“Under the new policy, $1.5 billion that had been reserved for the bank bailout will be rerouted to five states that have seen housing prices drop more than 20% since 2006: Nevada, California, Michigan, Florida and Arizona.

The money will go toward homeowners who have lost their jobs, owe more than their houses are worth or cannot afford to make monthly payments.”

The new program is designed to help the people who have suffered from the mortgage crisis rather than give more to banks that have already recieved bailouts. Hopefully this will prove more successful than the Making Home Affordable mortgage modification program (many were excited, few have been able to get coherent answers from any bank…)

See Also:

Non-Conforming Bank Loans

The requirements are quite narrow, as explained by the USDA:

“Applicants for direct loans from HCFP must have very low or low incomes.  Very low income is defined as below 50 percent of the area median income (AMI); low income is between 50 and 80 percent of AMI; moderate income is 80 to 100 percent of AMI…Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance, which are typically within 22 to 26 percent of an applicant’s income.  However, payment subsidy is available to applicants to enhance repayment ability.  Applicants must be unable to obtain credit elsewhere, yet have reasonable credit histories .”

If you’re one of the few that fits these unique requirements, check out the USDA website for more info on these government subsidized mortgages.

photo credit: Micheal  Peterson

See Also:

FHA Mortgage Guide

Today, I want to discuss another area where this is possibility: Detroit.

Houses in Detroit can now be had for less than just about any area in the nation. Want to look in some of the scarier areas? If you’re not afraid of inner-city violence, vandalism, and trespassers, you may be able to get a home for just a buck. Check any MLS site and you’ll see dozens of listings for less than a Big Mac.

The Chicago Tribune reports:

“It may be tough to get financing for a new car these days, but in Detroit you can buy a house with a credit card.

The median price of a home sold in Detroit in December was $7,500, according to Realcomp, a listing service.

Not $75,000. Remove a zero—it’s seven thousand five hundred dollars, substantially less than the lowest-price car on the new-car market.”

If the average home is going for less than ten grand, think of what you could have if you triple or quadruple that amount.

Although it’s experiencing a major case of urban blight, there are some ok areas in Detroit where you can buy a house on a credit card for $50,000 or less.

photo credit: TheTruthAbout…

Wells Fargo Alternative Documentation Qualifications

Borrowers must meet traditional lending standards with the exception of proving their income. To prove income, they must submit six or twelve consecutive months of their most recent bank statements. Income is determined by the monthly average of the money deposited.

Wells Fargo Alternative Documentation Loan Terms

The alternative documentation solution may be applied to any personal home loan including both fixed-interest and adjustable loans. Borrowers should expect to pay a higher interest rate than may be offered for traditional qualifications.

Applying for a Wells Fargo Alternative Documentation Loan

You can apply for a Wells Fargo Alternative Documentation Loan by contacting a mortgage broker or calling Wells Fargo directly (1-877-937-9357). You can also visit their website for more details about this program.

Countrywide Fast and Easy Loan Qualifications

Fast and Easy borrowers must meet the standard mortgage qualifications with these exceptions: they are only required to turn in limited documentation, there is no income verification, and there is only verbal job verification. Borrowers must have extremely high credit scores to qualify and put at least 5-10% down.

Countrywide Fast and Easy Loan Terms

Borrowers can use the Fast and Easy program alongside almost any loan including ARMs, fixed-rates, and interest only. Borrowers generally pay for their convenience with a higher interest rate than they would receive through a traditional program.

Applying for a Countrywide Fast and Easy Loan

You can apply for a Countrywide Fast and Easy Loan by contacting a mortgage broker or calling Countrywide directly (1-888-231-7074). You can visit their website for more details about this program.

Countrywide House America Loan Qualifications

Countrywide House America customers must be able to meet traditional loan qualification standards with these exceptions: they can use cash from relatives or other non-traditional sources for their down payment, they can count non-traditional income sources towards their debt-to-income ratio (such as money made by family members), and they can use alternative payment records (such as rent payments or utility bills) to supplement an un-established credit score.

Countrywide House America Loan Terms

Aside from the altered qualifications, these loans are similar to traditional mortgages. Lenders generally charge a higher interest rate for borrowers using non-traditional qualifications.

Applying for a Countrywide House America Loan

You can apply for a Countrywide House America Loan by contacting a mortgage broker or calling Countrywide directly (1-888-231-7074). You can visit their website for more details about this program.