FHA and Investor Specialist

Apparently Fannie Mae and Freddie Mac are raising their loan limit shortly to as much as $725,000 and The Federal Housing Administration is going to raise their single family limit to $417,000.  As much as I am in favor of markets correcting themselves, this is great news for those with a vested interest in the liquidity of the secondary markets.  In other words, this is great news for everyone in the US, as well as for foreign investors.

The big questions that remain are: when will this take effect, how much will the increases be(including 2-4 unit properties), and what will the impact be?  What will the unintended consequences be as well?

Happy Selling

Michael Byrne

Gateway Funding

www.mortgageprosforum.com

1-800-999-2489 x7972

I just was thinking about how 2 of my favorite subjects, mortgages and baseball, have two very similar scandals in the sense that there were guidelines that were not enforced while there was a reward for not following the rules.  I read the book Freakonomics about a year ago, so here goes my attempt to correlate to very different subjects and how they allowed abuses of the sytem to happen with a skewed reward/punishment system.

In baseball, there is a Union with a collective bargaining agreement that said there should be no steroid or amphetamine testing.  The drugs were prohibited but there was no drug testing. The reward for hitting a baseball 10-20 feet further takes one from making loud outs and having warning track power to earning millions of dollars a year, making it very lucrative to break a rule not being enforced. 

The mortgage arena has a secondary market system, that was increasingly determined to purchase loans with stated income.  Loan Officers were told that stated income loans were not to be abused, but there would not be a 4506 test utilized and limited due diligence testing on stated income files.  On the other hand, it was increasingly lucrative to close these loans and be known as the guy/gal who got deals done.

In both cases, the athletes and loan officers are clearly wrong for abusing the system.  But isn't it also the sytems fault?  I think in baseball, we are finally beginning to see that and as the secondary market continues to correct itself, we will see more controls put into place as well.

Michael Byrne

www.mortgageprosforum.com

Foreign investment in the US Economy is not a new thing.  Foreign investors have long bought our debt in the form of Treasuries and most recently mortgage obligation debt.  A new trend is Foreign National purchasing secondary homes in the US, judging by the hits I receive at This link on  My Site .  Providing loan for Foreign Nationals is a great potential niche for any lender and a great niche for a Real Estate Salesperson as well.  This is a brokered loan product-not available to other mortgage brokers. Limited lending area, primarily the New York Metropolitan Area.  Here are some brief highlights for a loan program I can currently offer for Foreign Nationals as well as documentation requirements:  

- 50% down required.  40-45% down by exception with established US credit and a FICO over 651.*

- Rates starting in the 8% range for a 3 year Fixed Rate.

- Proof of closing funds required 30 days prior to settlement.

- Copy of valid passport from issuing Country

- Bank information for automatic payment withdrawal, Attorney In US to act on clients behalf.

- No income, Employment verification required for true Foreign National.

This is a great program, however, it is NOT designed for those living and working in the US illegally.  It is a true Foreign National Loan Program.  Again, this provides a great program for Foreign Nationals.  Happy selling!

*Rates and Terms can vary by date.  Not a Commitment to Lend.  Please contact Michael Byrne at Gateway Funding at 1-800-999-2489 x7972 or 908 531 6170 for more details. Limited State Availability and subject to wholesale lender guidelines.  This is a brokered loan product-not available to other mortgage brokers. Limited lending area, primarily the New York Metropolitan Area.

Each year we get a chance to make some New Year's Resolutions.  Hear are mine for the year:

1. To be happy overall.

2. To enjoy married life.(I got hitched 12/31/2007)

3. To find a true product niche in FHA loans that gains more referrals.  I think the fhasecure may be a little bit more sizzle than steak, but the Streamlined K is a great program as well as basic FHA for multi-family dwellings.

4. To run(slowly) a marathon.

5. To work more on my spanish, or lack thereof.  It's amazing when you leave this country and realize most people in the world can at least speak a little bit of a second language.

6. To find more time to read: I have about 8 books lined up that I have not opened yet.  I do recommend Tony Dungy's autobiography to football and non-football fans alike.

7. To spend more time on activerain to learn as well as network.

8. To actually sell a shirt at www.cafepress.com/buyfromclarence

How about you?