FHA Loans in Washington

Maybe you are buying your first home in Washington, or perhaps you're relocating to Washington from another state. Then again, you may be a long-time Washington resident who is looking to either refinance your current mortgage or take out a home equity loan for home improvements. Regardless of your situation, it's important that you educate yourself on Washington home loans before shopping for a home and/or mortgage. This article explains what you will need to know before seeking a home loan in Washington:

The median price of a home in Washington is $211,500. Recently, homes in Washington have been appreciating at rates well above the national average. As a result, income levels in many parts of Washington are too low to purchase a median-priced home with a conventional loan. Although average interest rates in Washington are below the national average, Washington has one of the lowest levels of home affordability in the nation.

In Washington, before a buyer submits an offer on a home, their real estate agent is required to present them with a completed Real Estate Transfer Disclosure Statement. This document, completed by the seller of the property, requires the seller to name all of the property that will be included in the purchase (refrigerator, stove, alarm system, etc.) and rate certain aspects of the conditions of both the included property and of the house itself. This document requires the seller to disclose any potential problems or hazards that may discourage the buyer from putting an offer in on the home.

Washington's Civil Code Provision of the Real Estate Act regulates the issuance of variable interest rates for the purchase of real estate. Therefore, borrowers who are issued large mortgage amounts are guaranteed a fixed rate mortgage. Washington law also prohibits the charging of interest more than one day prior to the recording of the mortgage even if the borrower received the loan prior to that time.

In July of 2002, Washington law enacted a set of anti-predatory lending laws in order to help protect Washington homebuyers from predatory lenders. Some of the provisions of this new set of laws include the prohibition of a lender charging points and fees in excess of 6% of the total principal financed amount, the prohibition of a mortgage company issuing a loan to a borrower in an amount that the borrower could not reasonably afford to repay, and the prohibition of the financing of single-premium credit insurance, among others.

If you're buying a home in the state of Washington, you qualify for both federal and state FHA, USDA, and VA loans. First-time home buyers qualify for Washington FHA loans with below-market interest rates, and, depending on their eligibility, may also qualify for a loan in order to cover down payment and/or closing costs. Teachers and other professionals who work in an educational capacity may qualify for Washington's Extra Credit Teacher Home Purchase Program, a down payment assistance loan with forgivable interest.

In addition to FHA loans, the state of Washington also offers comparable programs to persons with disabilities or persons who live with and care for persons with disabilities. The state also offers several unconventional loans designed to aid home-buyers with the costs of their monthly mortgage payment. For example, Washington's Interest Only PLUS loan provides qualified home-buyers with a 100% financing 35-year loan that only requires payments toward the accrued interest on the mortgage for the first five years of the loan -- borrowers do not have to pay toward the principal amount borrowed until after the first five years. The individual requirements of each of these loans vary depending on the county in which you are buying a house.

Stop Thinking About It. It's Time to Sell Your House. Inventory is Very Very Low in Northern Virginia

Now is THE Time to Sell Your Northern Virginia House!

The title of this blog post pretty much says it all.

I'll repeat it here:

If you've been thinking about selling your house in Northern Virginia, follow these four important steps:

1. Stop what you are doing right now. Seriously. Stop!
   
2. Stop "thinking" about selling your house.
   
3. Tidy up the house.
   

Why?

Northern Virginia Housing inventory is at EXTREMELY low levels. A "normal" or balanced market means that there is 6 months of inventory of houses on the market. More than 6 months inventory favors buyers who have lots of homes to choose from. Less than 6 months inventory favors sellers who can take advantage of the lack of inventory to entice the buyers to buy their home.

In Northern Virginia, housing inventory is VERY VERY low.

Consider:

City of Alexandria:

• 446 homes on the market
• 1,103 sales in last 6 months or 183.8 Alexandria home sales/month
• Currently ONLY 2.4 Months of housing inventory in Alexandria, VA

Arlington County:

• 593 homes on the market
• 1,495 sales in last 6 months or 249.2 Arlington home sales/month
• Currently ONLY 2.4 Months of housing inventory in Arlington, VA

Fairfax County:

• 2,455 homes on the market
• 8,300 sales in last 6 months or 1,383 Fairfax County home sales/month
• Currently ONLY 1.77 Months of housing inventory in Fairfax County, VA

Oh, one more reason to get started now: Buyers have until April 30th to take advantage of the extended first-time homebuyer tax credit. You might be able to take advantage of the move-up tax credit yourself.

FHA Loan Limits for 2010

In semi-recent FHA news, the House just passed HR 3288, home loan legislation which would continue 2009 FHA loan limits through 2010 for owner-occupied purchase and refinance loans. However, the bill did state that HUD will be reducing loan limits for FHA reverse mortgage loans that are available to senior homeowners who are at least 62 years of age. HUD is now approved to insure FHA home loans worth up to $400 billion.

This is a significant rise from $315 billion last year. The mortgage bill also mandates that FHA mortgage loan limits from fiscal 2008. This means the FHA loan limits will still allow loan amounts up to $729,750 in certain areas. Gone are the days when HUD could copy Fannie or Freddie when setting FHA loan limits for the counties in the 50 states. No more can HUD say “ditto” when it comes to home loan limits, because Fannie and Freddie are silent and appear to be disenchanted with the government bail-outs that have ran-sacked the mortgage industry over the last 3 years.

So with 2010 FHA loan limits all set, consumers looking to FHA for home financing have real numbers to work with. It also helps FHA lenders and brokers, because banks usually won’t roll out new loan programs with government loan limits up in the air. Consumers have been blessed with record low FHA mortgage rates in 2009 and this is clearly good news for FHA rates in 2010. When considering refinancing or a purchase mortgage, check with HUD for local loan limits set by county for each state.

Texas Housing Market

According to Housing Predictor, the Texas housing market isn't immune to the national recession, but most areas have been much slower to see drastic drops in home values. However, Texas has more than its share of problems, including the drug wars, which could have a major impact in terms of housing values.

As the center of the U.S. oil business, Texas is experiencing more job layoffs in the energy business with less energy exploration and drilling rigs being idled due to lower prices being paid for oil. Foreclosures are rising and foreclosed properties are only projected to increase in coming years.

The fallout from the credit crunch will become abundantly clear in the Lone Star state. The drug wars along the Texas border will also impact the value of housing. In El Paso, on the extreme western side of Texas bordering Juarez, Mexico, the economy is just beginning to feel the impact from the Drug Wars in Mexico, which is expected to affect housing values on the most south west edge of the community.

Housing values could suffer as much as a 50% loss from violence associated with the drug cartels. Juarez saw 1,600 murders from drug violence last year. Job lay-offs are also affecting the economy, making it harder for many to pay their mortgages. For now, El Paso is forecast to see average housing deflation of 8.7% this year.

In the state's largest metropolitan area, Houston home sales have been on a dive for close to two years, but values in many areas of the market have held up remarkably for the time being. About a third of all home sales are foreclosures, and as foreclosures increase with the moratoriums expiring values will fall. More business failures, job losses and bankruptcies are hitting the state's largest populated area. The impact will have a devastating blow on the Houston economy, which is forecast to see average home prices deflate 9.8% in 2009.

Despite a huge drop in new home construction mortgage, the Dallas-Fort Worth area still ranks second in the country in new home sales. Houston tops the nation. But home sales are well off their record pace and home values are falling. Sales haven't slowed to a halt like in many other areas of the country, but increasing foreclosures will begin to have a more severe impact on the market over the next year.

With a loss in population in Dallas and an estimated loss of more than 300,000 residents statewide, Texas is hurting. The downward pressure will increase towards the end of 2009 and produce fewer home and condo sales. Housing Predictor forecasts that the average price of a home in the Dallas area will deflate 9.2% by year's end.

San Antonio home prices are on the way down, falling more than most areas of the state as a result of having the most over-built housing market in Texas. Increasing defaults in sub-prime and conventional remodel mortgages are troubling San Antonio, which could see the worst foreclosure rate in the state before it gets through the credit crisis.

Bargain priced properties listed by bankers are making it tough for other homeowners to sell these days. Home sales are projected to slow further in 2009 in San Antonio as fall out from the foreclosure epidemic hits with forecast deflation of 10.2% on the average home.

In some parts of Austin the market has remained fairly stable compared to other areas of the country. The rate of decline hasn't been magnified as much as areas that experienced double-digit housing inflation, bolstered by a strong high-tech business in Austin, and a youth culture that is doing everything it can to buy their first home. First-time home buyers are a large percentage of total home buyers in this area.