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Cost of FHA Mortgage Insurance to Increase October 4th
Posted by Paul Gonzales | Leave A Comment »
With the passage of HR 5981 Congress has given the FHA the ability to change the mortgage insurance premiums it charges on FHA-insured loans without any further “acts of Congress”. As a result, the FHA has announced that effective October 4th, the Up Front Mortgage Insurance Premium (UFMIP) charged to home buyers will be reduced from 2.25% of the loan amount to 1.00%. However, the Annual Premium (which is paid monthly) will increase to 85 to 90 basis points. What this boils down to is a higher monthly payment on FHA-insured home loans for the same purchase price. On average the increase in the total monthly payment will be approximately 3.7% higher than under the current FHA insurance scheme.
- For Example: assuming that the buyer rolls the UFMIP cost into their new loan (as the vast majority do), on a $400,000 purchase with the FHA-minimum 3.5% down payment, this change will translate to an increase of about $85 in the total monthly payment of principal, interest and mortgage insurance premium. This change will not apply to certain rare situations such as Title I, HECM, HOPE for Homeowners, Section 247 (Hawaiian Homelands), Section 248 (Indian Reservations), Section 223 (e) (declining neighborhoods), Section 238(c) (Military Impact areas in Georgia and New York).
The intent is to help the FHA rebuild its depleted insurance reserves. An unintended consequence, however, may be to put yet another drag on efforts to rebuild the housing market as the increased monthly cost of an FHA loan means fewer home buyers qualifying at any given purchase price point.
Paul Gonzales, CW Mortgage Lending (760) 746-7388 or paulforloans@aol.com
Related Posts: San Diego
A Taste of Beer Goes with a Helping of Charity at the San Diego Festival of Beer
Posted by Sean Zanganeh | Leave A Comment »
Imagine: 6,000 people, local musicians, and samplings from 70 of the best breweries around. The cause for such a great gathering? The 16th annual San Diego Festival of Beer! Not only is this a night to remember for those in attendance, all proceeds from the event will be donated to local cancer-fighting causes. For more information about this event you just can’t miss, follow the link here: http://www.mysddreamhome.com/index.php/a-taste-of-beer-goes-with-a-helping-of-charity-at-the-san-diego-festival-of-beerwi/
Related Posts: Activities & Events, Downtown, Entertainment, San Diego
When Does It Makes Sense to Refinance?
Posted by Paul Gonzales | Leave A Comment »
Trying to decide whether or not to refinance your mortgage can be like trying to find treasure on a deserted island. You can shovel a lot of sand and still come up empty-handed at the end of the day. However, you can sift it all down and find that nugget of wisdom rather quickly if you know how.
There are three primary reasons to refinance your mortgage:
(1) To take advantage of a lower interest rate and/or smaller monthly payments
(2) Pull cash out of your equity to consolidate other more costly debt, like credit cards, car loans, student loans and such, thus saving a lot of money each month
(3) Pull cash out to invest or pay for other expenses such as college tuition, home improvements, medical expenses or taxes.There are other reasons to refinance that you might consider such as swapping an adjustable-rate loan for a fixed-rate mortgage, but they all boil down to the three primary reasons noted above.
Refinancing to consolidate debt, invest or meet other obligations is usually straightforward and the numbers are easy to grasp. But how do you know when refinancing just to lower your interest rate or monthly payment really makes financial sense?
Back when the Beach Boys were Surfing USA, the “rule of thumb” was that it made sense to refinance your loan if you could lower your interest rate by 2 percent (say from 12% to 10%). But that was in the days when the typical middle-class home loan was $65,000.
Today, with most home loans considerably larger than that, a good standard rule is that if you can recover the cost of refinancing within 24 to 36 months, you should consider doing so.
For example, if you can refinance your $300,000 loan and reduce the interest rate by just three-quarters of a percent from 5.5% to 4.75% you will save at least $138 per month. If the cost to refinance is $2,900, dividing that cost by your monthly savings of $138 results in a payback of your initial $2,900 cost in about 21 months.
This simple calculation is called a “break-even analysis”. After 30 months, you are making money on your lower interest costs – and that makes sense for most people. As I have said before, consult your trustworthy loan officer and ask him or her to work up a break-even analysis for you. Then you will quickly be able to sift a beach-full of sand and discern that golden nugget!
Call Paul Gonzales at (800)775-7334 or email me at paulforloans@aol.com to see if refinancing makes sense for you! NMLS#290493
Related Posts: San Diego
Coming Soon to Carlsbad…
Posted by Rachel LaMar, J.D. | Leave A Comment »
From new restaurants to shopping to new schools, there are some exciting things going on in Carlsbad…so don’t be left out! Visit here to find out the latest: http://www.rachellamarrealestate.com/blog/2010/09/01/whats-new-in-carlsbad-2/
Related Posts: Carlsbad, Just for Fun, Restaurants, San Diego, Schools, rachel lamar
***Upcoming Local Event***
Posted by Nancy Canfield | Leave A Comment »
What’s happening in the RB Area?
Rancho Bernardo Historical Society
Presents
SUNSET BARBEQUE and Wagon Ride
Welcome New Members!
PLEASE JOIN US FOR A STEP BACK IN TIME!
Saturday, September 11, 2010 – 4:30-7 PM
Depart from Sikes Adobe Historic Farmstead – San Dieguito River Park
12655 Sunset Drive, Escondido, 92025
Only 150 tickets will be sold for this wonderful event
so reserve your space soon before it sells out!
Casual clothes and walking shoes recommended
Cash bar for beer & wine – Door prizes
Sikes Adobe Farmhouse Tours
Live Music
Wagon Rides
Western BBQ
ALL INCLUDED IN PRICE OF ADMISSION!
For more info, please call (858) 487-4599 or visit www.rbhistoricalsociety.org
Nancy Canfield, RBHS President 
(619) 871-9333
www.NancyCanfield.com
ncanf@san.rr.com
Related Posts: Activities & Events, Area Information, San Diego
