Contact Your Congressman

Last week I mentioned a couple of things that homeowners should contact their Congressman and/or Senator about.  That was the mortgage interest deduction and the deductibility of PMI.  Hopefully you have done that.  By the way, I just learned that only about 25% of the folks that could use these write offs actually take advantage of the write off.  Surely you don't want to give Uncle Sam more money than you have to.  I'm just sayin.

There is another bill that is expiring that really needs to be renewed.  If you know someone that is selling on a short sale or is or has been foreclosed on they are at risk.  The amount of loss is taxable income after Jan 1.  That is just piling on.  If someone could afford that tax they probably wouldn't have trouble keeping their home.  So I encourage you to contact them again.

Housing Market Comeback

By any measure, almost everyone would agree that the housing market is finally making a comeback.  It is an ideal time to buy if you have a need.  The prices are great (at least if you are buying) and the interest rates are even better.  The bottom line is that housing affordability is amazing.  You can buy much cheaper than you can rent in most cases.


Here is the problem.  Various groups in Washington are wanting to take away the mortgage deduction and not wanting to renew the deductibility of PMI.  And there are other issues that would hurt.  The country doesn’t need to do anything that hurts the housing industry.  We all know it has been difficult enough to get it back on the right track.  Please let your Representative or Senator know.

Mortgage Insurance

This week's topic is so important, but it makes some people's eyes glaze over. It is Mortgage Insurance. It is rare that a loan is made (that does not show 20% equity or down payment) and you don't see mortgage insurance. It is probably the most important thing to talk to me about when you call about a mortgage. It may be more significant than the interest rate. With all the defaults in the housing industry we have seen huge changes in MIP, PMI, Funding Fees, Guarantee fees etc. The only plus is PMI (which is the conventional loan version) is showing signs that are positive. For it you need 5% of your own money or equity and 720 plus credit scores. If you have that I can show you how to save money. But if you don't, it isn't worth waiting . You might miss these great interest rates.



Call me at 615-777-4663 or email me at george.margrave@migonline.com to discuss your options.

Have You Heard?

You probably haven't heard, but Fannie Mae and Freddie Mac have done it again. The are making it way more expensive for 75% of your clients and mine to buy or refinance with conventional loans. They have taken risk based pricing to new lows. For example if your client has an 800 score and has a higher loan to value than 75% they will pay a quarter point more (that doesn't sound like much by it adds up to a thousand dollars on a $400,000 loan). If they have a 679 score and a 79% LTV it is 2.75 points. I have trouble even counting that high.


These agencies are bleeding red ink with all the foreclosures, but guess what, if you don't have income you will never reverse the losses. And the loans of the last couple of years have to be performing well. The whole idea of risk based pricing is supposed to charge those with the higher risk more and reward those with low risk. It is not supposed to penalize almost everyone. Almost every conventional loan with a loan to value over 70% had the hit go up, some as much as a half point.


At a time when our industries need all the help we can get we get this. It just delayed our recovery some more. It is bound to push some folks into renting instead of buying. I say lets look at FHA every time we can, because these hits combined with the higher PMI rates are not pretty. Let me help you with the best loan type for your client. Also, contact your represenatives. They have said they want to get the government out of mortgage financing, but their actions are pushing us in the wrong direction.


You can reach me at 615-777-4663 or text me at 615-481-5626 or via email at George.Margrave@MIGonline.com