Comments on: FHA No-No

By: Kris Berg

Kris Berg — Thu, 11 Feb 2010 17:00:41 +0000

AK – Congrats! And it is a thrill to meet the guy with the wicked funny sense of humor.
Joe – Thank you for the comment and the very comprehensive laundry list. I will forgive you for the agent “donation” remark.

By: joe feinhandler

joe feinhandler — Thu, 11 Feb 2010 00:51:49 +0000

AK.. Here is a list of the non-allowable fee’s from the VA website. Many don’t apply to California but many do. The fee’s can NOT be paid by a VA buyer but that does not mean that they have to be paid by the seller. I am in the middle of 2 VA transactions right now where I am paying the non-allowables as the lender. I have also seen transactions where the agents have “donated” to the costs.

• lender’s inspections, except in construction loan cases
• loan closing or settlement fees
• document preparation fees
• preparation of loan papers or conveyance fees
• attorney’s services other than for title work charged by the lender
• photographs
• interest rate lock-in fees
• postage and other mailing charges, telephone calls, and other overhead
• amortization schedules, pass books, and membership or entrance fees
• escrow fees or charges
• notary fees
• commitment fees or marketing fees of any secondary purchaser of the mortgage
• preparation and recoding of assignment of mortgage to any secondary
purchaser of the mortgage
• trustee’s fees or charges
• loan application or processing fees
• fees for preparation of a truth-in-lending disclosure statement
• fees charged by loan brokers, finders or other third (3rd) parties whether
affiliated with the lender or not
• tax service fees
• termite inspections (except cash-out/regular refinance transactions).

By: AK

AK — Thu, 11 Feb 2010 00:28:39 +0000

Hi, I’m the original poster of the “Whiskey Tango Foxtrot” on the Piggington.com forums. Believe it or not I got an offer accepted and hope to have keys 45 days from now, assuming the appraisal is good and no little arthropods have been munching on the framing.

Now about those seller-paid closing costs … I got two different estimates from two different lenders. One estimated about $3000 in non-allowables. The other estimated … $50, for a termite report. A cynic might be forgiven for thinking that lenders were exploiting the myth of non-allowables to pad loans with junk fees. I guess I’ll find out at closing.

By: Rick Arvielo

Rick Arvielo — Fri, 11 Sep 2009 20:40:32 +0000

Great article check out my blogs for some info on FHA as well

http://www.rickarvielo.com/post/New-American-Funding-New-American-Direct.aspx

http://www.rickarvielo.com/post/Struggling-Homeownere28099s-Across-the-United-States.aspx

By: W.C. Varones

W.C. Varones — Sat, 05 Sep 2009 17:32:31 +0000

I’m glad. FHA is for marginally qualified speculators with no down payment, and it’s a huge risk to the taxpayers.

By: Joe Feinhandler

Joe Feinhandler — Sat, 05 Sep 2009 01:07:48 +0000

“the buyer in a typical transaction would customarily pay yet in the case of VA are required of the seller”
Kris this is not a true statement. Like you said there are fee’s that the buyer is not allowed to pay or “non-allowables” but over time that has been twisted as the seller must pay. These fee’s can come from anywhere but the buyer in line item fee’s on the HUD. On deals where the seller has had to net a specific amount I have seen these fee’s covered by rebate, loan origination and even agent concessions when the debt ratio was too high to raise loan costs. The big issue that I have seen with VA is there is NO give on the termite work but on FHA if it dosent menion termite in the contract it dosent have to be done.

By: Doug Francis

Doug Francis — Fri, 04 Sep 2009 14:29:26 +0000

This input must be coming from their agents, who are just putting hurdles up to getting their listings sold.

By: Kim Hannemann

Kim Hannemann — Thu, 03 Sep 2009 17:57:47 +0000

Previous low FHA appraisal – stuck with it for 6 months.