Good News for Veterans!

The Federal Governement announcement yesterday that Fannie Mae and Freddie Mac will come under control of the government is good news for veterans. This announcement came as the government felt both these institutions will no longer be able to meet their mission statement which is to provide liquidity, stability and affordability in the housing markets.

The majority of VA and FHA homeloans are sold to these government sponsored agencies. So what does this mean to me as a veteran?

Fannie Mae and Freddie Mac both have issued many Bonds which over time mature, and Fannie and Freddie need to pay back the principal on the maturing Bonds. The way they raise capital to pay these maturing Bonds is to issue new Bonds. This happens every month. And as long as Fannie and Freddie can sell new Bonds this system works well. But the problems in the mortgage industry have reduced investor appetite to purchase these Bonds...and that's where the trouble begins. Without the ability to sell new Bonds, Fannie and Freddie are less able to meet the capital requirements to pay off the maturing Bonds. And that's the big fear. If Fannie and Freddie were to default and become insolvent, it would throw the beleaguered mortgage and housing markets even deeper into the abyss.

Additionally, the recent lack of appetite for Fannie Mae and Freddie Mac Bonds caused the two mortgage giants to have to do something to make their Bonds more attractive...so they offered their Bonds at higher yields to gain more investor interest. However, since they couldn't go back and raise rates on loans that had already been closed, it sucked even more profits out of Fannie and Freddie, reducing capital even further, and exacerbating the problem.

That's why the Treasury has stepped in and said that they will back the payments on these Bonds. This action has given investors a lot of confidence to step in and now buy Mortgage Bonds. Think about it. For a higher rate of return, investors can now buy Mortgage Bonds with the same guarantee as lower yielding Treasury Bonds. This is causing a nice rally in pricing this morning – which combined with the break above the 200-day Moving Average – leads to attractive rates and what could be the aforementioned refinance season ahead.

If you have been thinking about refinancing, this might be a good time to take advantage of your VA Streamline benefits.

Time to Make Your Move - Fed Stands Still

The Federal Reserve held the line on Tuesday–leaving the Fed Funds Rate at 2.00% for the third straight meeting. The decision, however, was anything but cut-and-dry.

Earlier in the week, the Personal Consumption Expenditure data indicated that inflation climbed 0.8% overall in June, which is the highest inflation jump in 27 years. In addition, the report indicated that inflation now sits at 2.3%–above the Fed’s desired range of 1-2%.

Although the Fed ultimately left interest rates unchanged, inflation obviously remains a concern and the recent rise may lead to an interest rate hike by the Fed in the near future.

What Does This Mean to You?
Many experts believe the housing market is nearing the bottom and may even be set to bounce back up. For now, home prices remain low, personal incomes are high, and interest rates are still very attractive.

If you've been weighing your options and waiting to see how things shake out, this is the ideal time to act–especially when you consider the new Housing and Economic Recovery Act benefits for home buyers:

Tax credits. First-time home buyers who purchase their primary residence between April 9, 2008 and July 1, 2009 are eligible for up to $7,500 in tax credit, as long as they haven't owned a home in the last three years. The credit is actually a generous interest-free loan, so we’ll have to talk about some income parameters and payback terms. But if you're a new home buyer – or know someone who is renting or in the market to buy – this is a huge benefit that we should discuss.

Lower rates for larger loans. In the past, mortgages of $417,000 or more have been considered "jumbo" loans that were more expensive to finance. Thanks to recent provisions, however, those jumbo loans were able to qualify for better financing rates in some parts of the country. Although those provisions were set to expire, they are being extended–with a minor change to the maximum amount eligible. This is great news that may save you a ton of cash, so call me to find out how this impacts our area, and if it could help you.

Down Payment Assistance...going, going, not gone yet. Another provision of the legislation eliminates some down payment assistance programs later this year...but they are still available right now, and depending on your circumstances, we may be able to take advantage of them to double your benefit as a home buyer.

Bottom line...now may be the ideal time to put together a purchase strategy based on your unique situation.

Protect Yourself Against Higher Payments

According to CoreLogic, nearly 300,000 subprime adjustable-rate mortgages (ARMs) are scheduled to reset throughout the summer months of 2008. For many borrowers, this means higher monthly mortgage payments with a rate increase of 1 or 2 percentage points -- or more in some cases -- when their loan adjusts.

The peak month for the resetting of mortgages, however, will come this October when, according to Credit Suisse, more than $50 billion in mortgages are scheduled to adjust to a new rate for the first time. If you or someone you know has an ARM, be proactive. Find out how much your payments will increase before your loan adjusts this fall. Remember, while interest rate cuts from the Federal Reserve over the last year will definitely help some borrowers, many others could have trouble making increased monthly payments with food and fuel costs on the rise -- especially if the Fed begins increasing its key interest rates in order to fight inflation.

It's also important to note that credit guidelines have tightened dramatically in the last year or so, and it may be harder for you qualify for a fixed-rate product if we don't have enough time to address certain credit issues. So don't wait until October. Give us a call today. We'll review your adjustable-rate mortgage with you and see what's best for your individual goals and needs.

Feds Cut Again.

The Federal Reserve cut interest rates today for the seventh straight time since September of last year. Many experts believe that the Fed is done cutting interest rates and will begin a new watch-and-wait policy. This new policy is due – in part – to the fact that the first Stimulus Act rebate checks are hitting millions of mailboxes this week. The Fed hopes this money gives a boost in the arm to the economy.

If you've been taking a watch-and-wait approach with your own finances, now is the time to call and review your options.

Consider this: the Federal Reserve Board meets 11 times this year to review the health of the US economy and make adjustments if needed. Don't you think you owe it to yourself to take just a few minutes and do the same with your own financial goals?

We want to ensure that you're taking advantage of this unique market and not letting it pass you by. Here are just a few things to consider:

Today's tougher housing market means there are some great buys to be had if you're looking to purchase. This is an especially friendly market for first-time home buyers.


The government has temporarily increased FHA loan limits in many areas across the US. These government-insured loans are not FICO-score driven and require little to no down payment. Here's the catch: these new limits expire at the end of the year, so you must act now.


You really don't want to play the waiting game if you are holding an adjustable rate mortgage (ARM). That's because there is nowhere for the rates to go but up from here, if we are truly at the end of the Fed's cutting cycle.
Invest 10 minutes in your financial future. Call us today. Together we'll review your situation. While the Fed takes a quick break from cutting to plan its next move, take advantage of the opportunity to do the same for yourself. We look forward to hearing from you!

VA Regional Loan Centers

This is a list of VA Regional Loan Centers with contact information. These centers can help you obtain your certificate of eligibility or answer questions about va home loans. Each center has its own jurisdiction, mailing and website addresses, and telephone number.

Regional Loan Centers:

Jurisdiction:
Atlanta Georgia
North Carolina
South Carolina
Tennessee

Department of Veterans Affairs
VA Regional Loan Center
1700 Clairmont Rd.
Decatur, GA 30033-4032
(Mail: P.O. Box 100023, Decatur, GA 30031-7023)
http://www.vba.va.gov/ro/atlanta/rlc/index.htm
1-888-768-2132

Jurisdiction:
Cleveland Delaware
Indiana
Michigan
New Jersey
Ohio
Pennsylvania

Department of Veterans Affairs
VA Regional Loan Center
1240 East Ninth Street
Cleveland, OH 44199
http://www.vba.va.gov/ro/cleveland/index1.htm
1-800-729-5772

Jurisdiction:
Alaska
Colorado
Idaho
Montana
Oregon
Utah
Washington
Wyoming

Department of Veterans Affairs
VA Regional Loan Center
155 Van Gordon Street
Lakewood, CO 80228
(Mail: Box 25126, Denver, CO 80225)
http://www.vba.va.gov/ro/denver/loan/lgy.htm
1-888-349-7541

Jurisdiction:
Honolulu Hawaii
Guam
American Samoa
Commonwealth of the Northern Marianas

Department of Veterans Affairs
VA Regional Office
Loan Guaranty Division (26)
459 Patterson Rd.
Honolulu, HI 96819

*Although not an RLC, this office is a fully functioning Loan Guaranty operation for Hawaii. 1-808-433-0481

Jurisdiction:
Arkansas
Louisiana
Oklahoma
Texas

Department of Veterans Affairs
VA Regional Loan Center
6900 Almeda Road
Houston, TX 77030-4200
http://www.vba.va.gov/ro/houston/lgy/home.html
1-888-232-2571

Jurisdiction:
Connecticut
Massachusetts
Maine
New Hampshire
New York
Rhode Island
Vermont

Department of Veterans Affairs
VA Regional Loan Center
275 Chestnut Street
Manchester, NH 03101
http://ww.vba.va.gov/ro/manchester/lgymain/loans.html 1-800-827-6311
1-800-827-0336

Jurisdiction:
Arizona
California
New Mexico
Nevada

Department of Veterans Affairs
VA Regional Loan Center
3333 N. Central Avenue
Phoenix, AZ 85012-2402
http://www.vba.va.gov/ro/phoenixlgy/
1-888-869-0194

Jurisdiction:
District of Columbia
Kentucky
Maryland
Virginia
West Virginia Department of Veterans Affairs
VA Regional Loan Center
210 Franklin Road, SW
Roanoke, VA 24011
http://www.vba.va.gov/ro/roanoke/rlc 1-800-933-5499

Jurisdiction:
Illinois
Iowa
Kansas
Minnesota
Missouri
Nebraska
North Dakota
South Dakota
Wisconsin

Department of Veterans Affairs
VA Regional Loan Center
1 Federal Drive, Ft. Snelling
St. Paul, MN 55111-4050
http://www.vba.va.gov/ro/central/stpau/pages/homeloans.html
1-800-827-0611

Jurisdiction:
Alabama
Florida
Mississippi
Puerto Rico
U.S. Virgin Islands

Department of Veterans Affairs
VA Regional Loan Center
9500 Bay Pines Blvd.
St. Petersburg, FL 33708
(Mail: P.O. Box 1437, St. Petersburg, FL 33731)
http://www.vba.va.gov/ro/south/spete/rlc/index.htm
1-888-611-5916
(out of state)
1-800-827-1000
(in FL)
Winston/Salem Department of Veterans Affairs
Winston-Salem Eligibility Center
P.O. Box 20729
Winston-Salem, NC 27120 1-888-244-6711

Military Service Requirements for VA Loan Eligibility:

Note: Applications involving other than honorable discharges will usually require further development by the VA. This is necessary to determine if the service was under other than dishonorable conditions.

Wartime - Service During:

WWII: 9/16/1940 to 7/25/1947
Korean: 6/27/1950 to 1/31/1955
Vietnam: 8/5/1964 to 5/7/1975
You must have at least 90 days on active duty and been discharged under other than dishonorable conditions. If you served less than 90 days, you may be eligible if discharged for a service connected disability.

Peacetime - Service during periods:

7/26/1947 to 6/26/1950
2/1/1955 to 8/4/1964
5/8/1975 to 9/7/1980 (Enlisted)
5/8/1975 to 10/16/1981 (Officer)
You must have served at least 181 days of continuous active duty and been discharged under other than dishonorable conditions. If you served less than 181 days, you may be eligible if discharged for a service connected disability.

Service after 9/7/1980 (enlisted) or 10/16/1981 (officer)

If you were separated from service which began after these dates, you must have:

Completed 24 months of continuous active duty or the full period (at least 181 days) for which you were ordered or called to active duty and been discharged under conditions other than dishonorable, or
Completed at least 181 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1171 (Early Out), or have been determined to have a compensable service-connected disability;
Been discharged with less than 181 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances for the convenience of the Government.
Gulf War - Service during period 8/2/1990 to date yet to be determined

If you served on active duty during the Gulf War, you must have:

Completed 24 months of continuous active duty or the full period (at least 90 days) for which you were called or ordered to active duty, and been discharged under conditions other than dishonorable, or
Completed at least 90 days of active duty and been discharged under the specific authority of 10 USC 1173 (Hardship), or 10 USC 1173 (Early Out), or have been determined to have a compensable service-connected disability, or
Been discharged with less than 90 days of service for a service-connected disability. Individuals may also be eligible if they were released from active duty due to an involuntary reduction in force, certain medical conditions, or, in some instances, for the convenience of the Government.
Active Duty Service Personnel

If you are now on regular duty (not active duty for training), you are eligible after having served 181 days (90 days during the Gulf War) unless discharged or separated from a previous qualifying period of active duty service.

Selected Reserves or National Guard

If you are not otherwise eligible and you have completed a total of 6 years in the Selected Reserves or National Guard (member of an active unit, attended required weekend drills and 2-week active duty for training) and

Were discharged with an honorable discharge, or
Were placed on the retired list, or
Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable service, or
Continue to serve in the Selected Reserves
Individuals who completed less than 6 years may be eligible if discharged for a service-connected disability.

You May also be determined eligible if you:

Are an unremarried spouse of a veteran who died while in service or from a service connected disability, or
Are a spouse of a serviceperson missing in action or a prisoner of war
Note: Also, a surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003, may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must apply no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.

Eligibility may also be established for:

Certain United States citizens who served in the armed forces of a government allied with the United States in WW II.
Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with WW II service, and others.

Identity Theft

5 Tips to Protect Your Privacy

The Federal Trade Commission (FTC) estimates that as many as 9 million Americans have their identities stolen each year. This means that an identity is stolen every 3seconds, costing the average victim nearly $4,000 and nearly 175 hours to straighten out their problems and their credit. How can you protect yourself from the dangers of identity theft? Here are some suggestions.

Conduct a Credit Check-up – Visit www.annualcreditreport.com to obtain a free credit report every 12 months. Review all three of your credit reports and look for any suspicious activity, unusual or inaccurate names or addresses, or any inquiries that were done without your knowledge. In many states, you may place a 90-day "Fraud Alert" on your credit report, which further restricts access to your credit information. Simply call one of the three main credit bureaus to activate the alert. Here are the toll-free numbers: Equifax 1-800-525-6285; Experian® 1-888-397-3742; or TransUnion® 1-800-680-7289.

Don't Give It Up – Avoid falling prey to phishing scams, both over phone and through email. In a phishing scam, identity thieves pretend to be someone from your bank or a credit institution and simply ask you for your personal information. If someone contacts you and requests any personal information, don't give it to them. Verify who is requesting the data and why, and then call the institution yourself. One extra phone call could save you a lot of trouble and money.

Stay off the Pharm – While phishing enables thieves to pilfer information from you, pharming is another kind of scam that consists of hijacking your computer and stealing your personal information. A pharming site is designed to look just like the website you're trying to visit. However, enter your information on this fake site and not only can it track your moves within it, it may also direct your computer to give up other personal information at a later time. Be sure you are visiting the correct site, that the address in the navigation bar is correct before entering any information.

Return to Sender – Some scammers simply fill out a change of address form and divert your mail to another location. Others simply steal the mail they want right from your mailbox. The key to avoiding this scam is to know your statement delivery dates and pay close attention to any unusual delays in delivery. A lot of identity thieves do things the old-fashioned way: They rummage through your trash to collect your information that way. Be sure to shred any junk mail or other documents that may contain your personal information before you throw it away.

Opt-out of Special Offers – Visit www.optoutprescreen.com to cut down on the pre-approved offers from credit card and insurance companies. When people apply for a mortgage, they often become "trigger leads" to the credit bureau, who sell your information to any number of companies. It only takes a few minutes to opt out, but it could spare you a ton of junk mail and could possibly save you from identity theft.