TTrumble

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  • in reply to: CURRENT HIGH INTEREST RATE QUESTION #80421
    TTrumble
    Member

    Hello Pure1,

    There are a couple of inaccurate assumptions in your message.

    The statement “I cannot refinance NACA’S rate at a later date if rates fall” isn’t true. You can refinance, but we just aren’t going to allow it for five years. The simple reason why is that it would give property investors/flippers an easy loophole to get out of the owner-occupancy requirement.

    Additionally, you are not going to be able to refinance out of any loan, or even obtain a mortgage modification, for an absolute minimum of 12 months. The lender is going to require that the loan “season” with a minimum 12 on-time consecutive payments before anything can be done. The refi lender will likely require even longer.

    You are presuming that mortgage rates are going to fall at some point in the reasonably near future. People seem to have forgotten that prior to the mortgage crisis, rates of seven-to-eight-percent were commonplace and not considered predatory. The problem likely stems from the fact that mortgage rates crashed so dramatically when the economy tanked in 2007 and have stayed that way until the buying frenzy started during the pandemic. It was long enough ago that rates at their current level seem outrageous by comparison even they are in reality pretty normal historically.

    In fact, tomorrow (September 21) the Federal Reserve Board is meeting in Washington and will raise the Fed Funds rate by 0.75% to 1.00% as a way of trying to stem the tide of rising inflation. While mortgage rates are not directly tied to the Fed Funds rate, they will follow suit and you will see market rates break 7% and possibly even get close to 8%. The rise in mortgage interest rates is coincidentally a means of trying to battle the outlandish increase in home prices that began even before the current inflationary spiral in the economy (and it actually appears to be starting to turn things around for housing prices).

    Finally (Whew! How long is that Tim guy gonna go on for?) you are forgetting that a refi lender will either charge closing costs and fees for initiating the new loan or build it into the refi with a higher rate. NACA is unique in that the closing costs and fees are not rolled into the loan in any fashion but are truly absorbed by BOA. That is one of the reasons that it’s almost always unwise to sell or refi within five years anyway even at market rates, much less after saving all that money to begin with through NACA.

    Okay, end of lecture! 😀 Long story short, even at today’s rates, much less with the 1% reduction for low- to moderate-income buyers or buyers in lower income areas, it just won’t be feasible to refi out of the NACA loan for several years.

    Tim Trumble
    Online Operations, NACA

    • This reply was modified 1 week ago by TTrumble.
    • This reply was modified 1 week ago by TTrumble.
    • This reply was modified 1 week ago by TTrumble.
    in reply to: Home in a trust meeting NACA no-ownership requirement? #80418
    TTrumble
    Member

    Hello MarkH708,

    There are a few questions that will have to be answered prior to being able to determine whether or not it complies with the rule that you may not have an ownership stake in any other property when you close on your home through NACA.

    The biggest and most obvious question is why is the home in a trust to begin with? Is it a family trust that is designed to make it an inheritance at some future point in time? Is it in a trust for tax purposes? Is it an investment trust of which you are the owner or a partner, similar to placing it in an LLC? The answer to that question (and the ability to prove it) will make a huge difference in meeting the requirement.

    Tim Trumble
    Online Operations, NACA

    in reply to: Separation in NC #80330
    TTrumble
    Member

    Hello sv098,

    Marriage and divorce laws can vary dramatically from one state to another, so what you read about the separated spouse signing a statement of disclaimer doesn’t automatically apply everywhere. I can tell you for a fact that it doesn’t apply in North Carolina. Since NC does not have “legal separation” either, your husband will potentially have claim to any property you buy prior to your divorce becoming final, not to mention the fact that he can rescind the statement on a whim.

    Bottom line is that Member Services was right. As I always remind people, neither I nor anyone else at NACA is qualified to give legal advice, but even a divorce attorney will tell you not to buy until after the divorce is final since it becomes a marital asset that can be taken into consideration as part of the divorce proceedings.

    Tim Trumble
    Online Operations, NACA

    in reply to: Trucker w/ multiple addresses #80184
    TTrumble
    Member

    Hello NVTrucker,

    Not to be argumentative, but nobody’s “giving you a hard time”. You have created a situation that is making it impossible for you to get qualified because it throws up a lot of red flags and your only option is to fix some things.

    From what you wrote:

    Your DL and Voter Registration are in one state though you apparently no longer live at that address, you have a residence in another state and your mail goes to two other completely different places. You essentially have no verifiable legal address. That is going to stop you from getting a mortgage anywhere, not just at NACA. People don’t realize that proof of identity, residence and income are all much stricter since the Dodd-Frank Act was passed in 2007.

    You have to consolidate those things to a single address. No two ways about it. If that should happen to be California, it shouldn’t give you any problems buying in Nevada since you can show current familiarity with the market and have a legitimate reason to move there.

    It’s pretty much that simple. It’s not that you travel for a living, it’s that you can’t actually prove that you have a legal residence anywhere. It’s not something that is going to have a work-around. You just have to fix it.

    Tim Trumble
    Online Operations, NACA

    in reply to: Interest rate buy-down contribution from BOA #80179
    TTrumble
    Member

    Hello Theresa Divine,

    The buy down program has changed since the information you mentioned was published. The BOA incentive is now a lower interest rate based on your income level relative to the median income for the metro area in which you plan to buy. If your income is below the median for the Metro in which you are buying, or if the home you buy in in a low-to-moderate income Census Tract, you will receive a rate one percent below the market rate.

    Here is the current buy-down program as described in the NACA Qualification Workbook:

    The impact of the NACA Interest Rate Buy-Down is extraordinary (“NACA Buy-Down”). It is often the most effective way for you to increase what you can afford (i.e., a higher purchase price) and/or to reduce your monthly mortgage payment. In fact, the same amount of funds used for the Buy-Down compared to a principal reduction reduces the monthly mortgage payment by about two times. This is a huge benefit for Members that are looking for long-term homeownership who have available funds or can obtain them. You have the option to use a lump sum amount to permanently buy down the interest rate, and it is your choice by how much.

    For each one-and-a-half percent (1.5%) of the total mortgage (loan) amount – or “discount points” – you pay up front, the interest rate is permanently reduced for the life of the mortgage. The reduction in rate for each discount point paid is about two times greater than what is normally available in the market. The NACA program also permits you to reduce the interest rate more than other programs in the market.

    • 30-year NACA mortgage, each one-and-a-half discount points permanently reduces the interest rate by one-quarter of one percent (0.25%) for the life of the mortgage.
    • 15-year Wealth Builder Mortgage, one discount point permanently reduces the interest rate by one-quarter of one percent (0.25%) for the life of the mortgage.

    The NACA Buy-Down is only available with a NACA Mortgage and can only be accessed when submitting your bank loan application and cannot be obtained once you have closed on your loan. The funds can come from your savings, the seller, grants, and/or a gift from family that does not require repayment.

    Seller contributions for the NACA Buy-Down is limited to ten percent (10%) of the property’s contracted sale price. The NACA Buy-Down cannot be financed with an increased purchase price. A seller contribution greater than six percent (6%) may initiate a risk review by the participating lender to verify that the NACA Buy-Down was not financed as part of a higher sales price.

    Note: the NACA Buy-Down is limited by current regulations and subject to change.

    Grants can be obtained for the interest rate buy-down and/ or principal reduction. Most of these grants are funded by the federal government and sometimes enhanced by state and local municipalities. Cities and municipalities administer and provide these grants. These funds — which can be from $5,000 to over $30,000 for each buyer — are used for down payment, closing costs, and can also be used for buying down the NACA interest rate in some cases. The most effective use of these funds is to access the NACA Mortgage and to buy down the interest rate from NACA’s already below-market fixed rate.

    To access these funds for the NACA Buy-Down, you need to contact your state, county, or city officials to get them to work with the NACA Mortgage. NACA can assist you and others in getting access to government funds for the NACA Buy-Down with the NACA Mortgage.

    in reply to: LMIB. RATE REMOVED! #80082
    TTrumble
    Member

    Hello Precious1ne,

    That, very simply, is a question for your counselor.

    There’s a couple of potential file-related variables, so your counselor is the person to ask.

    Tim Trumble
    Online Operations, NACA

    in reply to: Attorney Representation at Closing #80079
    TTrumble
    Member

    Hello bellasi,

    NACA requires the buyer to be present at the closing as an additional safeguard against investors abusing the NACA program.

    However, if there are no reasonable alternatives within your control and you can document the situation, you may be able to receive an exception from Director of Mortgage Operations Erick Exum. Please provide your counselor with your request and supporting documentation and he or she will will contact Mr. Exum with the request.

    Tim Trumble
    Online Operations, NACA

    in reply to: New Debt before Qualifying #79977
    TTrumble
    Member

    Hello trulycarter,

    I’m afraid a delay is going to be inevitable in your case. Having acquired new debt, you are going to have to establish a payment history on the loan. Had you worked directly with the IRS on a payment plan, you would have still been unable to qualify until it was paid in full. So you were looking at a delay in qualifying regardless of which way you had handled it.

    The bottom line to this though is the fact that you were unable to pay your taxes. This indicates you are either self-employed or a 1099 independent contractor at a company. Were you a W-2 employee, those taxes would have been taken out automatically each pay period, and self-employed/1099 workers should set aside part of their income as they receive it to cover their taxes. The way things are being done now, it’s going to be viewed as not handling your money as well as you could (and should) be doing.

    Long story short, you’re going to need to tighten your belt a bit, get the new loan paid off or create a payment history, and also start tucking away money regularly to cover the tax bill you already know you will have next year.

    I’m sorry that this is going to hold you back, but the last thing anyone wants to see is for the IRS to swoop in and place a “super lien” on the home you just bought. So it’s far better to make the adjustments necessary to resolve this problem and make sure it never happens again.

    Tim Trumble
    Online Operations, NACA

    • This reply was modified 2 months ago by TTrumble.
    in reply to: BOA Closing 0.5% Grant #79928
    TTrumble
    Member

    Hello tristinrobin,

    The terms have changed as of several months ago. Now, low- and moderate-income buyers or buyers in lower income communities receive an interst rate on both the 30-year and 15-year loans that is one full percent lower than that given to higher income buyers. As of this writing (7/19/22) those are 4.75% 30-year rate and 4.0% 15-year rate for low- and moderate-income buyers or buyers in lower income communities. Rates for higher income buyers in higher income communities are one percent higher.

    Also, for the interest rate buy down, 1.5% of the loan amount (i.e. one and a half points) reduces the rate by one-quarter percent with a legally required limit of five to six points.

    TTrumble
    Member

    Hello tkansley,

    Why hasn’t your supervisor simply written a letter stating that you are being given an expemtion from the 2/3 home policy for the foreseeable future? That should be all you need.

    in reply to: Suspended Pending Decline #79918
    TTrumble
    Member

    Hello cranapple71,

    In a situation such as this, let your counselor do his or her job. The counselor will file a response with the bank pointing out any inaccuracies to the bank and will bring NACA executives in on the situation if needed. It requies patience, which is very difficult to have at such a time, but that is what is needed while we work out the problem and get the bank to give the Clear to Close.

    in reply to: Buydown rate change #79701
    TTrumble
    Member

    Hello BostontoAtl,

    The buy down amount actually changed more than a year ago when Bank of America renewed their agreement with us and committed an additional $5 billion to the NACA program. For a 30-year loan, each point buys down the rate 1/6 of one percent (0.167%) and on a 15-year loan, it’s 1/4 of one percent (0.25%).

    in reply to: File from Last Year Status Help? #79095
    TTrumble
    Member

    hello gbfl1991,

    Pretty simple, actually.

    Make sure you have all of your documents updated in your file. Paystubs, bank statements, credit card statements, tax returns and W2’s.

    Call our scheduling team at 425-602-6222, option 1, and get a new appointment scheduled. You will also need to pay your membership dues for this year plus the cost for us to pull and updated credit report.

    There’s really nothing to worry about, just go ahead and do it. You’ll be fine.

    Tim Trumble
    Online Operations, NACA

    in reply to: Requalification #79093
    TTrumble
    Member

    Hello mikeyboy2547,

    Pure1 is closer to the truth than you may think. “Karens” typically know they are in the wrong to begin with and so do the people they confront. It’s why they put on the overdramatic air of entitlement, but it’s also what gives them away within seconds and why they almost never get what they want. In short, don’t shoot yourself in the foot by improperly casting suspicion on yourself.

    Go bank and read the thread “Suggestions”. A member who also had problems getting their file submitted for qualification did it the right way and it of course worked. Patience and persistence. I’ve preached it for years here because it works.

    Tim Trumble
    Online Operations, NACA

    in reply to: Moving to a different city after purchasing through NACA #79092
    TTrumble
    Member

    Hello rjlee,

    As often happens in situations like this, you’re overthinking things. The home you purchased through NACA is still your primary residence, especially since you will be going back and forth. Getting an apartment to accommodate your new job doesn’t change that. Don’t change your driver’s license or voter registration and you’ll be okay.

    Tim Trumble
    Online Operations, NACA

Viewing 15 posts - 1 through 15 (of 7,087 total)