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
Tuesday, April 29, 2008
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?
Why it Will Get Worse
I know I have been predominately optimistic about the local real estate market, however, over the last few weeks I'm starting to think we might not be out of trouble yet. In fact, the problem may be getting bigger. Why the change of heart? Lender guidelines, "Declining Markets, and Americans spending habits"
This ugly tag of a "declining market" that lenders and mortgage insurance companies have set on most of Colorado and the nation is going to hurt. If a market is designated as a "declining market" financing becomes much more difficult for those who are trying to obtain financing (purchase or refinancing). 100% financing, forget about it. In a "declining market" 95% financing is difficult to find, a lot of lenders will on financing 90%-92%. Ten, twenty years ago this would not have been a problem (actually the norm), however, very few people plan or have the ability to make a down payment now.
Lender and mortgage insurance guidelines are becoming more conservative by the day. Stated income loans, which most self-employed borrowers use to qualify, are becoming extinct or so limited they are only useful to a small percentage. Other similar guideline changes have excluded thousand from home ownership or trapping them in bad loans that they can't refinance.
For example, I talked to a borrower the other day, he purchased his house 2 years ago with no money down. He has a great credit score 743, he has never made a late payment in his life, however, because he lives in a "declining market" and is self-employed he has no chance at obtaining a new loan at this time. He can't afford his payment when it increases $650/month, he is going to have to walk a way from his home.
So we have an excess of homes on the market, thousands of people who own homes and now in trouble (because of the economy, life changing events, or bad loans), lenders shutting the doors on a majority of society, and Americans who like to spend and hate to save. This is bad news for the national economy and local real estate market. However, all of the plans that have came from the White House or Capital Hill will do little or nothing to stop the slide. Watch out!!!
Prosperity Financial - Your Mortgage Manager
Lafayette, CO
www.colomortgages.com www.myprosperityfinancial.com www.3bed2bath.net
This ugly tag of a "declining market" that lenders and mortgage insurance companies have set on most of Colorado and the nation is going to hurt. If a market is designated as a "declining market" financing becomes much more difficult for those who are trying to obtain financing (purchase or refinancing). 100% financing, forget about it. In a "declining market" 95% financing is difficult to find, a lot of lenders will on financing 90%-92%. Ten, twenty years ago this would not have been a problem (actually the norm), however, very few people plan or have the ability to make a down payment now.
Lender and mortgage insurance guidelines are becoming more conservative by the day. Stated income loans, which most self-employed borrowers use to qualify, are becoming extinct or so limited they are only useful to a small percentage. Other similar guideline changes have excluded thousand from home ownership or trapping them in bad loans that they can't refinance.
For example, I talked to a borrower the other day, he purchased his house 2 years ago with no money down. He has a great credit score 743, he has never made a late payment in his life, however, because he lives in a "declining market" and is self-employed he has no chance at obtaining a new loan at this time. He can't afford his payment when it increases $650/month, he is going to have to walk a way from his home.
So we have an excess of homes on the market, thousands of people who own homes and now in trouble (because of the economy, life changing events, or bad loans), lenders shutting the doors on a majority of society, and Americans who like to spend and hate to save. This is bad news for the national economy and local real estate market. However, all of the plans that have came from the White House or Capital Hill will do little or nothing to stop the slide. Watch out!!!
Prosperity Financial - Your Mortgage Manager
Lafayette, CO
www.colomortgages.com www.myprosperityfinancial.com www.3bed2bath.net
Wednesday, March 26, 2008
Paying For Other's Mistakes...
You came home after a hard day at work and open your pay check, and you are astonished, upset, angry when you see how much of your check has been taken my Uncle Sam. If you are still mad, STOP READING NOW!!!
Although most American home owner's made a conscious effort to purchase a house within their budget, obtain a loan that would fit their financial plan, and even struggled to make their payments in hard times, they now will be forced to help those who didn't. Many Americans don't know that their hard earned money and taxes they pay will be used to help bailout homeowners who made bad choices and may lose their home in foreclosures. The Federal Government has already allocated billions of dollars to bailout investment banks that made poor decisions and now there is legislation that is gaining popularity to bailout homeowners, AT OUR COST!!!
Politicians are quick to note that some of these homeowners were victims of fraud, and will share personal stories of these people to help them pass these bills. The fact is, a majority of these people made poor financial decisions and either purchased more house than they could afford or gambled with ARM loans and didn't follow up and refinance their house before the loan adjusted or over spent on materialistic items (like new cars, boats, electronics) and now can't make their mortage payment. And now, we have to pay for their mistakes and bail them out.
When will we as society start holding people responsible for their mistakes and make them accept the consequences of their actions??? If I don't manage my business correctly and I'm forced to close my doors the government is not going to come and save me, nor do I expect them or want them to. I understand and fully support helping those who are less fortunate, but I'm responsible for my failures and the consequences, as well as, my success and prosperity. I shouldn't have to bare the burden of others mistakes nor should I share in their prosperity. But I guess that is what our nation is becoming or already has become?
Prosperity Financial - Your Mortgage Manger
Say it Ain't so, Joe
Lenders are once over reacting and creating another mortgage mess. This time they are eliminating programs for qualified borrowers making it tougher for people to purchase or even keep their homes.
Every day I hear of new guidelines or lenders eliminating products eliminating another set of borrowers from purchasing or refinancing their house. There are very few lenders offering 100% LTV loans even if you have great credit, income, and assets it's a lot harder to obtain financing then it was a few months ago.
Self-employed borrowers options to obtain financing is also becoming scarce. A lot of self-employed borrowers typically use stated income loans because their tax returns do accurately reflect their cash flow. However, many lenders are eliminating their conforming stated income programs making it tough or impossible for them to obtain financing. If they can obtain financing the loan amount for which they will be approved will be much lower than before.
These two changes are going to eliminate a lot of borrowers from the real estate market and will also probably help increase the foreclosure numbers around the nation. There are some alternatives for borrowers, such as FHA and others but they will not be able to help a lot of these people. Not good for the real estate market and not good for the value of your house.
Why are lenders over reacting? There are a few reasons, supply and demand on the secondary market and mortgage insurance companies are facing problems with their current portfolio of loans that they insured over the last few years.
If you need help navigating through mortgage chaos to find financing that meets your financial needs, please call and we would be happy to help you or guide you in the right direction.
Prosperity Financial - Your Mortgage Manager
http://www.3bed2bath.net/ http://www.colomortgages.com/ http://www.myprosperityfinancial.com/
Every day I hear of new guidelines or lenders eliminating products eliminating another set of borrowers from purchasing or refinancing their house. There are very few lenders offering 100% LTV loans even if you have great credit, income, and assets it's a lot harder to obtain financing then it was a few months ago.
Self-employed borrowers options to obtain financing is also becoming scarce. A lot of self-employed borrowers typically use stated income loans because their tax returns do accurately reflect their cash flow. However, many lenders are eliminating their conforming stated income programs making it tough or impossible for them to obtain financing. If they can obtain financing the loan amount for which they will be approved will be much lower than before.
These two changes are going to eliminate a lot of borrowers from the real estate market and will also probably help increase the foreclosure numbers around the nation. There are some alternatives for borrowers, such as FHA and others but they will not be able to help a lot of these people. Not good for the real estate market and not good for the value of your house.
Why are lenders over reacting? There are a few reasons, supply and demand on the secondary market and mortgage insurance companies are facing problems with their current portfolio of loans that they insured over the last few years.
If you need help navigating through mortgage chaos to find financing that meets your financial needs, please call and we would be happy to help you or guide you in the right direction.
Prosperity Financial - Your Mortgage Manager
http://www.3bed2bath.net/ http://www.colomortgages.com/ http://www.myprosperityfinancial.com/
Thursday, March 13, 2008
Mortgage Brokers Hitting the Books
Colorado has announced that mortgage brokers licensed to do business in the State of Colorado will have to complete 40 hours of education by the end of 2008. Until now, any one that was registered/licensed could originate mortgage loans with little or no knowledge of the industry.
This is great for the industry and consumers, as consumers can now be assured their mortgage brokers is knowledgeable about the industry and not some one who was selling cars yesterday. However, I would like to see it go a step further and require all mortgage professionals, even those who work for banks, be required to complete education courses. If we really want to protect consumers we need to make sure every mortgage broker and loan officer is required to complete classes that will provide them with the knowledge to originate mortgage loans.
This is great for the industry and consumers, as consumers can now be assured their mortgage brokers is knowledgeable about the industry and not some one who was selling cars yesterday. However, I would like to see it go a step further and require all mortgage professionals, even those who work for banks, be required to complete education courses. If we really want to protect consumers we need to make sure every mortgage broker and loan officer is required to complete classes that will provide them with the knowledge to originate mortgage loans.
Monday, March 10, 2008
Are you Trying to Pay Off Your Mortgage?
I'm still surprised with how many people I talk to on a weekly basis that hold paying off their mortgage as one of their main financial goals. My first question is always why? And I never receive a good response.
While our parents and grandparents worked hard every day to pay off their mortgage, this is not the best use of your money in today's market. I know their is a huge sense of pride to own your house free and clear, but your equity in your house is not making money for you.Also there has been a large marketing campaign recently about a new program in the mortgage industry that will help you pay off your mortgage quicker.
However, if you leverage your equity in the house and invest wisely (and conservatively looking for a 6% return), you would not only be able to pay off your mortgage within 30 years but you would also have hundreds of thousands of dollars in liquid assets.
Your mortgage should be a part of your financial plan that allows you to accomplish your financial goals quicker. For more information on how you can be using your mortgage to help you meet your long term financial goals please call us.
Prosperity Financial - Your Mortgage Manager
Lafayette, CO
www.colomortgages.com www.3bed2bath.net www.myprosperityfinancial.com
While our parents and grandparents worked hard every day to pay off their mortgage, this is not the best use of your money in today's market. I know their is a huge sense of pride to own your house free and clear, but your equity in your house is not making money for you.Also there has been a large marketing campaign recently about a new program in the mortgage industry that will help you pay off your mortgage quicker.
However, if you leverage your equity in the house and invest wisely (and conservatively looking for a 6% return), you would not only be able to pay off your mortgage within 30 years but you would also have hundreds of thousands of dollars in liquid assets.
Your mortgage should be a part of your financial plan that allows you to accomplish your financial goals quicker. For more information on how you can be using your mortgage to help you meet your long term financial goals please call us.
Prosperity Financial - Your Mortgage Manager
Lafayette, CO
www.colomortgages.com www.3bed2bath.net www.myprosperityfinancial.com
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