DON'T BE A SITTING DUCK!

                                                                                                               eslbagcaafe.com

   Today's news brings some distressing information from Arkansas pertaining to a real estate broker who was tragically killed showing a vacant home. Having been a real estate agent for ten years I understand the impulse to meet a potential client at a listing in the quest to make the sale.  No one in the real estate industry gets paid until the purchase is under contract, the mortgage loan is written and approved, and the deal is closed.  The need to pay the bills, get food on the table and keep the children in shoes looms large in the decision to show a property -- even to someone the agent has never met before. As the situation in Arkansas shows, this need can put agents in a situation that an spiral out of control with devastating consequences.

  I am sure that many real estate firms around the country will be reviewing their safety practices in light of this horrible event.  For my agent partners I would make a couple of suggestions:

 1) Resist the temptation to show a home to someone you never met.  If they tell you they have been pre-approved ask who the loan originator was that spoke with them and follow up with that person. While pre-approval isn't  fail safe, if a buyer has produced paystubs, bank statements, and identification it does lower the risk.  Due to the increased scrutiny on lending required by the Patriot Act, we are required to obtain picture ID, social security cards, and do a Home Land Security search form, as well as review discrepancies on credit.  If the person is giving a false name or social security number the credit report should pick it up.  The Federal Government takes questions of identity seriously, please take advantage of that fact.
 
 

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 One of the practical effects this may have is that as an agent you may want to consider offering the buyer an alternative to online lending. you aren't going to get much information about a client out of an online lender.  Most of the agents I know would prefer to deal with a local lender that they can count on to give them information pertaining to how the financing piece is coming along rather than try to find whoever it is in cyber space that you need to speak with in order to get the job done.  If you are a buyer reading this, by keeping things local you assist the efficiency of your own purchase process.  In my experience very few online lenders are going to give you a deal that is significantly better than what you can find in your own town. The advertising may not have anything to do with the actual loan you, the consumer is getting. 

  Lenders should be asking prospective buyers the hard questions about where they live now, where they have worked in the past - - questions that many real estate agents feel uncomfortable asking.  Listen, I have no problem asking a potential buyer just about anything. Divorce, child support, the reason for the bad credit two years ago, underwear size - - you name it we have to investigate it.  Because if they aren't really a buyer I want to know now and not spend a lot of time on something that is not going to be successful. I have to close loans to make a living, and you my real estate friends, have to have buyers who can buy so you can make a living too.

2) If you are an agent that does open houses as a marketing strategy, don't go it alone.  Either take another agent with you or call in your favorite Mortgage Loan Originator to assist you. Buyers almost always have questions about interest rates, programs and the short term future of lending. Bring in an expert to help. It's safer and you are building what may be an excellent partnership.

                                                                                                 cherrypointhomesforsale.com

 Okay consumers, this next section is for all you, HGTV watching, that doesn't look so hard, do it yourselfers.  Besides the fact that selling a home is in fact hard - -if it was easy there would be no real estate industry - - there are some things to consider besides the money you think you will be saving.

  Would you allow a stranger that pulls up into your driveway access to your home?  Think about that for a minute.  Some stranger pulls into your driveway one evening and says, "I have always loved the way this home looks.  Can I see the inside right now?  I might want to buy it sometime."  Would you let that person have access to your home? This person will be seeing the inside of your home, any expensive electronics, furnishings, where doors and window are, if there is an alarm system and what is even more terrifying, where your children sleep at night. Would you do that?  My friends, when you choose to market your home by yourself that is exactly what you do.  You are allowing perfect strangers whom you know nothing about into your home.

  It is a fact that our community is small, relatively speaking.  Maybe the chances of someone coming into your home to do you harm are less than what they might be in a larger city, but that doesn't mean it can't happen here.  Many real estate agents I know can speak to a visitor that came to an open house that might not have been there to see the house.  In my own case, working as a new home consultant I had a visit from supposed prospective buyers at the end of an afternoon that made the hair on the back of my neck stand up. In that case I thought they were casing the house for a potential hit and run theft rather than to do me harm -- but even the thought of that is enough that I don't want to let just anyone into my home. And folks, I know a lot about selling houses and could so quite capably myself but I would never sell my home without the able assistance of real estate agent.

  The fact is that a home owner is even less likely to ask any qualifying questions to a potential buyer, thereby putting themselves at even more at risk. If you are a sell-it-yourselfer- consider the additional layering of safety that listing with a real estate firm gives you. If your agent is doing their job they will know something about who is coming into your home. No commission savings is worth putting your family at risk.

   If you are a real estate professional, the commission isn't worth your life. If a potential buyer won't do what they need to do to prepare to go inside of someone's home - don't risk it -the red flags should be flapping at the top of the pole. Due diligence is a good rule for personal safety and the safety of your clients as well.

                                                                                                 farmprogress.com

  As a rule I don't view the world as a dangerous place, but there is no sense allowing oneself to become a sitting duck.

12thompson.com

7 NO SALAD

 

                                                                                                            

                                                                                                           relativetaste.net

  Today's topic is geared towards those who will either be first time home buyers or those who have not been through the mortgage process for a few years - say pre 2010. 

  When most folks think about buying a house they think of a pleasant experience, the fulfillment of a dream, the procuring of the nest. Home has so many powerful emotional connotations. I have seldom worked with a buyer that wasn't excited about the prospect of buying a home. Many buyers come to me with ideas of how they would like to structure their financing and some very creative plans about how to do it. Maybe they read a book, or spoke with someone who bought creatively back in the day. So for those folks-let's take a moment to review.

  In 2008 the bottom fell out of the real estate bubble due to over inflated housing prices and some lending practices that were sketchy at best, illegal at worst.  By 2010 the federal government had caught up with the issues and instituted corrections that probably went overboard in terms of how to fix the situation.  Many of the fixes are beginning to come under scrutiny as they have kept the housing market in slow motion as qualifying restrictions have been so ...well...restrictive that they have choked off business.  We have seen some dialing back of lending regulations but there are enough left in place to warm the cockles of any auditor's heart, and frustrate even the most patient borrower.

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Compliance Alert ahead-these are things that no longer can be done if you are going to purchase a home using a mortgage.

1) I have my down payment in loose change that I have been saving for ten years. I want to run it through the change machine at the bank and use it for my down payment.

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  This actually happened on one loan we did a few years ago, but the issue is not the amounts of change, the issue is large cash deposits to your bank account.  Un-sourced money can't be used in a real estate transaction.  By sourced, I mean the money used in the purchase has to come from a documented source-a paycheck, and IRS check, a check for the sale of your motorcycle (accompanied by a bill of sale and title transfer).  In other words we as the lender have to be able to see where it came from, not under the mattress (Yes we may be able to see it there, lying between the memory foam and the box springs but we can't see where it actually originated .  This is often the most troublesome area to document. You may have garage sale proceeds, the money your cousin Ernie owed you to buy new tires for his car, or whatever.  I look at my own bank account and it probably wouldn't withstand much scrutiny.  When we buy a home we have to use our bank account differently. If you plan ahead the lender will only require two months bank statements so put your mattress money in the bank several bank statements before you plan to use it.

2) You want to buy a house with a big hole in the roof and the kitchen has been gutted. You have pretty good contracting skills so you will just fix it after the loan is closed. 

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  Unfortunately you will not be able to borrow money for a home that has serious repairs that need to be made with the idea that you will make the repairs as you can.  Lending got caught on that one.  It seems there were people out there that closed their loans and never made the repairs (Who would ever have guessed???). Along the same lines, there used to be a practice of lending more money than the asking price for the home so that repairs could be made.  That too has undergone some serious changes. Once again people just were not making the repairs and using the money for other things. Anyone up for a trip to the Bahamas?  Along comes the lending crisis and banks found out they owned a bunch of homes that had never been repaired.  There are a couple of rehabilitation loans out there funded by FHA, but those are highly regulated and not open for freestyle repair jobs. 

3) you just bought a beautiful wooded lot a couple of months ago. You signed a contract with a builder and you are going to use the lot as your down payment.

                                                                                                       pandawhale.com

It is a Fannie Mae and Freddie Mac requirement that you own the lot for 12 months before you can use it as equity for the down payment.  Along the same lines it is very difficult to obtain financing for a self build. So all of you would- be contractors will have to find funding other than from any type of source that uses money that is overseen in any way by the federal government. There may be some small banks that will do in house lending that may still do some of this for outstanding clients.

4) You are self employed and  make a really good living.  But, here's the thing, you really think taxes are too high so you expense everything out so you show a loss on your taxes.  But you have great credit and you can put 20% down.

                                                                                                       sodahead.com
Back in the bad old days there used to be a great loan for self employed people. It was called the "stated income" loan, more often fondly referred to as the liars loan.  The borrower would "state" their income - a number that would ensure loan approval as since it was "stated" it could be goosed up to cover any debt ratio issues that might occur.  That loan has been pretty much decreed illegal.  So-if you are expensing away your income on your tax returns, you need to start showing some net profit.  Enough net profit to cover your debt ratios.  Two year's worth of net profit is what is required. It would be helpful if some accountants would take note of this so you can counsel your self employed clients- a simple question-do you plan on needing a loan in the future, would do the job. This is a two year plan. And I would think any significant consumer credit loan would need the same preparation.

5) you can't sell your current home for what you would like to get for it.  You will just keep it and the rent you receive will offset the new house payment.

The only way you can do that is if you make enough money to cover both house payments and your debt ratio is in line with both payments.  The rules on this one are that you must have two years of rental history filed on your taxes any specific property to use the rent money to offset rent in the debt ratio. If your current loan is an FHA loan you must also have a 25% equity position as well. The same applies if you have sold your existing home on a contract sale. Two years showing the payments on your tax returns. That's the rule.

6) you currently have an FHA loan.  You don't plan to sell your current home but your mortgage  loan originator tells you that another FHA loan is the best way to go.

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FHA only allows you to have one FHA loan at a time. UNLESS: and this is getting harder and harder to get an exception for - you can demonstrate a significant increase in family size so the original home doesn't suit any more, or in the case of a job transfer you can't commute to the new job. It used to be that Indianapolis was far enough away from Lafayette that the exception could be approved. The last one of those I tried was a definite thumbs down.

7) Your credit is too low for financing a mortgage loan. But your girlfriend has great credit so it would be okay to make her the co-borrower wouldn't it?

                                                                                                                700startup.com
No- the whole co-borrower thing doesn't work anymore.  Lending takes the lowest middle credit score so your girlfriend's credit does nothing to help the cause.  She may be able to buy a house if she chooses and let you live there.

  Gee this whole exercise has been a bit negative hasn't it.  I will follow it up in my next blog with all the yes answers!  There are more than you think left.

8 REASONS TO BUY A HOME THIS FALL

                                                                                                                   picturenew.com

  Eight, ocho, huit, acht, however you say it, is a good number.   A solid number. Not too many, not too few.

   While I do not necessarily recommend home ownership to everyone and will be honest with folks  that I don't think are either ready or in a good position to purchase, I do support and encourage home ownership.  To achieve maximum benefit one must be in a situation that will be stable for the next five to seven years.  If you might relocate in the next twelve to twenty four months I would probably not advise you to purchase a home.  It takes about three years to break even, so I would suggest that if you are not planning on relocating three years or more, buying a home vs renting should be a part of your calculation.

  Having stable income is also a must and it while you can purchase a home with little or no savings using gift money or one of the 100% financing options, those loans without any savings to back them up make me nervous. Just because I can get the approval doesn't necessarily make it the right thing to do. Furnaces need to be replaced, roofs repaired, etc. So it is important to have some back up funds and a reliable job in case of emergency.

1)                    

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 The first and most compelling reason to purchase a home now and not put it off is the low mortgage rates.  I know, I know, they have been low for quite some time.  Long enough that an entire generation has come of age knowing nothing else.  It is hard to convince younger buyers that have seen anything but rates in the high 3's and low 4's that it will ever change. To be honest, they have hung around a lot longer than I would have predicted. But they will go up.  The moment it looks as if the housing market is stable and the economy is growing at a steady clip, look out.

2) More inventory, more choice.    

myscottsvalley.com

 

 

 

 Housing inventory has increased steadily over the most recent years.  Value is up and sellers are now more confident that they have equity and may be able to walk away from a sale with a little money in their pocket.  With values increasing and rates remaining low, a seller has an excellent chance of being able to sell and buy their new home at a good price.  Waiting to sell only increases the chance that the seller will have to pay more. Add to the fact that new phases of subdivisions are now being developed as the new home market has come roaring back-now may be an excellent chance to investigate new home construction if you can't find an existing home that meets your needs.

 

3) Beat the price increase.     

economist.com

 

 

 

 

As I mentioned earlier-prices on homes will be increasing. As the market comes back, more buyers will be entering and sellers will be able to sell their homes at a higher price.  Currently HUD is looking at easing some of the constraints that have kept qualified buyers from mortgage eligibility, and Fannie Mae and Freddie Mac are reviewing their fee structure with the idea in mind of reducing stipulations on consumer lending.  All of this should mean a more robust market next spring.  Builders too will have to pay more for materials.  Those price increases generally happen in January so a word to the wise if you think new construction is in your future-get that contract locked in prior to January.

 

4)  Has anyone mentioned that rents keep going up?  

 

 

ocrealestateconsultant.com

 

 

It is all about supply and demand folks.  When people are unable to purchase a home due to credit issues from the recession, not being able to find a stable job, or not being able to save a down payment, they rent. The more renters there are, the more the prices go up.  From what I have been told, in our area at least, finding a decent rental is going to cost as much or more than buying. The farther away we get from the Great Recession, it is increasingly likely that people will start thinking about buying instead of renting, if for no other reason that the cost.

 

5) Employment stability is increasing. 

 

 

 

  Tippecanoe County is moving forward with increased employment opportunities. A new assembly line at Subaru and a new General Electric plant are compliments to the old standbys of Caterpillar, Alcoa, Purdue and Wabash National.  Employment is on the uptick. It is a fact that employees that own their homes become more rooted in the community and decreased turnover is the result. If more people are moving to the area, the demand for housing increases.

 

6) You have to pay to live somewhere.  

 

 

 

  That's a fact, unless you are residing in your parent's basement.  Sooner or later adulthood demands that you have to pay to live somewhere so you owe it to yourself to consider buying a home.

 

 

7) If you buy right, owning is forced savings.    

24/7.net

 

 

 

  As we move into a more normal economic period, homes will once again accrue value. While buying a home is not a short term investment, over time a home in a desirable location should appreciate in value.  And keep in mind it is all about the location, and how you buy.

 

 

8)  

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  For most people the mortgage interest deduction is the single largest deduction on the income tax. The home mortgage deduction can be the difference between paying taxes and receiving a refund. And with home ownership come property taxes.  Property taxes are also deductible. So if you receive $1200 back in tax benefits, that nets  out to a $100 a month reduction in your mortgage payment. It is important to keep this fact in mind.  Rent is not deductible from the federal taxes.

 

  There you have it. Eight good reasons not to put off home ownership until next month, next year, or the year after that. You could be saving money, building equity, and lowering your tax liability. If not now, when?








6 COMMON MORTGAGE MYTHS

                                                                                                                 fanpop.com

  That's a lovely picture. A Phoenix, a mythical bird that rises from the ashes of it's predecessor, a  symbol of new life. Today we are going to discuss mortgage myths, notions that seem to take on new life that keep people from acting on their desire to purchase a home.

 

 

MYTH #1

 

I have to save 20% for a down payment.

 

FALSE

 

  I am not exactly sure why this statement is still pervasive, but many people still believe that your grandmother's down payment still goes.  The fact of the matter is that a 3.5% down payment can get the job done or in the case of two types of government loans, USDA and VA, there is no down payment requirement. Conventional lending at this time requires 5% down although Fannie Mae is bringing back a 3% down product that was discontinued last year. So forget the 20%.

 



vampymeodeviantart.com

 

 

  References to the dreaded Jackalope go as far back as the Aztec Empire, this creature is reputed to be highly dangerous though jackalope milk is rumored to have extraordinary medicinal properties.

 

 MYTH #2

 

 I have to have excellent credit to be approved for a mortgage loan.

 

FALSE

 

  While some could argue that having excellent credit does take on extraordinary properties, outstanding credit is not required to obtain a loan approval.  FHA,VA and USDA will loan on credit scores down to 580.  This is not a guarantee that if your credit score is a 580, you will have a loan, but it does mean that we would be happy to consult with you and assess your complete financial picture to see if you would fit in the criteria required to be successful.  Given that we are a mortgage broker we have access to a lender that does excellent work with credit in the 580-639 range.

 

 

forwallpaper.com

 

 

   Who doesn't love Pegasus, the horse of the Greek Gods? Pegasus brings us to:

 

 

MYTH #3

 

My bank turned me down for a mortgage so I won't be able to buy a house.

 

 

  Under no circumstances accept your bank's word as the last word as to whether or not you will be able to obtain a home loan.  Many banks are very conservative organizations and have lending rules in place that exceed the rules required by loan programs. A bank typically has one source of funding so whatever the rules are for that investor, so goes the thumbs up or down process.  A mortgage broker such as Tippecanoe Mortgage has several difference sources of money. We choose our sources based upon different specialties, so given more choices, there are more chances for success.  Your bank is not the last word.

 

 

 

The griffin is a beast comprised of the king of beasts, the lion and the king of birds, the eagle.  Often the symbol of royalty can be seen on the family crests and shields of Kings and universities for some reason.

 

 

MYTH #4

 

I must be at my job for two years before I can qualify for a mortgage.

 

FALSE

 

 

Each situation is unique, but different lenders and different loan programs have different criteria. Often 30 days is enough if all probationary period requirements are met and the work was preceded by training or education in that field or prior experience in that line of work.

 

 

 

Disney.com

 

Heroes from Gilgamesh to St. George have battled this mythical creature and it still crops up in modern literature in no less popular a series of books than Harry Potter.  The blood of the dragon is said to render invincible those who bathe in it.

 

MYTH #5

 

A mortgage broker charges their clients more than a bank.

 

FALSE

 

 

  The fees a mortgage broker charges are regulated by the Federal Government under the Dodd/Frank Financial Reform Act, the same as a bank's.  I find that on most occasions when I am competing with a bank for a loan my fees are less.  I still see articles around that state that the consumer has to beware of "junk" fees, i.e. fees that are thrown in that add to the broker's bottom line. It might be instructive to note that we are required to submit invoices for all fees that are charged, and we can charge no fees that aren't for third party services. This old myth can die with a stake in its heart.

 

The Metropolitan Museum of Art

Last but not least, who could forget the unicorn the most beloved of mythical beasts, appearing on the royal coat of arms of Scotland it is considered a symbol of purity.

 

MYTH #6

 

Mortgage Brokers Charge Higher Interest Rates.

 

FALSE

 

  We have dispensed with the fact that mortgage brokers charge higher fees so mortgage brokers must charge higher rates? Right? Nope. Interest rates are competitive with comparable loans from other lending sources. In many cases our rates are better as we have more than one source of money at our disposal.

 

  These six myths are some of the most common reasons why consumers may be hesitant to purchase a home or choose a mortgage broker as their lender. And like my mythical beasts, the stories are old and pass as conventional wisdom. But they are simply not true.  Be sure you know the facts of your situation before you decide you are unable to buy a home. Rates are great, and prices are reasonable. Now is a terrific time to buy. 

 

 











7 WAYS TO CARE FOR YOUR CREDIT

  It is a fact that credit now permeates almost every area of our financial lives. Not only is your credit rating important when it comes to mortgage lending, it makes a difference in what interest rate you pay on credit cards, auto and home owner's insurance, whether or not a landlord will rent to you as well as increasingly whether or not you will be hired for a job.  Computing technology makes changes to your credit score with lightening speed.  It is important that a small amount of understanding with regard to what makes up credit and how to maintain it is in order.

1) Delinquent payments.  It should go without saying, but paying your bills late brings your credit score down. Specific late payments such as a late mortgage payment or a late student loan payment hurt scores more than a late credit card payment.  It is also worth noting what is called a “rolling late”. A rolling late occurs when a payment is made late and skipped. Until the past due amount is made up, the late reporting will "roll" from one month to the next compounding the damage done to the credit score.




2) Collections and judgments. These items don’t just go away.   They are supposed to be removed from a credit report after seven and ten years respectively, but it doesn’t always happen. The older a collection gets the less it impacts credit and if you decide to pay off a collection you must pay the collection company not the original creditor or the collection will not be changed to show it has been paid.

 Medical collections are items that many people don’t know are reporting on credit.  You go to the hospital, file the insurance claim, receive the original bill pending insurance and think the bill is paid and go on about your business.  There is often a lag time in insurance paying medical bills. In the interim the bills go to collection. Theoretically the collection company should notify you of a pending collection but it doesn’t always happen. Even if the payment is received by the original creditor, chances are they won’t notify the collection company and you are stuck with the collection bringing down your credit score. There is a big change pending due to the Consumer Financial Protection Bureau ruling that medical collections can’t be used to downgrade credit as negatively as they have in the past. So that is good news.

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  You might need New Balance shoes to elude your creditors if you let your credit card balances get out of control. Even though you have a limit it is never a good idea to charge up to the limit.

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3.  You will want to remember this number.  33% is the optimum balance you should keep on each card in relation to your credit limit.  It is better to have two or three cards at 33% than one with a large limit that is charged up close to the limit.  A simple and fast way to boost credit scores is to pay down balances to 33% of the credit limit.

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4) Age.  The age of your credit account also helps you. If your accounts have been established and paid on time for 12 months or more, you score will be better than if your accounts are new with no length of history.

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5) More is better, right? Having a bunch of credit cards is better than having just one. Yes and no. One credit card won't give you the depth of credit and the maximum history you need for optimum scoring.  The ideal number is up to individual preference but we always recommend at least two cards that are used regularly. They don't need to be used a lot, just regularly. 

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6) Assuming we all agree that variety is the spice of life, it is important that your credit accounts are varied. For the best credit scores you need more than one type of creditor reporting on you credit report.  Without a doubt revolving credit gives you the most bang for you buck. But a couple of credit cards should be varied with a car loan or another type of installment loan.  Student loans and mortgages also assist in increasing your credit scores. We recommend three credit lines and maximum effectiveness tops out at about six.

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7)  There is one last item on my credit agenda and this has to do with closing credit cards you no long wish to use.  When you close accounts, your credit score drops. Why? Because they aren't working for you anymore.  If there are accounts you no longer wish to use, just pay them off and leave them alone. They won't necessarily help your credit but they won't actively hurt it either.

  Credit is hard to pinpoint as it is constantly in motion based upon what accounts you are using. paying, and closing.  However, if you follow the above rules, you can keep your credit in excellent condition and obtain the best rates and yes, even that dream job.

EVERYTHING OLD IS NEW AGAIN

   Didn't someone once say "the more things change the more they stay the same?"  I believe the original quote was in French - - and since I am a recreational French speaker at best, I will refrain from putting on paper words that I can't pronounce.

  In any event, the fourth quarter this year will be a time of change for lending.  The first of these changes occurs today.  Those who have been in the real estate industry pre-2008 probably remember a mortgage loan called "My Community."  My Community is a conventional mortgage that is a great alternative to FHA.  In it's original format, My Community was 100% financing.  Since the rate of foreclosures on properties that had little or no down payments was higher than other types of loans, My Community is not back in its 100% configuration.  However it is back as a 5% down loan. The 5% can be a gift from a family member. How does this differ from a normal 5% down loan, you may ask?  I would be pleased to answer - - the good news about My Community is that the mortgage insurance premium is significantly lower than either FHA or conventional lending.  And just as is the case with conventional lending the MI does fall off the loan once a 78% equity position has been achieved. An FHA loan requires the mortgage insurance to remain on the loan for the life of the loan. Blech!

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My Community does have an income cap like USDA, but unlike USDA the income cap is only for the borrower not the entire household. In our area the cap is generous - - around $61,000 for those who reside in Tippecanoe and contiguous counties.

  The next change on the horizon happens on October 1st and it has to do with USDA.  The monthly mortgage insurance premium will go up to a .50 factor of the loan amount.  So a $100,000 mortgage will be assessed $41.67 per month in mortgage insurance as compared to the .40 percent ($33.33) that has been charged on the same $100,000 mortgage.

  The second change having to do with USDA is that the current maps of eligible areas are changing October 1. USDA property eligibility is based upon population density.  USDA has finally gotten the 2010 census integrated into their system and will be shifting boundaries based on those numbers. So beware, what once was an eligible area may no longer be. If you currently have a USDA mortgage and are thinking of refinancing, where you are located has no bearing on your ability to refinance. However your income is still a qualifying factor. But, if you do still qualify income wise, USDA has a great streamline refinance that allows you to roll closing costs in, but does not require an appraisal. So for anyone that has an old USDA loan out there at 5.5% or more, you are a prime candidate for a streamline refinance as the current USDA rates are 4.0-4.50 depending on credit, loan size etc. 

 

simonfamilyjcc.org

 

 

 

  Coming soon to a Tippecanoe Mortgage Branch near you another oldie but goodie (drum roll please)

 

 



 

                                                                                                         azerotheanlife.com



 

 

 

DOWN CONVENTIONAL LOANTHE 3% !  You can see by the fact that I have written this in read and in bold type that I am very partial to this loan.  Once again we have an alternative to FHA that features a lower down payment than FHA. I am not sure when this one will be available again but I am told prior to the end of the year. 

 

  USDA is proposed to go to a new underwriting system typical of the manner in which FHA loans are underwritten - - by the lender. If the lender approves the loan, it is ready to close. Currently USDA loans have to be underwritten and then double checked by USDA to ensure that their guidelines were met by the lender.  A bit  of duplication of effort, department of the redundancy department I 'd say, not to mention that the check off by USDA creates a backlog of loans. (currently 760 loans in Indiana are waiting for USDA to stamp them approved which translates to a wait time of 32 business days)  FHA uses a system which certifies underwriters to underwrite to FHA rules and that is that. If an underwriter messes up and the lender has to take back too many loans - -the underwriter won't retain their job long.  Therein lies the control on the FHA system. So, the USDA is supposed to be going to a similar system this November. It does involve and act of Congress, and you know how that's going lately.

 

 

  And as further proof of change, lenders are becoming more tolerant of lower credit scores. Up until the fall of last year purchasing a home with a score under 640 was an impossible task. FHA allowed it but the first challenge was finding a lender who would underwrite the loan.  We began seeing a thaw in that ice, however, it was a tortuous, difficult, frustrating route to closing.  This fall we are seeing more lenders say they will consider lower scores, but the process is still extremely difficult.  We have been fortunate to affiliate with a lender that will do these lower score FHA and VA loans without demanding an arm, a leg, rights to the first male child and a DNA sample from our borrowers. Our files have been moving through their system with little problem. Many people have lower scores due to past medical issues, or loss of job credit hangover from several years ago. These folks are prime candidates for this lender.

 

 

thabto.wordpress.com

 

 

   It is true, the more things change the more they stay the same, repackaged and reconfigured, perhaps, but more opportunities for more people to buy homes.  I'll drink to that!

 

 

fineartamerican.com

 

HAVE A GREAT WEEKEND!