Archive for May, 2010

Credit Score Tips For The Best Mortgage Rates

by Justin Miller on May 28, 2010 in Credit, Mortgage Education 101 with No comments

Just as the article below states there is so much to know about improving your credit score.  It is important to keep your credit card balances below 30% of your credit limit.  Another is to not pay off a collection account in the middle of trying to get a loan. 

Credit reports are going to play an even bigger role starting June 1st due to Fannie Mae’s new Loan Quality Initiative (LQI).  Starting June 1st lenders are going to have to confirm that the borrower did not take on any new debts.  In order to prove this did not occur we are going to have to pull a new credit report right before closing.  I am not sure if we will be pulling updated credit scores as of yet but what I can tell you is to not use your credit cards, buy a new card, apply for a credit card, etc. once your loan has started.  Keep your credit report the same way other than making your monthly payment on time or paying down your debt.  Do not close out any account either. 

I just listed to a conference call yesterday on credit reports and they talked about how with a short sale you want it to show up as a paid account, not settled for less than owed, etc.  On loan modifications, your credit score will take a hit as of right now.  Very shortly they are going to change the credit score code from the current of AC, which does hurt your score, to CN which will not hurt your score as long as your loan has been paid on time.  If you got a loan modification and have paid it on time but your score has been impacted ask your mortgage servicer to change the code from AC to CN. 

I have a great handout that I can email to you if you want a lot of great information on credit reports and scoring.  Just send me an email with the subject loan “Credit Report Handout” and I will send you a copy.

http://www.marketwatch.com/story/credit-score-tips-for-the-best-mortgage-rates-2010-05-28?siteid=rss&rss=1

Life After Foreclosure

by Justin Miller on May 28, 2010 in Credit, Foreclosure with No comments

How long will you have to wait in order to buy again?  It is going to depend on whether you can show a true hardship or not versus someone who just walked way, a strategic default.  Another part that is going to play a large part is how much you are willing to put down.

Fannie Mae recently released their new guidelines for distressed sales such as a short sale.  The new guideline basically says the more you put down the sooner you can buy a home. 

Whether or not you had a true hardship is going to be to the underwriter’s discretion and I would have to imagine you better have a lot of documentation to back up the fact that you didn’t just walk away such as a job loss, health issues, a huge decrease in income, etc. 

There is no telling what the future of mortgages holds for us but make sure to pay all of your other bills on time, start saving money for a down payment, and look into getting your credit repaired if it needs it.

http://money.cnn.com/2010/05/28/real_estate/homebuying_after_foreclosure/index.htm?section=money_realestate&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_realestate+%28Real+Estate%29&utm_content=Google+Reader

Is The Luxury Home Market Making A Comeback?

by Justin Miller on May 28, 2010 in Jumbo Mortgages with No comments

It should be able to with Jumbo mortgage rates coming down and lower down payment options out there.  It does appear South Florida still has room to improve but with more financing options available on Jumbos in a hard hit area like South Florida we should begin to see some improvement.

Miami-Dade County still has enough homes priced at $2 million or more to last 41 months at the current sales pace, though down from 116 months a year earlier, says Ron Shuffield, president of EWM Realtors, a large local brokerage.

There is financing out there for loan amounts up to $2 million with 20% down in South Florida depending on the strength of the borrower.  You just need to make sure to talk to the mortgage professionals that have these relationships with the local banks.  

http://online.wsj.com/article/SB10001424052748704717004575268573660359734.html?mod=djemITP_h  

Are You An Energy Hog?

by Justin Miller on May 27, 2010 in General News with No comments

This is pretty neat from Microsoft.

More than 60 million U.S. homeowners, by simply typing in their address, can now see how their energy efficiency compares with others in their neighborhood or state.

Microsoft Hohm, a free online service that gives tips on how to boost home efficiency, announced Wednesday a new feature that scores homes nationwide. Its estimates are based on public information about a home’s size, age and location and other data on an area’s typical weather and utility bills.

http://content.usatoday.com/communities/greenhouse/post/2010/05/are-you-an-energy-hog-microsoft-ranks-60-million-homes/1?csp=usat.me 

Credit Card Disputes

by Justin Miller on May 26, 2010 in Credit with No comments

It looks like Federal law allows it as long as you file the complaint correctly.  I don’t have a lot to say on this because I don’t know much about it but I did find the article very informative.

For example, to challenge a “billing error” as defined under the Fair Credit Billing Act, or FCBA, you must send your dispute letter to the address for billing inquiries within 60 days of the first statement that contained the mistake. The issuer must acknowledge the complaint in writing within 30 days after receiving your letter, investigate the claim and resolve the dispute within two billing cycles or 90 days, whichever comes first.

http://www.bankrate.com/finance/credit-cards/how-do-i-win-a-credit-card-dispute.aspx

6 New Hurdles For Home Financing

by Justin Miller on May 26, 2010 in Mortgage Education 101 with No comments

This is the most important part of this article and why I cannot stress to you enough about using something who is an expert because your deal can and will fall apart.

Paul McFadden, a loan officer with The Legacy Group in Bellevue, Washington, says, “These days, the number of mortgage applications that get approved is probably three out of 10. In the heyday, it was nine out of 10. Normally five or six out of 10 would be the ratio.”

The article does a good job of pointing out the different hurdles.  Credit scores was the first but this only really plays a big part with Conventional loan although you really should have at least a 620 middle score for government loans. 

The 2nd one was the scrutiny of income and assets.  We will look at every deposit and withdraw on your bank statement and if we can’t determine where a deposit came from you will need to document proof of where it came from.

The last 3 are the ever changing guidelines, appraisals, self-employed borrowers, and how hard it is to get financing on condos.  The bottom line is that even though this may scare some, none of it is hard as long as you are willing to cooperate and provide whatever is asked for from your mortgage professional.  Leave that sense of entitlement at home.

http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2010/05/25/investopedia44311.DTL 

Fannie Mae & Second Credit Reports

by Justin Miller on May 25, 2010 in Guideline Changes with No comments

There are a lot of rumors out there about this right now.  Here is what the HousingWire reported.

A source at Fannie tells HousingWire that reports in the press are misstating the actual provisions of the LQI1, coming into force June 1. The source says that a second credit report on the borrower needn’t be pulled near to closing on the mortgage, although “a lender may choose to do so,” he said.

As I learn more I will let you know but remember, the lender may choose and guess what?  I am sure we will be choosing to pull.  We have to protect ourselves.  The best thing to do is to tell the borrower not to use any credit cards or take on any debt until the loan is closed. 

http://209.236.64.240/2010/05/24/fannie-will-not-require-second-credit-report-pull-for-mortgage-approval/?utm_source=rss&utm_medium=rss&utm_campaign=fannie-will-not-require-second-credit-report-pull-for-mortgage-approval

Lenders May Go After Homeowners

by Justin Miller on May 24, 2010 in Foreclosure, Loan Modification, Short Sales with No comments

This is very real and I am sure there will be many that will buy the deficiency judgments from the banks for pennies on the dollar and then go after the homeowners. 

Lenders will file a tidal wave of lawsuits against homeowners in the next few years as a way to recoup losses when home sales or foreclosure auctions don’t result in enough money to pay the mortgages in full, real estate and legal analysts say.

Under Florida law, banks have five years from the date of the sale to file for so-called deficiency judgments and up to 20 years to collect. Lenders can garnish wages or make claims on borrowers’ assets.

http://articles.sun-sentinel.com/2010-05-22/business/fl-short-sale-debt-20100521_1_mortgages-lender-homeowners

Delays & Denials For The Homebuyer Tax Credit

by Justin Miller on May 21, 2010 in General News with No comments

I am not surprised by either but I will have to tell you I didn’t think there would be denials.  The article states that delays seem to run 25 weeks. 

There are rumors that the IRS is rejecting claims from people who have ITINs, the Individual Taxpayer Identification Numbers issued to aliens who do not qualify for real Social Security numbers. This rumor happens to be true. There’s no credit for non-resident aliens.

Did you get a rejection because your new home has an apartment number? How odd is that? How many ways can you live in an owned residence in this country with a unit number? Let me count the ways: Condominiums. 

http://www.marketwatch.com/story/delays-denials-hit-home-buyer-tax-credit-filers-2010-05-21?siteid=rss&rss=1

Should You Payoff Closed Credit Cards

by Justin Miller on May 21, 2010 in Credit with No comments

The answer is no and you might want to call the credit card company right before you pay it off to ask them to reopen it.  It is always good to talk to an expert because each individual’s situation is different.  I am not an expert. 

http://www.marketwatch.com/story/steps-to-a-higher-credit-score-can-be-mystifying-2010-05-21?siteid=rss&rss=1 

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