Rates are great, but getting a mortgage isn’t easy:
- RIS Media notes that FHFA is limiting Fannie Mae and Freddie Mac loan purchasers to “Qualified Mortgages”. Beginning on January 10, 2014, they will not purchase a loan that is subject to the “ability to repay” rule if the loan is not fully amortizing, has a term longer than 30 years, includes points and fees in excess of 3% of the total loan amount
- NAR’s Realtor Magazine’s article, “Retirees face unique loan qualifications”, illustrate the challenges facing this demographic. Lenders increasingly are looking for a consistent monthly income in line with their usual debt to income standards. Social security is always counted. Fannie Mae guidelines permit lenders to increase that income by 25% if the beneficiary isn’t paying taxes on it.
Everyone wants to know if the mortgage tax deduction will be preserved:
- In an article in Inman News, Ken Harney quotes Isaac Bollansky, an influential D.C. based housing and mortgage analyst who tracks legislation affecting these industries, “we believe that if tax reform occurs in this congress, which is becoming more likely, that the mortgage interest deduction as we know it will be altered. “ He believes the most likely strategy will be to cap the maximum size mortgage eligible for deductions significantly below the current $1.1 million for first and second, perhaps to $500,000.