New­mort­gage prod­ucts in 2018

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In the new year of 2018 we are see­ing new home loan prod­ucts that will greatly ben­e­fit bor­row­ers. This is the best sign in a long time, and way over­due. The mort­gage world is fi­nally cre­at­ing more user-friendly pro­ce­dure for home­own­ers. Raise your glass!

Ev­ery year we see mi­nor changes in Fan­nie Mae, Fred­die Mac and Jumbo Loan un­der­writ­ing. But the 2018 changes are more sig­nif­i­cant, be­gin­ning with the cat­e­gory of con­do­minium ap­provals for primary and sec­ond-home pur­chases. That both­er­some and time-con­sum­ing ques­tion­naire from the re­spec­tive condo as­so­ci­a­tion will no longer be required. This is im­por­tant be­cause th­ese ques­tion­naires of­ten point out Fan­nie Mae vi­o­la­tions, such as a project hav­ing more then 50 per­cent rentals, daily rentals and other el­e­ments that can pro­hibit a straight­for­ward ap­proval for a 30-year fixed-rate mort­gage. Good news! No longer will condo buy­ers have to re­sort to an ad­justable mort­gage due to fac­tors oc­cur­ring in the condo project that are be­yond their con­trol.As of Jan­uary 2018 the Fan­nie Mae loan limit for all loan prod­ucts such as the 30-year, the 15year, and ad­justable loans was in­creased to a max­i­mum of $453,100. This was a wel­come small in­crease from the pre­vi­ous limit of $424,100

One of the most in­flu­en­tial and in my view, spec­tac­u­lar and some­what exclusive new prod­ucts, im­ple­mented in March 2018, in­creases the ceil­ing of the 30-year fixed-rate loan for primary and sec­ondary res­i­dences. For cer­tain lenders the limit is in­creased to $679,650. Fan­tas­tic! Very few lenders have this spe­cial prod­uct. Look hard. Not only do you get a Fan­nie Mae price, which is bet­ter than the jumbo pric­ing, but you get Fan­nie Mae un­der­writ­ing: to­tally sim­pli­fied com­pared to jumbo un­der­writ­ing.

Could we be headed for more changes in the home mort­gage world that will ben­e­fit home­own­ers? This is a real pos­si­bil­ity. Changes in dis­clo­sures and wait­ing pe­ri­ods for mort­gage ap­provals would be wel­come and jus­ti­fied. We even hear talk that some of the pro­vi­sions of the Dodd Frank bill will be changed on a na­tional level. Im­prove­ments to as­sist prospec­tive home­own­ers in fi­nanc­ing their res­i­dences are needed badly and ap­pear to be headed our di­rec­tion.

Jim Gay was a real-es­tate bro­ker for 20 years and has been a fi­nan­cial con­sul­tant to For­tune 500 com­pa­nies. He is cur­rently a bro­ker/owner atThe Mort­gage Place, inc. (505-986-9080) and can be reached at jim@jim­gay­home­m­o­rt­gage.com.

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