Seattle Mortgage Planner

I believe that Bank of America is taking over servicing of FHA loans and they may offer 203k's. Good luck. - Sat Aug 15 2009, 14:28

USDA loans offer 100% financing for people with less than perfect credit. There is no mortgage insurance--there are income limits and the property must be located in a rural area. For more information, you can read this post from my nationally recognized blog. - Sat Jun 6 2009, 18:01

Gina,
a lot is going to depend on why your credit score is low. Were you approved for a conventional 100% financing such as a Flex 100? Some pmi companies are now calling areas in Pierce county as "soft" and that may have zinged you as well.

FHA does sound like your best bet. And FHA is not going by "soft markets". - Wed Mar 12 2008, 22:11

Plus waiting while your home depreciates means that you'll have mortgage insurance. :( Sorry...I'm feeling like a real bummer. - Thu Feb 5 2009, 15:25

There are issues with waiting for the gov. to lower rates. To begin with the Fed is doing this buy purchasing mortgage backed securities (bonds) at specific rates. Mortgage rates (at this time) are not directly controlled by the gov. Year to date, I believe the Fed has all ready purchased $92B in mortgage backed securities, yet we're hanging around 5% (depending on credit score, ltv, etc). Other factors are influencing current rates. I've written more about it in the link below. I also invite you see what rates I'm quoting "live" to real consumers at http://www.twitter.com/mortgageporter (please disregard the rates posted in the link below as they are from January 23). - Thu Feb 5 2009, 14:07

Carl, I highly recommend selecting a local Mortgage Professional who will watch rates for you. What I'm offering my clients in Washington State who are waiting for "under 5%" is to begin the application process so that we have everything we need in order to lock when the rate is available.

When the rates dip into the 'below 5' range, many LO's become inundated and are not able to handle all the request from potential borrowers. They have to tend to those who are committed to them first (often with a forward lock agreement) and will contact "rate shoppers" next.

Another factor is that the actual banks/lenders will become too busy to handle the rates and they will either shut down their lock desk or "artifically" increase rates in order to slow down new locks.

The industry has fewer people to handle all the request...last week, I heard a stat from the Washington Association of Mortgage Professionals that we have gone from 14,000 licensed loan originators in Washington State to 4,000 in two years!

Be sure to consider what your current rate is, what rate you need to break even on closing costs and how long you plan to retain your current home.

Good luck! - Thu Feb 5 2009, 13:25