Three Reasons to Refinance

To move from an adjustable-rate mortgage to a fixed-rate loan
Sometimes you have to settle for an adjustable-rate to get a lower interest rate when you really need it. Now that you have been making your monthly payments on a regular basis and interest rates are low, this might be the perfect time to lock yourself into a low fixed-rate mortgage. 

To shorten the term of your loan
If you bought your home under a 30-year mortgage to save money on your monthly payments, you might find that the lower interest rates we are experiencing right now might make a 15-year mortgage out to be only a bit more expensive, or even less expensive, than what you are currently paying. 

To take advantage of less expensive mortgage insurance
In early 2015, the Federal Housing Administration announced that it would reduce the mortgage insurance premium rate charged for FHA-backed loans from 1.35 percent to 0.85 percent. Some estimates say that can mean a savings of as much as $900 a year for anyone refinancing a house. The FHA made this decision to spur home buying, but it works out in your favor too, if you refinance. Even better, if you have enough equity in your home, you might be able to refinance from an FHA loan to a conventional mortgage and remove those mortgage insurance payments altogether! 

Stay connected. Stay educated. Stay saving with A and N Mortgage. 

5 Goals to Help Your 2015 Budget

A New Year brings new goals. Financially you may wish to build up savings, pay off debt, manage monthly spending or save for retirement. Here are five goals to help you stick to your 2015 financial resolutions.

Make Extra Mortgage Payments

Making extra payments can dramatically shorten the time until your mortgage will be paid in full.

Pay Off Your Second Mortgage

It's not always easy to pay off a second mortgage, but the freedom from that added debt and interest expense can be well worth the effort.

Investigate Your Property Taxes

If your house has declined in value in recent years, you might be able to save some money in 2015 by contesting your property tax assessment.

Refinance

Refinancing your mortgage to decrease your payment or lock in a low fixed rate also might be a smart move in the new year.

Look For Homeowner's Insurance Discounts 

Major repairs or improvements that you made to your home last year can get you a discount or a lower quote on this year's coverage.

Whatever your goals may be make sure to reach out to your A and N mortgage  consultant. A and N is always here to help.

Stay connected. Stay educated. Stay saving with A and N Mortgage. 

A and N Mortgage Homeowner Tips: Making the Most of Your Yard This Summer

Whether it's cooking on the grill, planting a garden, or simply relaxing in a hammock under a tree, homeowner's love their yards. Here are some tips to help you get the most out of the great outdoors.

Outdoor Kitchen 

An outdoor kitchen is perfect for entertaining in your backyard. If your grill will be used under a covered area, include a power vent hood or other method for venting the smoke. The cabinets for an outdoor kitchen should be built to resist the elements. This could be custom cabinets, using treated lumber and plywood, or ones made from a weatherproof material.  

Choosing a Grill 

Appliances and grills for outdoor kitchens are usually made from stainless steel to make them weatherproof as well. While most grills today are gas fired, cooking with hardwoods-like hickory, pecan, or oak-can produce better results. Using starter sticks, rather than lighter fluid, to light a wood or charcoal fire can improve the taste of the food. The insulating qualities of ceramic charcoal cookers, like the Big Green Egg, allow them to be used as a conventional grill or as a smoker oven for slow cooking. 

Grill Maintenance 

Use a wire brush to clean the cooking grate after each use. Once a year, disassemble the grill and clean it thoroughly. Remove cooking grates, soak in liquid grill cleaner, scrub with a wire brush, and rinse. Take out the ceramic plates or briquettes and clean them with a wire brush. Remove the burners and use a wire brush to take off residue and rust. Clean out the burner holes by inserting a toothpick into each hole. Use a wet/dry vac to vacuum out the inside of the grill. Reassemble all the grill components. Light the grill and leave it on for a few minutes to burn off any remaining residue. 

Keeping Cool 

Shade is essential for summer backyard activities. Popular options include: 

Shade arbor: An outdoor arbor covered with vines makes a cool retreat on a hot summer day. 

Roof: Extending the roof of your house to cover a patio works well.

Awning: A retractable awning is a great way to create shade when and where you need it. 

Misting System: Outdoor misters keep you cool by spraying a fine mist of water in the air. Misting systems are available as inexpensive DIY Outdoor Cooling Kits as well as portable misting umbrellas that hook to a garden hose. 

Water Feature: The soothing sound of falling water from a fountain or waterfall can make your yard feel like an oasis during a summer heat wave. Pre-made water features are available, or you can build your own custom water feature for your backyard. 

Keeping You Informed

A and N Mortgage professionals are dedicated to keeping you informed of the latest market trends, household tips and mortgage options. Call A and N Mortgage today to obtain custom loan options designed to fit your needs and help you obtain your home goals.

Renovation Lending Aids the Property Search Given Available Inventory

One problem facing buyers in the current market is the lack of available inventory. Sellers continue to bide their time. However, buyers do not need to miss out on low interest rates or the ability to purchase in their target neighborhoods. Although Renovation Lending is not the solution for every borrower, it is an opportunity to get into certain areas by purchasing a potentially lower- priced property and then borrowing enough money to fix it up.  It is by no means a panacea, but it is certainly an option and in many cases, one which can rapidly increase the equity in your property.

A Renovation Loan differs in many ways from a traditional construction loan. Reno loans are closed one time, with the purchase money going to the seller and the renovation funds placed in an escrow account held by the lender throughout the draw process. In most cases, there is no upfront money from you or the lender for the contractor; the General Contractor works on a draw basis. This is not a hardship for any solvent contractor as they should have the ability to buy materials and pay their sub-contractors while being reimbursed through inspected draws.

Most neighborhoods still have a large quantity of foreclosures that need to be fixed up or even properties that are simply outdated.  Here are some key words that indicate that the property may be right for a Renovation Loan:

• Sold “as-is
• Estate Sale
• Any foreclosure that has NOT been recently updated
• Fannie Mae or Freddie Mac foreclosures (especially the Fannie Mae HomePath properties)
• “fixer-upper”
• Handyman’s dream
• Current occupant has 400 cats
• Property needs “love or attention”

Depending on your budget, you can gut a property or just update the kitchens and bathrooms. As long as the property is habitable at the end of the six month rehab period and you remain within the guidelines of the loan program, you can often use your imagination as to what you would like your home to end up looking like. You can even purchase and rehab a 2-4 unit property as long as you occupy one of the units!

So, before you start your next tour with your agent, consider asking about properties that are ripe for renovation. It may be an opportunity to create the home you dream about and live in the neighborhood you choose!  Contact Carrie Rosenberg, renovation loan specialist, for more information.

Next topic: Which Renovation Loan Product is right for you?

TaxSmart Mortgage Credit Certificate Program

TaxSmart is a Mortgage Credit Certificate (MCC) program that provides a federal income tax credit to qualified homebuyers. A tax credit is a direct reduction of taxes due. Under the program, a homebuyer would receive a MCC to reduce income taxes by an amount equal to 20 percent of the interest paid on a mortgage. The tax credit may be claimed each year the home buyer continues to live in a home financed under this program. The homebuyer will be charged a $375.00 application fee of which $225.00 is due at loan closing to the City of Chicago, Department of Planning and Development. A charge of $100.00 will apply to replace or reissue a Series 2013 MCC Certificate for any cause including, and without limitation, due to being lost or misplaced, being damaged, a refinance of the existing mortgage, or any other reason allowed by the Code or the Program Regulations.

Federal law requires that a home buyer satisfy each of the following guidelines:

First-Time Homebuyer or Target Area Purchase

Any person who has not owned a principal residence at any time during the three years prior to closing a loan under this program is considered a first-time home buyer. Non first-time homebuyers are also eligible if they purchase a home in a designated target area.

Income

Federal law imposes maximum limits on the annual gross income of home buyers.

Purchase Price

Federal law also imposes limits on the purchase price of homes financed under the program.

Principal Residence

The home buyer must occupy the home as a principal residence within a reasonable period which, under most circumstances, may not exceed 60 days after financing is provided. A principal residence is a home occupied primarily for residential purposes and does not include a home used as an investment property, as a recreational home or a home in which 15 percent or more of its total area is used for a trade or business.

One-to Four-Family Home

Each residence financed must contain 1-4 units. A one-family residence includes a detached home, one unit of a duplex, a townhouse or a condominium unit. If the residence is a 2-4 unit building, one unit of the residence must be the principal residence of the building owner and the residence must have been first occupied for residential purposes at least five years prior to applying for a mortgage loan financed in connection wi t h the MCC.

New Mortgage

The mortgage loan financed in connection with a MCC certificate is required to be a new mortgage and may not replace a prior mortgage on the home (whether or not previously repaid).

Program Area

In order to be eligible for a MCC certificate, the home financed under the program must be located in the City of Chicago.

Mortgage credit certificates are issued to eligible home buyers on a first-come, first-served basis. The certificates are available in connection with any type of mortgage loan (except loans from tax-exempt bond programs), including fixed rate and adjustable rate mortgages.

First-time homebuyers must receive pre-purchase counseling to be eligible and must provide a certificate of completion of pre-purchase counseling with their applications. Applications and additional information are available from participating TaxSmart Mortgage Lenders.

Income Limits Non-Target Area Target Area Less than three-person Household $88,320 $88,320 Three or more person Household $102,985 $103,040

Purchase Price Limits*                                                  Non-Target Area                                               Target Area Existing New Construction Existing New Construction One Unit $357,750 $357,750 $437,250 $437,250 Two Unit $457,973 Ineligible $559,744 $559,744 Three Unit $553,598 Ineligible $676,619 Ineligible Four Unit $687,961 Ineligible $840,842 Ineligible

*These limitations are periodically adjusted and do not apply to mortgage credit certificates issued with respect to qualified home improvement loans.

The 'Welcome Home Illinois Loan Program"

The state of Illinois started a huge advertising campaign 2 weeks ago for a new program called "Welcome Home Illinois". Your members may be calling for more information. The program gives 1st time home buyers (a buyer who hasn’t owned a home in the last 3 yrs. ) $7,500 towards the purchase of a new home which is a forgiven loan after 5 yrs . 

The interest rate is set by the Illinois Dept. Of Affordable Housing and they are offering below market rates. There are income limitations and they go by total household income not applicant income , a family of 3 or more can’t make more than $106,000.00  Below are the highlights:

• $ 7,500 forgiven loan after 5 years

• Below market interest rate

• Reduced PMI rates

• As little as 3% down

• Down payment can be 100% Gifted

• Conventional , FHA and VA products available

I’ve worked with the state's down payment assistance programs for many years and the down side had always been that the state’s interest rates were always .50% - .75% higher than what I could offer in the secondary market. This is the 1 st time they are offering below market rate so there’s really very little downside. 

A and N Mortgage Tips: New Year, New Changes for 2014 Mortgages

Mortgages Affected: 2014

The Consumer Financial Protection Bureau are enforcing a new set of Qualified Mortgage rules that will start to phase in on January 10th, 2014 and the residential real estate market could be in for some major changes. The vast majority of mortgages issued these days are "Qualified" which means a borrower has to meet specified standards to obtain a home loan. In general home shoppers will undergo more scrutiny and may see their borrowing power shrink. In addition interest rates are also expected to be up possibly to as much as the mid 5 percent range.

These new rules all but eliminate most of the lending practices that caused the housing market bubble to burst. 

Here are some of the new rules:

The maximum debt to income ratio decreases from the current 45 percent to 43 percent.  

There can be temporary exceptions made to this rule that allow for higher debt ratios for loans that can be purchased by Fannie Mae and Freddie Mac. The obvious negative impact is that borrowers who are lower income or are really stretching themselves to get a mortgage may not qualify for as much as they need.

The new rules also help speed up the process of getting a mortgage by giving lenders the authority to reject outright credit-report information if a borrower can prove that it's wrong. This is a huge help as in the past lenders many times would use the credit report as the final authority.

The Qualified Mortgage grants the creditor greater protection from potential liability. Under this rule, lenders cannot include toxic features such as negative-amortization ARMs that increase borrowers' debt with each monthly payment, or excessive upfront points and fees.

In conjunction with the lower debt ratios, interest rates are going to affect how much money a homeowner can borrow. Economists are expecting interest rates to rise gradually during the coming year. The predictions for the most part put interest rates gradually rising throughout the year, starting at the high 4 percent range in the beginning of the year and hitting possibly 5.3 percent or more by years end. Put simply, you will probably get more bang for the buck if you buy your house earlier in the year. 

The process of obtaining a home loan can be arduous and confusing. New rules all the time, paperwork that's never-ending can lead to frustration and high blood pressure. So consider contacting your local mortgage broker as they are the experts that keep up on these new rules and regulations and can help answer any questions you have.

Keeping You Informed

A and N Mortgage mortgage professionals are dedicated to keeping you informed of the latest market trends and mortgage options. Call A and N Mortgage today to obtain custom loan options designed to fit your needs and help you obtain your home goals.

THIS IS AN ADVERTISEMENT. This is not a commitment to lend. A and N Mortgage Services, Inc. is an Illinois Residential Mortgage Licensee and Equal Housing Lender.  1945 N. Elston Ave.   Chicago, IL   60642  p: 773.305.LOAN   ANMtg.com  
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