Short sales, however, are slightly different.

FNMA hasn’t changed the 3-year foreclosure guideline for about 18 months now. That much we knew. Short sales, however, are slightly different. We read in the underwriting guidelines that if you had a short sale on your credit you could be approved for a loan after two years with good re-established credit. Now, we know that investor guidelines are looking at “Short Sales” on credit as needing 3-years after completion to be eligible.

Fair Isaac, the credit reporting company, doesn’t have a specific category for short sales, but it does show on the credit report that the loans were settled for less than balance or “shorted”.

It is possible for the bank to report it differently such as “paid in full” negotiate with the bank on how they will report it and it doesn’t mean that it will report it that way every single time.

· Fed Cuts Possible Tomorrow?
· Property Taxes too High?
· See the newsletter below.

Credit Qualifying - Short Sales - Foreclosures

One thing we are learning more about is doing loans for those who have had a short sale or foreclosure on their credit. If you have clients who have had a short sale on their credit instead of having to wait two years to purchase we are learning that it is now three years. The banks are looking at this credit profile as if it is a foreclosure on their credit and are held to the same guidelines as having a foreclosure. Even if they credit qualify with their credit scores this is something to consider when speaking to your potential buyers.

Credit Qualifying, Short Sales, Foreclosures,

Rates going to 4.5%?

There have been recent rumors of interest rates being brought down towards 4.5% by the Treasury. Rates are not going to 4.5% with the wave of a wand by Hank Paulson or Ben Bernanke. As a matter of fact, the massive borrowing to fund the TARP program has a negative effect on rates. This irresponsible release included no definitive plan, no indication of who might qualify, or what the restrictions would be. Remember, it may make sense for you to act now, and take advantage of current historically low rates...with the possibility of refinancing should rates decline further. Waiting for rates to fall to 4.5% may leave people sorely disappointed.

Canadian / Foreign National financing

Attached is a flyer for Canadian / Foreign National financing. No one else has this program at these loan to values!! So check it out.

Market Update

The November jobs report was released today showing some of the worst numbers in decades. Non-farm payrolls dropped 533,000 last month and was only the fourth time in 58 years that our economy lost over 500,000 jobs. The unemployment rate ticked up to 6.7%, the highest since October of 1993.

The news sent the Stock markets lower while the Bond markets didn't have much of a reaction. We are currently in a bad economy and only news of a better report would have been a surprise.

Mortgage bonds are down a little today and we have had several reprices…. I am floating clients until Monday to see how the market continues.

Mortgage bonds are trading low

Hope you had a safe and fun Halloween! Check out this week’s newsletter. I’d like you to focus on the bond graph below. Mortgage bonds are trading low right now, which means rates are higher than we want, I would recommend to float interest rates for the next few days. I’m thinking about 10 days into middle of next week. If you have deals in progress or offers just accepted advise your clients to hold off on locking until the bond market comes back after the elections next week. There’s lots of volatility right now; however, I will keep you up to date with the latest mortgage news!