Premiere Mortgage Services Inc. - Dana Bain

Super Conforming Loan Limits:

http://activerain.com/blogsview/1721131/what-is-a-super-conforming-loan-what-are-the-loan-limits-per-county

Premiere Mortgage Services Inc. www.BainMortgage.com

Dana Bain & Robin Bain cover all of MA & NH 800-480-0545 978-422-2311

A super conforming mortgage loan is a term coined by Fannie Mae and Freddie Mac for mortgages in certain parts of the country that are more expensive areas to live. Fannie and Freddie have a mortgage limit of $417,000 in most parts of the country, and anything above that figure they will not buy because it is considered a jumbo loan. Because of the appreciation in home values, certain areas can now apply for loans up to $625,000 and even $729,000 because of the high cost of homes.

2009 Super-Conforming First Mortgage Loan Limits Up to $729,750 Now Available in High-Cost Areas

On February 17, 2009, President Obama signed the American Recovery and Reinvestment Act (“ARRA”) which established “high-cost” area conforming loan limits (termed ‘Super-Conforming’) in specific counties in addition to the standard conforming loan limits. Please contact your Financial Advisor for more information about Super-Conforming loans.

ARRA High-Cost AreaLoan Limits

COUNTY NAME	STATE	ONE-UNIT LIMIT
Coconino County	AZ	$450,000
Alameda County	CA	$729,750
Alpine County	CA	$547,500
Amador County	CA	$443,750
Calaveras County	CA	$462,500
Contra Costa County	CA	$729,750
El Dorado County	CA	$580,000
Inyo County	CA	$437,500
Los Angeles County	CA	$729,750
Madera County	CA	$425,000
Marin County	CA	$729,750
Mendocino County	CA	$512,500
Merced County	CA	$472,500
Mono County	CA	$529,000
Monterey County	CA	$729,750
Napa County	CA	$729,750
Nevada County	CA	$562,500
Orange County	CA	$729,750
Placer County	CA	$580,000
Riverside County	CA	$500,000
Sacramento County	CA	$580,000
San Benito County	CA	$729,750
San Bernardino County	CA	$500,000
San Diego County	CA	$697,500
San Francisco County	CA	$729,750
San Joaquin County	CA	$488,750
San Luis Obispo County	CA	$687,500
San Mateo County	CA	$729,750
Santa Barbara County	CA	$729,750
Santa Clara County	CA	$729,750
Santa Cruz County	CA	$729,750
Shasta County	CA	$423,750
Solano County	CA	$557,500
Sonoma County	CA	$662,500
Stanislaus County	CA	$423,750
Sutter County	CA	$425,000
Tuolumne County	CA	$437,500
Ventura County	CA	$729,750
COUNTY NAME	STATE	ONE-UNIT LIMIT
Yolo County	CA	$580,000
Yuba County	CA	$425,000
Boulder County	CO	$460,000
Eagle County	CO	$729,750
Garfield County	CO	$425,000
Gunnison County	CO	$433,750
Hinsdale County	CO	$557,500
La Plata County	CO	$443,750
Lake County	CO	$729,750
Ouray County	CO	$482,500
Pitkin County	CO	$729,750
Routt County	CO	$675,000
San Juan County	CO	$425,000
San Miguel County	CO	$651,250
Summit County	CO	$729,750
Weld County	CO	$417,500
Fairfield County	CT	$708,750
Hartford County	CT	$440,000
Middlesex County	CT	$440,000
Tolland County	CT	$440,000
New Castle County	DE	$420,000
District of Columbia	DC	$729,750
Broward County	FL	$423,750
Collier County	FL	$531,250
Manatee County	FL	$442,500
Miami-Dade County	FL	$423,750
Monroe County	FL	$729,750
Palm Beach County	FL	$423,750
Sarasota County	FL	$442,500
Greene County	GA	$662,500
Hawaii County	HI	$625,500
Honolulu County	HI	$793,750
Kalawao County	HI	$716,250
Kauai County	HI	$773,750
Maui County	HI	$790,000
Blaine County	ID	$729,750
Teton County	ID	$693,750
Valley County	ID	$462,500
COUNTY NAME	STATE	ONE-UNIT LIMIT
Anne Arundel County	MD	$560,000
Baltimore City	MD	$560,000
Baltimore County	MD	$560,000
Calvert County	MD	$729,750
Carroll County	MD	$560,000
Cecil County	MD	$420,000
Charles County	MD	$729,750
Frederick County	MD	$729,750
Garrett County	MD	$437,500
Harford County	MD	$560,000
Howard County	MD	$560,000
Montgomery County	MD	$729,750
Prince George’s County	MD	$729,750
Queen Anne’s County	MD	$560,000
Talbot County	MD	$443,750
Worcester County	MA	$437,500
Barnstable County	MA	$462,500
Bristol County	MA	$475,000
Dukes County	MA	$729,750
Essex County	MA	$523,750
Middlesex County	MA	$523,750
Nantucket County	MA	$729,750
Norfolk County	MA	$523,750
Plymouth County	MA	$523,750
Suffolk County	MA	$523,750
Douglas County	NV	$468,750
Rockingham County	NH	$523,750
Strafford County	NH	$523,750
Atlantic County	NJ	$453,750
Bergen County	NJ	$729,750
Burlington County	NJ	$420,000
Camden County	NJ	$420,000
Cape May County	NJ	$487,500
Essex County	NJ	$729,750
Gloucester County	NJ	$420,000
Hudson County	NJ	$729,750
Hunterdon County	NJ	$729,750
Mercer County	NJ	$440,000

COUNTY NAME	STATE	ONE-UNIT LIMIT
Middlesex County	NJ	$729,750
Monmouth County	NJ	$729,750
Morris County	NJ	$729,750
Ocean County	NJ	$729,750
Passaic County	NJ	$729,750
Salem County	NJ	$420,000
Somerset County	NJ	$729,750
Sussex County	NJ	$729,750
Union County	NJ	$729,750
Santa Fe County	NM	$427,500
Bronx County	NY	$729,750
Dutchess County	NY	$443,750
Kings County	NY	$729,750
Nassau County	NY	$729,750
New York County	NY	$729,750
Orange County	NY	$443,750
Putnam County	NY	$729,750
Queens County	NY	$729,750
Richmond County	NY	$729,750
Rockland County	NY	$729,750
Suffolk County	NY	$729,750
Westchester County	NY	$729,750
Camden County	NC	$729,750
Currituck County	NC	$458,850
Dare County	NC	$460,000
Hyde County	NC	$483,000
Pasquotank County	NC	$729,750
Perquimans County	NC	$729,750
Athens County	OH	$432,500
Clackamas County	OR	$418,750
Columbia County	OR	$418,750
Deschutes County	OR	$447,500
Jackson County	OR	$422,500
Multnomah County	OR	$418,750
Washington County	OR	$418,750
Yamhill County	OR	$418,750
Bucks County	PA	$420,000
Chester County	PA	$420,000
Delaware County	PA	$420,000
Montgomery County	PA	$420,000
Philadelphia County	PA	$420,000
Pike County	PA	$729,750
York County	PA	$425,000
Bristol County	RI	$475,000
Kent County	RI	$475,000
Newport County	RI	$475,000
Providence County	RI	$475,000
Washington County	RI	$475,000
Cannon County	TN	$432,500
Cheatham County	TN	$432,500
Davidson County	TN	$432,500
Dickson County	TN	$432,500
Hickman County	TN	$432,500
Macon County	TN	$432,500
Robertson County	TN	$432,500
Rutherford County	TN	$432,500
Smith County	TN	$432,500
Sumner County	TN	$432,500
Trousdale County	TN	$432,500
Williamson County	TN	$432,500
Wilson County	TN	$432,500
Salt Lake County	UT	$729,750
Summit County	UT	$729,750
Tooele County	UT	$729,750
Wasatch County	UT	$431,250
Albemarle County	VA	$437,000
Alexandria City	VA	$729,750
Amelia County	VA	$535,900
Arlington County	VA	$729,750
Caroline County	VA	$535,900
Charles City County	VA	$535,900
Charlottesville City	VA	$437,000
Chesapeake City	VA	$458,850
Chesterfield County	VA	$535,900
Clarke County	VA	$729,750
Colonial Heights City	VA	$535,900
Cumberland County	VA	$535,900
Dinwiddie County	VA	$535,900
Fairfax City	VA	$729,750
Fairfax County	VA	$729,750
Falls Church City	VA	$729,750
Fauquier County	VA	$729,750
Fluvanna County	VA	$437,000
Frederick County	VA	$475,000
Fredericksburg City	VA	$729,750
Gloucester County	VA	$458,850
Greene County	VA	$437,000
Goochland County	VA	$535,900
Hampton City	VA	$458,850
Hanover County	VA	$535,900
Henrico County	VA	$535,900
Hopewell City	VA	$535,900
COUNTY NAME	STATE	ONE-UNIT LIMIT
Isle of Wight County	VA	$458,850
James City County	VA	$458,850
King and Queen County	VA	$535,900
King William County	VA	$535,900
Lancaster County	VA	$545,000
Loudoun County	VA	$729,750
Louisa County	VA	$535,900
Manassas City	VA	$729,750
Manassas Park City	VA	$729,750
Mathews County	VA	$458,850
Nelson County	VA	$437,000
New Kent County	VA	$535,900
Newport News City	VA	$458,850
Norfolk City	VA	$458,850
Petersburg City	VA	$535,900
Poquoson City	VA	$458,850
Portsmouth City	VA	$458,850
Powhatan County	VA	$535,900
Prince George County	VA	$535,900
Prince William County	VA	$729,750
Richmond City	VA	$535,900
Spotsylvania County	VA	$729,750
Stafford County	VA	$729,750
Suffolk City	VA	$458,850
Surry County	VA	$458,850
Sussex County	VA	$535,900
Virginia Beach City	VA	$458,850
Warren County	VA	$729,750
Williamsburg City	VA	$458,850
Winchester City	VA	$475,000
York County	VA	$458,850
Clark County	WA	$418,750
Jefferson County	WA	$437,500
King County	WA	$567,500
Kitsap County	WA	$475,000
Pierce County	WA	$567,500
San Juan County	WA	$593,750
Skamania County	WA	$418,750
Snohomish County	WA	$567,500
Hampshire County	WV	$475,000
Jefferson County	WV	$729,750
Teton County

Dana K. Bain

President

MLO 18693

www.PremiereMortgageServicesInc.com

www.BainMortgage.com

11 Malvern Hill Road

Sterling, MA 01564

Phone: (978) 422-2311

Toll Free: (800) 480-0545

Fax: (978) 422-2313

MA Lic. No. MB1205

Licensed by the State of NH
Banking Dept. Lic. No. 5430-MBR

Tanya is a self-employed writer with solid credit and enough savings to put 30 percent down on her chosen Connecticut house. But for the past year, no lender would approve her. Then one got personal.

While dissecting the account she shares with her boyfriend, “they demanded to know what my relationship was with him. I finally gave up (and) decided I would just rent,” said Tanya, who asked that her last name be withheld should she opt to “go back to that bank.”

Businessman Ben Wilkinson-Raemer and his wife tried for six months to purchase a (very small) apartment in Manhattan's West Village neighborhood, on the market for $400,000. He dutifully provided underwriters mounds of requested financial records. He winced when they also scoured the bank account of his 85-year-old grandmother because she gave him $10,000 toward the purchase. Despite his excellent 700 credit score, the loan was rejected.

“We opened a bottle of Champagne (afterward),” said Wilkinson-Raemer. “We were just so happy to have the whole weight off our shoulders.”

Even for successful buyers with sterling credit, seeking a mortgage these days can feel like a simultaneous root canal and colonoscopy. Tighter loan restrictions were expected after the mortgage fiasco. A quarterly Federal Reserve survey of loan officers at large banks confirms they have tightened standards significantly over the past three years, although now some lenders are beginning to loosen up.

But as the housing market continues to struggle, with sales of existing homes dropping unexpectedly last month, sales some mortgage brokers say the pendulum of scrutiny has swung too far, causing transactions to take far longer than necessary, putting buyers through too much hassle and blocking qualified applicants from purchasing.

The real estate business seems to have switched its motto from “location, location, location” to “documentation, documentation, documentation.” Potential buyers must chronicle every dollar of income and all assets via pay stubs, W-2s, tax returns, bank statements, credit reports and sometimes even letters from employers or family members. Mortgage brokers blame new federal lending rules for injecting unneeded delays in the loan process, and they accuse some underwriters of focusing on their own job security rather than fairly analyzing a consumer’s default risk.

“The big difference today is the fact that underwriters look at the guidelines with a strict black-and-white viewpoint and are unwilling to interpret the guidelines for fear of job loss,” said Kirk Jaffe, chief operating officer of Los Angeles-based Peak Financial Partners Inc., which offers real estate services. “It is always easier (for underwriters) to say no than to say yes.”

“The changing rules during the last couple of years are making it much more difficult to obtain mortgages, slowing our economy, causing our housing market to decline,” said Warren Greenlee, who runs RE/MAX at the Lake in Mooresville, N.C.

Many brokers and agents agree that home-loan snags are stalling the housing recovery and damaging the economy, hurting businesses that sell the types of goods and services and new homeowners typically buy.

“The changes are far-reaching," Greenlee said. "Some are comical.”

Like the lender who — due to an inspector’s typo — temporarily refused to fund a mortgage for a Greenlee client. When naming the property in his report, the inspector mistakenly inserted a space between the words “Four” and “Square.” The bank, JPMorgan Chase, insisted the inspector redo his report. “In years past,” Greenlee said, “the lender would have never noticed or cared.”

The simplest loans — those involving one person with one checking and savings account —require 33 pages of disclosure documents, said Todd Huettner, president of Denver-based Huettner Capital, a real estate mortgage brokerage.

Home-loan frustrations, Huettner said, are touching “every borrower.” But the most qualified applicants — high-income, high-credit folks who three years ago zoomed through the process with 10-minute pre-qualification calls and no-doc loans — now are most apt to choke on red tape because they have “the most complex finances,” he said. In such cases, an underwriter often demands extra documentation from the borrower “five, six, or seven” times.

“And considering that each iteration takes about a week, that’s why people are spending two and three months trying to get a loan done,” he said.

According to a survey conducted earlier this year by The Work Number — an employment verification database used by more than half of the Fortune 500 companies — 72 percent of respondents said they are confused by the flood of disclosure forms.

“We were joking while signing all the paperwork (for our mortgage) that, on paper, I don’t think anybody knows us better right now,” said Aaron Lupo. Last week, he and his wife closed on a $150,000 home in Olathe, Kan. The underwriters “know everything there is to know about us.”

But consumers like Wilkinson-Raemer in Manhattan, stuck in rental purgatory, are paying the steepest price.

In a “normal market,” about six of every 10 loan applicants are approved, estimated Paul McFadden, a loan officer at the Legacy Group in Bellevue, Wash. Before 2008, at the height of the subprime lending craze, roughly nine of every 10 loans were approved, he said.

“Now, it is probably three out of 10,” McFadden said. “As a lender, we've all had to adjust to a new reality.”

“In many cases, borrowers who have proven their ability to buy homes and pay for mortgages are being penalized and declined mortgages,” Jaffe said.

Huettner also blamed federal reforms for mucking up the mortgage machine.

RESPA — the Real Estate Settlement Procedures Act — requires lenders to supply good-faith estimates to would-be buyers, revealing loan terms and closing costs. As a result of the law, which went into effect Jan. 1, brokers cannot order property appraisals until their clients have had the good-faith estimates for three days — an “artificial delay,” according to Huettner.

Then there’s the federal Home Valuation Code of Conduct, which prohibits lenders, brokers and agents from selecting or having “substantive” communication with a residential appraiser. The idea was to ensure appraiser independence.

Before the mortgage crisis, fraudulent appraisals inflated many home values. Yet as a result of the new code of conduct, appraisers now might come from 20 to 50 miles away and are unfamiliar with the neighborhood’s nuances. As a result they often write “egregiously low” appraisals, Huettner and other brokers contend.

“The regulatory stuff coming from Washington ... it’s bad,” Huettner said. But he said the pendulum might not have swung as far as some believe.

Some of “the whining you’re hearing,” Huettner believes, lies with “inexperienced” mortgage brokers who “don’t have underwriting expertise.”

Huettner doesn’t see loan guidelines as being substantively different from years past. The real change: the paper trail of income evidence that’s now required.

He said the new scrutiny of borrowers is a change from recent years but not unprecedented.

"Go talk to someone who bought a home 40 years ago," he said. "They had to produce all kinds of documentation.”

“The end result here is that lenders and investors want to be certain that they have minimized any opportunity for default prior to originating a mortgage,” said Jim Sahnger, a mortgage brokers in Jupiter, Fla.

“As procedures were implemented to verify all aspects of the application, confidence has returned. And part of the result is the lowest mortgage rates we have ever seen,” Sahnger said. But “today, just because you have a FICO score in the 740-plus range does not mean you don’t have to prove it.”

1) NAMB conservatively estimates (breakdown below) that the HVCC is costing consumers over 2.8 BILLION dollars a year in extra fees, created by long delays (extended lock-in fees) and higher appraisal costs.

2) Unregulated Appraisal Management Companies (AMCs), who have been the subject of several misconduct investigations, are the centerpiece of the HVCC. The original Cuomo investigation involved a federally chartered bank and an AMC.

3) AMCs are driving honest appraisers and mortgage brokers from business, eliminating competition, increasing costs to consumers and reducing state revenue. The HVCC is causing significant delays in real estate transactions, hurting real estate agents, title companies and other third parties reliant on turnaround time.

4) HVCC does nothing to reduce fraud, as it legitimizes the same failed model, which was the subject of Attorney General Cuomo's investigation.

5) No Portability! Consumers are "trapped" with a specific lender. If a better deal becomes available with a different lender, the consumer is forced to pay for another appraisal.

Background:

I. Lack of Portability
A. Lenders are not allowing borrowers to transfer appraisals, regardless of the reason.
B. Forces the borrower to pay for another appraisal and wait for a new appraiser to be assigned and complete it, increasing the total cost and time needed for obtaining a home. Delays in turnaround times also cause the borrower to miss rate lock deadlines and possibly face penalties charged by the lender.
C. In a poll conducted by NAMB, 75.8% of respondents said that 0% of their appraisals are portable since the enactment of the HVCC.

II. Lack of Quality
A. AMCs are assigning appraisers from a different municipality, county, or even state to appraise the target house, therefore unfamiliar with the neighborhood and unable to produce an accurate appraisal.
i. Because of this, the HVCC is forcing appraisers to be in direct violation of the Uniform Standards of Professional Appraisal Practice (USPAP) for jurisdictional competence.
B. Because AMCs pay appraisers such low fees, those assigned appraisers willing to do the work are often inexperienced and fail to adequately appraise the home.

III. Increased Cost of Appraisals
A. The minimum increase we have seen in direct consumer cost is $150 per appraisal. That, coupled with the drastically increased appraisal turnaround times that impose extended lock periods at an average expense of $561.95 per loan, is now costing consumers an estimated additional $711.95 per transaction.
B. $150.00 - minimum increase per appraisal
$561.95 - average loan amount of $224,778 at .25% for extended lock period
$711.95 - average total increase per transaction
x 3,870,552* - 2007 HMDA report of residential real estate loans originated
$2,755,639,496 - $2.8BILLION in increased fees to consumers!

IV. Articles Illustrating the Effects of the HVCC
A. The Appraisal Bubble - The Center for Public Integrity
B. The Cure is Worse than the Disease - Appraisal Press
C. Appraisals Roil Real Estate Deals - The Wall Street Journal

For more info on this see:

http://www.bainmortgage.com/MyBlog

http://www.youtube.com/user/ThinkBigWorkSmall#p/u/0/qxqXqi7WGzs

http://www.cnbc.com/id/30521887/Home_Valuation_Code_of_Conduct_Fix_or_Fraud

http://fredglickre.blogspot.com/2010/04/my-speech-at-hvcc-rally-today.htm

l

US House To Push To Sunset Home Appraisal Code

Jun 21, 2010

By Jessica Holzer, Of DOW JONES NEWSWIRES

WASHINGTON -(Dow Jones)- U.S. House negotiators on the sprawling financial- overhaul bill will seek to reinsert a measure to phase out a controversial new set of standards for home appraisals.

The Home Valuation Code of Conduct, adopted in May 2009 to ensure appraisers' independence, bars mortgage brokers and bank-loan officers from selecting appraisers.

Mortgage brokers and Realtors complain the rules have produced low-ball appraisals that have blown up deals, while appraisers say the change has hurt appraisal quality.

Mortgage lenders, however, are fighting to keep the new rules. Several major lenders own or have a stake in companies that have seen a surge in business as a result of the rules.

The House measure would sunset the code and require federal regulators to come up with a new set of protocols. It was not contained in the financial-overhaul bill that passed the Senate.

The code of conduct was adopted by the industry last May as a result of an agreement between the New York Attorney General and Fannie Mae (FNM) and Freddie Mac (FRE).

http://www.nasdaq.com/aspx/stock-market-news-story.aspx?storyid=201006211347dowjonesdjonline000269&title=us-house-to-push-to-sunset-home-appraisal-code

Want a lender to delay or even cancel your mortgage closing? Then change your "borrower circumstances" between the day you apply for and the day you close a home loan.

Lenders have gotten stricter in response to the mortgage meltdown. The latest tightening of the screws comes from Fannie Mae. The mortgage titan's Loan Quality Initiative, which went into effect June 1, requires lenders to track "changes in borrower circumstances" between application and closing.

The rules aren't new, but Fannie will enforce them more vigorously. For borrowers, it means certain actions are likely to delay or otherwise mess up a mortgage closing.

"Any change in circumstance could affect and delay a borrower's closing on a transaction," says David Adamo, CEO of Luxury Mortgage of Stamford, Conn.

Following are three things borrowers can do to mess up their next mortgage closing.

Get a new credit card or auto loan

If you want to implode your impending mortgage, get a new credit card or auto loan.

Lenders have long admonished mortgage applicants to avoid getting new credit cards and auto loans while home loans are in underwriting. Fannie's Loan Quality Initiative adds urgency to this request.

For example, picture a borrower who gets a car loan a week before closing on the mortgage. The mortgage lender doesn't know about it. Later, the borrower misses a couple of mortgage payments.

Fannie Mae can look back, discover the undisclosed auto loan and make the lender buy back the bad mortgage. That's a money loser for the lender.

So at the eleventh hour, most lenders check credit for new accounts.

Even merely opening an account — without charging anything to it — can be a mistake.

Retailers often offer discounts to customers who apply for store credit, Adamo says. "That is something that most consumers will take advantage of, and even something as benign as that could affect a borrower's ability to close on a mortgage approval."

Charge up credit cards

Charging up credit cards with thousands of dollars' worth of appliances, tools and yard equipment is another surefire way to muck up a closing. It's best to leave those cards alone.

"Don't increase your credit card balances at all. Consider paying cash for everything," says Dan Green, a mortgage planner for Waterstone Mortgage in Cincinnati.

Mortgage approval is based partly on debt-to-income ratio. The lender looks at the borrower's minimum monthly debt payments and compares them to income. If the ratio of debt payments to income is too high, the borrower could be turned down for a mortgage.

Fannie encourages mortgage lenders to recalculate debt-to-income ratios just before closing. If a spending spree sends the debt-to-income ratio too high, the mortgage could be doomed. For this reason, borrowers should wait until after closing the mortgage before buying furniture, a refrigerator or a lawn mower on credit.

Change jobs

Changing jobs is another good way to derail a mortgage before closing. Other potential deal-breakers include staying with a current employer, but switching from a salaried position to one where primary income comes from commissions or bonuses.

"Because the rules about any job change, especially if you go to commission or bonus, usually you need a two-year history," says Bob Walters, chief economist for Quicken Loans. "So if all of a sudden you switch from W-2 to some other kind of compensation, and you don't have the history, a lot of times that income can't be included. So all of a sudden you'll find maybe you don't qualify."

Keep in mind the actual lender will pull their own credit report at closing, and if your credit scores have dropped, you may no longer qualify for the rate that was underwritten and the final approval may come back with a higher rate. Unfortunately, all lenders qualify you by your credit score as to which criteria you fit and every loan has different criteria attached. The loan to value, the debt to ratio and so on etc. This is what borrowers do not understand, and they think the loan officer is baiting and switching. They are not. If an issue comes up that the lender decides you do not qualify for a certain loan, the only thing a loan officer can do is shop for lenders and see if any are willing to give the rate and program they thought you qualified for. If you have good credit and know your score, the loan officer can give you an idea what he or she can offer based on what you say. But do not expect them to stand by their quote if and when they pull your credit your scores have dropped.

Fed officials send conflicting signals on rates

CHICAGO/KANSAS CITY (Reuters) - Two top Federal Reserve officials on Tuesday offered opposing signals on the direction of interest rates, highlighting an increasingly salient split within the central bank.

Chicago Fed President Charles Evans argued high unemployment and low inflation justified holding benchmark interest rates at very low levels.

"I think we will continue to have an accommodative policy stance for quite some time," Evans told business leaders in Chicago.

But in a forum in Kansas City, colleague Thomas Hoenig reiterated his call for the U.S. central bank to begin raising rates soon, bringing them to one percent by end of summer from their current rock-bottom range of zero-0.25 percent.

Hoenig represents a vocal minority at the Fed that most analysts do not expect will dissuade its Washington-based board from maintaining the accommodation members believe is needed to sustain a recovery.

Still, the divergence does send mixed signals to financial markets, which are already vulnerable because of ongoing anxiety about Europe's debt problems.

The nervousness and its impact on interbank lending has captured the Fed's attention, with some officials saying it strengthens the case for keeping borrowing costs low.

Evans downplayed the impact of any slowdown in European growth on the United States, saying that the trade effects "are likely to be limited" because Europe accounts for just 15 percent of U.S. exports.

"Nonetheless, if events in Europe evolve so that they have a more severe and broad impact on financial markets, then the scope of the problems for the U.S. could be magnified," he said.

While direct U.S. exposure to European debt is limited, he said, further liquidity or solvency problems in Europe could lead to a pullback by investors and lenders and throttle lending.

The Fed last month opened dollar lending lines to the European Central Bank and other major central banks to head off potential stress in the international banking system from the crisis, but so far they have not been heavily tapped.

Fed Chairman Ben Bernanke said on Monday the U.S. economy appears to have enough momentum to avoid a "double-dip" recession, citing strengthening consumer and business spending.

"There are some signs the private sector is picking up the baton," he said.

In response to the worst financial crisis in generations, the Fed slashed interest rates effectively to zero and undertook a wide range of emergency lending measures to restart frozen credit markets. The Fed has kept short-term borrowing costs near zero since December 2008.

Hoenig said he is leery of this prolonged period of the same easy money that got the economy into trouble in the first place by creating bubbles.

"I'm worried about it," he told the Kansas City Fed forum. "I am very much of the mind that we need to have a stable monetary policy that looks to the long run."

Hoenig said the nation's manufacturing sector, which has bounced back strongly from a steep retrenchment at the end of 2008 and early 2009, will continue to build on this strength.

Housing appears to have stabilized, but commercial real estate will stay weak for some time, he said, adding that he sees U.S. gross domestic product expanding between 3 percent and 3.5 percent.

(Additional reporting/writing by Mark Felsenthal, Ann Saphir, Kristina Cooke, Pedro da Costa; editing by Carol Bishopric)

How to qualify for the best mortgage rates you hear advertised.

Shelby Bateson - Mortgage and Housing Examiner 

Whether you are buying a house, an investment property, or refinancing a current mortgage, there is a long list of variables that determine what rates you will pay. In addition to considering rates, there are still many types of loans available, each with their own eligibility criteria, that can affect your rates, including:

Conforming/Conventional: Conforming loans are those that follow Fannie Mae/Freddie Mac lending guidelines, because approximately 87% of all conforming mortgages are still sold to Fannie or Freddie. Typically conventional loans have a maximum loan amount of 417,000, regardless of where you live in the country.

Jumbo: Jumbo loans are those with loan amounts/balances above $417,000
High balance conforming: for 2009, the loan amounts that are considered “conforming” have been increased, pursuant to the American Recovery and Reinvestment Act. In areas where the average home prices are higher than Fannie/Freddie conforming limits, “High balance conforming” loans are now eligible for special rates, substantially lower than Jumbo loan rates, but a bit higher than conforming loan rates. Click here to determine the maximum loan amounts in your area to qualify for High balance conforming loans.

Government (FHA, VA, and USDA rural): These are loans that are insured by government entities, such as HUD, VA, and USDA.

ARM (adjustable rate mortgages): These are loans that start at lower rates than conforming, and your rate is locked for a specified period of time before the rate can adjust higher or lower (depending on the index your loan is tied to, and the margin, which never changes.

A few lenders are offering other loan types, but for the sake of this article, we will consider only the above.

Regardless of the type of financing you are seeking, there are other criteria that CAN affect the rate you will pay on your loan, including:

Credit score: When you apply for a mortgage, almost all lenders will require what is called a “Tri-merge” credit report which pulls your credit history from all three of the major credit bureaus. Most lenders will use the “mid score” to determine your rate eligibility (because all three credit bureaus have different formulas for determining your score, so expect each score to be different, and because not all creditors report to all three bureaus.)

Your credit score is the number one factor in determining the rate and types of financing available to you, so your credit history is critical. Currently most lenders require scores of 740 or better to qualify for the best advertised rates, but this is very dependent on the type of financing you want. For example, VA FHA loans are not nearly as rate sensitive as Fannie/Freddie loans.

Credit history: Lenders are looking for a number of factors on your credit history, including, but not necessarily limited to:

1. Derogatory information, such as collections, judgments, bankruptcies, “settled accounts” where you were ‘forgiven’ part of your debt, foreclosures, etc?
2. How much you owe other creditors?
3. Payment history: just one 30 day late payment in the last 12 months can disqualify you from many loan programs.
4. Other mortgages and their history

LTV (loan to value ratio): how much down payment can you make, compared to your purchase price? For a refinance transaction, how much is your house worth compared to the loan you are requesting? The lower the LTV - to a point - the better the rate will be.

Debt ratio - how much do you owe other creditors relative to your monthly income? Lenders look at two debt ratios, the ratio of the new mortgage payment (including taxes, insurance, HOA payments, and any other recurring debts associated with your mortgage payment) to your gross monthly income, AND the ratio of all your debts, including the new mortgage payment, relative to your gross monthly income.
Different loan programs have different debt ratio limits, but in general, most programs are looking for ratios close to 38/45 (38 is your mortgage payment to income, 45 is the ratio of all debt to income.)

Type of property: a house, condo, condotel, manufactured house, land, etc. If you are buying a manufactured home, for instance, you should expect to pay higher rates, and because not all lenders are doing manufactured home loans, your choices will be more limited. Looking for financing on a condhotel? You may be limited to financing by the builder, the development, or private money.

Occupancy: Will you live in this house, is it a second home or an investment? How many other investment properties do you own? How long is your history as a landlord?

Lock period: How long do we need to lock this loan? Can the loan close in 30 days or less? Often, this depends on you getting all the required paperwork to your lender quickly. But some of this is out of your control. Before a loan can close, an appraisal is required. This can take up to 3 weeks from the date it is ordered until it is received. Also, as this market has become so volatile, some lenders are offering rate incentives for very short locks of 7 -12 days, so many people are opting to wait to lock the loan until after final lender approval has been received.

Employment history: Most lenders want to see at least 2 years at the same job, or at least in the same line of work.

Type of Loan: Refinance or Purchase: If you are refinancing your house, is this to get a better rate and term, or do you need cash out? Cash out loans usually have an upward adjustment to rate, especially if the Loan to Value is higher than 70%.

Location: Rates differ from state to state AND can also be affected by being in an area designated as "declining value?" Most areas of the country are still as "declining value." This primarily affects how much you can borrow, relative to the value (LTV), but could also affect the rate.

Loan Amount: Believe it or not, most lenders charge a higher rate for loan amounts under $100,000.

And if all the above information isn’t enough, if you are shopping for a mortgage, it is also important to work with someone with offices close to the property you want to finance. A lender in Arkansas, for example, may not have Oregon rates available, and may not know about any special loan programs or financing specials running in your area of interest. Mortgage brokers work with big banks, but also work with smaller, less well known, and sometimes local lenders. Because these smaller lenders do not advertise, they can sometimes offer lower rates.

Mortgage rates are very volatile right now. Some lenders adjust rates several times a day based on the most current market rates. Other lenders might change rates only once a week. So, it is very important to shop for mortgage rates before you settle on a lender.

Questions and comments are always welcome.

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Dana Bain

Premiere Mortgage Services Inc.

978-422-2311