Mold Information & EPA Links

Recently, I had an agent email me that there was mold in one of my homes listed for sale.

Being a blue cheese loving, scientific, germ-a-phobic, hypochondriac, and having several clients with severe mold and respiratory issues, I have spent considerable time studying “mold issue”. But I forget that other people are not as diligent when they say “THERE IS MOLD!”

Two recent experiences, opened my eyes to the lack of facts that most professionals have when they make these statements and what to do about them. So I began compiling research from the EPA Environmental Protection Agency.

Here is a link to the the epa mold document with the facts on mold and cleanup they give the recommendations on how and who can do mold cleanup.

here is the EPA link concerning mold cleanup

here is another epa link concerning mold cleanup –

here is another epa link concerning mold cleanup and testing

These are just a few guidelines to what the epa says about mold.

The EPA says “Molds can be found almost anywhere; they can grow on virtually any substance, providing moisture is present. There are molds that can grow on wood, paper, carpet, and foods.”

Also according to the EPA, “There is no practical way to eliminate all mold and mold spores in the indoor environment; the way to control indoor mold growth is to control moisture. ”

Mold is complicated, the best resource I have found is the EPA website –

If mold is concern, I strongly advise any buyer to have it tested by an expert. Especially if they has asthma or allergic reactions to mold or any other indoor air pollutants.

According to the EPA – “Molds can trigger asthma episodes in sensitive individuals with asthma. People with asthma should avoid contact with or exposure to molds.”

HUD Announces Changes with FHA

Posted by Rich E. Blanchard on January 30, 2013


FHA will increase its annual mortgage insurance premium (MIP) for most new mortgages by 10 basis points or by 0.10 percent. FHA will increase premiums on jumbo mortgages ($625,500 or larger) by 5 basis points or 0.05 percent, to the maximum authorized annual mortgage insurance premium. These premium increases exclude certain streamline refinance transactions.

FHA will also require most FHA borrowers to continue paying annual premiums for the life of their mortgage loan. Commencing in 2001, FHA cancelled required MIP on loans when the outstanding principal balance reached 78 percent of the original principal balance. However, FHA remains responsible for insuring 100 percent of the outstanding loan balance throughout the entire life of the loan, a term which often extends far beyond the cessation of these MIP payments. FHA’s Office of Risk Management and Regulatory Affairs estimates that the MMI Fund has foregone billions of dollars in premium revenue on mortgages endorsed from 2010 through 2012 because of this automatic cancellation policy. Therefore, FHA will once again collect premiums based upon the unpaid principal balance for the entire period for which FHA is entitled. This will permit FHA to retain significant revenue that is currently being forfeited prematurely.

FHA will [also] require lenders to manually underwrite loans for which borrowers have a decision credit score below 620 and a total debt-to-income (DTI) ratio greater than 43 percent. Lenders will be required to document compensating factors that support the underwriting decision to approve loans where these parameters are exceeded, using FHA manual underwriting and compensating factor guidelines.

My initial thought: With the elimination of the 78% LTV MIP cancellation, FHA will be an expensive proposition vs a conventional loan.


The Federal Housing Administration’s (FHA) single-family loan limits change effective October 1, 2011 through December 31, 2011. These limits apply to forward mortgages insured under section 203(b)(2) of the National Housing Act and reverse mortgages insured under section 255 (Home Equity Conversion Mortgages (HECM)). A mortgagee letter providing further guidance has been issued August 19, 2011.

For Forward Mortgages, the FHA floors for the period October 1, 2011 through December 31, 2011 are $271,050, $347,000, $419,425 and $521,250 for 1-, 2-, 3- and 4-unit dwellings, respectively. The FHA ceilings are $625,500, $800,775, $967,950 and $1,202,925 for 1-, 2-, 3- and 4-unit dwellings, respectively. For all other areas, i.e., those where 115 percent of the median home price for the area is in between the floor and the ceiling, the limit shall be at 115 percent of the median home price. For areas under Section 214 of the National Housing Act (Alaska, Guam, Hawaii and the Virgin Islands), higher ceilings of $938,250, $1,201,150, $1,451,925 and $1,804,375 for 1-, 2-, 3-, and 4-unit dwellings, respectively, apply.

For HECMS, the maximum claim amount will remain at $625,500.

As HUD is not updating median prices at this time, there is no appeal period associated with the change of loan limits on October 1, 2011.

For calendar year 2012, HUD does expect to announce proposed maximum mortgage amounts in November 2011.

Complete schedules of FHA mortgage limits for all areas for forward mortgages will be available through the downloadable file links found at The website also provides a current look-up tool that will have the capability of finding loan limits for periods in 2011 and 2012. Please read these FHA Maximum Mortgage Limit FAQs:

If you have questions regarding this notice, please call FHA’s Resource Center at 1-800-CALL-FHA (1-800-225-5342). Persons with hearing or speech impairments may access this number via TDD/TTY by calling 1-877-TDD-2HUD (1-877-833-2483). You can also get email technical support on FHA mortgage limits at: or by visiting:

FHFA Extends Refinance Program

Federal officials just announced an extension to the refinance program aimed at helping homeowners who owe more on their mortgages than their homes are worth.  The program (HARP) expands access to qualified Kansas City homeowners whose homes have loss value. 

The Home Affordable Refinance was set to expire June 30 but has been extended to June 30, 2012, said the Federal Housing Finance Agency. The program covers Freddie Mac and Fannie Mae loans, and since its inception two years ago, HARP has enabled 623,000 homeowners to refinance their mortgages. 

Press Release

Kansas City Mortgage Rate Update

Mortgage Rates are still under 5% according to Mortgage Daily News

CURRENT MARKET: The “Best Execution” conventional 30 year fixed mortgage rate has fallen BACK to 4.875%.

For those looking to buy down their rate to 4.75%, this quote carries higher closing costs. The upfront cost of permanently buying down your rate  to 4.75% is not worth it to many applicants. We would generally only advise the permanent floatdown if you plan to hold your new mortgage for longer than the next 10 years.  Ask your loan officer to run a breakeven analysis on any origination points they might require to cover permanent float down fees.

On FHA / VA 30 year fixed “Best Execution” is still 4.75%. 15 year fixed conventional loans are best priced between 4.125% and 4.25%, but 4.25% is more efficient in terms of the floatdown breakeven cost.

Five year ARMS are best priced at 3.625%.

FHA Mortgage Insurance Rate Increase After 4/18/2011

FHA has increased Annual MI premiums across the board by .25% effective with case numbers issued on or after 4/18/2011.

The FHA is boosting the annual mortgage insurance premium charged on its home loans, a move that will increase the cost of an average FHA mortgage by about $30 a month.

Effective April 18, the FHA is increasing the annual mortgage insurance [Read more…]

It’s better to Rent than Buy in KC!


SAN FRANCISCO, January 24, 2011 – Trulia released its latest Rent vs. Buy Index which found that it is more affordable to buy than to rent a two-bedroom home in 72 percent of America’s 50 largest cities. Meanwhile, a nation of renters has emerged as more Americans rent by choice or due to unforeseen financial difficulties. In contrast to this nationwide trend, renting is only less expensive than buying in four of the cities included in this study – namely New York, Seattle, Kansas City and San Francisco. The remaining 10 cities are locations where buying may still be a financially sound long-term decision despite the relative affordability of renting.

“Since the start of the ‘Great Recession,’ many former homeowners have flooded the rental market. Following the principles of supply and demand, renting has become relatively more expensive than buying in most markets,” said Pete Flint, CEO and co-founder of Trulia. “Though necessary for achieving true economic recovery, stricter bank lending practices have also further aggravated the struggling housing market in the short term. Even highly-qualified homebuyers face intense scrutiny on their income, savings, existing debt and credit history before they can get a mortgage loan.”

Cities overwhelmed by foreclosure filings and unemployment, including many cities in Florida, Arizona, Nevada and central California, typically correspond to more affordable markets for prospective buyers; however, there are exceptions. Oakland and Los Angeles, which are experiencing similar rates of unemployment or foreclosure filings as Phoenix, Miami and Sacramento, are still more affordable to renters. Moreover, close proximity to economic centers with promising job growth projections has propped up both the demand for homes and costs of home homeownership in Oakland and Los Angeles.

“Although owning a home is relatively more affordable in most cities, market conditions have caused an interesting demographic swap between traditional renters and buyers,” said Tara-Nicholle Nelson, Consumer Educator for Trulia. “For example, lifelong renters are seizing the opportunity to become homeowners while affordability is high. At the same time, a growing number of long-time homeowners are finding themselves tenants – some by choice and others by necessity.”

Top 10 Cities to Rent vs. Buy

Rank City State Price:Rent Ratio
1. New York NY 31
2. Seattle WA 24
3. Kansas City MO 21
4. San Francisco CA 21
5. Memphis TN 20
6. Los Angeles CA 20
7. Fort Worth TX 19
8. Oakland CA 18
9. Portland OR 18
10. Albuquerque NM 18

Top 10 Cities to Buy vs. Rent

Rank City State Price:Rent Ratio
1. Miami FL 6
2. Las Vegas NV 6
3. Arlington TX 7
4. Mesa AZ 8
5. Phoenix AZ 8
6. Jacksonville FL 8
7. Sacramento CA 10
8. San Antonio TX 11
9. Fresno CA 11
10. El Paso TX 11

Trulia calculates the price-to-rent ratio for the 50 largest U.S. cities using the median list price compared with the median rent on two-bedroom apartments, condominiums and townhomes listed on

Sample Price-to-Rent Ratio Calculation:

  • Median List Price: $140,201.37
  • Median Rent: $1,871.65
  • Price-to-rent ratio: $140,201.37 ÷ ($1,871.65 x 12) = 6

Interpretation Key:

  • Price-to-Rent Ratio of 1-15: Owning a home is much less expensive than renting in this city.
  • Price-to-Rent Ratio of 16-20: The total costs of homeownership in this city are greater than the costs of renting, but it might still make financial sense to buy depending on the situation.
  • Price-to-Rent Ratio of 21+: Renting in this city is much less expensive than owning a home.


  • Total costs of homeownership include mortgage principal and interest, property taxes, hazard insurance, closing costs at time of purchase and ongoing HOA dues and private mortgage insurance, where applicable. It also includes an offset for the tax advantages of homeownership, including mortgage interest, property tax and closing cost deductions.
  • Total costs of renting include rent and renter’s insurance.


HUD No. 11-007 | Friday January 28, 2011
WASHINGTON – In an effort to continue stabilizing home values and improve conditions in communities experiencing
high foreclosure activity, Federal Housing Administration (FHA) Commissioner David H. Stevens [Read more…]

Mission Hills is No. 3 among wealthy U.S. neighborhoods

Mission Hills’ median household income is estimated at $243,000.

The under-the-radar Kansas City suburb of Mission Hills has made it onto Forbes’ radar — it tied for third on the publication’s list of the most affluent U.S. neighborhoods.

According to Forbes, Mission Hills’ median household income is estimated at $243,000, and its residents include Kansas City Royals legend George Brett.

Mission Hills ranked behind two other suburbs — Dallas suburb Westlake in the top spot and Chicago suburb Kenilworth as No. 2. Their median household incomes were $250,000 and $247,000, respectively.
The rankings were based on average median household income estimates from 2005 and 2009, available from the U.S. Census’ American Community Survey. Interestingly, all of the most affluent neighborhoods had populations of less than 64,999. the city that tied with Mission Hills — Popponesset Island, Mass. — had 39 residents, according to the 2000 Census. That same year, Mission Hills’ population was 3,593.

VA Home Loans – A Quick Guide For Homebuyers & Real Estate Agents


The more you know about our home loan program, the more you will realize how little “red tape” there really is in getting a VA loan. These loans are often made without any downpayment at all. Aside from the veteran’s certificate of eligibility and the fact that the appraiser is assigned by VA, the application process is not much different than any other type of mortgage loan. And if the lender is approved for automatic processing and the Lender Appraisal Processing Program (LAPP), as more and more lenders are now, a buyer’s loan can be processed and closed by the lender without waiting for VA’s approval of the credit application or for VA to review the appraisal.

Lenders are also able to use VA recognized automated underwriting systems, such as Loan Prospector and Desktop Underwriter, to facilitate the underwriting process.


Apply for a Certificate of Eligibility (COE).

A veteran can obtain a COE by completing VA Form 26-1880, Request for a Certificate of Eligibility, and mailing it, along with proof of military service, to the eligibility center (see office list at back of pamphlet). Also, veterans who have already begun the loan application process with a lender may request the lender obtain a COE through webLGY, which is accessed through the VA portal. More information about this online system can be found at the VA website which is:
Decide on a home to buy and sign a purchase agreement.

Order an appraisal from VA. (Usually this is done by the lender.)

Ordering an appraisal can be done via the Internet using TAS (The Appraisal System). This is a centralized system that allows lenders easy and quick access to order an appraisal.

Apply to a mortgage lender for the loan.

While the appraisal is being done, the lender can be gathering credit and income information. If the lender is authorized by VA to process loans on the automatic basis (and approx. 99 percent of all VA loans are processed this way), the loan can be approved and closed upon receipt of the appraised value determination without waiting for a VA review of the credit application. VA has also approved the use of several automated underwriting systems for lenders to use in connection with VA loans. The two main systems are Loan Prospector and Desktop Underwriter. For loans that must be approved by VA, lenders send the credit package to VA. VA staff will then review it and notify the lender of the decision.

Close the loan and move in.

More than 27 million veterans and service personnel are eligible for VA financing. Even though many veterans have already used their loan benefits, it may be possible for them to buy homes again with VA financing using remaining or restored loan entitlement.

Before arranging for a new mortgage to finance a home purchase, veterans should consider some of the advantages of VA home loans:

Most important consideration, no downpayment is required in most cases.
Loan maximum may be up to 100 percent of the VA-established reasonable value of the property. Due to secondary market requirements, however, loans generally may not exceed $417,000 ($625,500 for loans in Hawaii, Alaska, Guam and U.S. Virgin Islands). This figure is subject to change each year.

Flexibility of negotiating interest rates with the lender.

No monthly mortgage insurance premium to pay.

Limitation on buyer’s closing costs.

An appraisal, which informs the buyer of estimated property value.

Thirty-year loans with a choice of repayment plans.

Traditional fixed payment: (constant principal and interest: increases or decreases may be expected in property taxes and homeowner’s insurance coverage); Graduated Payment Mortgage-GPM (low initial payments which gradually rise to a level payment starting in the sixth year); and in some areas, Growing Equity Mortgages-GEMs (gradually increasing payments with all of the increase applied to principal, resulting in an early payoff of the loan).

Hybrid ARMs: VA is authorized to guarantee hybrid ARM loans where the initial rate remains fixed for at least 3 years. The initial adjustment can be as much as 2 percent if the fixed rate period is 5 or more years. Annual adjustments thereafter are limited to 1 percent if the fixed rate period is less than 5 years, and 2 percent if the fixed rate period is 5 or more years. If the fixed rate period is less than 5 years, the initial adjustment is limited to 1 percent and the annual cap to 5 percentage points. Traditional ARM loans: VA can also guarantee traditional 1-year ARM loans where the rate is adjusted annually. Annual adjustments are limited to 1 percent and the maximum interest rate increase over the life of the loan is limited to 5 percentage points.

New homes, which are appraised before or during construction, are inspected to help ensure compliance with the plans and specifications used for the appraisal and with VA minimum property requirements. All new houses, regardless of when appraised, are covered by either a 1-year builder’s warranty or a 10-year insured protection plan.
An assumable mortgage, subject to VA approval of the assumer’s credit.

Right to prepay loan without penalty.

VA performs personal loan servicing and offers financial counseling to help veterans avoid losing their homes during temporary financial difficulties.


These loans are made by a lender, such as a mortgage company, savings and loan, or bank. VA’s guaranty on the loan protects the lender against loss if the payments are not made, and is intended to encourage lenders to offer veterans loans with more favorable terms. The amount of guaranty on the loan depends on the loan amount and whether the veteran used some entitlement previously. With the current maximum guaranty, a veteran who hasn’t previously used the benefit may be able to obtain a VA loan up to $417,000 ($625,500 for loans in Hawaii, Alaska, Guam and U.S. Virgin Islands), depending on the borrower’s income level and the appraised value of the property. Your VA Regional Loan Center can provide more details on guaranty and entitlement amounts.


To buy a home, a condominium unit in a VA-approved project, or to purchase a unit in a cooperative (co-op).
To build a home.
To simultaneously purchase and improve a home.
To improve a home by installing energy-related features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/caulking, storm windows/doors, or other energy efficient improvements approved by the lender and VA. These features may be added to the purchase of an existing dwelling or by refinancing a home owned and occupied by the veteran. A loan can be increased up to $3,000 based on documented costs or up to $6,000 if the increase in the mortgage payment is offset by the expected reduction in utility costs. A refinancing loan may not exceed 90 percent of the appraised value plus the costs of the improvements. Check with a lender or VA for details.
To refinance an existing home loan up to 90 percent of the VA-established reasonable value or to refinance an existing VA loan to reduce the interest rate.
To buy a manufactured home and/or lot.


Veterans with active duty service, that was not dishonorable, during World War II and later periods, are eligible for VA loan benefits. World War II (September 16, 1940 to July 25, 1947), Korean conflict (June 27, 1950 to January 31, 1955), and Vietnam era (August 5, 1964 to May 7, 1975) veterans must have at least 90 days of service. Veterans with service only during peacetime periods and active duty military personnel must have had more than 180 days of active service. Veterans of enlisted service which began after September 7, 1980, or officers with service beginning after October 16,1981, must in most cases have served at least 2 years.

Gulf War. Basically, reservists and National Guard members who were activated on or after August 2, 1990, served at least 90 days and were discharged honorably, are eligible. VA can assist with eligibility questions.

Members of the Selected Reserve, including National Guard, who are not otherwise eligible and who have completed 6 years of service and have been honorably discharged or have completed 6 years of service and are still serving, may be eligible. Contact the VA Eligibility Center to find out what is needed to establish eligibility. Reservists will pay a slightly higher funding fee than regular veterans. (See paragraph entitled “Costs of Obtaining a VA Loan.”)


Remaining Entitlement

Veterans who had a VA loan before may still have “remaining entitlement” to use for another VA loan. The current amount of entitlement available to each eligible veteran is $36,000. This was much lower in years past and has been increased over time by changes in the law. For example, a veteran who obtained a $25,000 loan in 1974 would have used $12,500 guaranty entitlement, the maximum then available. Even if that loan is not paid off, the veteran could use the $23,500 difference between the $12,500 entitlement originally used and the current maximum of $36,000 to buy another home with VA financing. For certain loans in excess of $144,000, the basic $36,000 entitlement can be increased to a maximum guaranty equal to 25 percent of the Freddie Mac conforming loan limit for a single family residence, minus any previously used entitlement.

Most lenders require that a combination of the guaranty entitlement and any cash downpayment must equal at least 25 percent of the reasonable value or sales price of the property, whichever is less. Thus, in the example, the veteran’s $23,500 remaining entitlement would probably meet a lender’s minimum guaranty requirement for a no-downpayment loan to buy a property valued at and selling for $94,000. The veteran could also combine a downpayment with the remaining entitlement for a larger loan amount.

Restoration of Entitlement

Veterans can have previously-used entitlement “restored” to purchase another home with a VA loan if:

The property purchased with the prior VA loan has been sold and the loan paid in full, or
A qualified veteran-transferee (buyer) agrees to assume the VA loan and substitute his or her entitlement for the same amount of entitlement originally used by the veteran seller. The entitlement may also be restored one time only if the veteran has repaid the prior VA loan in full, but has not disposed of the property purchased with the prior VA loan. Remaining entitlement and restoration of entitlement can be requested through the VA Eligibility Center by completing VA Form 26-1880.


VA Appraisal

Because the loan amount may not exceed VA’s estimate of the value of the property, the first step in getting a VA loan is usually to request an appraisal. Although anyone (buyer, seller, real estate personnel or lender) can request a VA appraisal, usually this is done by the lender via the Internet using TAS (The Appraisal System). The appraiser will send a bill for his or her services to the requester according to a fee schedule approved by VA. To simplify things, VA and HUD/FHA (Department of Housing and Urban Development/Federal Housing Administration) generally use the same appraisal forms.

It is important to recognize that while the VA appraisal estimates the value of the property, it is not an inspection and does not guarantee that the house is free of defects. Homebuyers should be encouraged to carefully inspect the property themselves, or to hire a reputable inspection firm to help in this area. VA guarantees the loan, not the condition of the property.


The application process for VA financing is no different from any other type of loan. In fact, the VA application form is the same as that used for HUD/FHA and conventional loans. The mortgage lender verifies the applicant’s income and assets, and obtains a credit report to see that other obligations are being paid on time. If all is well and the appraised value of the property is enough to cover the loan needed, the lender, in most instances, can then close the loan under VA’s automatic procedure. Only about 1 percent of VA loan applications have to be submitted to a VA office for approval before closing.


To obtain a VA loan, the law requires that:

The applicant must be an eligible veteran who has available entitlement.
The loan must be for an eligible purpose.
The veteran must occupy or intend to occupy the property as a home within a reasonable period of time after closing the loan.
The veteran must be a satisfactory credit risk.
The income of the veteran and spouse, if any, must be shown to be stable and sufficient to meet the mortgage payments, cover the costs of owning a home, take care of other obligations and expenses, and have enough left over for family support. An experienced mortgage lender will be able to discuss specific income and other qualifying requirements.


Funding Fee
A funding fee must be paid by all veterans using the VA home loan program, except those exempt due to receipt of disability compensation.

The funding fee can range from 0.5 percent for Interest Rate Reduction Refinancing Loans (IRRRLs) to 3.3 percent for veterans who are subsequent users of the VA home loan program.

For all VA loans, the funding fee may be paid in cash or included in the loan.

For more information on the VA funding fee, contact your VA Regional Loan Center.

Other Closing Costs

Reasonable closing costs may be charged by the lender. These costs may not be included in the loan. The following items may be paid by the veteran purchaser, the seller, or shared. Closing costs may vary among lenders and also throughout the nation because of differing local laws and customs.

VA appraisal
Credit report
Loan origination fee (usually 1 percent of the loan)
Discount points
Title search and title insurance
Recording fees
State and/or local transfer taxes, if applicable
No commissions, brokerage fees, or “buyer broker” fees may be charged to the veteran buyer.


Veterans seeking more detailed information concerning the VA home loan program may request VA Pamphlet 26-4, VA-Guaranteed Home Loans for Veterans, or VA Pamphlet 26-6, To the Home-Buying Veteran, from VA.

Remember, VA-guaranteed financing is a benefit which Congress intended eligible veterans should have. If you are a veteran home buyer or know of one, it makes sense to look into the VA loan program as a good way to finance a home purchase.

To locate a VA facility, or to obtain more information on the VA Loan Guaranty program, visit and click on Facilities Locator.

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