Loannetter

The process of buying a home can be boiled down to three basic steps: 1. First you qualify for the amount of money you will need to borrow (credit approval) followed by 2. Finding a property you like and can afford, and 3. The final step of  'closing' which brings everything together and you get the keys. While this may sound easy, there is a lot of paperwork and communication required along the way.  All banks and lenders now observe 'safe and sound lending' practices. These guidelines are not new; but they are more regulated. It's all good ! Everyone wants to be sure you are informed of all you consumer rights while making such a big financial decision. Before you even start on the Credit Approval process, it's a great idea to put things into perspective. For example, what  are you now paying for rent and what do you think you could afford for a house payment? Have you established good credit habits? Is your employment history stable? Fortunately with al...

It's great to get some good real estate news for a change. We see opportunities for buyers everywhere we look! Enter REO: At today's rock bottom prices -- REO or "Real Estate Owned Homes" (i.e., in the bank's portfolio) are the best value going. Fortunately Fannie Mae and VA will fund their own 'acquired homes'. For buyers intending to occupy the home themselves, acquiring fixed rate terms at current rock bottom rates is a fantastic option. The Challenge: For most folks the home you can afford is the one you can get a loan for! Funding is a big conundrum with most REO's due to their often distressed condition, the quick sale aspect at auction and the mood of the selling bank. If you've tried your hand at closing a Foreclosure or Short Sale you know how much fun that can be. You do need a keen nose to ferret out a solid home beneath the banged doors and tall grass. The homes are generally sold without an appraisal 'as is'. That there...

Checklist for a Positive Home Loan Experience: 1. Work with a trusted advisor! Applying for a loan is a pretty personal thing. It really helps if you have someone on your side who expresses interest in you, rather than just trying to fit you in their ‘box’. If you are also buying a home, seek out a Realtor and Broker who work together for maximum effect on your behalf. 2. Borrow within your means! It is REALLY imporant to find out what you can afford before you go shopping for a home. Work with your mortgage planner to establish what you feel comfortable with in terms of a mortgage payment in context with your home ownership goals. Otherwise, you may be encouraged you to buy at the top of your borrowing power. (It's a fact that your realtor and lender make more commission the higher your purchase amount). Establish a monthly budget taking into account your personal needs, taxes, insurance and ongoing upkeep. 3. Understand your commitment! Many very sophisticated people go...

Credit Scores and Certain Propertery Issues = Risk Categories to Investors. If you apply for a home loan with a FICO credit score of 720 or over, you will most often be approved for a great interest rate with full documentation (proof of employment, assets, etc.) and the property values well. An applicant with a mid FICO score of 680 or better, depending on the specific lender's guidelines must have pretty solid income verification and be a wage earner. The litmus test for self employed persons for best terms is currently 740+ FICO and very solid tax returns and quarterly reports. Example: L et's say you can get 6% on a 30 year fixed rate for a person with 720+ middle FICO Score. If your score is 680-719, you may be offered an interest rate of 7%. If your score is below 680 expect 'hits' to your price and possibly 8% or higher for the rate. Below 600 and you will be charged even higher rates and may only qualify for much higher rates or be limited to programs. Most...

I fondly recall the image of John Travolta combing his hair while walking down the street to the Bee Gees 'Staying Alive' in Saturday Night Fever . That movie was really about a street smart guy using everything at his disposal including very fancy footwork to win against the odds. To identify with such a caricature is what it feels like to be a mortgage broker today. We are the creative, the resourceful, the get it done folks you know will find a way if anybody can. However you may be affected by the horrible news going down in the financial world--I would like to stand in support of some very committed mortgage professionals I call my colleagues. While it is sad for us to watch our lenders (some very decent folks) one by one close their collective doors...it is obvious from where we sit that the biggest of our esteemed banks have been doing (to quote today's newscaster) "really stupid things!" It is very hard to imagine what was going through the minds of...

Winds of Change Bring Fresh Air! Old ideas are our biggest liability: The 40-year record low interest rate was fun while it lasted. Let's celebrate the fact of healthy growth in our region with property values holding ...and seize the moment! New ideas are our biggest asset! It's time to stop being reactive and get creative. People will continue to move, refinance and need sane financing. It really pays to keep up on all the lending changes coming thick and fast now. For example, some lenders accept 10-99 income verification and business records for self employed borrowers. You just need to know which lenders and loan programs will honor this form of documentation. Credit appetite cycles: Our economy is experiencing a cyclic shift. Considering the subprime market is less than 17% of the entire mortgage industry and those at risk are a fraction of that fraction, one might say what passes for news is overblown. Bear in mind: the main reason a homeowner might default on th...