Rates Near 2011 Lows

You may have heard that home loan rates have improved and are back down to near historic levels. In fact, I've been slammed with emails and phone calls from people who wanted to take advantage of this wonderful situation.

But you need to keep the following in mind…
While some people say good things come to those who wait, others say to strike while the iron is hot. In this case, the "iron is hot" with rates at exceptionally low levels. And while weak economic reports here in the U.S. and the economic crisis in Europe are two of the main reasons rates have improved recently, signs of inflation are beginning to creep into our economy–and that never bodes well for home loan rates. That's why it's more important than ever to act now.

Give me a call if you want to see if you can take advantage of this window of opportunity to save significantly on your monthly budget. I look forward to hearing from you!

Interest Rates When is the Best Time to Lock?

Interest Rates When is the Best Time to Lock?
When it comes to mortgage loans and interest rates, it's never a good idea to gamble. That's why I typically advise my clients to lock in an interest rate at the earliest opportunity. This is just one step of the standardized system we have put in place to ensure the best possible loan experience for each borrower that we work with. A mortgage loan cannot be closed without a locked-in rate, and there are three main elements to take into consideration: Interest Rate Points or fees Length of the lock Locking in a rate does not obligate the borrower to commit to the loan until the loan is actually closed. The lock is merely a security measure designed to eliminate the risk of market volatility throughout the duration of the purchase or refinance transaction. As long as the loan is approved and funded before the end of the lock period, the borrower will receive the interest rate quoted.

When a lender permits an extended lock-in period, the borrower will likely face a higher interest rate or additional fees that could be quoted as points. In other words, the borrower pays for the lender to take on the extended risk of being exposed to potential changes in the market.

For example, let's say a 30-day rate lock commitment costs the borrower one-half point, while a 60-day rate lock commitment costs one full point. If the borrower in this scenario needed the extended lock period, but did not want to pay points, then an alternative would be to accept a slightly higher interest rate. In this case, a 60-day lock would typically have a higher interest rate than a 30-day lock.

Our standard procedure is to lock in a rate as quickly as possible. My team and I want our clients to know that while interest rates fluctuate daily, most lenders do not want to lose any business because of it. If a significant rally causes interest rates to drop 0.25% or more, we know that we can most likely renegotiate the rate. In many cases, lenders prefer this option over losing the loan to another lender. On the other hand, if we'd allowed our clients to sit on the fence and not lock in their rate, we would have exposed them to market volatility without a safety net. Then, if rates were to increase, the borrower might no longer qualify for the loan they want - a situation that we want to avoid at all costs.

By knowing our clients' needs and working intimately with them to make the right decisions early on, my team and I are proud to say that we have helped them to achieve their home ownership dreams.

If you'd like to learn more about the loan programs we have available, please call me!

What Lenders Look for in Home Loan Applications

What Lenders Look for in Home Loan Applications

Once your loan application is filled out and sent to the lender for review, the first thing they will look for is your ability to pay back the loan you are requesting. My team and I have a streamlined loan process to help you get your ducks in a row prior to this review. A grand slam loan package is in perfect order and answers all the important questions up front. We know what the lenders are looking for, based on long-term relationships with them and extensive knowledge of guidelines for a multitude of loan programs that are available today.

What is the lender looking for when they review the loan application?

The lender wants to know about your personal financial picture, including savings and credit history and your employment stability. The co-borrower's history is also taken into consideration. The lender also considers the loan amount and appraised value of the home you are looking to purchase. Not every applicant is approved the first time through the process. If the underwriter has any questions or concerns, he or she will require certain conditions be met before they approve the loan. Pre-approval prior to house hunting lets you know exactly how much you are qualified to borrow in advance.

What can I do on my end to make it easier?

Before taking out a home loan it helps to establish a consistent record of paying your bills on time. If you have utility bills that are overdue, bring these up to date. Make sure you are paying credit card installments in a consistent and timely manner.

We can help you evaluate your debt-to-income ratio to determine what mortgage payment will be comfortable and affordable for you on a monthly basis. Aim for having enough savings to cover your down payment, closing costs if necessary, and two month's expenses in case of emergency. We'll help you find the loan program that works for you.

If I just started a new job six months ago, can I still apply for a loan?

A stable employment history is important, but the lender does take human factors into consideration. If you've recently completed college or vocational training, or were released from the military, you have good cause to have a lack of consistent work history. If your profession is seasonal, and gaps in employment are normal in your field, there are loan programs that can work with your situation. If you are a freelancer or do contract work, the lender will look for consistency in income over the last two years.

Consistency is the key word in the lender's mind. But know that lenders have developed many different loan structures to meet the needs of the general public. When your grandparents bought their first home, they probably put 50% down and made a lump sum payment when the note was due. Times have changed, and so have loan programs. My team and I stay on top of current mortgage trends. We monitor rates daily and have a support network of Realtors®, CPAs, Financial Planners and Credit Repair Consultants to lend you additional assistance.

Call me directly for a free consultation.

Great tool-Google Voice Rocks!

I only wish I would have started using it a long time ago.  It has so many cool features that allow you to be mobile and more productive.

Google Voice has the following features:
1.  You can email a copy of your voice mail
2.  It allows you to screen your calls much like an old answering machine.  You can actually pick up in the middle of a message.
3.  You are given text transcripts of your voice mail, so you don't have to listen to it.
4.  It gives you a visual list of who your voice mails are from.  This allows you to listen to the important ones first.
5.  It allows you to check your voice mail and texts from any computer or device in the world that has internet access.  Check it out!  I am sure you will love it.

http://www.google.com/googlevoice/about.html

Have you ever wished you could just leave a voice message?

Have you ever wished you could just leave a voice mail for a client or contact?

Let's face it, we all have clients that we wish we could just leave a voice mail to. Well, the following service is a much welcomed solution. 

Slydial bypasses the call and sends you DIRECTLY to voice mail.

Welcome – slydial slydial.com

slydial is a voice messaging service which connects you directly to someone's mobile voicemail... pretty sly huh?

You do have to listen to a brief commercial.  However, the time you save by leaving a brief message and moving on to the next item on your list is invaluable.

New Appraisal Standards Effective September 1

New Appraisal Standards Effective September 1 for Fannie Mae and Freddie Mac

It's finally happened: You've found the perfect home for your clients. Their financing is in place. But then...despite the comparables....the appraisal comes back low, threatening to ruin the whole deal.

To help make appraisals more consistent and accurate, and prevent situations like this in the future, the Federal Housing Finance Agency has directed Fannie Mae and Freddie Mac to develop the Uniform Appraisal Dataset (UAD). The UAD will (1) define what fields are required for an appraisal submission and (2) standardize both responses and definitions for certain fields.

Here are just a few of the items impacted by the new appraisal standards:

• Days on the Market: Days on market is now defined as the total number of continuous days. If a property is taken off the market and then relisted, the appraiser will have to count all of the days it has been listed.
  
  
• Offering Price: The original offering price and history of all price changes must be reported.
  
  
• Property Style: Appraisers must use appropriate architectural design indicators such as "Colonial," "Farmhouse," etc. Descriptions such as 1 story, 2 stories, etc are no longer acceptable.
  
  
• Condition of the Subject Property: An overall condition rating must be assigned from the predefined condition categories provided.
  
  
• Quality of Construction: The appraiser must rate the quality of construction of the subject property and all comps using a list of 6 predefined quality levels.

The UAD appraisal standards are required for all appraisals conducted on or after September 1, 2011 for conventional loans sold to Fannie Mae and Freddie Mac.

To read FAQs about the UAD appraisal standards, visit https://www.efanniemae.com/sf/lqi/umdp/pdf/uadfaqs.pdf. You can also call or email me any time if you have any questions. I'm always happy to help in any way I can.

Helpful First Time Home Buyer Videos...

Click the link for a couple of helpful first time home buyer videos.

http://whatcarluses.com/firsttimehomebuyer.html

YES YOU CAN REFINANCE EVEN IF YOUR HOUSE HAS LOST VALUE! (Ridhi Raheja via Activerain)

Courtesy of Ridhi Raheja via Activerain.

Homeowners, If you want to lower your monthly payments, look at these options.

YES YOU CAN REFINANCE EVEN IF YOUR HOUSE HAS LOST VALUE!

It is estimated that over 20 million American homeowners owe more on their mortgage than the value of their homes.  You don't need to sit on sidelines and feel bad because you can't refinance because your house has lost value. There are several things you can do to make refinancing a reality for yourself.

First go  to these sites and check who owns your mortgage

• 1-800-FREDDIE (8am to 8pm EST)
• www.freddiemac.com/mymortgage
• 1-800-7fannie(8am to 8 pm EST)
• www.fanniemae.com/loanlookup
•  

       

if your loan is owned by either one of these you can refinance under government's initiative for homeowners who have lost value in their homes. Call  your trusted mortgage lender and ask if they can run the automated underwriting to see if you are eligible for that program,

Now let us say you loan is not owned by either one of these , check if you have a FHA mortgage and if the answer is yes, you can still refinance under the FHA streamline option.

Let us say you don't qualify under any of these options , all is not lost yet. Here is my last suggestion. Everybody has heard of " CASH OUT MORTGAGE", where you can pull cash out of the house to take care of your financial needs but what about a 'CASH-IN- MORTGAGE" .

so what is a cash-in-mortgage? This is a strategy where you lower your balance with using your own personal funds is called a cash-in-mortgage. Using cash to pay down your mortgage may allow you to refinance into a lower interest rate and lower your monthly payments. For example, consider a homeowner who owns a $200,000 home that has declined in value to $150,000 . Here's what would happen if the homeowner uses $60,000 in cash to reduce the balance of their $180,000 mortgage to $120,000.

 

 how would you  like to earn 10.5% TAX FREE(AND RISK FREE) RATE OF RETURN ON YUR $60,000 INVESTMENT.

STEP 1: $525 monthly savingsX12= $6300 annual savings.

STEP2 : $6300 annual saving/$60,000 investment = 10.5% CASH ON CASH RETURN ON INVESTMENT .

There are two ways to get the $60,00 in cash to make this strategy work:

1. You can use cash from your retirement account or bank account that may be currently earning you 0% or 1% interest .This might not be the right option for everybody , so please talk to your financial advisor.
2. You could sell some other investment assets that are earning you less than 10.5% after tax.

So let us say , that we don't have access to the cash, you could still refinance and take advantage of really low rates if you could ask your lender to build PMI into the rate . What that means is that you don't pay mortgage insurance monthly but it is paid up front and it can be paid by taking a slightly higher interest rate. The difference is usually a quarter percent .

Either way , the strategy makes sense as long as you can earn a higher after-tax return on your money by paying down your mortgage than you would by leaving your cash wherever it is right now.

New FHA Program for Blue Water Home Loans

We are pleased to announce the addition of a new program at Blue Water Home Loans to service borrower's with sub 640 FICOs.  This is an FHA loan and will be underwritten according to FHA guidelines posted in the 4155 with certain lender overlays.  The overlays are significant so you should have the borrower contact us directly to determine borrower eligibility.  These loans will be underwritten by our underwriters but will require a 2nd sign-off by the investing underwriter.  Expect turn times to be an additional 2-3 days.  Pricing for this program will differ from a typical FHA loan because of the additional risk.  However, it is GREAT news that we are seeing credit scores move in the opposite direction!  Hopefully, this will allow you to close more deals!  As always, our staff is available if you have any questions or concerns!  We look forward to closing more deals with you soon!

USDA Guarantee Loan to have Mortgage Insurance in October

USDA Loans Will Have Monthly Mortgage Insurance as of October 1, 2011
What Does This Mean To You?

USDA Rural Development and its loan program were designed to help improve the economy and quality of life throughout rural America. The program continues to remain a wonderful option for qualifying homebuyers, with zero down payment required.

But a change is coming!

Beginning October 1, for the first time in the history of USDA, the Single Housing Guaranteed Loan Program will have an annual fee. This fee will be calculated based on the guaranteed loan amount and based on the average annual scheduled unpaid principal balance for the life of the loan.

If you're thinking of purchasing a home and you're wondering if you may qualify for a USDA loan, give me a call right away. Home loan rates are still very attractive. Let's see if this program is right for you...before the October 1 fee begins.