Home loans hard to get – WDRB 41 Louisville – News, Weather, Sports Community
Home loans hard to get – WDRB 41 Louisville – News, Weather, Sports Community.
Louisville, KY (WDRB News) — Interest rates for home buyers remain low. But only highly qualified borrowers are applying for such financing.
Banks have plenty of money to lend, but government restrictions are so tight that they may be keeping people away who might qualify for a mortgage.
One reason – the home building industry has had such a difficult time bouncing back is that while interest rates are low, too many consumers no longer meet the qualifications to get a mortgage.
“It is far too difficult to get a loan,” says Tara Brinkmoeller of the Home Builders Association of Louisville.
According to the Federal Reserve, about 25 percent of the people who apply for a home loan these days are turned down.
“Three, four, or five years ago everybody could get a loan,” says the president of Republic Bank Scott Trager. “They did not have to have any documentation and that was a farce, now that crisis has forced the pendulum to go the other way and now it is too tight.”
On most loans, banks today want 20 percent down. Trager believes the tighter restrictions by federal regulators to discourage risky lending are discouraging some people from even applying who might actually meet the higher qualifications.
“There are a lot of programs we have, that the government has, so why not try?” asks Trager.
Trager agrees that the loan process can be intimidating. His best advice is that consumers should be prepared. He advises, “Make sure you have your pay stubs, your tax returns, your credit cards, your debts, the balances and who they are, account numbers, and all of the information on your income.”
Trager is looking forward to the day the credit markets will loosen up a bit. “I am hoping that by the end of 2012,” he says, “or the beginning of 2013, that we will see the requirements reduced and loosened up.”
Trager says his bank is developing an online site where consumers could apply for home loans in an effort to take some of the hassle out of the mortgage application process.
Copyright 2012 WDRB News. All Rights Reserved.
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Louisville Realtors 2011 Home Sales Report
Image by tracktwentynine via Flickr
Louisville Realtors 2011 Home Sales Report.
| Bullitt County | Dec. 2010
|
Dec. 2011
|
Jan. 1 – Dec. 31, 2010
|
Jan. 1 – Dec. 31 2011
|
||
| Houses Sold
|
50
|
52
|
757
|
741
|
||
| Average Selling Price
|
$133,639
|
$143,788
|
$140,793
|
$139,214
|
||
| Median Selling Price
|
$116,450
|
$128,000
|
$127,000
|
$129,500
|
||
| # of Listings Placed into Pending Status During Dec..
|
52
|
58
|
||||
| Active Listings at December 31
|
451
|
507
|
||||
Jefferson County Market Comment:
| Realtors® posted 612 closed sales in Jefferson County in December, an increase of 6% over December 2010. The December ’11 average selling price posted a gain over November, rising to $160,652 from $156,812. For the month, the average Jefferson County selling price has lost 8% from a similar period last year. The year-end average price paid for a home in Jefferson County was $161,373, 3% less than a similar period last year. The supply of homes on the market in Jefferson County stands at 4,414, down 377 units from November, but up 423 units from December 2010. At the current absorption rate, the county has a 7 month inventory of homes on the market. Year-end sales in the county stand at 7,648 units, down nearly 4% from a similar period last year.
Oldham County |
Dec. 2010
|
Dec. 2011
|
Jan. 1 – Dec. 31, 2010
|
Jan. 1 – Dec. 31, 2011
|
||
| Houses Sold
|
57
|
49
|
673
|
713
|
||
| Average Selling Price
|
$245,600
|
$222,107
|
$251,536
|
$271,831
|
||
| Median Selling Price
|
$209,000
|
$209,000
|
$230,000
|
$235,000
|
||
| # of Listings Placed into Pending Status During Dec..
|
40
|
56
|
||||
| Active Listings at December 31
|
394
|
463
|
||||
| efferson County | Dec. 2010
|
Dec. 2011
|
Jan.1 – Dec. 31, 2010
|
Jan. 1 – Dec. 31, 2011
|
||
| Houses Sold
|
577
|
612
|
7957
|
7648
|
||
| Average Selling Price
|
$176,397
|
$160,652
|
$167,011
|
$161,373
|
||
| Median Selling Price
|
$140,000
|
$128,000
|
$136,000
|
$130,000
|
||
| # of Listings Placed into Pending Status During Dec.
|
437
|
521
|
||||
| Active Listings at December 31
|
3991
|
4414
|
||||
Overall Market Comment:
Members of the Greater Louisville Association of Realtors® posted 860 sales during the month of December 2011. December’s total sales continued a six-month trend of outpacing the same period last year, which posted 847 sales during December 2010. The sales volume trend was notable as it revealed the 2010 Home Buyer Tax Credit produced a surge in activity in the 2
nd quarter of 2010, leaving a lean 3rd and 4th
quarter in its wake. The average selling price paid for single family and condominium homes in December was $160,402, up $3,499 from November, but down 7% from a year earlier. Average sales prices have retreated from their year-to-date peak of $179,758 posted in July 2011, but remain above the low for 2011 which was posted in March at $152,801.
Inventory, or the number of homes for sale, fell to their lowest level of the year in December, to 7,294 units, from 7,825 in November, 8,373 in October and 8,704 units in September. The number of homes for sale continues to exceed 2010 levels and remains at an 8 month supply; inventory levels near a 6 month supply are often associated with an in-balance market.
Overall, GLAR members end 2011 with 10,975 units sold, a decline of 467 units, or 4% less than 2010. The 2011 average sales price paid was $163,317, a 1.8% decline from 2010’s average of $166,295. In 2011, Metro Louisville home prices retreated from 2010 levels, but the year ended on a positive note with the December average $7,600 greater than March’s low of $152,801.
| Year-end market snippets: Cash transactions increased in 2011 to nearly 17% of all sold units closed by GLAR members. Cash sales increased nearly 50% from 2010 and posted their highest numbers of the decade. Conventional sales continued to dominate financing terms in 2011, with FHA and VA a distant second place. The highest priced home sold by a GLAR member in 2011 was an Oldham County property located at 14200 Reserve Cove; the unit closed for $3,000,000 in October 2011. In sum, 10,975 units were sold by GLAR members in 2011, totaling $1,792,398,597. The average list-to-sale ratio was 95%..
Jefferson County |
Dec. 2010
|
Dec. 2011
|
Jan.1 – Dec. 31, 2010
|
Jan. 1 – Dec. 31, 2011
|
| Houses Sold
|
||||
Greater Louisville Association of REALTORS, Inc.
Residential Sales Statistics
| Single Family Residential & Condo
All MLS Areas |
Dec. 2010
|
Dec. 2011
|
Jan.1 – Dec. 31, 2010
|
Jan. 1 – Dec. 31, 2011
|
||
| Houses Sold
|
847
|
860
|
11,442
|
10,975
|
||
| Average Selling Price
|
$172,640
|
$160,402
|
$166,295
|
$163,317
|
||
| Median Selling Price
|
$142,000
|
$130,450
|
$138,000
|
$134,500
|
||
| # of Listings Placed into Pending Status During Dec.
|
624
|
747
|
||||
| Active Listings at December 31
|
6624
|
7294
|
||||
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Kentucky VA Loan Refinance and Purchase Guidelines
Kentucky VA Loan Refinance and Purchase Guidelines
How do I refinance using my Kentucky VA Home Loan?
You can use your Kentucky VA home loan benefit to refinance your existing VA home loan to a lower
interest rate, with little or no out-of-pocket cost. This is called an Interest Rate Reduction
Refinancing Loan (IRRRL), also known as a “rapid refinance” or a “streamline refinance.”
Generally, no appraisal, credit information, or underwriting is required for this refinancing
option, although some lenders may require an appraisal and credit report. The fees and
charges associated with the refinancing loan may be incorporated into the new VA loan.
Remember: The interest rate on the new loan must be lower than the rate on the old loan
(unless you refinance an adjustable-rate mortgage to a fixed-rate mortgage).
To receive an IRRRL, work with your lender to process your application. It’s generally a good
idea to compare several lenders’ rates first, as there may be large differences in the terms
they offer. Also, some lenders may contact you suggesting that they are the only lenders
with the authority to make IRRRLs, but according to VA, any lender can
make you an IRRRL.
An IRRRL can be done only if you have already used
your eligibility for a KentuckyVA loan on the property you intend to
refinance. If you have your Certificate of Eligibility, take it
to the lender to show your prior use of the entitlement.
The occupancy requirement for an IRRRL is different from that for
other VA loans. When you originally got your Kentucky VA loan, you certified
that you occupied or intended to occupy the home. For an IRRRL, you
need only certify that you previously occupied it.
The loan may not exceed the sum of the outstanding balance on the existing VA loan,
plus allowable fees and closing costs, including the funding fee.
What’s the Cash-out Refinance Option?
The Veterans’ Benefits Improvement Act of 2008 allows you to free up cash with a cash-out
refinance, a VA home loan refinance program in which you can cash-out on the equity you
have built up in your home. As an example, if you still owe $70,000 on your original loan, you
can refinance for a $90,000 loan, which gives you a cash-out of $20,000.
An appraisal is required and you must qualify for the loan. If you are refinancing for the first
time, VA charges a 2.15% funding fee for this program (2.15% of the total loan) which can be
rolled into the loan amount. If you refinance more than once, the funding fee is 3.3%.
There is no minimum amount of time that you must own your home, yet your home must have
sufficient equity to qualify for KEntuckyVA refinancing. Existing loans can be refinanced whether they
are in a current or delinquent status, but refinancing loans are subject to the same income
and credit requirements as regular home loans. As long as you have title to the property
you can refinance an assumed loan. Check with your lender as there are some additional
regulations concerning assumed loans.
Conventional to VA Refinance
If you do not have a KentuckyVA home loan but are eligible for one, you can refinance a subprime or
conventional mortgage for up to 100 percent of the value of the property. Usually you will be
charged a funding fee of around 2-3 percent (depending on the lender you choose) if you are
using your VA loan guarantee for the first time. Benefits to this type of refinancing are that
your new interest rate may be lower and you will have no monthly mortgage insurance or outof-
pocket closing costs.
Can I reuse my Kentucky VA Home Loan benefit?
The Kentucky VA home loan benefit can be reused if you have paid off your priorKentucky VA loan and sold the
property. In addition you may, on a one-time-only basis, be able to reuse or restore your
benefit eligibility if your prior VA loan has been paid in full and you still own the property.
In either case, to restore your eligibility, you must send a completed VA Form 26-1880 to your
VA Eligibility Center. (See VA Loan Documents Checklist Above.)
To prevent delays in processing, you should also include evidence that the prior loan has
been paid in full and, if applicable, the property disposed of. This evidence can be presented
in the form of a paid-in-full statement from the former lender, or a copy of the HUD-1
settlement statement completed in connection with a sale of the property or refinance of the
prior loan.
Depending on the circumstances, if you have already used a portion of your VA-guaranteed
amount (up to $89,912), and the used portion cannot be restored, any remaining portion of
your VA guarantee is available for use on another loan. You will have to ask your lender if your
remaining VA-guaranteed portion will be enough, or if you will need to make a down payment
to qualify for the loan. If you have a question about your specific case, contact VA.
What are the advantages of a Kentucky VA Home Loan?
The following is a quick list of reasons why a Kentucky VA loan may be your best option:
•
No down payment required
•
VA funding fee may be financed in the loan
•
VA Loans do not require perfect credit – there is no credit score cut-off
•
VA funding fees may be waived for veterans with VA rated service-connected
disabilities and surviving spouses of veterans with service-connected disabilities
•
Closing costs may be shared between the buyer and lender
•
Flexible mortgage types – fixed, hybrid and traditional ARMs
•
No mortgage insurance premiums – this is huge in today’s housing market
•
VA guarantied mortgages are assumable
•
No pre-payment penalties
•
Homes are inspected and appraised by VA prior to approval and/or during
construction
•
VA can offer assistance to veteran borrowers in default due to temporary financial
difficulty
•
Refinance and Interest Rate Reduction loans are available
All in all, the pros far outweigh the cons. And, considering there are very few “no-down
payment” mortgage options around that offer lower associated fees, using your VA home
loan benefit seems like a no-brainer – as long as the red tape doesn’t scare you.
•
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Is your mortgage originator licnesed in KY?
