Tag Archives: Ron Ricchio

The Federal Housing Authority is raising its mortgage insurance premiums again! Once dedicated to helping families buy homes without the traditional down payment of 20 percent, the FHA has more than doubled its monthly fees, effectively pricing many potential homebuyers out of the market. Lenders typically only want to give loans for 80 percent of the value of the property. The FHA allows borrowers to put down as little as 3.5 percent, with the FHA agreeing to cover the difference should the borrower default. In exchange for this protection, the borrow purchases mortgage insurance that spreads the risk of default …

At the time of this writing, the Dow Jones Industrial Average was right around 14,000, which is just under the all-time high that was hit in October 2007. Gas prices have come up 42 cents in the past month and we are also dealing with higher payroll taxes which are taking more money out of our disposable income. The “sequester” which will amount to $85 billion in automatic spending cuts by the government, are set to go into effect on March 1. The hype is if this is not amended, we could see negative growth and thousands of jobs loss …

One of the new rules that have emerged from the Dodd-Frank financial regulation overhaul applies to “jumbo mortgages” that have a loan amount higher than $417,000. Still and the works, and set to go into effect on Jan. 1, 2014, these “Qualified Mortgages” are being put together Consumer Finance Protection Bureau, which will then be responsible for enforcing them. Qualified Mortgages wont have a minimum down payment or credit score, but rather will hinge upon a borrower’s ability to repay the monthly mortgage. The proposed rules maintain that a jumbo mortgage cannot be more than 43 percent of a borrower’s …

It was at the December meeting that the Federal Reserve finally came out and set a target for how long it will keep interest low, and how long it will continue to buy mortgage bonds. The Fed said it will continue to buy bonds until the unemployment rate hits 6.5 percent, as long as the inflation rate does not go above 2.5 percent. (The Fed top for inflation was previously 2 percent.) The Fed went on to say it will keep short-term rates low until 2015, extending the deadline for an additional year. Buying mortgage bond in the open market …

Back before the financial crisis of 2008, banks and brokers were able to use whichever appraisers they wanted. They decided which ones to use, and the compensation for those services was decided between the two parties. It wasn’t until late 2008 that then New York Attorney General and now Governor Andrew Cuomo pressed Fannie Mae and Freddie Mac to buy only mortgages that had originated from a third-party AMC, or appraisal management company. They called this change HVCC, or the Home Valuation Code of Conduct. Why was this put in place? Well, Cuomo’s office found out that Washington Mutual, which …