FHA VA Blog

Well it has started... today we recieved notice from the first investor to tell us that they were no longer accepting locks for seller assisted downpayment/FHA loans.  While recent legislation put the end date at Oct 1, we have expected that the investors would start eliminating the option.  This was only the first to do so, but we expect more to follow suit.

So, what are some other options?  CHAC and CHFA are great if you live in Colorado... Here is some basic info about CHFA...

CHFA will lend you the 3% needed for the down payment requirement using a purchase loan. You can still ask the seller to contribute up to 3% towards your buyer closing costs. This can help if saving up for the downpayment has been tough or you would prefer to keep your savings for basic home improvements afterwards.

CHFA was created to increase the availability of affordable and accessible housing to the lower and middle income Coloradans. CHFA has many programs they offer and all will require a home buyers education class to be completed, in many cases it can even be taken online. The CHFA offices are centrally located downtown Denver and do take consumer calls. However to secure a CHFA loan you have to work with a CHFA approved lender. Summit Home Mortgage is a CHFA approved lender and is one of a small number of approved lenders in Colorado who can offer CHFA to you.

The way it works is CHFA will give you up to a 3% loan, whereby you utilize with the applicable CHFA first mortgage to buy your home. CHFA's interest rates are very competitive to market rates, and as things get tougher in Denver, and with mortgage programs allowing down payment assistance demands for CHFA have grown.  (For example; on the FHA program, the 2nd mortgage is 'silent', the note is for a 0% interest rate, and no payments are due for the first 9 years).

As a borrower you have to invest $1,000 into the transaction when you buy or $500 if you are refinancing your home. You must complete a home buyers education, and also live in the house. CHFA does impose income limitations, but the HUD AMI in Denver is $71,400 and they have allowances for folks who may make more money, due to more members in the household.

For more information visit their website at www.chfainfo.com .

We can answer your questions and get you approved for a CHFA loan today! Call or fill out our basic pre-approval and we will get in touch with you to move forward.

Have you ever wondered how you could pay off your home sooner, save thousands and thousands of dollars in interest, prepare for retirement?

Here is a very simple way to save big, a loan refinance that many of our clients have found a great solution...

Streamlining into a shorter term loan...

Here is one example;

30 YR Fixed -streamline to new- 15 YR Fixed –lower rate, payment, reduce years, interest & MI

You purchased your home in June 2000 with an FHA 30 YR fixed rate loan at 7.00%.  At that time it would have looked something like this;

Purchase price                                                                        $200,000.00

Less 3% down payment                                                               $6,000.00

Add UPMIP (2.25%)                                                                   $4,365.00

Principle balance of loan                                                         $198,365.00

Payment

Principle & Interest                                                                     $1,319.73

Monthly MI                                                                                 $     80.83

Total before escrows (taxes & insurance)                                   $1,400.56

After 8 years of making scheduled payments…96 payments of $1,400.56… you have paid $105,849 of interest, $7,394 of monthly MI (Mortgage Ins.), and $20,845 of principle.  You have a principle balance of $177,520 remaining, along with 264 more payments totaling $353,067.

Why would it make sense to refinance after 8 years?

It will save you $80,729 in interest to streamline your current FHA 30 year loan into a new FHA 15 year loan.  You can reduce the term of your mortgage by 7 years, lower your interest rate, eliminate the monthly MI and keep your payment about the same.  Until Oct.1, 2008 the UPMIP (Up Front Mortgage Insurance Premium) on a new streamline is only 1.00%.  If you have made additional principle reductions over the years, your savings will be even greater.

Other streamline options;

Available options (all require interest rate reduction);

30 YR Fixed -streamline to new- 30 YR Fixed –lower rate and payment.

30 YR Fixed -streamline to new- 15 YR Fixed –lower rate, payment, reduce years, interest & MI

15 YR Fixed -streamline to new- 30 YR Fixed –lower payment, extend term.

15 YR Fixed -streamline to new- 15 YR Fixed –lower rate and payment.

  1 YR ARM -streamline to new- 30 YR Fixed –lock in fixed rate, potentially lower payment.

  3 YR ARM -streamline to new- 30 YR Fixed –lock in fixed rate, potentially lower payment.

  5 YR ARM -streamline to new- 30 YR Fixed –lock in fixed rate, potentially lower payment.

                       Call for other options…

Give us a call or e-mail if you want to see specifics for your scenario!