Be sure you’re serious about buying before you make an offer. If the seller accepts your offer, it becomes a legal contract after a few days.

Details and planning are important. Know what you would like to pay but also think about the most you’re willing to pay and the total pre-approved mortgage loan amount. Be specific, and put everything in writing. Also, having a pre approved mortgage loan will place you ina better negotiting posistion when making a real estate offer.

What are the steps in making an offer?

Negotiating a Sales Price
Before you negotiate a sales price, it’s important to determine if you or the seller has the stronger position. Knowing this will help you plan your negotiation.  A mortgage tip to consider would be to offer full price and have the seller buy down your San Diego Ca mortgage loan rate.  This will allow you to qualify for a higher loan amount amd provide you with lower payments.

The seller may have the stronger position if:

The local real estate market is strong and homes are selling quickly.
They aren’t in a rush to move.
Similar houses have sold for close to or above their asking price.
There are other offers being made on the house at the same time as you.
The buyer may have the stronger position if:

The local real estate market is weak.
The seller needs to move quickly.
The house has been on the market for a long time.
When negotiating, more information is better. Look at your notes from when you looked at the house. If there’s anything that needs to be repaired or replaced, you may want to consider including these costs in the negotiation. If you want certain appliances or fixtures to stay, be sure to include them as well. You may also want to make your offer contingent upon your obtaining financing or the house passing a professional home inspection, especially if it is an older home.

There are several steps to negotiating:

Asking price.
This is the price the sellers have originally listed. In a buyer’s market, you may be able to successfully offer below the asking price. However, in a seller’s market you may want to be prepared to offer more. Before making an offer in a seller’s market, know how much above asking price you are willing, and able, to bid in case the seller gets multiple offers.

Initial purchase offer.
This is your first offer. It may include contingencies (such as a requirement that the home pass a professional inspection or that you receive adequate San Diego Ca mortgage loan financing from your lender.)

Acceptance of offer or counter-offer.
The seller can accept your offer or make a counter-offer of a new price or additional contingencies.

If you’ve made a home inspection part of the contingencies and something serious is found during the inspection, you may want to submit a new counter-offer and discuss the situation with your lender. The process may go back and forth several times before you and the seller reach an offer that is acceptable to you both. Remember that in some instances, your lender may not approve your mortgage if the home has serious deficiencies that could affect its value.

Source Freddie Mac

Source: Hud . Gov

Streamline Your FHA Mortgage

Refinancing Your Home
   
 
Sometimes, refinancing your San Diego mortgage can really save you money. You may be able to pay less interest, lower your monthly payment, or convert from a 30-year loan to a 15-year loan (and build your equity faster!). But be sure that refinancing is right for you.

 FHA has permitted streamline refinances on insured mortgages since the early 1980’s. The “streamline” refers only to the amount of documentation and underwriting that needs to be performed by the San Diego lender, and does not mean that there are no costs involved in the transaction. The basic requirements of a streamline refinance are:

  The mortgage to be refinanced must already be FHA insured.
 
  The San Diego Ca mortgage to be refinanced should be current (not delinquent).
 
  The refinance is to result in a lowering of the borrower’s monthly principal and interest payments.
 
  No cash may be taken out on mortgages refinanced using the streamline refinance process.
 
Lenders may offer streamline refinances in several ways. Some lenders offer “no cost” refinances (actually, no out-of-pocket expenses to the borrower) by charging a higher rate of interest on the new loan than if the borrower financed or paid the closing costs in cash. From this premium, the lender pays any closing costs that are incurred on the transaction.

San Diego Lenders may offer streamline refinances and include the closing costs into the new mortgage amount. This can only be done if there is sufficient equity in the property, as determined by an appraisal. Streamline FHA refinances can also be done without appraisals, but the new mortgage loan amount cannot exceed the original loan amount. Investment properties (properties in which the borrower does not reside in as his or her principal residence) may only be refinanced without an appraisal.
 Source Hud.Gov

To make monthly mortgage payments more affordable, many lenders offer home loans that allow you to (1) pay only the interest on the loan during the first few years of the loan term or (2) make only a specified minimum payment that could be less than the monthly interest on the loan. Whether you are buying a house or refinancing your mortgage, this information can help you decide if an interest-only mortgage payment (an I-O mortgage)–or an adjustable-rate mortgage (ARM) with the option to make a minimum payment (a payment-option ARM)–is right for you.

Lenders have a variety of names for these loans, but keep in mind that with I-O mortgages and payment-option ARMs, you could face “payment shock.” Your payments may go up a lot–as much as double or triple–after the interest-only period or when the payments adjust. In addition, with payment-option ARMs you could face negative amortization. Your payments may not cover all of the interest owed. The unpaid interest is added to your mortgage balance so that you owe more on your CA mortgage than you originally borrowed. Be sure you understand the loan terms and the risks you face. And be realistic about whether you can handle future payment increases. If you’re not comfortable with these risks, ask about another loan product. Skip to content What is an I-O mortgage payment? What is a payment-option ARM? What do you need to ask when shopping for an I-O mortgage payment or a payment-option ARM? Mortgage Shopping Worksheet What are the risks with I-O mortgage payments and payment-option ARMs? When might an I-O mortgage payment or a payment-option ARM be right for you? When might an I-O mortgage payment or a payment-option ARM not make sense? What are the alternatives to I-O mortgage payments and payment-option ARMs? What are some important target dates in an I-O mortgage or a payment-option ARM? Does the type of loan and loan payment plan make much difference? What should I keep in mind when it comes to an I-O mortgage payment or a payment-option ARM? Comparison of Five $180,000 San Diego Mortgage Loans Glossary For More Information What is an I-O mortgage payment? Traditional mortgages require that each month you pay back some of the money you borrowed (the principal) plus the interest on that money. The principal you owe on your mortgage decreases over the term of the loan. In contrast, an I-O payment plan allows you to pay only the interest for a specified number of years. After that, you must repay both the principal and the interest. Most mortgages that offer an I-O payment plan have adjustable interest rates, which means that the interest rate and monthly payment will change over the term of the loan. The changes may be as often as once a month or as seldom as every 3 to 5 years, depending on the terms of your loan.

For example, a 5/1 ARM has a fixed interest rate for the first 5 years; after that, the rate can change once a year (the “1″ in 5/1) during the rest of the loan. More information on ARMs is available in the Federal Reserve Board’s Consumer Handbook on Adjustable Rate Mortgages. The I-O payment period is typically between 3 and 10 years. After that, your monthly payment will increase–even if interest rates stay the same–because you must pay back the principal as well as the interest. For example, if you take out a 30-year mortgage loan with a 5-year I-O payment period, you can pay only interest for 5 years and then both principal and interest over the next 25 years. Because you begin to pay back the principal, your payments increase after year 5.  What is a payment-option ARM? A payment-option ARM is an adjustable-rate mortgage that allows you to choose among several payment options each month. The options typically include a traditional payment of principal and interest (which reduces the amount you owe on your San Diego Ca mortgage). These payments may be based on a set loan term, such as a 15-, 30-, or 40-year payment schedule. an interest-only payment (which does not change the amount you owe on your mortgage). a minimum (or limited) payment (which may be less than the amount of interest due that month and may not pay down any principal). If you choose this option, the amount of any interest you do not pay will be added to the principal of the loan, increasing the amount you owe and increasing the interest you will pay. Interest rates. The interest rate on a payment-option ARM is typically very low for the first 1 to 3 months (2%, for example). After that, the rate usually rises to a rate closer to that of other mortgage loans. Your monthly payments during the first year are based on the initial low rate, meaning that if you only make the minimum payment, it may not cover the interest due. The unpaid interest is added to the amount you owe on the California mortgage, resulting in a highter balance. This is known as negative amortization. Also, as interest rates go up, your payments are likely to go up. Payment changes. Many payment-option ARMs limit, or cap, the amount the monthly minimum payment may increase from year to year. For example, if your loan has a payment cap of 7.5%, your monthly payment won’t increase more than 7.5% from one year to the next (for example, from $1,000 to $1,075), even if interest rates rise more than 7.5%. Any interest you don’t pay because of the payment cap will be added to the balance of your loan. Payment-option ARMs have a built-in recalculation period, usually every 5 years. At this point, your payment will be recalculated ( San Diego lenders use the term recast) based on the remaining term of the loan. If you have a 30-year loan and you are at the end of year 5, your payment will be recalculated for the remaining 25 years. The payment cap does not apply to this adjustment. If your loan balance has increased, or if interest rates have risen faster than your payments, your payments could go up a lot. Ending the option payments. San Diego Lenders end the option payments if the amount of principal you owe grows beyond a set limit, say 110% or 125% of your original mortgage amount. For example, suppose you made minimum payments on your $180,000 San Diego Ca mortgage and had negative amortization. If the balance grew to $225,000 (125% of $180,000), the option payments would end. Your loan would be recalculated and you would pay back principal and interest based on the remaining term of your loan. It is likely that your payments would go up significantly. Back to top What do you need to ask when shopping for an I-O mortgage payment or a payment-option ARM? Use the Mortgage Shopping Worksheet to compare different loan products. Ask lenders or brokers about the details of their loans and about the different loan options they offer. And don’t be afraid to make lenders and brokers compete with each other by letting them know you are shopping for the best deal. Look for a San Diego mortgage that allows you to buy the house and continue to afford the payments, even if payments go up over time.

Source: FDIC .Gov

Low down payments
Low closing costs
Easy credit qualifying
What does FHA have for you?

Buying your first home In San Diego?
FHA might be just what you need. Your down payment can be as low as 3.5% of the purchase price, and most of your closing costs and fees can be included in the San Diego Ca Mortgage loan.  Available on 1-4 unit properties.

Want a San Diego, California fixer-upper?
FHA has a loan that allows you to buy a home, fix it up, and include all the costs in one loan. Or, if you own a home that you want to re-model or repair, you can refinance what you owe and add the cost of repairs – all in one loan.

Financial help for seniors
Are you 62 or older? Do you live in your home? Do you own it outright or have a low loan balance? If you can answer “yes” to all of these questions, then the FHA Reverse Mortgage might be right for you. It lets you convert a portion of your equity into cash.

Want to make your home more energy efficient?
You can include the costs of energy improvements into an FHA Energy-Efficient Mortgage.

How about manufactured housing and mobile homes?
Yes, FHA has financing for mobile homes and factory-built housing. We have two loan products – one for those who own the land that the home is on and another for mobile homes that are – or will be – located in mobile home parks.

Ask an FHA lender to tell you more about FHA loan products.

Find an FHA lender at San Diego Mortgage lender resources.  Your number one choice for San Diego mortgage loans, purchase and refinance.

A: Yes, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior San DiegoVA loan and disposed of the property, you can have your used eligibility restored for additional use. Also, on a one-time only basis, you may have your eligibility restored if your prior San Diego Ca mortgage loan has been paid in full but you still own the property. In either case, to obtain restoration of eligibility, the veteran must send a completed VA Form 26-1880 to our Winston-Salem Eligibility Center. To prevent delays in processing, it is also advisable to include evidence that the prior loan has been paid in full and, if applicable, the property disposed of. This evidence can be in the form of a paid-in-full statement from the former lender, or a copy of the HUD-1 settlement statement completed in connection with a sale of the property or refinance of the prior loan.

 Q: I sold the property I obtained with my prior VA loan on an assumption. Can I get my eligibility restored to use for a new loan?

A: In this case the veteran’s eligibility can be restored only if the qualified assumer is also an eligible veteran who is willing to substitute his or her available eligibility for that of the original veteran. Otherwise, the original veteran cannot have eligibility restored until the assumer has paid off the VA loan.

 Q: My prior VA loan was assumed, the assumer defaulted on the loan, and VA paid a claim to the lender. VA said it wasn’t my fault and waived the debt. Now I need a new San Diego Ca Mortgage VA loan but I am told that my used eligibility can not be restored. Why? Or, Q: My prior loan was foreclosed on, or I gave a deed in lieu of foreclosure, or the VA paid a compromise (partial) claim. Although I was released from liability on the loan and/or the debt was waived, I am told that I cannot have my used eligibility restored. Why? A: In either case, although the veteran’s debt was waived by VA, the Government still suffered a loss on the loan. The law does not permit the used portion of the veteran’s eligibility to be restored until the loss has been repaid in full.

Q: Only a portion of my eligibility is available at this time because my prior loan has not been paid in full even though I don’t own the property anymore. Can I still obtain a VA guaranteed home loan?

A: Yes, depending on the circumstances. If a veteran has already used a portion of his or her eligibility and the used portion cannot yet be restored, any partial remaining eligibility would be available for use. The veteran would have to discuss with a San Diego mortgage lender whether the remaining balance would be sufficient for the mortgage loan amount sought and whether any down payment would be required.

 Q: Is the surviving spouse of a deceased veteran eligible for the home loan benefit? A: The unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible for the home loan benefit. If you wish to make application for the San Diego Ca Mortgage home loan benefit as a surviving spouse, contact our Winston-Salem Eligibility Center. In addition, a surviving spouse who obtained a VA home loan with the veteran prior to his or her death (regardless of the cause of death), may obtain a VA guaranteed interest rate reduction refinance loan. For more information, contact our Winston-Salem Eligibility Center. [NOTE: Also, a surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must apply no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 16, 2003 that are received after December 15, 2004.]

Q: Are the children of a living or deceased veteran eligible for the home loan benefit?

A: No, the children of an eligible veteran are not eligible for the home loan benefit.

Source: VA . Gov

Figure out how much you can afford
Know your rights
Shop for a loan
Learn about homebuying programs
Shop for a home
Make an offer
Get a home inspection
Shop for homeowners insurance
Sign papers

Step 1: Figure out how much you can afford
What you can afford depends on your income, credit rating, current monthly expenses, downpayment and the interest rate.  It is best to visit a lender or call a San Diego Broker to find out for sure.

 
Step 2: Know your home buyer rights
   Fair Housing: Equal Opportunity for All – brochure 
   Real Estate Settlement Procedures Act (RESPA) 
   Borrower’s rights 
   Predatory lending 

 Source Hud.Gov

203(b) Mortgage Insurance
   
 
What is the purpose of this program?

To provide mortgage insurance for a person to purchase or refinance a principal California residence. The San Diego Ca mortgage loan is funded by a lending institution, such as a mortgage company, bank, savings and loan association and the mortgage is insured by HUD.

What are the eligibility requirements?

The San Diego, Ca loan borrower must meet standard FHA credit qualifications.
The borrower is eligible for approximately 97% financing. The borrower is able to finance the upfront mortgage insurance premium into the San Diego mortgage. The borrower will also be responsible for paying an annual premium.
Eligible properties are one-to-four unit structures.
To learn more about the mortgage limits in your area

Step 3: Shop for a home mortgage loan
Save money by doing your homework. Talk to several lenders, compare costs and interest rates, negotiate to get a better deal. Consider getting pre-approved for a loan.

   Looking for the best San Diego Ca mortgage: shop, compare, negotiate – brochure 
   Let FHA help you 
   Why Ask for an FHA Loan? 
   Learn about interest only loans 
   Avoid Predatory Lenders 

Step 4: Learn about homebuying programs
   Homebuying programs in your state 

FHA loan programs offer lower downpayments and are a good option for first-time homebuyers.

   Let FHA help you 
   HUD’s special homebuying programs    Good Neighbor Next Door (formerly known as Teacher/Officer/Firefighter Next Door) 
   Hurricane Evacuees discounted sales 
   Homeownership for public housing residents 
   Indian Home Loan Guarantee Program (Section 184) 
 

Step 5: Shop for a home
   Choose a real estate agent 
   Wish list – what features do you want? 
   Home-shopping checklist – take this list with you when comparing homes 
   Homes for sale (including HUD homes) 
   ” Fixer-uppers ” – home purchase and repair programs 
   Manufactured (mobile) homes 
   Build a home 

If you choose a home in a neighborhood with a Home Owners Association (HOA), be sure to request a copy of the HOA packet, so you can review before closing.

  Back to Top   
Step 6: Make an offer
Discuss the process with your San Diego real estate agent. If the seller counters your offer, you may need to negotiate until you both agree to the terms of the sale.

   Making an offer 

Step 7: Get a home inspection
Make your offer contingent on a home inspection. An inspection will tell you about the condition of the home, and can help you avoid buying a San Diego, Ca home that needs major repairs.

   For Your Protection Get a Home Inspection 
   10 Questions to ask a home inspector 

Step 8: Shop for homeowners insurance
Lenders require that you have homeowners insurance. Be sure to shop around.

   Homeowners insurance 
   12 ways to lower your homeowners insurance costs 

Step 9: Sign papers
You’re finally ready to go to “settlement” or “closing.” Be sure to read everything before you sign!

   Settlement Costs and Helpful Information 

Source:  Hud .Gov

Military Service Requirements for VA Loan Eligibility:

Note:  Applications involving other than honorable discharges will usually require further development by VA.  This is necessary to determine if the service was under other than dishonorable conditions.

Wartime – Service During:

WWII: 9/16/1940 to 7/25/1947
Korean: 6/27/1950 to 1/31/1955
Vietnam: 8/5/1964 to 5/7/1975
You must have at least 90 days on active duty and been discharged under other than dishonorable conditions.  If you served less than 90 days, you may be eligible if discharged for a service connected disability.

Peacetime – Service during periods:

7/26/1947 to 6/26/1950
2/1/1955 to 8/4/1964
5/8/1975 to 9/7/1980 (Enlisted)
5/8/1975 to 10/16/1981 (Officer)
You must have served at least 181 days of continuous active duty and been discharged under other than dishonorable conditions.  If you served less than 181 days, you may be eligible for a Veterans Guaranteed mortgage loan if discharged for a service connected disability.

Service after 9/7/1980 (enlisted) or 10/16/1981 (officer)

If you were separated from service which began after these dates, you must have:

Completed 24 months of continuous active duty or the full period (at least 181 days) for which you were ordered or called to active duty and been discharged under conditions other than dishonorable, or
Completed at least 181 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1171 (Early Out), or have been determined to have a compensable service-connected disability;
Been discharged with less than 181 days of service for a service-connected disability.  Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances for the convenience of the Government.
Gulf War – Service during period 8/2/1990 to date yet to be determined

If you served on active duty during the Gulf War, you must have:

Completed 24 months of continuous active duty or the full period (at least 90 days) for which you were called or ordered to active duty, and been discharged under conditions other than dishonorable, or
Completed at least 90 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1173 (Early Out), or have been determined to have a compensable service-connected disability, or
Been discharged with less than 90 days of service for a service-connected disability.  Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances, for the convenience of the Government.

If you are a veteran living in the San Diego area and are considering a San Diego Ca Mortgage loan that is backed by the Veterans Administration you can obtain further information at the VA website.
Active Duty Service Personnel

If you are now on regular duty (not active duty for training), you are eligible after having served 181 days (90 days during the Gulf War) unless discharged or separated from a previous qualifying period of active duty service.

Selected Reserves or National Guard

If you are not otherwise eligible and you have completed a total of 6 years in the Selected Reserves or National Guard (member of an active unit, attended required weekend drills and 2-week active duty for training) and

Were discharged with an honorable discharge, or
Were placed on the retired list, or
Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable service, or
Continue to serve in the Selected Reserves
Individuals who completed less than 6 years may be eligible if discharged for a service-connected disability.

You May also be determined eligible if you:

Are an unremarried spouse of a veteran who died while in service or from a service connected disability, or
Are a spouse of a serviceperson missing in action or a prisoner of war
Note:  Also, a surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible for the home loan benefit.  However, a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must apply no later than December 15, 2004, to establish home loan eligibility.  VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.

Eligibility may also be established for:

Certain United States citizens who served in the armed forces of a government allied with the United States in WW II.
Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with WW II service, and others.

This artcle should help you to understand what VA can and cannot do for the San Diego, Ca mortgage borrowers making a home purchase. However, it is not a legal document and should not be interpreted as one. Nothing should be taken as a change of law or regulations. The article does not attempt to go into detail or into unusual problems. Information about VA loans is given in a narrative format followed by questions and answers in those areas of the greatest concern.

It is suggested that the pamphlet be read in its entirety. Please pay particular attention to the information about:

your responsibility to determine the condition of the property you purchase, and  assumption of your VA loan and obtaining a release of liability.

Any questions you have which are not answered here should be referred to the Loan Guaranty Division at the nearest VA regional office, or to your lender who will take them up with VA if necessary. A list of VA offices may be found in the Help section.

If you are a Veteran the VA loan program will offer several advantages over a traditional/conventional loan.  See additional posts that follow.
 
Source: MortgageX .com