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New loan product could be 'a game-changer'

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Mortgage Professional America | 30 Sep 2014, 07:55 AM Agree 0
A new innovation has come to the home lending industry and is aimed to help borrowers build equity more quickly
  • NACA Online | | 30 Sep 2014, 11:04 AM Agree 0
    The Wealth Building Home Loan also has the potential for buying down the interst rate to nearly zero through an extremely strong buydown option. One point (1% of the mortgage amount) will buy down the interest rate by one half percent, four times the buydown rate of many lenders. This is a far more efficient use of athe money compared to a traditional down payment. NACA's counseling and budget analysis also ensures that the home buyer gets a mortgage they can genuinely afford, and the 15-year mortgage has a default rate 70% LOWER than the traditional 30-yera model. NACA plans to have the program rolled out to all of its offices nationwide within 60 days of the announcement.
  • NACA Online | | 30 Sep 2014, 11:07 AM Agree 0
    For more information, NACA can be reached at 888-404-6222 or at www.naca.com.
  • saleem | | 30 Sep 2014, 11:17 AM Agree 0
    how can a low income borrower afford a 15 year amortized mortgage, when they can barely make the 30 year amortized payment.

    so even if this is a non-QM product, whats the max DTI?

    wouldn't this force the borrower to buy less of a house due to the higher payments?

    the big problem in my market (SF bay area) is the high purchase prices and low income borrowers not being able to compete.

  • MortgageLoans | | 30 Sep 2014, 11:29 AM Agree 0
    I don't understand the effectiveness of this for a broad spectrum of homebuyers. If the goal is to help low income homebuyers, is giving them a 15 year mortgage with a much higher payment going to help? Even with historically low rates buyers are having trouble with payments calculated on a 30 year amortization. I think this has very limited appeal for the market it is targeted towards.
  • | | 02 Oct 2014, 07:59 AM Agree 0
    No mention of income or mortgage limits. Do they vary by region?
  • Mortgage Pro | | 03 Oct 2014, 10:47 AM Agree 0
    NACA Online is like a salesperson that just doesn't listen to his customer, just keeps blurting out the same lines, not responding to what are obviously valid points made by industry professionals.

    "One point (1% of the mortgage amount) will buy down the interest rate by one half percent, four times the buydown rate of many lenders." No, its not four times the buydown rate, but keep saying it again and again and maybe it will be true.

    "NACA's counseling and budget analysis also ensures that the home buyer gets a mortgage they can genuinely afford, and the 15-year mortgage has a default rate 70% LOWER than the traditional 30-yera model." That's not the point! A 15 year is payment is much higher than a 30 year payment, and higher payments are more difficult to make than lower payments. We're on the front lines every day too, and we are responsible and responsive to our customers. Affording the payment is a big concern. Buyers are squeezed by low wages and high debt. You are not addressing this question but seemingly just trying to push your program. That approach doesn't work anymore.
  • Melanie | | 05 Oct 2014, 10:55 AM Agree 0
    The problem is that they are wanting to only help the "low income earner". Why not target the middle class with this type of mortgage. These are the people whom could really use this kind of help. It seems to me that you either have to be super wealthy or dirt poor for any type of benefit the government pushes out. But what about the working families whom have decent jobs trying to pay a mortgage and try to send their kids to college too? I am 44 years old. When I went to my community college over 20 years ago it was $6 a credit in California. Today it's $96 a credit!! Really? Our incomes are the same and prices are just going up and up...yet all of these programs are designed to help the poor. Please, help the people in the middle too. My God...you have no idea how much I have paid to banks in interest already. If I had this mortgage I would have paid my house off already 2 times over with all the interest we have paid. And maybe just maybe I could also help my son afford to go to college at the tune of $25,000 a year tuition cost for a measly bachelors degree. It's just crazy ...how foolish we are. Banks really own you...they enslave you to pay them 95% interest on a home mortgage...and make you work to take care of their house. And, when the economy does go south...what happens to the guy who has worked so hard to take of that home? Yeah right. It's no wonder America is falling apart with such greed.

    All of these great articles on this new mortgage...but what bank actually is really offering it? No mention of that...hello?
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