Colorado Mortgage Team

FBI Investigates Mortgage Fraud Cases in Colorado

Lately, it seems that there has been more than just a few headlines in the news regarding mortgage fraud – both right here in Colorado as well as in the national news. Because of the current housing crisis that the country is in, many people point to “mortgage fraud” as being on the main contributing factors that put the country in crisis. And while it may seem a little too late, enforcement agencies such as the FBI are starting to crack down on mortgage fraud.

According to a warning on the FBI Website:

Mortgage Fraud is investigated by the Federal Bureau of Investigation and is punishable by up to 30 years in federal prison or $1,000,000 fine, or both. It is illegal for a person to make any false statement regarding income, assets, debt, or matters of identification, or to willfully overvalue any land or property, in a loan and credit application for the purpose of influencing in any way the action of a financial institution. Some of the applicable Federal criminal statutes which may be charged in connection with Mortgage Fraud include:

• 18 U.S.C. § 1001 – Statements or entries generally
• 18 U.S.C. § 1010 – HUD and Federal Housing Administration Transactions
• 18 U.S.C. § 1014 – Loan and credit applications generally
• 18 U.S.C. § 1028 – Fraud and related activity in connection with identification documents
• 18 U.S.C. § 1341 – Frauds and swindles by Mail
• 18 U.S.C. § 1342 – Fictitious name or address
• 18 U.S.C. § 1343 – Fraud by wire
• 18 U.S.C. § 1344 – Bank Fraud
• 42 U.S.C. § 408(a) – False Social Security Number

Colorado Mortgage Fraud: It Isn’t Over

Some people think that mortgage fraud doesn’t really happen anymore, but it is alive and well. Chances are that some type of mortgage fraud is happening right here in Colorado, right now. If you or someone you know has witnessed any type of mortgage fraud, be sure to contact the FBI.

Colorado Obama Refinance To 125% Announced

Many people who have recently been told they couldn’t refinance under the Obama Refinance plan because they owed more than 105% of the value, can now refinance up to 125% of the home’s value. Today, it was announced by HUD Secretary Shaun Donovan that people who owed more than 105% of what their home was worth could now refinance up to 125% of the home’s value. This expansion to the Making Home Affordable plan will help many people right here in Colorado and is another sign that the Obama administration is doing whatever they can to contain the foreclosure problem.

Not just for people living in Colorado, but for people all across the country who currently owe more than 105%, they now can take advantage of low interest rates and refinance. Many people in Colorado will now take advantage of the Obama 125% refinance and rush to refinance while rates are low.

According to CNN reporters:

“The president’s Making Home Affordable plan is already helping far more than any previous foreclosure initiative and with today’s announcement we will extend its reach still further,” said Donovan.

According to Bloomberg:

“I don’t think it’s going to have much of an impact because you still don’t have enough qualified borrowers,” Miller said, referring to today’s announcement. “It will help on the margin, but the issues with Obama’s plans is that they all focus on affordability and not principal writedowns and at some point they’re going to have to address” that, he said.

What This Announcement Means For People Living In Colorado

Estimates vary on exactly how many people here in Colorado will benefit from the expansion, but no matter the numbers here in Colorado, there will be many people nationwide who will also benefit. To find out if you qualify under the recent Obama refinance guideline changes, be sure to contact your local Colorado mortgage expert today.

Many people across Colorado are searching for more information about how to use the 8000 tax credit for closing costs when buying a new home.

The Colorado Housing Finance Authority released important information for anyone who is interested in using the 8000 tax credit for closing costs when buying a new home in Colorado.

CHFA JumpStart Home Mortgage Product Highlights

• Designed to help Coloradans leverage the first time homebuyer federal tax credit for down payment or closing costs.
• Offers borrowers a first mortgage with a competitive 30 year, government insured fixed interest rate, AND a zero percent (0%) second mortgage with no payments if the second mortgage is repaid before June 30, 2010.
• The second mortgage may be a maximum of 3.5 percent of the home’s purchase price, or $6,000, which ever is less.
• Available from CHFA’s approved lenders for homes purchased and closed between April 1, 2009 and Nov.30, 2009.
• Must be a first time homebuyer and complete a free homebuyer education class to qualify.
• Income and purchase price limits apply. View the limits in your county on CHFA’s website www.chfainfo.com.
• $250 of CHFA’s $350 administrative fee will be returned to borrowers who pay off their second mortgage prior to June 30, 2010.
• The interest rate on the second mortgage will increase to 8 percent with a 10 year term if not paid off by June 30, 2010.
• CHFA urges borrowers who don’t plan to pay off second mortgage by the June 30, 2010 deadline to use the CHFA HomeOpener Plus mortgage product.
• CHFA HomeOpener Plus offers borrowers down payment and closing cost assistance at competitive market interest rates with a 30 year loan term.

While the rules associated with the 8000 tax credit loan may seem like there are lots of them, it is good to know that Colorado is one of the few states in the Nation where people can get help to take advantage of programs designed to help people use the 8000 tax credit for closing costs when buying a new home.

More Information: (www.chfainfo.com)

• CHFA JumpStart Brochure
• CHFA JumpStart Fact Sheet
• CHFA JumpStart Information Sheet
• Press Release: CHFA Brings Stimulus Dollars to Homebuyers

Many people across Colorado are considering buying a new home and have heard at least *something* about the 8000 tax credit for new home buyers. If you are one of the people who have heard something about it and are thinking about buying a home somewhere in Colorado — don’t worry, you aren’t the only one wondering!

Some of the most popular questions that people ask right here in Colorado have been answered nicely by the National Association of Home Builders and they have also put together a video that will most likely answer the questions that you may have.

If you have more questions, be sure to contact us – we are Colorado Mortgage Experts!

Some of the top questions that we have heard from people are also below — if you have a different question after seeing all of these, let us know!

1. Who is eligible to claim the tax credit?
2. What is the definition of a first-time home buyer?
3. How is the amount of the tax credit determined?
4. Are there any income limits for claiming the tax credit?
5. What is “modified adjusted gross income”?
6. If my modified adjusted gross income (MAGI) is above the limit, do I qualify for any tax credit?
7. Can you give me an example of how the partial tax credit is determined?
8. How is this home buyer tax credit different from the tax credit that Congress enacted in July of 2008?
9. How do I claim the tax credit? Do I need to complete a form or application?
10. What types of homes will qualify for the tax credit?
11. I read that the tax credit is “refundable.” What does that mean?
12. I purchased a home in early 2009 and have already filed to receive the $7,500 tax credit on my 2008 tax returns. How can I claim the new $8,000 tax credit instead?
13. Instead of buying a new home from a home builder, I hired a contractor to construct a home on a lot that I already own. Do I still qualify for the tax credit?
14. Can I claim the tax credit if I finance the purchase of my home under a mortgage revenue bond (MRB) program?
15. I live in the District of Columbia. Can I claim both the Washington, D.C. first-time home buyer credit and this new credit?
16. I am not a U.S. citizen. Can I claim the tax credit?
17. Is a tax credit the same as a tax deduction?
18. I bought a home in 2008. Do I qualify for this credit?
19. Is there any way for a home buyer to access the money allocable to the credit sooner than waiting to file their 2009 tax return?
20. If I’m qualified for the tax credit and buy a home in 2009, can I apply the tax credit against my 2008 tax return?
21. For a home purchase in 2009, can I choose whether to treat the purchase as occurring in 2008 or 2009, depending on in which year my credit amount is the largest?

Federal Housing Tax Credit.

Back in April, President Obama announced the Making Home Affordable plan. This plan was designed to help people in Colorado (and across the US) refinance their home or modify their mortgage and was fairly comprehensive.

Many people who wanted to refinance under the Making Home Affordable plan quickly found out that depending on who owned their current loan, they may or may not have been able to go to any lender they wanted.  When it was announced, if Fannie Mae owned your mortgage, you could refinance under the Making Home Affordable plan with any Fannie Mae approved lender.

But if Freddie Mac owned your mortgage, you were required to go through your current servicer to refinance your mortgage.

Until now.

Recently, Freddie Mac has announced that anyone who has a mortgage owned by Freddie Mac can now use whatever Freddie Mac approved lender that they want when refinancing their home under the Making Home Affordable plan. They also released the following guidelines.

Key highlight of the announcement include:

1. Borrowers can continue to work with their existing servicer to refinance their mortgage. In the vast majority of these cases, the current servicer will not have to re-underwrite the borrower.
2. If the borrower chooses to work with another Freddie Mac-affiliated lender, the mortgage will need to be re-underwritten.
3. Freddie Mac will allow the lesser of 4 percent of the new refinance mortgage amount or $5,000 of closing costs, financing costs and prepaids/escrows to be rolled into the new refinance mortgage.
4. Freddie Mac’s standard post settlement delivery fees, up to a maximum of 2 percent, will apply to the Relief Refinance Program.

According to Freddie Mac Executive Vice President Don Bisenius:

“We are responding to consumers’ desires to have more refinancing options. As an added benefit, we are expanding the program and providing greater flexibility in financing closing costs. Freddie Mac is committed to doing everything we can to bring the benefits of the Administration’s Making Home Affordable program to as many borrowers as possible.”

This announcement is good news for anyone who has a mortgage owned by Freddie Mac. Although you can now use whatever Freddie Mac approved lender that you would like, keep in mind that should you choose to work with a lender other than your current servicer, it will be more difficult to get your refinance done — although not impossible as it was before. This is good news to anyone who has received poor service from their current lender because now they have choices of what lender to use who can help you get your loan done.

Hurry before Colorado mortgage rates go up!