Archive for March, 2010

FHA Loans are getting tougher

Monday, March 29th, 2010

Next Monday, April 5th, the FHA guidelines get tougher. The upfront Mortgage Insurance Premium (MIP) will go from 1.75% to 2.25%. In addition, the maximum seller contribution will be reduced from 6% to 3%. On the other hand, FHA now allows 2-4 unit condos and 50% owner occupied and 50% presale as of February 1st. 

FHA Commissioner, David Stevens, does not believe raising the minimum down payment from 3.5% to 5% is a good idea.  Mr. Stevens believes it would shut out too many prospective buyers/borrowers.  I hope his perspective prevails.  However, changes have been adopted requiring a 10% down payment from those with a credit score below 580.  The standard minimum credit score for a 3.5% down payment is 640.

Currently 1 out of 6 FHA mortgages are delinquent so it is not hard to understand the changing guidelines.  However, FHA still provides lower interest rates, streamline refinancing, and offers a higher back end ratio of 50%.

So what do you think?  Will the recent migration to FHA loans begin to slow down with the new guidelines or will FHA continue to provide enough of a competive edge for home buyers?  

At Buyer’s Choice Realty we believe home buyer agents need to be aware of competitive loan opportunities for home buyers.  We are happy to talk to consumers about it and to bring in experts to help with lending advice.

Ronn@BuyersChoiceRealty.com  800-252-8937

 

Posted in Loan Shopping | No Comments »

Top 12 Towns

Wednesday, March 17th, 2010

12 Top Spots to live in the Greater Boston area.
 

This year’s Globe Magazine’s “Top Spots to Live” are all places that didn’t fare too badly during the economic downturn. Some even gained value during the five years.
 

The top 12 are Wenham, Jamaica Plain, Cambridge, Winchester, Rowley, Lynnfield, Natick, Downtown Boston, Weston, Brookline, West Tisbury on Martha’s Vineyard and Eastham on Cape Cod.
 

The selection came out of data from the Warren Group tracking single family median prices for 2005 and 2009.  The market peaked in 2005 and has gone steadily down through 2009. Median values for single family homes in our state have come down an average of 20% over the five year period.
 

As an aside, Buyer’s Choice Realty is located in the top choice town with our corporate office at 162 Main Street, Wenham. Two of our Exclusive Buyer’s Agents, Melissa Addis and Lorna Zizza, live in Wenham.
 

For more information on the why and how of the Globe’s Top 12 picks see Elizabeth Gehrman’s article on Boston.com.
 

Do you think this is an accurate picture of values in these towns? What does the median price comparison in 2005 and then in 2009 tell us? Is the real estate market any better today in March of 2010? We welcome your thoughts. Call or email us for more data and learn why despite climbing interest rates, this is a good time to buy.

Posted in Market Trends, Buyer Knowledge, Boston Real Estate | No Comments »