Premiere Mortgage Services Inc. - Dana Bain

Newsletter-April 30th, 2018     
Provided by
Dana Bain
Dana Bain
Premiere Mortgage Services
11 Malvern Hill Road
Sterling, MA 01564
Phone: (978) 422-2311
Fax: (978) 422-2313
E-Mail: dana@bainmortgage.com
 
 

Market Comment

Mortgage bond prices finished the week lower which put upward pressure on rates. We started with sharply higher rates as data showed economic strength. New home sales were 694K versus the expected 631K. Consumer confidence was 128.7. Analysts looked for a reading of 126. The 10Y hit the key psychological 3% mark for the first time since January 2014. Weekly jobless claims were 209K which was the lowest reading since 1969. Durable goods orders rose 2.6% versus the expected 2.3% increase. However, ex-auto orders were unchanged versus an expected 0.7% increase. Q1 Gross Domestic Product rose 2.3% versus the expected 2.1% increase. Employment cost index rose 0.8% which was 0.1% higher than expected. We ended the week worse by 1/8 to 1/4 of a discount point.


LOOKING AHEAD

Economic
Indicator

Release
Date & Time

Consensus
Estimate


Analysis

Personal Income and Outlays

Monday, April 30,
8:30 am, et

Up 0.4%,
Up 0.1% 
Important. A measure of consumers’ ability to spend. Weakness may lead to lower mortgage rates.
PCE Core Inflation

Monday, April 30,
8:30 am, et 

Up 0.2%

Important. A measure of price increases for all domestic personal consumption. Weaker figure may help rates improve.
ISM Index

Tuesday, May 1,
10:00 am, et

59.6

Important. A measure of manufacturer sentiment. Weakness may lead to lower mortgage rates.
ADP Employment

Wednesday, May 2,
8:30 am, et

242K

Important. An indication of employment. Weakness may bring lower rates.
Fed Meeting Adjourns

Wednesday, May 2,
2:15 pm, et 

No rate changes

Important. Few expect the Fed to change rates, but some volatility may surround the adjournment of this meeting.
Preliminary Q1 Productivity

Thursday, May 3,
8:30 am, et

Up 0.8%

Important. A measure of output per hour. Improvement may lead to lower mortgage rates.
Trade Data

Thursday, May 3,
8:30 am, et

$58B deficit

Important. Affects the value of the dollar. A falling deficit may strengthen the dollar and lead to lower rates.
Weekly Jobless Claims

Thursday, May 3,
8:30 am, et

208K

Important. An indication of employment. Higher claims may result in lower rates.
Factory Orders

Thursday, May 3,
10:00 am, et

Up 0.9%

Important. A measure of manufacturing sector strength. Weakness may lead to lower rates.
Employment

Friday, May 4,
8:30 am, et

4.1%,
Payrolls +120K

Very important. An increase in unemployment or weakness in payrolls may bring lower rates.

Jobs

Keep a sharp eye on the various employment related data this week. Last week’s weekly jobless claims hit levels not seen in over 40 years. The data showed 209,000 new applications for unemployment. Analysts expected a number around 230,000. It is not uncommon for the weekly figures to miss estimates but the sharply lower figure was a very strong indicator that the U.S. economy continued to add jobs. The Fed is clear on their course to raise rates. Strong employment data supports the call for rate hikes sooner rather than later.

 

 

Dana Bain Stay connected with me anywhere at danabain.mortgagemapp.com
978-422-2311
 
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Posted by Dana Bain on April 27th, 2018 3:20 PM

When you’re looking for a mortgage you can use a mortgage broker or deal directly with the bank. Even if you do have a bank you've worked with, you should consider shopping around anyway—don’t trust your bank is automatically giving you the best deal.

Keep in mind that when you're on your own, comparing rates and closing cost and terms can be time consuming and complicated. A second opinion could save your substantial $.

Each bank typically offers just a few mortgage options, so in order to find the best one, you will have to research them each individually.

Pros of Using a Broker

Mortgage Brokers are mortgage experts . They know the market, follow trends and know which institutions offer which mortgages products. They'll also know which lenders are offering discounts or deals.

Importantly, brokers can save you time. A smart broker can identify the most appropriate lender for your specific circumstances and know which mortgages will be most appropriate. They also handle the hassle of paperwork and interaction with lenders, which can help relieve stress from the process.

This saving of time, work and stress is a big factor for many individuals who use a mortgage broker. Some brokers develop personal and professional relationships with lenders, which may accelerate the application process.

Top 10 Reasons to Choose a Mortgage Broker vs a Banker, Dana Bain

 

Few people realize there are large differences when choosing what type of company to get your new mortgage from.  I have worked on both sides of the coin and will recommend to anyone: Find the best Mortgage Broker you can.

 

10.  Licensing Qualifications – Brokers have many more laws to abide by and are more heavily licensed than Bankers. 

 

            All Brokers are required to be SAFE Act compliant including being registered with the Nationwide Mortgage Licensing System.  The new licensing requirements: 20 hours of education, FBI Fingerprint scans, Submission of a credit report, and a satisfactory score on the Federal and State Licensing Exam. Once licensed the broker must complete 8 hours of continuing education to maintain their approved status.  Not all Bankers are required to meet the above guidelines; they can operate under the company licenses without being individually scrutinized. 

 

9.   Full Disclosure – All Brokers must be completely transparent when disclosing the closing costs to the borrower, even including their compensation.  Bankers Do Not,  nor is it figured into the fees they show you.

 

             We have to show you how much we make during the transaction and our fees are also considered when calculating whether or not the loan passes the Qualified Mortgage Rules Fee Cap.  As of Jan 10th 2014, there is a 3% cap to the amount of fees that can be charged on a loan that is equal to or greater than $100k. Brokers are not allowed to collect compensation from both the borrower and the lender in the same transaction.  We must choose one or the other, tell the borrower which and then show them the amount we are collecting.  Bankers do not have to disclose their compensation and their compensation is not figured into the new Qualified Mortgage Rules Fee Cap.  Bankers do not have to let you know their compensation nor is it regulated under the new federal laws.

 

8. Ability to Shop – Brokers have various lenders in their portfolio, so they can effortlessly shop for you.  Bankers cannot shop around and sometimes are unable to even get your loan approved.

 

                      Brokers can pair you with a lender that offers the best rates and costs for your situation and tailor the loan to meet your needs.  Bankers are usually stuck selling one product to everyone with no option to shop you around and find you the best fit.

 

7.  Wholesale Vs. Retail – Brokers sell wholesale, bankers sell retail. 

 

              When you use a Broker it’s like shopping at Costco or Sam’s club versus going to Walmart or Target.  Everyone knows that the wholesale stores offer better deals than their retail counterparts.

 

6. Smaller Company means Better Customer Service – Brokers have more time to work on a personal level.  Bankers work in volume and not have time to provide personal service.

 

            Most Brokers work for smaller local companies that focus on customer service instead of margins and bottom lines.  Those large Banks sure have big names, but tend to do loans in volume to make investors and stockholders happy.  A smaller local company is more than likely focusing on building customer relationships in the community than quarterly profit and loss statements.

 

5.  Faster and Easier Process – A common misconception today is that a broker has no control over his business, but must rely on the actual lender to close the loan.  We have competitors time and time again tell our clients if they want the loan closed then they better choose a banker. 

                False, we have more control over our loans because we do all the beginning initial pre approvals and qualifications.  Before we can submit a file to a lender it must be completely scrubbed by us and been run through Fannie Mae’s Automated Approval system.  This ensures the file is approved and is ready to be underwritten by the lender.  Most lenders hold brokers to high standards when submitting files that don’t close and a dirty file could cost us our relationship with that lender.  Once in the door approvals take 24-48 hours, then we can start moving a loan toward closing.  Fact is; as a Broker I can get a loan approved and closed before most Bankers can get an approval.  Need a loan closed in just a couple of weeks instead of a couple of months, then find a mortgage broker to work with.

 

4. Broker Hours vs Banker Hours – My hours don’t end when the Bank closes, therefore I am here to help my clients at any time.

 

         As an independent Mortgage Broker I am always available to answer your questions and take your calls.  Most of my business is done actually done before 9am and after 5pm, which is more convenient to the borrower.  When the bank closes, everybody goes home and you get the answering machine.

 

3. Knowledge – Brokers are usually more educated and experienced because of the strict licensing requirements and qualifications.

 

                 Strict licensing requirements and qualifications have weeded out most of the fly by night Brokers.  Those of us who are left have been in the industry for a number of years and have continued to be successful despite the growing pangs the industry has gone through since 2010.  Most companies won’t hire anyone without years of experience and a proven track record for success.  Banks are much more willing and likely to hire a newbie because they don’t have to be licensed.  Those few brokers who are left standing are the best of the best in this industry.

 

2. Lowest fees – Since Mortgage Broker’s Compensation is regulated by law we have seen these fees come way down and benefit the borrowers. 

                   On most of my deals I rely on my lender paid compensation to earn my commission.  This means I charge ZERO fees to the borrower, so all they are left with is Lender, Title and appraisal fees.  There are no points or origination and usually I can offer them a credit toward their closing costs to make them even lower.  The way it works is that each broker company must decide on a compensation plan with their lender of choice.  This is done usually once a quarter or monthly.  So every loan we bring to our lenders have a predetermined % of compensation we can expect to earn.  That means no matter which rate you choose, I am paid the same amount.  No reason to steer you into a higher rate to make more money.  We have our comp plans fairly low in the market, so when we offer a rate there is usually money still left over that goes to our clients as a credit to lower their overall costs.  

 1. Lowest Rates – Compounding on the lower fees is of course what rates come at those fees.  Since we are a smaller company with less overhead, we focus on the lowest rates. 

                The Big Banks have a lot of overhead; buildings, light bills, phone bills, tons of staff, and the list keeps going.  In order to compensate for their rising costs they have to make it up somewhere, usually from your pocket in the form of a higher rate.  Simply put, I don’t have to pay for all that stuff so I can give you the best rate and the lowest cost.                                                                                    
Massachusetts License Number Broker MB1498 Licensed by the State of New Hampshire Banking Department- License Number 5430-MBR Premiere Mortgage Services Inc. NMLS #1498 is a licensed broker and not a lender.We arrange  but  do not make loans.   Dana Bain NMLS #18693  Robin Dunbar Bain NMLS #18699

Here is the link to the National Mortgage Licensing System 
  http://www.nmlsconsumeraccess.org

See this great video:  https://www.youtube.com/watch?v=sGGDVcQJk6g

How To Contact Us

By Phone: 978-422-2311 (Office)
 
  978-501-0427 (Mobile)
By Fax: 978-422-2313 (Fax)
By e-mail:Dana@BainMortgage.com
Address:PREMIERE MORTGAGE SERVICES INC.
11 Malvern Hill Rd
Sterling, MA  01564-2829

 

 

Posted by Dana Bain on April 7th, 2018 1:50 PM

Buying a condo is a lot like purchasing a "regular" home, but with one big difference -- mortgages are tougher to come by.

Lenders impose a different set of rules on you when you buy a condo. They may sometimes increase your interest rate.

With condos and co-ops, it’s not just your creditworthiness the lender has to worry about. It must also verify the fiscal and physical health of the entire development into which you're buying.

 

Conforming mortgage rules for condos

The majority of homebuyers use "conforming" mortgage financing.

This means that their loan purchased by one of two government-sponsored entities -- Fannie Mae or Freddie Mac -- and that the loan meets the two group's minimum standards.

Fannie Mae and Freddie Mac use the term "warrantable" to describe condominium projects and properties against which they'll allow a mortgage.  See:  https://www.fanniemae.com/content/guide/selling/b4/2.1/01.html

 

Condo projects and properties which don't meet Fannie Mae and Freddie Mac warrantability standards are known as non-warrantable.

Non-warrantable condos are more challenging to finance.

Typically, a condo is considered warrantable if:

  • No single entity owns more than 10% of the units in a project, including the developer
  • At least 51% of the units are owner-occupied
  • Fewer than 15% of the units are in arrears with their association dues
  • The homeowners association (HOA) is not named in any lawsuits
  • Commercial space accounts for 25 percent or less of the total building square footage

Common non-warrantable properties include condotels, time shares, fractional ownership properties, and other projects which require owners to join an organization, such as a golf club.

Manufactured housing projects and other developments which are not legally considered real estate are also excluded from warrantability. These include house boat and motorhome projects.

When buying a condo, ask your real estate agent or lender about the building's warrantability before you go any further.

A warrantable condo typically gets you lower mortgage rates than a non-warrantable condo. Warrantable condos create lower risk for the bank.

 

 

How To Contact Us

 

www.BainMortgage.com

 

 

By Phone:

978-422-2311 (Office)

 

 

978-501-0427 (Mobile)

By Fax:

978-422-2313 (Fax)

By e-mail:

Dana@BainMortgage.com

Address:

PREMIERE MORTGAGE SERVICES INC.
11 Malvern Hill Rd
Sterling, MA  01564-2829

 

Massachusetts License Number Broker MB1498

Dana Bain NMLS #18693

Robin Dunbar Bain NMLS #18699


Licensed by the State of New Hampshire Banking Department- License Number 5430-MBR Premiere Mortgage Services Inc. NMLS #1498 is a licensed broker and not a lender. We arrange but do not make loans.

 

 

Posted by Dana Bain on March 29th, 2018 12:42 PM

Consumers thinking about getting a mortgage should know where they stand. Here is what you might not know about your credit score when it comes to applying for a mortgage.

The truth is not all credit reports are created equal. Many of the consumer credit reporting services that are available in the market place today such as Credit Karma do not give you the same type of data that a mortgage credit report does. The granddaddy credit report bar none is a financial services credit report. A financial services credit report is the most accurate type of credit report because it provides a credit score from each bureau.

Most of the consumer credit reports available in the market place only provide one score or no scores or a combination of multiple reports with inconsistent information as it pertains to accurateness.

For example, if your credit score is 700 from Credit Karma then when you go apply for a mortgage, your credit score is 650. This disparity might be because the credit report that the mortgage provider obtains is all 3 credit scores and they use the middle of the score.

The other misconception in the marketplace is that applying for a mortgage makes your score tank. That is just not true. The federal government encourages you to shop for a mortgage and does not penalize you from a credit reporting standpoint if you’re having mortgage lenders pull your credit report.

Consumers can get into trouble when they are applying for a mortgage and diverse types of credit entities at the same time e.g. a mortgage inquiry, a cell phone inquiry and a cable inquiry.

Another reason that there could be a disparity in your credit score versus the credit score that the lender obtains is that each creditor you have reports to the different bureaus at separate times of the month and there is not an accurate way to pin point in time when the optimal time to pull a copy of your credit report is.

A credit report is an accurate reporting of your credit 30 days ago. Put another way, you might see some debts on your credit report that are already paid off based on when your creditor reports your activity to the bureaus. If you need to get your credit score up most mortgage companies can do what’s called a rapid score to show that you’ve paid down a credit card for example to get your credit score up a couple of notches to change your mortgage loan program or your down payment or get you into a more affordable mortgage loan. Let the mortgage company help with your financial situation including your credit.

Give us a call at 978-422-2311 or email info@bainmortgage.com

Massachusetts License Number Broker MB1498

Dana Bain NMLS #18693

Robin Dunbar Bain NMLS #18699

Licensed by the State of New Hampshire Banking Department- License Number 5430-MBR Premiere Mortgage Services Inc. NMLS #1498 is a licensed broker and not a lender. We arrange but do not make loans.

Posted by Dana Bain on February 16th, 2018 6:11 PM

One of the smartest ways to build wealth is by buying real estate (particularly rental properties); just ask Warren Buffett. He was recently quoted as saying he’d buy “a couple hundred thousand single family homes [as an investment]” right now if he could Buffett realizes the value that rental properties can bring not just in terms of monthly cash flow but also in appreciation and deductions.

 

 Read more at: https://www.moneyunder30.com/multi-family-homes

 

Another benefit of owning a multi-family unit and living in one of the units while renting out the others is that you’ll always be close to your rental properties so that you can check on the condition frequently.

 

Premiere Mortgage Services Inc. MA Lic. NMLS: 1498   Dana Bain President NMLS: 18693

 

We Can Help With mortgage Financing Purchasing on a multi-family owner occupied Home - up to 4 Units with as little as 5% Down with No Income Limitations in Worcester & Hampden Counties In Addition Your Appraisal  Fee Up To $525.00 can be reimbursed back at closing.

 

 

 

Finding the Best Mortgage Loan: We can help:

 

Welcome to Premiere Mortgage Services, Inc., where you’ll find the best mortgage rates and a loan program that's best for you. We’re Robin and Dana Bain, and we provide Massachusetts and New Hampshire mortgage loans for home purchases and refinancing. Dana Bain has been originating mortgage loans for over 30 years and we treat our clients like family. 

If You Would Like Any Information On Mortgage Financing please call us at 978-422-2311 or email Dana@BainMortgage.com or Download My App at http://danabain.mortgagemapp.com/

 

 

Posted by Dana Bain on February 14th, 2018 4:15 PM

Homeowners with home equity loans may no longer be able to deduct from their taxes the interest paid on those loans, according to new legislation. This is the result of the sweeping tax law signed by President Trump in December.

Here’s what you need to know about these tax-code changes 2018,.

Home Equity Loan Tax Deductions Eliminated

In the past, most homeowners with home equity loans were able to deduct the interest paid on those loans, up to $100,000 in most cases (or $50,000 for married couples filing separately). With the passage of the Tax Cuts and Jobs Act, however, that deduction is going away.

These changes apply to home equity loans taken out in 2018 and onward, as well as those that were taken out in the past. In other words, the old deduction will not be grandfathered.

Despite these changes, home equity loans can be still a useful financing tool for some homeowners. It’s one of the cheaper ways to borrow money. That’s because the average rates assigned to these loans are typically much lower than credit card rates and other forms of financing. The new law just means that the interest paid on a home equity loans in may no longer be deductible, in 2018.

The question is, what now? Is there anything homeowners in this situation can do to regain some of their tax deductions? Consolidating might be an option here.

Refinancing to Consolidate First and Second Mortgage

One strategy that might work is consolidation refinancing. This is where the borrower / homeowner refinances in order to combine or “consolidate” a first and second mortgage, including an equity-based loan. And by adding a “cash-out” component, homeowners could still convert some of their equity into cash. The end result would be that the entire loan balance is once more tax-deductible, up to a certain limit.

Definition: Cash-out mortgage refinancing is when a borrower refinances an existing mortgage loan, or even two loans, for a larger amount and then receives the difference in cash. This strategy allows homeowners to turn some of the equity they’ve built up in their homes into cash. The money received could be used for a variety of purposes, including home improvements and educational expenses.

The mortgage interest deduction for a first mortgage on a primary residence still exists. Mortgage interest deductions were reduced from a cap of $1 million (before the new law), to a lower limit of $750,000. But they are still allowable under the new tax legislation. So, in some cases, homeowners might be able to refinance a first and second mortgage into one, thereby regaining their tax deduction benefits.

Thirty-year mortgage rates are still hovering near 4.32%, according to the weekly survey conducted by Freddie Mac (as of February 8, 2018).  See    http://www.freddiemac.com/pmms/pmms_archives.html   And home prices have risen over the last few years, boosting equity levels. So a lot of homeowners might be in a good position to refinance, possibly by consolidating a first and second mortgage with cash-out benefits.

However if you look at 30-Year Fixed-Rate Mortgages Since 1971  http://www.freddiemac.com/pmms/pmms30.html  you will see that the current mortgage rates are still at historical low's.

Tax code revisions can be downright confusing, especially when there are multiple versions of a bill leading up to its final passage. That’s why it is so important to speak to a knowledgeable mortgage professional about your financing options. Please contact our team http://www.bainmortgage.com/Home  Dana Bain NMLS # 18693& Robin Dunbar Bain NMLS # 18699

Premiere Mortgage Services Inc. / Boston Harbor Mortgage Your Mortgage Home Loan Market Price Leader.  where you’ll find the best mortgage rates and a loan program that's best for you. We’re Robin and Dana Bain, and we provide Massachusetts and New Hampshire mortgage loans for home purchases and refinancing. Dana Bain has been originating mortgage loans for over 30 years and we treat our clients like family.  


Premiere Mortgage Services Inc. and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

Posted by Dana Bain on February 8th, 2018 8:13 PM

 

There is so much to talk about with the Tax Cuts and Jobs Act of 2017 it’s hard to know where to start.  What we do know is that 2018 is going to be a year of changes.



Today we are going to talk about itemized deduction:

  1. Medical Expenses – you now have to reach a floor of 7.5% of your adjusted gross income to claim any of this deduction.  That means if you have $100,000 in income then you must have OVER $7,500 in medical expenses in order to deduct any portion of your medical expenses.  (Please note, that if your health insurance is paid through your employer then this expense DOES NOT count towards your deductible medical expenses.)

 

  1. Mortgage Interest – there are two big changes here:

 

    1. Mortgage interest is now limited to interest paid on mortgage balances of $750,000 or less.  Therefore if your mortgage principal is OVER $750,000, this deduction may be limited. 
    2. If you have an equity line on your home, that interest is no longer deductible under the new plan.  (Please note this is subject to special rules so if you have questions, please ask your CPA when you have your tax appointment this year)

 

  1. State & Local Taxes – This one was all over the news and will affect many of us here in Massachusetts.  Basically you are limited to a $10,000 deduction.  That means that your state income tax, your excise tax AND your real estate taxes are all subject to this ceiling of $10,000.  If your real estate taxes are $15,000 and your state income tax is $5,000 – you used to take a deduction of $20,000 on your taxes…under the new rules your deduction will now be limited to $10,000.

 

  1. Charitable contributions –you can now give up to 60% of your adjusted gross income before your deduction is limited.

 

  1. Miscellaneous Deductions - We saved the best for last! Miscellaneous deductions are no longer allowed.  Yep you read that right, these are now gone.  If you are a policeman, firefighter, sales person or any other person that was used to taking mileage that was not reimbursed to you, union dues, professional fees, investment fees etc. as a deduction, well you don’t have to keep track of all this anymore.

On a good note in an act to try and simplify taxes for the “regular” person, the standard deduction has now been raised.  So for a married couple filing jointly, the standard deduction is now $24,000.  For a single person the standard deduction is now $12,000.  What does this mean?  Well the government says that you, the taxpayer, are allowed to choose whether you want to take the standard deduction or the itemized deductions.  Further, they say that you can take whichever deduction is worth more to you.  Due to the increased amounts for the standard deduction and restrictions as described above on the itemized deductions, there will be more people that will opt for the standard deduction in 2018.

At Premiere Mortgage Services Inc. MA Lic. NMLS 1498 we can help you with great recommendations for CPA's, Financial Advisors & Real Estate Professionals.  And for your home financing needs both for a purchase mortgage or refinance mortgage please reach out to us at 978-422-2311 or info@bainmortgage.com

Dana Bain  MLO NMLS # 18693 & Robin Dunbar Bain MLO NMLS # 18699

Stay connected with us at

http://danabain.mortgagemapp.com/

 

Premiere Mortgage Services Inc. / Boston Harbor Mortgage Your Mortgage Home Loan Market Price Leader.  where you’ll find the best mortgage rates and a loan program that's best for you. We’re Robin and Dana Bain, and we provide Massachusetts and New Hampshire mortgage loans for home purchases and refinancing. Dana Bain has been originating mortgage loans for over 30 years and we treat our clients like family.  


Premiere Mortgage Services Inc. and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.

 

 

Dana K. Bain | President | MLO 18693

 

11 Malvern Hill Road, Sterling, MA 01564

P: (978) 422-2311 | C: (978) 501-0427 | F: (978) 293-9000

 

“The Best Compliment you can give us is an introduction to your family, friends, neighbors and co-workers”

 

BainMortgage.com      Stay connected with me anywhere!

Download my Mortgage app  http://danabain.mortgagemapp.com/

 

MA Lic. No. MB1498

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

 

Like Us on Facebook | Linkedin | Our Client Feedback

 

 

 

http://www.bbb.org/central-western-massachusetts/business-reviews/mortgage-brokers/premiere-mortgage-services-in-sterling-ma-101813

 

 

Posted by Dana Bain on February 1st, 2018 6:09 PM
January 16, 2017 - FHA loan policy about down payments for new purchase home loans is quite clear. One condition of FHA loan approval is that the borrower provide a minimum cash investment--a down payment--of at least 3.5%.

That money is required to be verified by the lender as having come from an approved source. What is an approved source? The borrower can tap into his or her own cash reserves, cash-in investments, savings bonds or other holdings. The idea behind verifying the source of your down payment on an FHA mortgage is to prevent borrowers from provided money obtained from non-collateralized loans such as a credit card cash advance, payday loans, etc.

Down payment funds may also come from someone else in the form of a gift, so long as that gift and the giver meet certain FHA requirements. In order to establish whether a particular gift of down payment money is permitted, we have to examine what the FHA describes as a bona fide gift. According to HUD 4155.1 Chapter Five Section B, In order for funds to be considered a gift, there must be no expected or implied repayment of the funds to the donor by the borrower.

Then there's scrutiny of the gift giver. According to Chapter Five, An outright gift of the cash investment is acceptable if the donor is
  • -the borrower's relative
  • -the borrower's employer or labor union
  • a close friend with a clearly defined and documented interest in the borrower
  • a charitable organization
  • a governmental agency or public entity that has a program providing home ownership assistance to low- and moderate-income families, or first-time homebuyers.
The FHA doesn't just list who may give such a gift--it also has rules discussing who MAY NOT provide gift funds for an FHA loan down payment. The gift donor may not be a person or entity with an interest in the sale of the property, such as
  • the seller
  • the real estate agent or broker
  • the builder
  • an associated entity
Gifts from these sources are considered inducements to purchase, and must be subtracted from the sales price.

FHA loan rules are specific and clear in these areas to insure fairness and to preserve the integrity of the home buying process with FHA loan funds. For more information on how these rules may apply to your situation, ask the loan officer or contact the FHA directly.
Posted by Dana Bain on November 28th, 2017 2:05 PM



The cake has been cut, the thank you notes written, and the last vendor has (finally) been paid. Depending on your budget and style, getting married may be one of the most expensive events of your life. The average wedding in the United States in 2016 cost $26,720, and even if you had help from family and loved ones, you probably had to save up quite a bit for the big day.

After spending a lot of money on a major life milestone, it might be hard to know what to save for, or to even want to save. While you can certainly give yourself a breather, don’t neglect your savings account.

If you built up good saving habits in preparation for your wedding, like paying yourself first or utilizing automatic savings, you don’t want to lose steam, particularly if you want to move towards other important life milestones. Here are 5 things to consider starting to save for:

#1: Saving for a Delayed Honeymoon

It’s great to take some time off after your wedding to relax and recharge. But it’s becoming more popular to put off the honeymoon, which some have coined the “later-moon.” There are a lot of reasons it might make sense for you to put off your honeymoon. One of our favorites? More time to save. If you’re already spending a lot of money on a wedding, it can be hard to save up for the honeymoon you want to take. You don’t have to compromise just to get away the day after you say “I do!” Once the pressure of paying for the wedding has passed, you can devote some more dedicated saving power to your dream vacation. Plus, you can take some time to rest from any wedding craziness, helping you fully enjoy your delayed honeymoon.

#2: Saving for a New Home

We know not all couples follow the “traditional” milestone track – get married, buy a house, have kids. But even if you already own a home, getting married means you might be reprioritizing. Your current living situation might not be ideal anymore for a variety of reasons, like needing more space or having different tastes. Whether you already own or you’re first-time homebuyers, consider saving money for a house.

#3: Saving for a Car

Are you still driving your college clunker? Channel your new-found saving skills into saving for a new ride. You may be combining finances for the first time, which could help you afford an upgrade. If you’re a two-car household, talk to your partner about which car will need to be replaced first. You may also want to consider varying what kind of cars you own. If both of you own smaller cars, you might want to save up for a vehicle with more cargo space for big purchases, or to fit more people. Which leads to…

#4: Saving for Kids

Before the wedding bells finished ringing, you probably already had one nosy family member ask you, “When are you going to have kids?” But even if they aren’t on the direct horizon, if you plan on having kids it doesn’t hurt to start saving now. According to the USDA, the average cost of raising a child born in 2015 was $233,610, and that’s without any college expenses. While those costs will be spread out over 18 years, planning ahead of time could ease the financial burden of starting a family.

#5: Saving for Retirement

If you’re enjoying the early days of wedded bliss, you probably aren’t think about retirement. But now’s actually a great time to consider how much you’re saving for retirement. In addition to banking on good savings habits, you likely need to swing by the HR department at work to update your marital status. While you’re there, get a refresher on any retirement plans, like 401ks, your company offers, as well as if they’re willing to match your contribution.

Massachusetts License Number Broker MB1498

Dana Bain NMLS #18693

Robin Dunbar Bain NMLS #18699



 

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Address:PREMIERE MORTGAGE SERVICES INC.
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Sterling, MA  01564-2829



Posted in:General
Posted by Dana Bain on November 21st, 2017 4:32 PM
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Have you ever called a mortgage company and received a quote and then called back the next day and the same rate was no longer available??

Mortgage companies, Banks and Credit Unions are subject to potential daily and even hourly shifts in the market. Interest rates fluctuate on the simple principal of supply and demand.   Global 1

Mortgage rates trade based on Mortgage Back Securities and The Bond Markets as well as the overall economy.  The vehicles that mortgage rates are based on are considered very conservative, stable and tend not to have the wild swings that one would find in the Stock Market.  If the Stock market begins to see large increases or decreases, Investors will shift Billions of dollars in and out of the Stock Market and move them in to the Mortgage Markets.  This will cause mortgage rates to either rise or fall.  Stock Market tanks, good news for Mortgage Rates, Stock Market rallies and rates suffer.   Investors and Traders will constantly shift funds out of the riskier stocks into the safe haven of the mortgage markets.  These shifts can occur as little as once a day or in some cases can happen multiple times during a trading day. Thus causing mortgage rates to possibly change multiple times in a day.

These markets are affected globally as well; so even after the markets are closed in US, whatever is happening in Europe, Asia and around the world will cause our markets to move one way or the other.

Here are some of the variables that are being watched in today’s market:

  • Middle East
  • Europe and Asia’s Economy
  • Comments by the President
  • Politics
  • The US Housing Market
  • Unemployment in our Country
  • The Price of Oil and Gas
  • The “Feds” decision to move short term interest rates
  • The overall health of the US EconomyPercent Down

Any of these items can trigger a rally one way or another.  Even a simple comment at a breakfast meeting by the President, the Fed Chairman or someone in power is enough to influence the markets.

Additional Mortgage Rate and Index Information:

To help us understand why mortgage rates change, it is important to realize that there is not one interest rate, but multiple ones. Below are some of the most prevalent interest rates and indexes that also have an impact on mortgage rates:

Prime rate – This rate is often offered to a bank’s best customers. If you are shopping for a home equity line of credit, then it is important to familiarize yourself with the prime rate. HELOCs are typically based upon the prime rate -plus or minus a certain percentage.

LIBOR – Stands for London Inter-bank Offered Rates. Libor rates are based upon the rates that a select group of London Banks offer each other for inter-bank deposits. Many adjustable rate mortgage programs use the Libor index.

Treasury bill rates ”T-bills” and Treasury Notes – These are short-term and intermediate debt instruments used by our Government to finance their debt. The treasury index is based upon the auctions of U.S. Treasury bills or on the Treasury’s yield curve. Like the LIBOR index, the U.S. Treasury index is a popular index for adjustable rate mortgage products. Also, the Twelve Month Treasury Average (12 Month MTA) is a popular index which is based upon the twelve month average of the monthly yields of U.S. Treasury securities (maturing in one year). The MTA is a popular choice for option arm mortgage programs.

Treasury Bonds – Unlike T-bills and Treasury Notes, treasury bonds are long-debt instruments. These bonds are used by the U.S. Government to finance its debt.

Cost of Savings Index – often referred to as the COSI index. This index is based upon the annual average of interest rates on World Savings deposit accounts. The average is pulled on the last day of each month.

11th District Cost of Funds – Often referred to as the COFI index – The COFI index is based upon the average of the borrowing cost to member banks of the Home Loan Bank of San Francisco of the 11th District. Unless you are shopping for an option arm mortgage, it is unlikely that your loan will be affected by this rate.

Certificates of Deposit Index – Often referred to as the CODI index – this index is arrived at by calculating the average of the past twelve months rates of 3 month CD rates.

Federal Funds Rate – The fed funds target rate is the rate which federally chartered banking institutions lend balances to other depository banks overnight.

This is a lot of information to weigh each day when calculating mortgage rates.  In general, most Banks, Investors, Lenders etc. will set rates around 10:30am once most of the morning economic reports have been released and the markets have had time to react to the information.  In a calm trading day on Wall Street, these rates would be good for that imagesCA6UKL3Jday.  In a day where lots of Economic reports and World events are occurring, these rates can be reset a few times as the Markets fluctuate.  It is important to call your lender or bank often to check on these rates as they can and will change.  It also important not to follow online rate sites that may be posting Average Rates as this information can be old as well a different Financial Picture then you may have.  The Freddie Mac rates are based on closed loans from last week and an average of .7 Points of fees in the rate. This may give you a range, but not accurate enough to base your mortgage payment on or what is happening today in the markets.


#DanaBain

Please leave a comment, email or call me anytime with questions you may have about mortgage programs, rates and to get approved for a mortgage.

Dana Bain NMLS# 18693  www.BainMortgage.com 978-422-2311  Download My Mortgage App Also At http://danabain.mortgagemapp.com/ 


Posted in:General
Posted by Dana Bain on October 16th, 2017 3:48 PM

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