By Angela Lanfranco
Colorado FHA Mortgages
Trouble Ahead for HUD
As Colorado homebuyers examine their options for home loans and apply for financing in Denver and throughout the state, they may look into federal loans as an alternative to private lenders. Indeed, following the meltdown of the subprime mortgage market, the Federal Housing Administration has increased its market share from 3% in 2006 to 30%. But can its resources and dated systems sustain this explosive growth? Policymakers both inside and outside of the FHA have expressed concern that the FHA’s programs are overtaxed and vulnerable.
The FHA is self-funding, using mortgage insurance premiums to generate its operational budget and to settle defaulted home loans. A slight tip in the balance caused by an unexpected increase in defaults could easily drain all reserves, a contingency which could be especially troublesome since the FHA’s market share is so large.
In a dismal economic climate where unemployment is relatively high, it is no surprise that the FHA has stated that default-related losses and foreclosures are indeed exceeding projections. The rapid increase in volume of loans granted also may correspond to a higher likelihood of fraud, as some critics have pointed out.
The FHA does not sufficiently investigate the backgrounds of the lenders whom it licenses. Therefore, those who misused the system by selling the illegitimate subprime loans may be able to misuse FHA licensing even further. Between 2004 and 2006 alone, over 6,000 FHA home loans were foreclosed in Colorado, well before the subprime market fell through. The problems were exacerbated by a number of HUD programs specifically created to skew the true feasibility of the home sale.
It is no wonder that the FHA would struggle to keep pace in doing due diligence in investigating recipients of licenses: the number of licensed lenders increased from 16,000 to 36,000 between the summer of 2007 and the fall of 2008. Leading up to and during this growth spurt, the size of the FHA staff has stayed approximately constant.
Admittedly, the requisites for FHA loans have always been less stringent than for private lender loans. However, its leniency is likely to become increasingly burdensome. And the FHA is no private lender: if its costs exceed the revenues generated, its expenses will become the burden of taxpayers.
At Golden Lenders, we beleive in helping you secure government options for home lending! Contact us today for a free consultation about what we can assist you with for your next Colorado Home Loan.
By Angela Lanfranco
The State of Colorado Home Sales in Early 2009
Are you in the process of obtaining Colorado home financing? If so, you may be walking in better shoes than those trying to get financed elsewhere in the country. According to information released on the last day of March, the average home price fell at an alarming, record pace throughout January. On the surface, this scares off potential home buyers from getting a home loan in Colorado. However, Denver was much better off than other metro areas.
The Standard & Poor’s/Case-Shiller home-price index, which started in 2000, showed the largest drop ever in 20 major cities. Colorado home financing was faring well along with the home prices in the Denver area. Denver seen a mere 5.1 percent decrease, while the average home price across the others decreased 19 percent. Colorado online mortgage lenders will be able to clearly help you understand what is going on with area real estate before you make any decision.
There’s a lot of activity going on with short sales, so much of the Colorado home financing has been helping home buyers get their hands on homes for less than what is owed on them. Jon Terry, a real estate broker from Realty Professional of America, says that’s one of the reasons we seen the small decline that we did.
Real estate broker Jon Terry of Realty Professionals of America Inc. points to a large number of short sales, in which homes are sold for less than the outstanding balance on the mortgage, and foreclosures as driving the decline. Many current home buyers are getting a home loan in Colorado for short sales, while regular home listings are taking longer to sell.
Another reason Colorado homes and Colorado home financing aren’t suffering as badly as in other areas is that there wasn’t an enormous appreciation of home values here. Those who were able to get Colorado home financing and buy a home here didn’t see the quick-rising appreciation as other areas did, such as Las Vegas. So, there wasn’t as much equity to be lost when the troubling times began. So if you’ve been considering a home loan in Colorado for that perfect, new home, hopefully this sheds some positive light on the situation. You can begin to see that this area has a more stable real estate market than in many other places.
If you’re still hesitant about entering into a Colorado home financing contract, look a little deeper than what the news tells you. For instance, it may not be as bad as the Case Shiller index indicates. The Federal Housing Financing Agency is actually more reliable. That’s because they consider appraisals for refinancing, and not solely home sales. The FHFA index only includes homes that are valued $450,000 and less. However, they cover a much larger area. Their numbers indicate nationwide housing sales only dropped 6.3 percent from the last year (with mountain states at 9.2 percent).The FHFA first quarter numbers for 2009 are not available yet, though. They release data quarterly for state-specific areas.
Whether you need Colorado home financing because you want to buy a new home off the regular market or try to get a deal through a short-sale, using Colorado online mortgage lender like Golden Lenders could speed up the process
By Angela Lanfranco
Denver Home Buying Seminar 2 May 09
GoldenLenders is hosting Denver home buying seminars that will be held on a monthly basis. Since the recession began, a lot of things have changed in lending and buying a home in general. These Denver home buying seminars are jam packed with useful information. Regardless if you are closing a home tommorow, or already own a home, these seminars can and will help you with your next home purchase. There will be plenty of professionals there to answer any questions you may have.
Some will go into the home buying process solely relying on their Realtors for expertise. We do believe Realtors play an important role in the home buying process, but your loan will be with you for 15-30 years… Why not learn about it? The choices you make now will reflect how much you spend or save on your next home purchase. The best thing about this Denver home buying seminar is – Its Free! Definetely a good time to bring the family, spouse, girlfriend or boyfriend, son or daughter, or come solo. This is some very in depth 2009 loan information that you won’t wanna miss. We will cover a range of topics from rates, points, and 2009 incentives from the U.S. Government such as Tax breaks and HUD.
You can register 1 of 2 ways for the seminar. You can shoot us an email or give us a call. This is a no pressure seminar and our goal is solely to educate consumers. Contact Mr. D.J. Robbins for further information or reserve your slot for this Denver home buying seminar today.
303-482-2361
“OPENING MORE DOORS TO HOME OWNERSHIP”
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