Fannie Mae and Freddie Mac along with the Attorney General of New York created this great program called Housing Valuation Code of Conduct (HVCC) that would solve all the appraisal fraud problems we have experienced over the last few years. While EVERY ONE in the business knew this was bad idea from the beginning the public was unable to let their voice be heard.
HVCC has not only resulted in higher fees and additional headaches for the consumer, a recent report shows appraisal fraud has actually increased by 40%. Another government intervention failure and I know there will be more to come.
When will they learn to talk to experts in the business before they create or pass new guidelines/laws?
Tuesday, November 3, 2009
Wednesday, August 12, 2009
The Moving Target
As the mortgage industry continues to evolve the toughest obstacle to over come is the constant moving target of loan approval. Tougher guidelines continue to limit home ownership to those who want to buy. Many potential home owners are finding out they may have qualified last month to purchase a home and now they don't OR they are approved for a much lower loan amount. So what can you do to make sure that you are able to buy home today AND next month with guidelines changing so rapidly and often? 
You need to make a budget for yourself and know what you can afford and WANT to pay on a monthly basis. The biggest problem most potential home owners make is they try to purchase a house at their qualifying amount, which is not always what they can afford. Mortgage underwriters only account for the debt that is reporting on your credit and you may have other obligations that are unknown to the underwriter. Make sure you have room in your budget for emergencies and don't over buy. By not over buying you are also protecting yourself from debt to income ratio guidelines changing.
Pay off your debt and save money! I know this sounds like common sense, but you don't how many people purchase new items for their home BEFORE they close or start the approval process. The lower your debt and the higher your savings will help your chances of loan approval when guidelines change. Mortgage underwriters will grant exceptions on certain guidelines if there are compensating factors and the two biggest compensating factors; our your debt to income ratio and savings.
Plan ahead - Once you obtain a mortgage approval it is typically good for 120 days, but you must be approved FIRST. Before you start looking for houses talk with a mortgage professional and obtain underwriting approval. This way if guidelines change, you most likely won't be affected as your loan is already approved. Also, the approval process is taking a little longer then it did six months ago, if you wait to start the approval process until you are under contract you may run in to complications with closing on time.
Finally, be prepared for the loan approval process to be a little more in depth and require more documentation then you did the last time you purchased a house or refinanced. If you haven't obtained a new mortgage in the last 12 months you are going to be surprised/shocked on how different the process is now.
If you have any questions or would like to be pre-approved for a mortgage please call 303.666.6550, email, or visit us online.
http://www.colomortgages.com/
You need to make a budget for yourself and know what you can afford and WANT to pay on a monthly basis. The biggest problem most potential home owners make is they try to purchase a house at their qualifying amount, which is not always what they can afford. Mortgage underwriters only account for the debt that is reporting on your credit and you may have other obligations that are unknown to the underwriter. Make sure you have room in your budget for emergencies and don't over buy. By not over buying you are also protecting yourself from debt to income ratio guidelines changing.
Pay off your debt and save money! I know this sounds like common sense, but you don't how many people purchase new items for their home BEFORE they close or start the approval process. The lower your debt and the higher your savings will help your chances of loan approval when guidelines change. Mortgage underwriters will grant exceptions on certain guidelines if there are compensating factors and the two biggest compensating factors; our your debt to income ratio and savings.
Plan ahead - Once you obtain a mortgage approval it is typically good for 120 days, but you must be approved FIRST. Before you start looking for houses talk with a mortgage professional and obtain underwriting approval. This way if guidelines change, you most likely won't be affected as your loan is already approved. Also, the approval process is taking a little longer then it did six months ago, if you wait to start the approval process until you are under contract you may run in to complications with closing on time.
Finally, be prepared for the loan approval process to be a little more in depth and require more documentation then you did the last time you purchased a house or refinanced. If you haven't obtained a new mortgage in the last 12 months you are going to be surprised/shocked on how different the process is now.
If you have any questions or would like to be pre-approved for a mortgage please call 303.666.6550, email, or visit us online.
http://www.colomortgages.com/
Monday, November 10, 2008
YES, We Are STILL DOING LOANS!!!!
I've never been so amazed on how many people believe every thing they hear on the news. Almost every person that I have met in the last month are amazed that I'm still doing business in the mortgage industry. They all thought that mortgages were near impossible to obtain at this point and were surprised to hear that I was not filing for unemployment. What about the credit squeeze they heard about on the news?
The facts are, that mortgages are still being approved and funded every day. Yes, the guidelines can be tougher in some places and there are a lot of loans that we can no longer due. However, you don't have to have an 800 credit score or 20% down to be approved for a loan. NOT EVEN CLOSE.
There are still 100% financing options available and you don't necessarily have to have GREAT credit to obtain no money down financing. And, YES, you can still obtain a mortgage loan if you can't verify your income. AND, YES, you can still obtain a mortgage for an investment property.
However, lenders will no longer approved loans with layered risk (multiple risk factors). If you don't have great credit and can't verify your income, good luck finding a loan. Or if you want to purchase an investment property with no money down, have fun trying. There are dozens of programs still available (with good rates) that will lend money to people with a lower credit score or can't verify income or don't want to put money down, but you can't have multiple risk factors.
When we look back in 5-10 years at the mortgage meltdown, I believe layered risk will be one of the biggest lessons learned. A lot of these loans are great programs, but there can't be multiple risk factors involved within these loans.
Greg Selters
Mortgage Manager
Prosperity Financial, LLC
http://www.myprosperityfinancial.com/
The facts are, that mortgages are still being approved and funded every day. Yes, the guidelines can be tougher in some places and there are a lot of loans that we can no longer due. However, you don't have to have an 800 credit score or 20% down to be approved for a loan. NOT EVEN CLOSE.
There are still 100% financing options available and you don't necessarily have to have GREAT credit to obtain no money down financing. And, YES, you can still obtain a mortgage loan if you can't verify your income. AND, YES, you can still obtain a mortgage for an investment property.
However, lenders will no longer approved loans with layered risk (multiple risk factors). If you don't have great credit and can't verify your income, good luck finding a loan. Or if you want to purchase an investment property with no money down, have fun trying. There are dozens of programs still available (with good rates) that will lend money to people with a lower credit score or can't verify income or don't want to put money down, but you can't have multiple risk factors.
When we look back in 5-10 years at the mortgage meltdown, I believe layered risk will be one of the biggest lessons learned. A lot of these loans are great programs, but there can't be multiple risk factors involved within these loans.
Greg Selters
Mortgage Manager
Prosperity Financial, LLC
http://www.myprosperityfinancial.com/
Monday, July 28, 2008
Why the Mortgage Bail Out Bill Won't Work?
There has been a lot of hype surrounding the Mortgage Bail Out Bill that is scheduled to be signed by President Bush today. However, it's all been for the wrong reason. Our government has waisted a lot of time and tax payer's money for a bill that will cause more harm than good. I'm not sure how they could get this so wrong and not have a clue.
Why won't it work and what is wrong with the bill?
Why won't it work and what is wrong with the bill?
- To be eligible for the bail out you must have obtained a loan between January 2005 and June of 2007. So if you received a loan prior to January 2005 or after June 2007 you are out of luck.
- To receive help your current lender must be willing to write a portion of your current loan balance, similar to a short sale . If you currently owe $250,000 and your home's value is only $200,000, your current lender will have to write of $70,000.00. Don't get me wrong a lot of lenders will do this, but it's a process and not an easy one. Most consumers will not be able to navigate through the process on their own and very few lenders will be willing to help as it will take a lot of time and very little in compensation.
- The consumer will have to share any appreciation they obtain with the government, up to 100%!!! If the consumer refinances or sales their house with in the 1st year the government would get 100% of the profit. The percentage the government would receive decreases 10% every year there after but is guaranteed to receive at least 50% of the profit regardless when you sale or refinance.
- TIME!!! There will also be a huge back log to obtain approval as all of these loans will have to be manually underwritten. Lenders are already struggling to keep up with current FHA loans that must be manually underwritten and a lot of lenders have placed tight guidelines on FHA loans that they will manually underwrite. I foresee a lot of lenders not offering this new FHA program as they will not be able to handle the workload and/or it will be cost prohibitive.
Not only will the bail out fall short in helping the millions Americans, it has made it tougher for millions of American to purchase a home. The bill will eliminate down payment assistance (DPA) programs that millions of Americans use to help purchase a house AND it raises the the down payment requirements to 3.5%. While I agree with the elimination of DPA this is not the time to do it. We have now cutoff millions of potential home owners ability to purchase a house at time that we are trying to stimulate the housing market. How will this help???
If you are in a house or mortgage that you need to get our of you need to call a mortgage specialist and discuss your options. We will provide a free consultation to review your options and help you develop a plan.
Friday, May 9, 2008
100% Financing And Much More
In this market there is no doubt that it's tougher to get financing then it was a year ago or even a few months ago. If you are self-employed or trying to buy a house with no money down you already know this. But it doesn't mean you can qualify for a mortgage, even at 100% or with stated income. Although you can't go to your local bank and get a loan at 100% financing or with stated income, mortgage brokers have access to these types of loans.
Why don't you hear about these programs, because a lot of brokers are lazy and complacent. They are still in the same mind set they were a few years ago, they have a few lenders that they work with and when their lenders eliminate programs they assume every one has. A lot professionals in the business also have the mindset if they can't help you now, they can't help you.
Don't give up if you have been turned by a lender or even 5, there are programs out there that can help you achieve your goals, but you have to be willing to do the research. I spend about 2 hours a day looking for new lenders and new programs that can help my clients (and I know where to look). Yes, you might have to do a little work to improve your credit scores, but your mortgage professional should be able to help you do this. I would say about 25% of our clients needed help with improving their scores 20-30 points before we could do a loan, but that usually can be done with in 60 days.
If you are self-employed, looking for 100% financing, or just need help finding a loan call us, we will work you to find the right solution, whether that is doing a loan with us or another option that will meet your needs better.
Prosperity Financial - Your Mortgage Manager
Why don't you hear about these programs, because a lot of brokers are lazy and complacent. They are still in the same mind set they were a few years ago, they have a few lenders that they work with and when their lenders eliminate programs they assume every one has. A lot professionals in the business also have the mindset if they can't help you now, they can't help you.
Don't give up if you have been turned by a lender or even 5, there are programs out there that can help you achieve your goals, but you have to be willing to do the research. I spend about 2 hours a day looking for new lenders and new programs that can help my clients (and I know where to look). Yes, you might have to do a little work to improve your credit scores, but your mortgage professional should be able to help you do this. I would say about 25% of our clients needed help with improving their scores 20-30 points before we could do a loan, but that usually can be done with in 60 days.
If you are self-employed, looking for 100% financing, or just need help finding a loan call us, we will work you to find the right solution, whether that is doing a loan with us or another option that will meet your needs better.
Prosperity Financial - Your Mortgage Manager
Tuesday, April 29, 2008
Questions YOU SHOULD be Asking
Any time I talk with a client or introduce myself to a stranger as a mortgage professional, the first and usually only question I receive, is what are your rates? Obviously, price (rate and closing costs) are important to every one, but I'm amazed that is the only question I hear?
While, price is an important factor when making a decision on what lender to use, service is more important. The problem is most people don't understand how great service from their lender can save them thousands of dollars and a dozen headaches. Here are some questions that you should be asking your lender and why they are important.
What is your process and how do you communicate the status/progress of the approval process? While all lenders basically have the same process, they all do it differently, and this can be important if there is a time crunch, especially on purchase transactions. Communication is also very important, you want to make sure you are working with a lender that communicates effectively with all parties involved. Also, make sure your lender is willing to fax/email/mail your rate lock to you, this will help you avoid the bait and switch tactic some lenders employ.
What after closing services do you offer? I believe this is one of the most important questions you can ask. You want to make sure you have a great relationship with you lender and that they are looking after you best interest even after the loan closes. A good lender will offer multiple after closing services such as, credit analysis, rate watch, and value analysis. After closing services can save you thousands of dollars, if not hundreds of thousands.
How do you store/dispose of my private information? This should be a no brainer, however, there have been many instances in the news of lenders throwing away clients private information (application, tax returns, bank statements), in the trash with out shredding it. Make sure you lender takes your privacy as seriously as you do.
Ask for Referrals!!!!! It blows me away how few people ask me for referrals from past clients. Any GREAT mortgage lender will have a plenty of refferals that you can call and ask about their services. Great lenders have raving fans as clients and their clients never have problems talking to prospective clients. If your lender is hestitant or will not provide you referrals, find a new lender.
Prosperity Financial - Your Mortgage Manager
www.colomortgages.com www.3bed2bath.net www.myprosperityfinancial.com
While, price is an important factor when making a decision on what lender to use, service is more important. The problem is most people don't understand how great service from their lender can save them thousands of dollars and a dozen headaches. Here are some questions that you should be asking your lender and why they are important.
What is your process and how do you communicate the status/progress of the approval process? While all lenders basically have the same process, they all do it differently, and this can be important if there is a time crunch, especially on purchase transactions. Communication is also very important, you want to make sure you are working with a lender that communicates effectively with all parties involved. Also, make sure your lender is willing to fax/email/mail your rate lock to you, this will help you avoid the bait and switch tactic some lenders employ.
What after closing services do you offer? I believe this is one of the most important questions you can ask. You want to make sure you have a great relationship with you lender and that they are looking after you best interest even after the loan closes. A good lender will offer multiple after closing services such as, credit analysis, rate watch, and value analysis. After closing services can save you thousands of dollars, if not hundreds of thousands.
How do you store/dispose of my private information? This should be a no brainer, however, there have been many instances in the news of lenders throwing away clients private information (application, tax returns, bank statements), in the trash with out shredding it. Make sure you lender takes your privacy as seriously as you do.
Ask for Referrals!!!!! It blows me away how few people ask me for referrals from past clients. Any GREAT mortgage lender will have a plenty of refferals that you can call and ask about their services. Great lenders have raving fans as clients and their clients never have problems talking to prospective clients. If your lender is hestitant or will not provide you referrals, find a new lender.
Prosperity Financial - Your Mortgage Manager
www.colomortgages.com www.3bed2bath.net www.myprosperityfinancial.com
Monday, April 14, 2008
Are you Kidding Me?!?!?
As most of you know in February of 2009 all television broadcasts are moving to digital. Which means that you will be required to have a TV or attenna or converter box that can receive the digital signal. What you might not know is that the Federal Government may spend over $1.3 TRILLION to help people with conversion!!!
ARE YOU JOKING????
Your tax money is going to help ensure people don't miss out on American Idol??? I didn't know watching TV was a right as an American? With all the problems we are facing now, we can't find a better way to spend this money?
Subscribe to:
Posts (Atom)
