience to meet their needs. After all, aren’t those the reasons you contracted with them? Perhaps it’s time for a change. Come meet Servbank at the MBA Servicing Solutions 2023 and let us show you how our cutting-edge, fully transparent and award-winning servicing platform (SIME), combined with our family of caring Customer Care reps, will protect your company from regulatory misses and keep your customers loyal by delivering a superior experience every time. If your current subservicer promised to make life easier for you, but continues to miss the mark, now is the time to partner with Servbank, the nation’s only fintech bank subservicer, who can meet your unique needs. Stop by booth #601, or schedule a meeting with Servbank.”

Right in time for the holidays, Floify has launched Floify Broker Edition, a one-stop lending platform that makes it easy for brokers to manage loans in one place. Wrapped in Floify’s famously sleek interface, Floify Broker Edition is packed with magical features that save precious time and money, such as automated mortgage call reporting, dual AUS functionality, and PPE and wholesaler integrations. Just like Santa’s elves, automated workflows advance loans behind the scenes so brokers can spend more time spreading the joy of homeownership and less time pushing paper. Treat yourself (and your borrowers!) this holiday season with a lending platform that’s a joy to use. Experience the magic of Floify Broker Edition firsthand and book a demo today.

Take advantage of more opportunities by adjusting your business to match the market. Recently, lenders who could quickly scale their home equity products were able to capitalize on the increased demand. Are you maximizing home equity lending in your system of record? Encompass® by ICE Mortgage Technology® is the only solution on the market that can be easily configured without any development efforts to support a user’s unique products and workflows for each of their channels, including retail, consumer direct, HELOC, wholesale and correspondent. This means you can quickly react to market changes and manage your business in your own way. Click here to read our recent blog that shares strategies to maximize your home equity lending business and how Encompass makes it easy.

A borrower’s servicing experience is only as good as the back-office environment that supports it, which is only as good as the technology that powers it. That’s why ICE is actively moving servicing forward through digitizing the consumer experience and streamlining back-office operations. The mortgage technology experts at ICE understand that effective servicing solutions are built from the “outside in”, designing with the customer in mind and working until the same level of convenience is brought to those working behind the scenes. Read the new blog from Sandra Madigan, Chief Digital Officer at ICE Mortgage Technology, to see how ICE is engineering with empathy, and helping people achieve and maintain the dream of homeownership.

In Naples, people hurl plates, appliances and even furniture out of their windows on New Year’s Eve to symbolize making room for the new. If your LOS has been causing you strife, take a cue from the Neapolitans and chuck it out the window. Dark Matter Technologies is here to help you usher in a more prosperous 2024 with its Empower LOS. A fully cloud-based system, Empower brings your tech ecosystem together in one place and intelligently orchestrates delightful borrower experiences and efficient loan production. Schedule a demo with the Dark Matter team to learn how Empower can elevate your business in the year ahead.

Two things come to mind when looking for strategies to help LOs today. First, understand home buyers in the context of uncertainty in the market today. Get back to basics of why homeownership still makes sense: pride of ownership, building equity for the future, and a better environment for their family to live and grow. Next, be able to articulate good solid strategies to make home buying more affordable, both down payment strategies and ARMs to lower payments. It’s also important to understand buyer’s bias against ARMs and counter with common sense arguments. Usherpa, the #1 ranked mortgage CRM in customer satisfaction and loyalty, is offering these FREE printable handouts with informational scripts to use when talking with your homebuyers and valuable resources you can easily send them about ARMs.

ActiveComply is thrilled to introduce a brand-new product, WebCompass™, to discover and manage your websites for branding, compliance, and accessibility. The same power as SocialShield™ for Social Media but now for website and brand compliance. With WebCompass™ you can discover and monitor company and employee websites & web pages, protect your brand with website content scans and compliance tracking, uncover rogue or unauthorized websites, and streamline reporting demands during regulatory examinations. Sign up today for a demo and the first 25 customers will receive a discount. ActiveComply cloud-based solutions help highly regulated industries confidently manage their social media and website compliance and virtual inspections.

Non-QM, DSCR, Jumbo Broker and Correspondent Program News

Can we continue our same ad please: Long-term Rental or Vacation Rental? Visio Lending is the nation’s leader in Non-QM Investor DSCR loans for buy and hold SFR rentals with nearly a decade of experience and over $2.5 billion in originations. No-DTI, 30-year terms, rate buy downs, free 45-day rate locks; I/O and Sub-1 DSCR options available. Through our top-notch Broker Program, brokers are able to earn up to 2 points YSP, and 5 points total. Visio Brokers can count on a designated Account Executive and in-house processing.

PRMG offers several Non-QM resources such as product matrices, job aids, trainings, calculators, worksheets, and other information to assist with using Non-QM loan products. Access the TPO Non-QM Resources page for detailed information.

Angel Oak Mortgage Solutions announced the release of its Blended Rate Calculator, providing borrowers with a quick and straightforward tool to estimate potential loan scenarios.

In tandem with its Angel Oak Mortgage Closed End Second Loans program, the Blended rate calculator helps you show borrowers what their 1st and 2nd payments, as well as LTV and blended rates, will be for both mortgages. This tool enables borrowers to easily assess how they can tap into their home’s equity while retaining their first mortgage.

PHH Mortgage announced new products for Non-Agency offering as of November 28th. Go to the company library to view the information.

A Jumbo option designed to empower homebuyers in high-value markets to secure their dream homes. Explore the advantages of Plaza’s new Jumbo Champion loan program, featuring top-notch pricing, loan amounts up to $3 million, and eligibility for FICO scores starting from 720.

LendSure Mortgage Corp., a Non-QM wholesale lender, announced the launch of its new Profit & Loss (P&L) Loan Program offering “a simplified and user-friendly process for business owners seeking capital in a complex financial landscape.” LendSure’s P&L Loan Program is designed to cater to business owners and self-employed investors with fluctuating seasonal income or cash businesses. It eliminates the need for a self-employment questionnaire, simplifying and speeding up the application process and making it more convenient for borrowers to secure financing. “We aim to empower business owners, redefining industry standards and facilitating their path to financial success… The program offers two tiers of loan amounts, giving borrowers the choice to provide only P&L statements for loan amounts up to $1,000,000 or supply two months of bank statements with P&L statements for loan amounts up to $1,500,000. This flexibility enhances the broker-customer relationship by providing a straightforward, efficient solution for business owners. Reach out to LendSure for more information.

First time home buyer/ first time investors now have a chance to buy an investment property with no income. Hometown Equity Mortgage offers a Bridge for First time home buyers; up to 75 percent LTV on a purchase, no ratio DSCR product, NO VOR/VOM, allowed to live rent free. FICO down to 650, Flexible guidelines, 12-24 month I/O with no prepay or EPO.

HighTech Lending Wholesale is now offering Jumbo Reverse Mortgages the Platinum Reverse which comes in three variations: Maximum LTV Fixed Rate, Adjustable Rate with a Line of Credit, and Reduced LTV with a lower Fixed Rate. The minimum age for the Platinum is 55 in most states, but some require the borrower to be 60 or 62.

Capital Markets

First Community Mortgage has named Jeff Pancer to the new position of Executive Vice President, Capital Markets. Congratulations!

Markets finally paused recent optimism that has been riding on the assumption that the Fed will lower interest rates in 2024. Until yesterday, that optimism had fueled rallies in both stocks and bonds over the past few weeks, with investors continuing to overlook Fed rhetoric and bet on deep interest rate cuts next year. Fed Chair Powell on Friday reiterated that it is too early to consider cutting rates, and that the Federal Open Market Committee plans to keep policy restrictive for some time. Despite his stance, markets are still at odds with the Fed, pricing in the first rate cut as early as March and 125 basis points of rate cuts in total for 2024. Remember, sticky inflation can prevent the Fed from cutting.

The Fed is widely expected to leave rates unchanged for the third consecutive FOMC meeting next week, in what would be no change for the fourth out of the past five meetings. However, the post-meeting statement will likely continue to indicate that additional tightening is possible. The fear is that the Fed declaring victory too early while the economy is growing, and the labor market is tight is a risk if inflation spikes back up. The Fed has entered its blackout period ahead of the meeting, so we won’t get any more chatter from FOMC members until after the meeting. Additionally, there will be no Treasury note or bond auctions this week. This week will be dominated by the jobs report on Friday where expectations are for an improvement from October’s report: an increase of 180,000 jobs in November and no change in unemployment.

Today’s economic calendar has a lot of non-market moving releases: Redbook same store sales for the week ending December 2, final November S&P Global services PMI, expected to decline slightly, ISM non-manufacturing PMI for November, expected to tick up, and JOLTS job opening for October, supposedly sliding to 9.35 million from 9.55 million in September. We begin the day with Agency MBS prices better by .125-.250, the 10-year yielding 4.23 after closing yesterday at 4.29 percent, and the 2-year yield down to 4.52 as investors continue to believe, perhaps mistakenly, that the Fed is not only done raising rates but will come around to cutting them.

Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

Apache is functioning normally

December 7, 2023 by Brett Tams

Many people want to buy a home but think it isn’t possible because they don’t have money to put toward a down payment. Traditionally, lenders require a 20% down payment toward your mortgage.

But a 20% down payment adds up to a lot of money. For example, if you plan to purchase a $150,000 home, you’d need to come up with a $30,000 down payment. Many people cannot afford this, but fortunately, the 20% rule is a lot less common than you might think.

Is a buying a house with no money down possible?

The National Association of Realtors (NAR) reports that 39% of non-owners believe they need a 20% down payment or more and 22% believe they need a 10% to 14% down payment.

But neither of these are true. Many mortgage lenders will let you buy a home by putting down as little as 3%. And some lenders will let you skip the down payment altogether.

NAR also found that 61% of first-time homebuyers made a down payment between zero and 6%. So, it’s safe to say that a 20% down payment isn’t the standard anymore. But unfortunately, many consumers choose not to pursue homeownership because they believe this down payment myth.

Weighing the Pros and Cons of No Down Payment Mortgages

Is there any reason to aim for 20% down when most home buyers buy with a down payment less than 20%? If you can afford it, yes, the 20% rule is still a wise choice.

The more money you put toward your mortgage, the less debt you’ll have to repay and the less your monthly payment will be. Plus, there are several drawbacks to putting down less than 20%:

Less favorable rates: If you pay less than 20%, lenders will probably see you as a risky investment. And they will take this into consideration when calculating your mortgage rates. In general, you can expect to pay a higher interest rate if you put down a smaller down payment.
Higher closing costs: Closing costs are based on the size of your mortgage. So, the smaller your down payment is, the higher your closing costs will be. However, you may be able to get around this if you live in a state where it’s typical for the seller to pay the closing costs.
Private mortgage insurance (PMI): Private mortgage insurance is a type of mortgage insurance designed for borrowers who make a down payment lower than 20%. It protects your mortgage lender in case you end up defaulting on your loan.

PMI can cost as much as 1% of your total monthly mortgage payment. So for a $150,000 mortgage, you’ll end up paying $150 per month.

However, this may not be that bad, especially if you have a less expensive mortgage. And once you reach 20% home equity, you can cancel your PMI and get rid of these extra payments.

Check Out Our Top Picks for 2023:

Best Mortgage Lenders

How to Buy a House With No Money Down

Fortunately, there are several lending programs that do not require a down payment. Here are five payment assistance programs that will help you buy a home with little to no down payment.

1. VA Loans

VA loans are a valuable option for eligible military veterans, active-duty service members, and certain surviving spouses. These government-backed loans offer several benefits, making homeownership more accessible and affordable through the use of a VA loan.

100% Financing and No Down Payment

One of the most significant advantages of VA loans is the 100% financing, meaning you won’t need to make a down payment when utilizing a VA loan. This can save borrowers a substantial amount of money upfront, making it easier to enter the housing market.

No Private Mortgage Insurance (PMI) Requirement

Unlike conventional loans that require PMI for down payments less than 20%, VA loans do not require PMI. This can save borrowers hundreds or even thousands of dollars per year in mortgage insurance premiums when using a VA loan.

VA Funding Fee

While VA loans offer numerous benefits, there is a one-time funding fee charged to help offset the costs of the program. The funding fee is 2.15% of the total loan amount for first-time users of VA loans and 3.3% for subsequent uses.

This fee can be financed into the VA loan, reducing the out-of-pocket expenses for the borrower. In some cases, borrowers may be exempt from the funding fee, such as those with service-connected disabilities.

Certificate of Eligibility

To apply for a VA loan, borrowers need to obtain a Certificate of Eligibility (COE) from the Department of Veterans Affairs. The COE verifies the borrower’s eligibility for the VA loan program based on their military service or, in some cases, the service of their spouse. The COE can be requested online through the Department of Veterans Affairs website, by mail, or through an approved lender.

Additional Benefits

VA loans also offer competitive interest rates, more lenient credit requirements, and flexible underwriting guidelines compared to conventional loans. Additionally, there are no prepayment penalties, allowing borrowers to pay off their VA loans early without incurring additional fees.

2. Navy Federal Credit Union

Navy Federal Credit Union’s loan program is similar to what the VA offers. It offers a zero down mortgage and no mortgage insurance. And Navy Federal’s funding fee is only 1.75%.

Navy Federal offers a 30-year loan and a 30-year jumbo loan. 30-year loans have a loan limit of $424,100 while jumbo loans are available up to $1 million. However, you will have to be a Navy Federal member to qualify.

3. USDA Loans

If you’re looking to move to a rural area, you might qualify for a USDA loan. The United States Department of Agriculture Housing Program was designed to aid rural development and is aimed at low-income families. USDA loans offer 100% financing with low interest rates.

Here are the eligibility requirements you must meet to qualify for a USDA loan:

When buying a home it must be within the USDA’s boundaries: Although this loan targets rural areas, some suburban areas may still qualify. You can look at this map on the U.S. Department of Agriculture’s website to see if your location falls within the USDA’s geographical boundaries.
Your household income can’t exceed a certain threshold: This applies to everyone living in the household, even if they won’t be listed on the mortgage. For instance, if you have a parent living with you who collects Social Security, this counts toward the gross income of all members of a household. The maximum household income varies by state and county so you can find out if you qualify here.

See also: Best Home Loans for Low-Income Borrowers

4. Lease-Option

A lease-option (also known as rent-to-own) allows you to rent a home with the option to buy it at a predetermined price after a certain period. A portion of your monthly rent may be applied toward the purchase price or down payment. This can be a solid option if you need more time to save for a down payment or improve your credit.

5. Seller Financing

In some cases, the seller may be willing to finance the property for you, allowing you to purchase the home without a traditional mortgage. This arrangement typically requires a contract outlining the terms of the loan, including the interest rate, payment schedule, and any potential penalties.

Seller financing can be a viable option if you have a strong relationship with the seller or if the seller is having difficulty selling the property.

6. Crowdfunding

Crowdfunding is a method where you raise money from multiple individuals, typically through online platforms. You can set up a campaign to raise funds for your down payment or even the entire purchase price. This method may work best if you have a strong network of friends, family, and supporters who are willing to contribute to your home-buying goal.

7. Shared Equity Agreements

Shared equity agreements involve partnering with an investor who provides a portion or all of the down payment in exchange for a percentage of ownership in the property. When the property is sold or refinanced, the investor receives a return on their investment based on the agreed-upon share of equity. This can be an attractive option if you can’t afford a down payment but are willing to share future appreciation in the home’s value.

8. Housing Assistance Programs

There are numerous local, state, and federal housing assistance programs that offer grants, low-interest loans, or other forms of financial support to help eligible individuals purchase a home with no money down. These programs often have specific requirements, such as income limits, property location, or first-time homebuyer status. Be sure to research and apply for any programs for which you might be eligible.

Low Down Payment Loans

If you’re unable to buy a house with no money down but can afford a small down payment, consider these low down payment options that can help make homeownership more accessible.

1. 97% LTV mortgages

97% LTV mortgages is a loan program that is offered to first-time homebuyers by Fannie Mae and Freddie Mac. They require a 3% minimum down payment and private mortgage insurance.

Here are the guidelines for the program:

You’ll need a credit score of at least 680
One of the borrowers must be a first-time homeowner
Manufactured housing isn’t permitted
Gifts, grants, and other funds may be used toward the down payment

2. Federal Housing Administration (FHA) Loans

The Federal Housing Administration (FHA) was established in 1934 to reduce the requirements to qualify for a mortgage. This government-backed mortgage program offers flexible requirements, making it an attractive option for first-time homebuyers.

Here are the guidelines you’ll need to meet to qualify for an FHA loan:

Credit Score Requirements

The minimum credit score required to qualify for an FHA loan is 500. The specific down payment requirements depend on your credit score:

If your credit score is between 500 and 579, you’ll need to make a 10% down payment.
If your credit score is 580 or higher, you’ll have to make a 3.5% down payment.

Seller Contributions

FHA loans allow sellers to contribute up to 6% of the closing costs. This can help reduce the upfront costs for the buyer and make it easier to afford the purchase.

Mortgage Insurance Requirements

Mortgage insurance is required for an FHA loan, protecting the lender in case the borrower defaults on the loan. However, once you build 20% equity in the home, you can refinance to a conventional loan to eliminate the mortgage insurance requirement.

Debt-to-Income Ratios

FHA loans accept high debt-to-income (DTI) ratios, allowing borrowers with significant existing debt to still qualify for a mortgage. The FHA typically requires a maximum DTI of 43%, but exceptions can be made for borrowers with compensating factors, such as substantial savings or a history of making large payments on time.

3. HomeReady Mortgage

The HomeReady mortgage is a Fannie Mae program designed for low-to-moderate-income borrowers. It requires a down payment as low as 3% and offers flexible underwriting guidelines, making it an attractive option for first-time homebuyers or those with limited credit history.

4. Home Possible Mortgage

Similar to the HomeReady mortgage, the Home Possible mortgage is a Freddie Mac program that allows for a down payment as low as 3%. It is designed to help low-to-moderate-income borrowers achieve homeownership and offers flexible underwriting guidelines.

5. State and Local Homebuyer Assistance Programs

Many state and local governments offer homebuyer and down payment assistance programs that provide grants or low-interest loans to help cover down payment and closing costs. These programs typically have income and property location requirements, so be sure to research and apply for any programs for which you might be eligible in your area.

Each of these low down payment mortgage options has its own set of eligibility requirements and potential benefits. Be sure to research and compare these options to determine which one best aligns with your financial situation and home-buying goals.

Preparing for Homeownership

Before jumping into the home buying process, it’s essential to prepare yourself financially and mentally. This section covers tips for improving credit scores, creating a budget, and managing debt to make the home buying process smoother.

Credit Score Improvement Tips

Improving your credit score involves checking your credit report for errors and disputing any inaccuracies. Ensure that you pay your bills on time and reduce outstanding debt as much as possible. Keep credit card balances low, avoid opening new credit accounts, and consider requesting a credit limit increase without increasing your spending.

Creating a Budget

Creating a budget requires tracking your income and expenses to understand your spending habits better. Categorize your expenses and set realistic limits for each category. Allocate funds for saving and investing, including a down payment and emergency fund, and regularly review and adjust your budget as needed.

Managing Debt

Managing your debt effectively involves prioritizing high-interest debt and paying more than the minimum payment. Consider debt consolidation or refinancing options to secure a lower interest rate. Avoid taking on new debt before applying for a mortgage and create a debt repayment plan that you can stick to.

Understanding the Total Cost of Homeownership

Understanding the total cost of homeownership means factoring in property taxes, insurance, maintenance, and utility costs. Estimate homeowners association (HOA) fees if applicable and consider the costs of furnishing and updating the home. Prepare for potential increases in expenses over time, such as property tax hikes.

How to Choose the Right Mortgage Option

With various mortgage options available, it’s crucial to select the one that suits your financial needs and long-term goals. This section discusses factors to consider when choosing a mortgage, such as loan term, interest rates, and mortgage insurance.

Fixed-Rate vs. Adjustable-Rate Mortgages

Fixed-rate mortgages have a consistent interest rate for the loan’s duration, providing stability and predictable monthly payments. In contrast, adjustable-rate mortgages (ARMs) have an initial fixed-rate period followed by periodic rate adjustments, which may result in lower initial payments but potential rate increases over time.

Mortgage Term: 15-Year vs. 30-Year

The mortgage term plays a crucial role in determining the overall cost of your mortgage. 15-year mortgages typically have lower interest rates and allow for faster equity buildup, but require higher monthly payments. 30-year mortgages offer lower monthly payments, but result in more interest paid over the loan’s lifetime.

Mortgage Insurance Considerations

PMI may be required for conventional loans with less than a 20% down payment. Loans backed by the federal government, such as FHA, VA, or USDA loans, may have different insurance requirements or fees.

Assessing Your Long-Term Goals

When choosing a mortgage option, consider how long you plan to live in the home and whether your financial situation or housing needs may change. Evaluate the potential for home value appreciation and the impact on your future financial goals.

Planning Your Next Steps

Assess Your Financial Situation

The amount of money you choose to put toward a down payment is a personal choice. If you feel ready for homeownership but know that a 20% down payment isn’t feasible for you, there are many options available to help you.

The best place to start is by looking at your monthly budget and seeing what you can realistically afford. Use a mortgage calculator to reverse engineer your goal and find your ideal home purchase. Consider factors like property taxes, insurance, and maintenance costs, as well as any debts you currently have.

Get Pre-Approved

Get pre-approved for a mortgage before you start house hunting. This will give you an idea of how much you can afford, and it will show sellers and real estate agents that you’re a serious buyer.

To get pre-approved, you’ll need to provide your lender with documentation such as pay stubs, bank statements, and tax returns. They’ll then assess your credit score and financial history to determine how much they’re willing to lend you.

Shop Around for the Best Mortgage

Shop around for the best mortgage rates and terms. Don’t just settle for the first lender you come across. Compare different lenders and loan programs to find the best fit for your financial situation. Look for competitive interest rates, low fees, and flexible repayment terms.

Work with a Knowledgeable Real Estate Agent

A good real estate agent can help you find a home that fits your needs and budget. They’ll also guide you through the home buying process, making it less stressful and ensuring you don’t make any costly mistakes.

Attend First-Time Homebuyer Classes

Consider attending first-time homebuyer classes or workshops. Many local organizations and government agencies offer educational resources for first-time homebuyers. These classes can help you understand the ins and outs of the home buying process and give you the knowledge you need to make informed decisions.

Save for Unexpected Expenses

Even if you’re able to buy a home with no money down, it’s a good idea to have some savings set aside for unexpected expenses. These might include moving costs, home repairs, or furnishing your new home.

Build an Emergency Fund

In addition to saving for unexpected expenses, it’s also important to have an emergency fund in place. This should be enough to cover three to six months’ worth of living expenses in case you lose your job or face another financial emergency.

Be Patient and Stay Disciplined

Home buying is a complex process, and it can take time to find the right home and secure financing. Stay focused on your goals, be disciplined with your spending, and remember that homeownership is a long-term investment.

Conclusion

Buying a home with no money down is possible, but it may not be the best choice for everyone. Consider your financial situation, your long-term goals, and the various mortgage options available to you before deciding on a zero down payment mortgage. With careful planning and preparation, you can make your dream of homeownership a reality, even if you don’t have a large down payment saved up.

Source: crediful.com

Apache is functioning normally

December 7, 2023 by Brett Tams

Loan workouts carried out by the Hope Now alliance broke the one million mark, Treasury Secretary Henry Paulson said as part of his address to the National Association of Business Economists this morning.

The group, which includes companies like Countrywide Financial and Litton Loan Servicing, helped more than one million homeowners avoid foreclosure since July through loan modifications or repayment plans, including 638,000 subprime borrowers.

“According to today’s information, HOPE NOW’s progress is accelerating,” said Paulson, in a statement. “In January, there were 167,000 work-outs, up 11 percent from December.”

“Loan modifications alone increased 19 percent from December to January. By comparison, foreclosure starts increased just 5 percent during the same period.”

“I am encouraged that the number of borrowers receiving help is rising faster than the number entering foreclosure.”

Paulson also explained that through the implementation of the American Securitization Forum’s fast-track framework, Hope Now was able to focus on subprime borrowers, a group that represents a significant chunk of the foreclosure starts despite accounting for only a sliver of the total outstanding mortgages.

“While subprime mortgages make up only 13 percent of outstanding mortgages, about 50 percent of the foreclosure starts in the third quarter 2007 were subprime loans,” said Paulson.

“And more astonishing is the fact that, while subprime ARMs are only 6.5 percent of mortgages, they represent 40 percent of third-quarter 2007 foreclosure starts.”

Paulson added that Hope Now members modified 45,000 subprime loans, a 16 percent increase from December, and plans to streamline more borrowers so resources are available to tackle more dire situations.

“Before the creation of HOPE NOW, servicers were sending letters to delinquent borrowers and getting only a 2 to 3 percent response rate,” he said. “The alliance now sends out letters on HOPE NOW letterhead, and gets closer to a 20 percent response.”

“They’ve sent over 1 million letters to struggling borrowers who had previously avoided contact, and the higher response rate means almost 200,000 borrowers have reached out for help.”

Good news…

(photo: gemsling)

Source: thetruthaboutmortgage.com

Apache is functioning normally

December 6, 2023 by Brett Tams

Mortgage rates moved higher for all types of loans compared to a week ago, according to data compiled by Bankrate. Rates for 30-year fixed, 15-year fixed, 5/1 ARMs and jumbo loans increased.

After surpassing 8 percent in late October, mortgage rates have somewhat retreated. One big driver: Inflation has cooled, which means the Federal Reserve might end its rate increases. The Fed last hiked its key interest rate in July, which increased borrowing costs on a variety of financial products, including mortgages.

The central bank decided to hold firm at its November meeting, indicating it expects rates to stay on the higher side for the foreseeable future.

“Expectations of slower economic growth, moderating inflation and no more Fed interest rate hikes have been a downward influence on mortgage rates,” says Greg McBride, CFA, chief financial analyst for Bankrate.

The slight decline in mortgage rates comes alongside appreciating home prices. Home values have now climbed for eight months in a row, according to the S&P CoreLogic Case-Shiller index for September 2023.

Rates last updated December 5, 2023.

These rates are Bankrate’s overnight average rates and are based on the assumptions indicated here. Actual rates displayed across the site may vary. This story has been reviewed by Suzanne De Vita. All rate data accurate as of Tuesday, December 5th, 2023 at 7:30 a.m.

30-year mortgage rate moves higher, +7.53%

The average rate for a 30-year fixed mortgage for today is 7.53 percent, up 753 basis points over the last week. A month ago, the average rate on a 30-year fixed mortgage was higher, at 7.83 percent.

At the current average rate, you’ll pay a combined $701.27 per month in principal and interest for every $100,000 you borrow. That’s an increase of $701.27 over what you would have paid last week.

The popular 30-year mortgage has a number of advantages:

Lower monthly payment: Compared to a shorter term, such as 15 years, the 30-year mortgage offers lower, more affordable payments spread over time.
Stability: With a 30-year fixed mortgage, you lock in a set principal and interest payment, making it easier to plan your housing expenses for the long term. Remember: Your monthly housing payment can still change if your homeowners insurance premiums and property taxes go up or, less likely, down.
Buying power: With lower payments, you might qualify for a larger loan amountor a more expensive home.
Flexibility: Lower monthly payments can free up some of your monthly budget for other goals, like building an emergency fund, contributing to retirement or college tuition, or saving for home repairs and maintenance.

Learn more: What is a fixed-rate mortgage and how does it work?

15-year mortgage rate moves up, +6.80%

The average 15-year fixed-mortgage rate is 6.80 percent, up 680 basis points over the last week.

Monthly payments on a 15-year fixed mortgage at that rate will cost around $888 per $100,000 borrowed. Yes, that payment is much bigger than it would be on a 30-year mortgage, but it comes with some big advantages: You’ll come out several thousand dollars ahead over the life of the loan in total interest paid and build equity much more rapidly.

5/1 adjustable rate mortgage rises, +6.78%

The average rate on a 5/1 ARM is 6.78 percent, ticking up 678 basis points over the last 7 days.

Adjustable-rate mortgages, or ARMs, are mortgage terms that come with a floating interest rate. In other words, the interest rate will change at regular intervals, unlike fixed-rate mortgages. These loan types are best for those who expect to sell or refinance before the first or second adjustment. Rates could be much higher when the loan first adjusts, and thereafter.

While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.

Monthly payments on a 5/1 ARM at 6.78 percent would cost about $651 for each $100,000 borrowed over the initial five years, but could climb hundreds of dollars higher afterward, depending on the loan’s terms.

Jumbo mortgage interest rate trends higher, +7.59%

The average rate for a 30-year jumbo mortgage is 7.59 percent, up 759 basis points since the same time last week. Last month on the 5th, jumbo mortgages’ average rate was higher, at 7.82 percent.

At the current average rate, you’ll pay $705.39 per month in principal and interest for every $100,000 you borrow. That’s $705.39 higher compared with last week.

Mortgage refinance rates

Current 30 year mortgage refinance rate climbs, +7.63%

The average 30-year fixed-refinance rate is 7.63 percent, up 763 basis points compared with a week ago. A month ago, the average rate on a 30-year fixed refinance was higher, at 7.96 percent.

At the current average rate, you’ll pay $708.14 per month in principal and interest for every $100,000 you borrow. That’s an extra $708.14 compared with last week.

Where are mortgage rates heading?

Mortgage rates have done a 180 as of late, falling back under 8 percent. With inflation cooling and 10-year Treasury yields declining, the 30-year fixed mortgage could head into the 6 percent range by next year, said Lawrence Yun, chief economist of the National Association of Realtors, at the group’s conference in November.

“I believe we’ve already reached the peak in terms of interest rates,” said Yun.

The rates on 30-year mortgages mostly follow the 10-year Treasury, which shifts continuously as economic conditions dictate, while the cost of variable-rate home loans mirror the Fed’s moves. These broader factors influence overall rate movement. As a borrower, you could be quoted a higher or lower rate compared to the trend.

What today’s rates mean for your mortgage

While mortgage rates fluctuate considerably,, there is some consensus that we won’t see rates back at 3 percent for some time. If you’re shopping for a mortgage now, it might be wise to lock your rate when you find an affordable loan. If your house-hunt is taking longer than anticipated, revisit your budget so you’ll know exactly how much house you can afford at prevailing market rates.

You could save serious money on interest by getting at least three loan offers, according to Freddie Mac research. You don’t have to stick with your bank or credit union, either. There are many types of mortgage lenders, including online-only and local, smaller shops.

“All too often, some [homebuyers] take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming,” says Mark Hamrick, senior economic analyst for Bankrate. “But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”

More on current mortgage rates

Methodology

Bankrate displays two sets of rate averages that are produced from two surveys we conduct: one daily (“overnight averages”) and the other weekly (“Bankrate Monitor averages”).

The rates on this page represent our overnight averages. For these averages, APRs and rates are based on no existing relationship or automatic payments.

Learn more about Bankrate’s rate averages, editorial guidelines and how we make money.

Source: bankrate.com

Apache is functioning normally

December 4, 2023 by Brett Tams

With more affordable housing prices than surrounding states, Nevada is attracting new residents every day. Those moving to Las Vegas have very different preferences when it comes to apartments. These are the best apartments in Las Vegas.

Photo source: Avion at Sunrise Mountain / Rent.

Right at the base of Sunrise Mountain on the northeast side of the Las Vegas metro area, Avion at Sunrise Mountain has the best view of the city you can get. Furthermore, it boasts not one, but two pools, a 24-hour fitness center and a business center.

Resident can choose from apartment plans with up to three bedrooms, with furnished units available for those that would like them.

Photo source: Trend! / Rent.

Living up to its name, Trend! is a contemporary apartment community with amenities galore—on-site dry cleaning, electric vehicle charging stations, a heated pool and water bottle and towel services are only a handful of the many.

These luxury apartments have one-, two- and three-bedroom plans to choose from and are in the mellow Silverado Ranch neighborhood.

Photo source: Tamarus Park at Heritage Square / Rent.

Tamarus Park at Heritage Square lies within walking distance of UNLV and only a few minutes away from the Strip by car. There are studio, one and two-bedroom units giving the perfect space for anyone at any stage of life, whether a student, young professional, or growing family.

The added benefits of a pool, hot tub and fitness center, not to mention on-site patrol make it a safe environment to live and relax without needing to leave the community.

Photo source: La Villa Estates / Rent.

La Villa Estates is in the coveted Summerlin neighborhood, with trendy boutiques and cafes and views of the mountains across the city.

There are one, two and three-bedroom options, along with access to a business center, hot tub, pool and even racquetball courts. Safety is a priority at La Villa Estates, with gated community access, controlled access to each building and on-site patrol.

Photo source: Wynn Palms / Rent.

On just the other side of the freeway from the Strip, you’ll find the Wynn Palms. Living here will put you within walking distance from many high-end restaurants, casinos and other entertainment options.

A business center, playground and pool come with these one-and two-bedroom apartments. There is also on-site patrol to give further privacy and protection to Wynn Palms residents.

Photo source: Maverick & Hidden Village / Rent.

Minutes away from downtown Las Vegas, Maverick & Hidden Village is comfortably settled within the Arts District and Orleans Square, putting great food and art right at your doorstep.

These one- and two- bedroom units allow for short-term rentals to accommodate any time period for which you might need an apartment. There’s also the option of renting a furnished apartment, so you only need to bring your clothes and personal items.

Photo source: 20 Fifty One / Rent.

Offering units with up to three bedrooms, 20 Fifty One is truly a family-friendly community. It includes a shared barbeque area with a children’s playground, a clubhouse for indoor gatherings and multiple safety measures put in place, including on-site patrol and controlled access to each building.

Not only does 20 Fifty One allow for up to two pets (dogs and/or cats), but it’s located near a pet park where residents can easily take their furry friends to get some fresh air and let out their energy. You will want to see this complex because it’s one of the best apartments in Las Vegas.

Photo source: Park at Spring Valley / Rent.

Park at Spring Valley is in the desirable Rancho Manor neighborhood, which is near the popular Fremont Street and connects directly to the central freeways of Las Vegas. It offers various layouts, ranging from large 3-bedroom layouts to smaller studio options.

Amenities include tennis courts and two pools, along with a private park for residents—all patrolled for safety.

Photo source: Buena Vida on Palms / Rent.

Located just outside of the main city action, Buena Vida on Palms is in a fairly quiet area, but still within close driving distance from downtown. Residents can choose layouts with one or two bedrooms and have a swimming pool and gated community access.

While Buena Vida on Palms may not have as many luxury amenities, the location paired with the price makes it a solid option for those wanting to live in a relaxed area without being too far from the city buzz.

Photo source: Summerhill Pointe / Rent.

Summerhill Point is in a convenient location right on Saraha Avenue, making it easy to get to other parts of the city when needed. It’s perfect for dog owners with its own gated dog run and no breed restrictions, so whatever type of dog you have is welcome! It’s one of the best apartments in Las Vegas.

These one-, two- and three-bedroom apartments have private patios and additional storage lockers. The property also boasts of three resort-style pools and two spas for taking it easy after a long day.

Photo source: Eagle Trace / Rent.

For those who like being in more secluded areas, Eagle Trace is as far from the city center as you can get, just outside of Nellis Air Force Base. Its one-, two- and three-bedroom apartments are great for any individual or family accommodations.

Eagle Trace is a fitness fan’s paradise, with multiple swimming pools and hot tubs, along with basketball and tennis courts, all lighted for day and evening use.

Photo source: 2one5 / Rent.

2one5 apartments are luxurious and hi-tech. It offers more amenities than most apartments you’ll find, including smart home technology, a sunbathing pool, a fitness center with classes, a dog park with a washing area, electric vehicle charging stations—and the list goes on.

It offers floor plans with up to three bedrooms, all of which have high-end finishings and appliances.

Photo source: Town Villas / Rent.

Family-friendly Town Villas offers two- and three-bedroom floor plans and a safe community for residents. Gated access provides additional safety from the bustling streets of central Las Vegas.

The complex is near hiking and biking trails and a pet park. There’s also a business center for tenants to use and a playground for the younger kids to run around and have fun.

Photo source: Tiffany Place / Rent.

Offering plenty of amenities for an affordable price, Tiffany Place has tanning beds, indoor and outdoor pools, sports courts, an indoor fitness center and a car wash area.

It has one- to three-bedroom units with the option to have an additional garage with storage outside of the apartment for extra belongings.

Photo source: Sonoma Hills / Rent.

Sonoma Hills is in a fantastic location—while it’s not near the center of Las Vegas, it is close to plenty of stores and the base of the mountains and hiking trails. Its one-, two- and three-bedroom apartments have some units with extra storage space in case it’s needed.

Additional benefits are on-site patrol and a list of amenities, like tennis and basketball courts, a pool, a clubhouse and a fitness center.

Photo source: Capri / Rent.

The one-, two- and three-bedroom apartments of Capri offer high-end living. Renovated interiors include a fireplace, stainless steel appliances and large closets. It also boasts a swimming pool, hot tub, tennis courts and a fitness center.

It’s close to McCarran International Airport for those with the travel bug, as well as shopping and plenty of great restaurants.

Photo source: Silver Stream / Rent.

On the edge of the quiet Spring Valley suburb, just east of the Strip is Silver Stream. Here you’ll find updated apartments with high-end stainless steel appliances, large balconies, and amenities such as a business center, pool and fitness studio.

Additionally, There are layouts containing up to three bedrooms and a patrolled parking lot, making it safe for all ages and perfect for all family sizes.

Photo source: Park Arms / Rent.

Within walking distance of the Strip and monorail, you’ll find spacious one-, two- and three-bedroom apartments at Park Arms. For such an exciting and convenient location, the price is far below the state average of $1,709—in fact, it’s less than half, starting at $720.

There’s also a pool and gated access to the complex, leaving it as a safe, relaxing community among the buzz of the Strip.

Photo source: Rosewood Park / Rent.

Rosewood Park is part of a quieter area and offers floorplans for studio, one-, two- and three-bedrooms, all of which have renovated interiors with vinyl flooring and resurfaced countertops.

Along with nearby parks, the complex contains its own basketball courts, pool, hot tub and fitness center. Plus, there’s extra storage on the property for those belongings that don’t fit into your apartment!

Photo source: The 211 / Rent.

The 211 is right at the center of all the city hustle and bustle! In one of the most convenient spots in the middle of downtown Las Vegas, it has a 24-hour gym on the property, an 800-square-foot hot tub and a rooftop patio with views of the city. Plus, you’re also getting a gated entry with controlled access to the building for extra safety.

There are one-, two- and three-bedroom apartments at this exciting complex to accommodate everyone, whether you’re an individual living on your own or a family.

Photo source: Montecito Pointe / Rent.

On the furthest, northwestern corner of the city lie Montecito Pointe apartments, where safety is a top priority. While it’s already in a quiet, safe area, the additional benefits of a gated access and on-site patrol makes Montecito Point one of the safest complexes you’ll find.

Furthermore, these one-, two- and three-bedroom apartments have endless amenities and perks—extra storage space, a pool, fitness center, and access to trails for hiking and biking.

Not close to downtown or many shopping areas, but it’s right off the freeway, so you can quickly hop on and get anywhere in the city.

Photo source: Wyandotte / Rent.

Nestled on the outskirts of the Strip, Wyandotte has large, newly-renovated, affordable apartments with up to 4 bedrooms. For someone interested in the night life and the Arts District, this apartment complex is perfect. Plus, you have a business center, playground and pool at the ready.

Photo source: Viridian / Rent.

Being only minutes away from the Strip, Viridian is a surprisingly affordable apartment community close to all the action and shopping of Las Vegas. With being so close to the Strip, you’ll also get to enjoy the view of the cityscape right from your living room.

Choose between anything from a studio to three-bedroom layouts and enjoy a dip in the pool after playing on one of Viridian’s sports courts—all starting at $685 per unit.

Photo source: Cooper Creek / Rent.

While Copper Creek is further from downtown, it’s in a relatively new part of Las Vegas—much quieter and more mellow. Its oversized closets, high ceilings and other high-end finishings make these luxury apartments appealing to most.

There are additional perks to these one-,two- and three-bedroom apartments, such as a resort-style pool, spa and fitness center.

Photo source: San Michele / Rent.

Settled between up-and-coming North Las Vegas and trendy Summerlin, San Michele is northwest of the downtown area. Being in a quieter area, right by an elementary school, it boasts proximity to both the boutique shops. In Summerlin, there is also exciting nightlife of downtown.

It offers newly renovated one- and two-bedroom apartment layouts with a clubhouse, pool and children’s play area.

Check out the best apartments in Las Vegas

No matter what your preferences are, there are plenty of apartment options in Las Vegas. Whether you’re after luxury living or a great location near the lights of downtown, each apartment community has a unique combination of offerings for every taste. You can find apartments for rent in Las Vegas to match your preferences.

We looked at all available multifamily rental property inventory from January to June 2021 on Rent. to determine which properties with a Las Vegas mailing address are most viewed by organic internet searches. The information included in this article is used for illustrative purposes only. The data contained herein does not constitute financial advice, availability or a pricing guarantee for any apartment.

Source: rent.com

Apache is functioning normally

December 3, 2023 by Brett Tams

A new study released by FreedomWorks found that various programs proposed or enacted to address the ongoing mortgage crisis don’t benefit homeowners evenly.

The group noted that many of the programs reward those who made the riskiest decisions while hurting those who were more conservative and bought only what they could afford.

For example, the American Securitization Forum’s Framework for Loan Modification plan, which freezes the teaser rate on subprime ARMs and refinances subprime borrowers into fixed loans, leaves those borrowers in a better position than those who originally chose fixed-rate loans, the study argued.

The idea here is that many of these borrowers made minimum payments on option-arms and other adjustable-rate mortgages that equated to lower monthly mortgage payments than those made by fixed-rate borrowers, allowing them to take out larger loans in the process and subsequently qualify for aid when they failed to make the higher reset payments.

The paper also cites a variance in state foreclosure rates driven by “exogenous economic forces,” and not the loans or borrowers themselves.

It found that that prime loans are defaulting at the highest rate where subprime defaults are the worst, noting that aid programs exclude good borrowers “unlucky enough to live in the states that experienced the worst of the current economic downturn.”

“Current programs and proposals reward borrowers who took out risky subprime mortgages and who live in states where the economy has held up,” author Todd Sinai wrote. “They do nothing for borrowers who chose more prudent financing and/or those who have entered default.”

In relation to that, Sinai believes taxpayers in all 50 states will fund federally mandated programs that only benefit homeowners in a few states such as California, Florida, New York, and Texas.

“The exposure of subprime mortgage debt is not evenly distributed across the United States. Rather, it is concentrated in a handful of states,” Sinai wrote.

He added that the four aforementioned states hold 50 percent of the “outstanding stock of subprime mortgages,” with 25 percent held in California alone.

The study also took a crack at the impending conforming loan limit increase, claiming that it will only help households with annual incomes between $129,000 and $180,000 based on sheer loan size, doing little to help median and low income families.

“A truly equitable policy of homeowner assistance would not distinguish among borrowers based on a borrower’s choice of financing, and it would not interfere with preexisting mortgage contracts.”

Read the entire study, written by Todd Sinai, a real estate professor at the Wharton School at the University of Pennsylvania.

(photo: sfllaw)

Source: thetruthaboutmortgage.com

Apache is functioning normally

December 2, 2023 by Brett Tams

When you’re shopping for a mortgage, you’ll likely see two of the most common repayment terms — 30 years and 15 years — no matter which lender you shop with. Each term has its benefits and drawbacks, and the better option depends on your unique situation. Here’s a look at the pros and cons of 15-year mortgages, how to qualify for one and what mortgage rates you might expect.

Pros and cons of a 15-year mortgage

A 15-year mortgage can be a great option if you want to save money on interest and can afford higher monthly payments. But before taking out a 15-year home loan, consider the pros and cons of choosing this term.

15-year fixed-rate mortgage vs. ARM

Home loans may come with a fixed rate or an adjustable rate. A fixed rate won’t change throughout the life of the loan, even if market rates rise or fall. That means your monthly principal-and-interest payments won’t change either, which can be helpful for budgeting purposes.

With an adjustable-rate mortgage (ARM), your interest rate is fixed rate for a certain number of years and then fluctuates at regular intervals. A 15-year ARM is less common, so you’ll likely see the adjustable-rate option when taking out a 30-year mortgage. The frequency at which your rate changes depends on the loan you choose, but it’s common to see 5/1, 7/1, 10/1, 5/6, 7/6 and 10/6 ARMs.

The top number indicates the fixed period, while the bottom number shows how often the rate can change. With a 5/1 ARM, for instance, your rate remains fixed for five years, then fluctuates once a year through the rest of the loan term. And with a 5/6 ARM, your rate will be fixed for five years and then will change every six months.

ARMs typically come with rate caps, so your rate can only increase by so many percentage points even if market rates skyrocket. In general, an ARM can make sense if you plan to stay in your home for a short time, or you’re willing to risk potentially higher rates for possible rate decreases in the future.

How to qualify for a 15-year mortgage

Lenders consider several factors when evaluating prospective borrowers. In general, you’ll need to meet the following criteria to qualify for a conventional mortgage loan.

Credit score: You’ll typically need a credit score of at least 620 when you apply for a conventional home loan, though a higher credit score might be necessary in some cases. Loans backed by the Federal Housing Administration (FHA), U.S. Department of Agriculture (USDA) and Department of Veterans Affairs (VA) often have looser qualifying criteria because they pose less risk for lenders.
DTI ratio: Your debt-to-income (DTI) ratio shows the amount of debt you carry relative to your monthly income. Most lenders prefer a DTI below 36%, though some will accept a DTI of up to 50%.
Down payment: Some lenders may allow for a down payment as low as 3% of the loan amount, but you may need a down payment as high as 20% in some cases. Requirements vary by lender and loan type.
Employment: Lenders often check two years’ worth of employment history when you apply for a mortgage.

Qualification requirements can vary with each lender and the loan you want to take out. Before you apply for a mortgage, you can research lenders and ask about their requirements to determine your approval odds. Consider doing a preapproval, which can help you check how much you can borrow.

Comparing current 15-year mortgage rates

Your mortgage is likely the largest loan you’ll ever take out, so it’s wise to compare rates before applying. Even a slightly lower rate could help you pay much less in interest costs over the life of your 15-year term.

For instance, if you’re approved for a $350,000 home loan with a 15-year term, a 7% interest rate and a 3% down payment, you’d pay $209,845 in interest over your loan term. But the same loan with a 6.75% rate would cost just $201,303 in interest.

While your rate depends on many factors (including location), here’s a look at current 15-year mortgage rates from some well-known lenders, as of November 2023.

How to find the best rate and lender

Finding the best mortgage lender and the lowest interest rate comes down to doing some prep work. Take the following steps to find the best deal when you get a home loan:

Check your finances. Pull your credit reports and look for any reporting errors that are dragging your credit score down. Also check your credit score, which will directly impact the rate you receive. The best rates are usually reserved for borrowers with excellent credit.
Research several lenders. Create a list of prospective lenders you may want to borrow from. These could be traditional banks, credit unions or online lenders.
Compare rates and terms. Lenders often list available mortgage rates and terms on their websites. Using a mortgage calculator, you can estimate your monthly payment based on the potential loan size, down payment and interest rate.
Get pre-qualified. Once you’ve narrowed your list of lenders, check whether they offer a pre-qualification tool on their websites. Pre-qualifying involves providing some basic personal and financial information to get insight into potential rates and loan amounts.
Apply for the loan. After you’ve found a lender and a home loan that works for you, you’ll need to formally apply for the mortgage. Expect to provide in-depth personal and financial information as part of the application process.

Frequently asked questions (FAQs)

As of November 22, 2023, the average interest rate for a 15-year mortgage is 7.06%. But rates vary by lender, so it’s important to shop around and compare loans.

While 15-year mortgage rates are currently high, they will likely decrease at some point. The National Association of Realtors predicts rates may decline through fall and winter of 2023 if the federal funds rate stabilizes.

Your interest rate is the percentage your bank charges you to borrow money. Your APR includes both the interest rate and the fees you’ll pay for your mortgage loan, such as broker fees and points. Both rates are expressed as a percentage, so you can use them to compare multiple loan options.

Whether a 15-year is better than a 30-year mortgage depends on your situation. A longer term comes with a lower payment, but you’ll pay more in interest costs over time.

“So when it comes to a 15-year mortgage, the question that most people need to answer is: ‘Am I comfortable with this higher monthly payment?’ and ‘Is paying the home off more quickly a priority for me versus using that monthly cash for other purposes?’” says Jon Bodan, a strategic financing adviser at Real Estate Bees.

“There’s no right or wrong answer here,” Bodan adds. “But if you have other savings and are contributing to your retirement, then doing a shorter-term mortgage can be another good way to build net worth and wealth.”

Interest rates on 15-year mortgages are often slightly lower compared to 30-year home loans. Because repayment terms are shorter with 15-year mortgages, lenders take on less risk. Thus, the rates borrowers receive for shorter-term mortgages tend to be lower.

Source: usatoday.com

Apache is functioning normally

December 1, 2023 by Brett Tams

The delinquency rate for mortgages on one-to-four unit residential properties climbed to 5.82 percent of all outstanding loans in the fourth quarter on a seasonally adjusted basis, up 0.87 percent from the same period a year ago and 35 basis points from the third quarter, the Mortgage Bankers Association said today.

The MBA’s National Delinquency Survey also found that 2.04 percent of outstanding loans were in the foreclosure process, up 0.85 percent from a year ago and 0.35 percent from the third quarter.

That marked an all-time high, while the total delinquency rate reached its highest point since 1985.

The survey revealed that the mortgage crisis is all encompassing, and not just a subprime issue, but rather an adjustable-rate mortgage crisis.

Since the fourth quarter of 2006, foreclosure starts on prime ARMS increased to 1.06 percent from 0.41 percent, while foreclosures tied to subprime ARMS rose to 5.29 percent from 2.70 percent.

Conversely, foreclosure starts tied to prime fixed mortgages rose just six basis points to 0.22 percent over the last year, while subprime fixed loans experienced a foreclosure start rate of just 1.52 percent, up from 1.09 percent a year ago.

The MBA also found that 42 percent of foreclosures started during the fourth quarter were tied to subprime ARMs, despite the fact that these loans only account for seven percent of all loans outstanding.

Prime ARMs represented 15 percent of the loans outstanding in the fourth quarter, but accounted for just 20 percent of the foreclosures started.

Much of the foreclosure activity was in hotbeds like California and Florida, two states that held 21 percent of all loans outstanding, but accounted for 30 percent of all foreclosure starts in the U.S.

The rate of foreclosure starts in Florida more than tripled over the last year, while more than doubling in California.

“Declining home prices are clearly the driving factor behind foreclosures, but the reasons and magnitude of the declines differ from state to state,” said Doug Duncan, MBA’s Chief Economist and Senior Vice President of Research and Business Development.

“In states like Ohio and Michigan, declines in the demand for homes due to job losses and out-migration have left those looking to sell the homes with fewer potential buyers, particularly with the much tighter credit restrictions borrowers now face. In states like California, Florida, Nevada and Arizona, overbuilding of new homes created a surplus that will take some time to work through.

During the fourth quarter, the seriously delinquent rate (90 days or more past due) increased for all loan types from the third quarter.

The rate increased 36 basis points for prime loans (from 1.31 percent to 1.67 percent), 306 basis points for subprime loans (from 11.38 to 14.44 percent), 46 basis points for FHA loans (from 5.54 percent to 6 percent) and 27 basis points for VA loans (from 2.56 to 2.83 percent).

Read the entire mind numbing report here.

(photo: robyngallagher)

Source: thetruthaboutmortgage.com

What is a conventional loan?

Types of conventional loans

Conforming vs. non-conforming loans

Fixed-rate vs. adjustable-rate loans

VA loans explained

Key differences between a VA loan vs a conventional loan

Loan eligibility requirements

Loan closing costs and fees

Down payment requirements

Loan limits

Mortgage insurance requirements

Property restrictions

Resale and refinancing

The benefits of a VA loan vs conventional loan

The benefits of a VA loan

The benefits of a conventional loan

Is a VA loan better than a conventional loan?

Summary of Money’s VA loan vs conventional loans

Compliance, CRM, LOS, Servicing, Workflow, Internal Audit Products; Non-QM and Jumbo News

Option 1: Copy and send this link

Is a buying a house with no money down possible?

Weighing the Pros and Cons of No Down Payment Mortgages

How to Buy a House With No Money Down

1. VA Loans

100% Financing and No Down Payment

No Private Mortgage Insurance (PMI) Requirement

VA Funding Fee

Certificate of Eligibility

Additional Benefits

2. Navy Federal Credit Union

3. USDA Loans

4. Lease-Option

5. Seller Financing

6. Crowdfunding

7. Shared Equity Agreements

8. Housing Assistance Programs

Low Down Payment Loans

1. 97% LTV mortgages

2. Federal Housing Administration (FHA) Loans

Credit Score Requirements

Seller Contributions

Mortgage Insurance Requirements

Debt-to-Income Ratios

3. HomeReady Mortgage

4. Home Possible Mortgage

5. State and Local Homebuyer Assistance Programs

Preparing for Homeownership

Credit Score Improvement Tips

Creating a Budget

Managing Debt

Understanding the Total Cost of Homeownership

How to Choose the Right Mortgage Option

Fixed-Rate vs. Adjustable-Rate Mortgages

Mortgage Term: 15-Year vs. 30-Year

Mortgage Insurance Considerations

Assessing Your Long-Term Goals

Planning Your Next Steps

Assess Your Financial Situation

Get Pre-Approved

Shop Around for the Best Mortgage

Work with a Knowledgeable Real Estate Agent

Attend First-Time Homebuyer Classes

Save for Unexpected Expenses

Build an Emergency Fund

Be Patient and Stay Disciplined

Conclusion

30-year mortgage rate moves higher, +7.53%

15-year mortgage rate moves up, +6.80%

5/1 adjustable rate mortgage rises, +6.78%

Jumbo mortgage interest rate trends higher, +7.59%

Mortgage refinance rates

Current 30 year mortgage refinance rate climbs, +7.63%

Where are mortgage rates heading?

What today’s rates mean for your mortgage

More on current mortgage rates

Methodology

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Photo source: Tamarus Park at Heritage Square / Rent.

Photo source: La Villa Estates / Rent.