In the fashion world, the color black is an icon. It is THE color that never goes out of style and will always have a place in every persons closet. However, every year someone touts that latest fad color as the New Black meaning its going to be a classic that will never go out of style either (but usually its something off the wall, like Lime Green!)
Well, FHA financing has been one of the staples of homeownership for decades, although it fell out of favor in the last few years because of Fads like pay option arms, 100% My Community, and other such colors. In fact, in 2005, there were only about 5,000 FHA loans made in the entire country!
But all of that has changed... after 2005s abysmal showing, the leadership up at HUD (Department of Housing and Urban Development) actually asked real estate agents and mortgage professionals why they were no longer using FHA financing for their clients. Not only did they ask... they actually listened! And starting in early 2006 theyve been rolling out several changes to make FHA more attractive, and I do say it couldnt have come at a better time! Lets look at some of the highlights of the current FHA 203b program (203b is the standard purchase program), some are new and some have been around a while but thought you might need a refresher!
- No Minimum Credit Score, in fact, a no-score may still be acceptable if you can build whats called Alternate Credit such as insurance payments, cell phone, utility bills, buy-here-pay-here, and other regular payments that dont report to a credit bureau
- Bankruptcy guidelines: 2 years since discharge of chapter 7 (1 year in certain cases) and can be currently in a chapter 13 with one year pay history
- Collections and Judgments dont necessarily need to be paid off
- 3% Buyer Total Investment: Borrowers own funds, Gift from relative, employer, or union (cannot be a loan) Gift, grant, or secondary financing from a government agency or a non-profit 501(c)3 organization (note, HUD is trying to disallow the charities that are funded by a donation from the seller. As of this writing, they are still acceptable, but probably not for much longer!)
- Seller can contribute up to 6% towards closing costs (borrower still needs minimum of 3% as shown above)
- Automated underwriting is used in about 65% of the loans closed, resulting in less paperwork and less hoops for the parties to jump through
- Higher debt ratios are now acceptable
- Seller no longer is required to pay the FHA Non-allowables of $600-900
And heres my favorite part (by the way, the #1 reason professionals stated for not using FHA financing any more)
No More Property Condition Reports!
Some of you may remember the 4-page VC (Value Condition) report that appraisers had to complete, and if it was on their report, your seller was fixing it! (my favorite was must have a handrail if 3 or more steps down) Under the new kinder, gentler FHA guidelines you will notice several changes...
- No more mandatory standard tests for termites, flat roofs, septic, and well water
- No more 4-page VC sheets. Uses Fannie Mae appraisal forms
- No repairs required for minor items like leaky faucets, cracked windows, worn carpeting, deferred maintenance, hand rails, etc.
- Appraiser must report ALL property conditions, even minor ones, and then
- Underwriter will determine if any repairs or tests are required
- Watch out for: If a pre-1978 house has peeling paint, that WILL need repairing
- Minor weather related items will be able to be escrowed for repair at closing
FHA has also simplified their 203k Rehabilitation loan program, which is where your client can buy a house that needs rehabilitation and roll the repair costs right in with their loan. The entire transaction will be based on the value of the house after repairs. These used to be very hard to deal with all of the inspections and consultants, but the new Streamline 203k doesnt need any inspections at all if the repairs are under $15,000 (there is no maximum on the repairs in a 203k, but the program will require inspections and/or consultants depending on the job scope). This may be the perfect answer to we love the neighborhood... if it only had an updated kitchen and a new roof, it would be perfect!
Think you want to start recommending FHA Financing to your buyers?
Its very important to find a mortgage professional that has experience in FHA loans. Since these loans have not been as popular in the last few years, there are not a lot of loan officers with FHA knowledge right now. Dont trust your clients to someone that is new and inexperienced. Find someone that has been around a while and used to close FHA back in the late 90s and early 00s. Many very good loan officers still want and need your business right now and your buyers are too few and far between to take that chance.
According to the report from the Ministry of environment, Mauritius produces some 120 tons of plastic wastes daily amounting to a total of 43,800 tons of waste every year of which only 4%, representing some 164 tons, are recycled. In 2006, the population’s consumption of non-biodegradable plastic products amounted to some 70 million Polyethylene Terephthalate (PET) bottles, 7 million PVC bottles, and 113 million plastic bags.
Now just imagine a process able to clear our environment of plastic wastes, creating jobs in waste management and collection and at the same time bringing useful resources such as petrol and gas, which can be beneficial to our economy. The Liquid Hydrocarbons pilot project proposed by the Green Hydrocarbons (Mtius) Ltd has the ambitious desire of turning our plastic wastes into hydrocarbon petrol.
The environment friendly project, realized with the collaboration of the initiators of the project in India, Unique Waste Plastic Management & Research CO. Pvt. Ltd., will enable Mauritius to get rid of its plastic wastes while at the same time providing resources such as petrol. The initiator of the project will bring all the technology and equipment necessary for the setting of the pilot plant while the government, in collaboration with Green Hydrocarbons Ltd., will provide the necessary location and licenses.
The ration of the conversion of the plastic waste into petrol is one kilogram of plastic into the volume of 1000 cc of petrol. The pilot project will hence be converting some 2.5 tons of plastic wastes daily into some 25,000 liters of petrol and other by-products. This project is a green alternative to the palliative solutions that have been found so far to deal with plastic wastes. Land filling, incineration, recycling, gasification and blast furnace have shown their limits in the treatment of plastic wastes.
Recycling is unfortunately not a practical solution in that the cost of collection is quite high; there is a limited market for it, with an absence of marketing. Moreover, plastic can only be recycled three to four times, after that it loses its strength and can’t be recycled. The project realized with the collaboration of Indian partners is due to start in the course of the year 2007, once the EIA obtained.
Beginnings
The concepts of plastic conversion into hydrocarbons was elaborated by Professor Alka Zadgaonkar of the Raisoni College of Engineering, Nagpur in Indian, in the year 1995. While giving a lecture on Applied Chemistry, she came up with the idea of turning plastic back into hydrocarbons. She worked with a team on the formula and in 2004; they succeeded in turning 300mg of plastic into hydrocarbon liquids.
Unique Waste Plastic Management & Research Co. Pvt. Ltd of India later launched a pilot project where some 5,000 tons of plastic wastes were converted everyday. The process was later extended to treat 25,000 tons daily in 2006 and the objective of the project is to treat some 450,000 tons. She asked for analysis by Indian Oil and made a number of recommendations for the use of the final products.
After about one year of operation, the project was realized with the help of loans. Representatives of the State Bank of India acknowledged that the project is already running on profit, thus proving the efficiency of the method. The world produces no less than 60% more plastic wastes than it did some ten years back with a production of 100 million tons every year. India produces 10,000 tons of plastic wastes everyday which 40% are recycled.
This project has enabled India to better manage the country’s plastic wastes while at the same time creating jobs. Actually India sells its hydrocarbon at 40% to 50% less than normal diesel. The technology is presently being exported to other regions such as Rajasthan and even to America; for instance, some hospitals are being operated using their own wastes.
The investments for the pilot project in Mauritius are estimated to around 100 to 300 millions Rupees. Land filling, incineration and recycling 4% are presently being used but they do not resolve the problem of environmental damage caused by plastic. The Waste to Compost project, will however give a new dimension to the processing of plastic in that hydrocarbon and the other by-products used as compost.
Both Ben Needles & Andre Lee are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Ben Needles has sinced written about articles on various topics from Business Credit Cards, Anger Control and Business Credit Cards. About the Author (text)Andy Tolbert has been in the real estate industry for over a decade and has been training others in the real estate industry for over 5 years. Tolbert's specialty is investor financing. Ben Needles's top article generates over 550000 views. to your Favourites.
Andre Lee has sinced written about articles on various topics from Air Travel, Finances and Infidelity. About the author: André Lee is the Internet Marketing consultant, Advisors to Tour Operators and Ticketing Agents. More of his articles are available at