Mortgage Broker Approval-Becoming Approved with Wholesale Lenders

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As a mortgage broker, to say that you’ve been affected by the market’s volatility would be an understatement. Credit tightening has led to the loss of loan programs while some wholesale lenders or departments have ceased to exist. In such a situation you may find it necessary to become approved with new wholesale lenders. Below are some suggestions that can help make that approval process go smoother.

Submit all documents in support of your application at the beginning of the process, just as you would submit a full loan file. This prevents the need for additional phone calls or speculation.

For newer brokers — ask the lender if they require a certain number of years experience. If you meet the requirement, then include resumes for yourself and othe important staff members that show your experience.

If the lender asks for references from account executives you have worked with, make sure the contact information for the AE’s is still good. If you are unable to contact the AE, then the lender won’t be able to either.

Make sure you provide all the requested signatures

Review your application to ensure you submit all information has been requested.

If you are a sole proprietor, you may need to include 2 years tax returns or company financials. Verify with the lender.

If there is a checklist, use it as your guide and double check before sending off the approval package.

Do not handwrite the answers to questions on the application. Use a typewriter or printer instead. This will reduce errors.

Although this period of change can be scary, there is hope out there, and there are still good wholesale lenders who can help you provide loans to your clients. Find those good ones, then use the steps above to simplify the approval process with them. Before you know it, the market will have stabilized and you’ll have relationships with some of the best lenders out there.

Learn how to Buy a Home with a No Money Down Mortgage

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People are under the confused notion that they need thousands of dollars for a down payment on their dream home because of the problems in the mortgage industry. That is absolutely false! A HUD approved government program allows any buyer to take advantage of the amazing buyers market we are in and buy their dream home with No Money Down.

The following will walk you through how to buy a home with no money down and no money out of pocket using a government program (FHA) and a DPA.

You must first find an expert Mortgage Consultant that’s familiar with FHA and working with a DPA. DPA is short for down payment assistance program. The most popular DPA is the Nehemiah program. Nehemiah has been in existence since 1998 and has assisted buyers with gift funds of over $1 Billion (yes a “B”). They are completely government approved.

Get pre-approved for a DPA with a certified specialist. Credit need not be perfect to qualify. In fact, a score as low as 550 is acceptable for some FHA financing. The most important aspect of qualifying for the program is income verification. This program is for any buyer (first time or otherwise) of an owner occupied residence.

Now the fun part begins - looking for your new home. Due to current market conditions this is easier than ever. FHA limits have increased and typically they are around $423,000 for most areas. In certain areas, like Los Angeles county, they go as high as $729,000. These limits should give you plenty of flexiblity to buy your dream home.

Now it’s time to negotiate with the seller. The seller will be contributing the entire down payment to you through Nehemiah (or other DPA) and give you a credit for closing costs as well. This will require their cooperation. You will be asking for a contribution of between 7-12% so your offer should be closer to the listing price of the house. Due to market conditions sellers are more flexible than ever. They are primarily concerned with how much they are going to net (or walk away with) so negotiate with that in mind.

Meet with your certified DPA specialist to make your mortgage application. It is imperative that you choose an experienced professional who is familiar with the workings of Nehemiah (or whatever DPA you choose) and FHA. Working with an inexperienced “Broker” will cost you. You could lose time, money or even the home that you’ve chosen.

You will be required to bring 2 years W-2’s and/or tax returns as well as your most recent paystubs. Even though no money down is required you will also need your most recent bank statements. If currently renting, copies of your last 12 cancelled checks or a letter from the management company will be needed.

Go to closing and be AMAZED! The closing is not a time to fret and be worried. The closing is the finsh line - the CELEBRATION! If your Mortgage Consultant has done their job then all questions will have been answered. I’ve seen individuals walk away from closing with a 5.75% 30 year fixed rate mortgage, a few hundred dollars back to them and a new HOME! You can do it too. Don’t let the greatest buying opportunity of our generation go by.

Mortgage Cycling - A Much Friendlier Mortgage Broker

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There’s a different kind of mortgage broker on the block, and they’re giving conventional mortgage brokers a run for their money. With today’s current economy, consumers have to be as budget conscious as ever, and it’s showing in every consumer decision they make - including shopping for a mortgage. Gone are the days where the consumer waits with baited breath as to whether or not the corner mortgage broker can find financing for the home they want to buy.

At last there is a new alternative and he is called the Mortgage Seeker. You really will feel that every fine detail is there in big black bold letters. You really feel as though you are dealing with somebody from a genuine professional institution and they will always go to the trouble of signing a sealing a contract that states the amount to be paid in commission and they certainly wouldn’t later try and get further fees from you, like their colleagues do in the traditional sector.

The borrower will pay the broker a fee in addition to paying the wholesale loan price. With conventional mortgage brokers, borrowers don’t know the true cost of the loan until after the application has been submitted. The conventional lenders add a markup to the wholesale rate of the mortgage to make their profit. While on the surface it may seem like the prices quoted by upfront mortgage brokers compared to the quotes received by conventional lenders would not be the wise choice, don’t be fooled.

The traditional mortgage brokers just don’t have their clients best interests on the table and are really only interested in making big fat profits. On the other hand the new upfront mortgage brokers will not earn a dime unless they find that mortgage that will permit you to start a new life in the house of your dreams.

There are also times when mortgage brokers are given rebates by third parties.While a conventional broker may keep this rebate as a part of their profit, an upfront mortgage broker will always pass this rebate on to the borrower. With consumers appreciating honesty and no-nonsense approaches when dealing with their lending needs, upfront broker methods may just change the face of mortgage lending forever.

McManions The New Term for the American Homes

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Though we have this image of families from yesteryear living in large Victorian-style houses, the truth is that homes across the developed world are getting larger on average than they’ve ever been. In Australia the average home size has increased nearly 40% in just the past two decades, to an average of approximately 2,450 square feet. The numbers are similar in the U.S, where the average home sits at around 2,343 square feet, a jump of over 50% in the last 35 years.

These rates are not so much a result of houses across the income barrier getting progressively larger, but main houses in the upper tier getting much larger. 3,000 square feet new homes are now considered on the smallish side, with 5,000 to 8,000 being the norm. Whereas old style large homes were all quite unique from each other, this new crop of large, mini mansions are now dubbed McMansions, for their cookie cutter design and assembly line style production, often being crammed together closer than these homes would’ve been in the past.

The average house now has four or more bedrooms, despite the average family size in developed countries dropping drastically in the past 50 years. These large homes inevitably also get filled with larger everything. Larger appliances, multiple heating and cooling systems, professional-grade stoves and fridges, larger sofas, etc are just the beginning.

It’s all about interior space with these houses, which is their main selling point. You may find yourself feeling claustrophobic after being in one of these behemoths and then returning to a smaller home. The ceilings tower and the rooms are massive, with large walk-in closets, tons of large windows, wide hallways, etc. If the human race evolves to the point where we’re all eight feet tall with massive wingspans, these homes will not need to be renovated to accommodate them one inch.

A home of this size will all but surely be the most expensive item you’ll ever purchase, and therefore needs a good deal of thought but into it beforehand. This begins with the neighbour, and not only the way the neighbourhood is now, but the way it’s expected to be in ten, twenty or more years when you’re looking for a consolidation or equity loan.

If you’re building a new custom home, you should certainly look into incorporating energy efficient designs into the home. Proper insulation, lighting, and heating and cooling systems will all play a major role in your utilities bill. You may also wish to give the house a more complete feel by having the brick or stucco facades that only face the front of most McMansions encircle your entire home. It’s small touches like these that make a home unique and valuable.

Freud would be aghast at our preoccupation and obsession with size, but it’s undeniable that we do love things bigger and more extravagant as we can get it, regardless of need or worth. This trend will surely continue in the years to come, at least until we eventually run out of land and are forced to cram into tiny apartments and sleep in containers like the Japanese.

Reverse Mortgage Limits: What They Mean to You

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Before getting a reverse mortgage, you may desire to know about the reverse mortgage limits. These upper barriers could affect you depending on the value of your home. Actually, there are “hard” upper barriers and “soft” upper barriers.

A hard limit is the upper barrier set by the FHA. At this time, 90 percent of reverse mortgages are FHA backed. Therefore, the limits set by the FHA are very important.

At this time, the FHA limit fluctuates from $200,160 and $362,790. The lower limits are used for country areas and the upper ones for large cities or states where the cost of living is higher. Also, the upper barrier can be adjusted up to 150 percent in Alaska, Guam, Hawaii and the Virgin Islands.

These limits are modified every year. Still, to get a realistic picture of how much you can borrow, you need to understand about the soft ceilings. Soft limits veto homeowners of high price homes to borrow more than those with homes valued at the FHA boundary and also set the actual amount you can get.

The soft boundary can be considered the actual limit for your house since it will set how much you can borrow. The amount that you can borrow is calculated from the lower of the appraised worth and the FHA boundary.

The real funds homeowners can get is dependant on their age, the market rate, diverse mortgage costs and the appraised value of their home or FHA’s home boundaries for their region. In general, the more valuable your home is, the older you are, and the lower the interest rates, the more you may get.

For instance, owners with a $100,000 loan at 9% interest could borrow up to 22% of the home’s worth if they are 65. If the owners are 75, they could borrow up to 41%, and up to 58% if they are 85 years old.

In addition, remember that there are no asset or income ceilings on borrowers applying for a HUD’s reverse mortgage. This basically means that you can have poor credit or earn no money or too much money and still be able to qualify for the loan. Nobody could be excluded because earnings, assets, or poor credit.

Remember, before you get a home mortgage, discuss it with your professional home mortgage broker about the reverse mortgage limits so that you may have a more realistic representation of how much money you can receive by apply for this kind of home mortgage.

Mortgage Information

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If you’re new to buying a home and don’t have the time to read an encyclopedia on mortgages, this is the article for you. We’ll go over some basic mortgage terms and concepts to get you started.

Deciding to buy a home and obtain a mortgage is a serious decision with significant responsibilities. Not only must you spend money upfront to obtain your loan, you’ll be entering (or increasing) your debt. You’ll also be responsible to pay a large monthly payment. Hence it is important that you choose wisely what loan to get and where to get it.

You’re mortgage education should start with some basic explanations that will help you understand and pick your loan: closing costs, APR, rate, monthly payment, ARM, fixed, and of course, mortgage.

Let’s start with the definition of a mortgage. A mortgage is when you borrow money to either refinance your current home or to buy someone else’s home. The collateral for the loan is the house itself. In other words, if you were to break your mortgage contract, such as by missing payments, then the mortgage holder would be able to take possession of your home.

The term “rate” refers to the percentage used in calculating the amount of interest you’ll pay for your loan. The interest is essentially your cost for borrowing money. If the interest rate remains the same throughout the loan term, then the mortgage is considered a “fixed-rate” loan. On the other hand, if the rate can change, then the mortgage is called an adjustable rate mortgage or an ARM.

Besides interest, there are additional costs associated with obtaining a home loan. These could include fees for underwriting, the application, checking your credit history and scores, having the property’s value appraised, loan origination, title search and insurance, etc. Together, these fees are called “closing costs”.

Brokers and lenders can charge different amounts for these closing costs, which makes using the interest rate by itself an ineffective method of deciding where to buy a loan. Instead of comparing interest rates, you should compare what is known as the Annual Percentage Rate or APR, since it is calculated by adding the closing costs to the loan amount. It provides a more standardized number for comparing loans among lenders.

Besides looking at the APR, you’ll want to pay attention to the total monthly payment that you will owe. Besides including principal and interest, this amount includes property taxes, hazard or homeowner’s insurance, mortgage insurance, and HOA dues. Mortgage insurance is independent of interest rate, and when factored into your monthly costs, could result in a loan program with a higher interest rate having a lower monthly payment than a loan with a lower interest rate.

For a Sound Investment why not purchase a Bank Foreclosure

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A bank foreclosure is also known as a real estate foreclosure and it occurs when a borrower is unable to repay their outstanding debt to the bank. The real estate property was put up for collateral for securing the loan and a lien was put upon the property giving the bank legal right to seize that property should there be a default in payment.

In order to preserve their credit rating, a property owner can attempt to sell their home during thepre foreclosure period. A shrewd investor will realise this and could make a killing

Extremely lucrative deals can be made by a wise investor as many homeowners do require to sell their property very quickly indeed.

If during the pre foreclosure period, the property is not sold, then the bank will repossess the property and will take ownership of the title.

Banks do not wish to keep the property for numerous reasons, should a bank foreclosure occur

? Banks are moneylenders; they are not real estate owners.

If a bank has properties on their books, it is seen as incorrect decisions, resulting in customer not able to pay back their loans

? Banks lose money on the ownership of repossessed homes. They must maintain the buildings, pay taxes and insurance fees. The longer they own the property the more loss they incur.

Any money lost on a bank foreclosure has to be regained by the bank

Awise investor will search for bank foreclosures and will find suitable properties that match his or her current needs. Because the banks do want to get rid of the foreclosed properties as soon as possible, they will sell the properties and between 20-60% below the current market value of a bank foreclosure. There aremany onlites sites that provide uptodate foreclosure listings on commercial foreclosures, foreclosures homes and also governmet foreclosures. An excellent service is provided for a nominal fee

A bank foreclosure home or real estate property presents a risk free investment, where there are no liens on the property and the costs involved are way below market value. A wise investor is responsible, purely for the costs involved in the selling of the property.

Sub Prime Mortgages are finally phasing out.

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In the summer of 2005, sub-prime mortgage lending was at its peak. Rates were relatively low and lending guidelines were relatively loose.

Borrowers typically chose between two main products of sub-prime loan. They either locked the initial rate in for 2 years or for 3. The predominate choice at the time was the 3/27.

The 3/27 would have a teaser rate that remained fixed for 3 years then begin adjusting. It would usually adjust to the 6-month LIBOR plus a margin of 5.999 percent. This caused rates to sky-rocket at the time of adjustment. Further problems occured when the loan now became a principal and interest mortgage instead of interest only.

Since around August of 2005 was the very peak of sub-prime lending, it only makes sense that the height of its adjustments would take place now.

For homeowners with adjusting sub-prime loans, there is some (relative) good news out there. Today, LIBOR hovers near 3.15 percent, meaning that an adjusted mortgage rate will be in the neighborhood of 8.15 - 9.15 percent.

Many borrowers faced a 10.3 - 11.3 rate adjustment last year when the LIBOR was higher.

Obviously an interest rate increase of any size can cause difficulty. If you’re a sub-prime borrower and having difficulty be sure to contact your lender before you go into default.

Home Refinancing-When Should You Refinance Your Loan?

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Saving money is always a good thing, but sometimes you’re already stretched so thin that it seems like there’s nowhere else to cut back. Perhaps now is the time to take a close look at your home loan. Home refinancing can be a great way to cut down on your monthly bills, but it can also end up costing you more than you save if you’re not careful. So when is it a good idea?

If your current loan has an adjustable rate, this is probably a good time to look into refinancing to a fixed rate loan. Chances are you’ll save money. Adjustable rate loans can be good if you get the loan when the rates are high. But in the current rate environment it doesn’t make sense. It could mean thousands of dollars in your pocket over the duration of the loan if you can simply lock in a low rate. Interest rates always go back up. When they do, you’ll still be locked in at the current low rate.

Another good time to refinance is if you have a balloon payment that will be due soon, and you simply don’t have the funds available. Finally, if your current mortgage has a rate higher than the current market, then seriously look into refinancing. Even a savings of 0.25% can make a huge difference over the course of a 30 year loan.

With all the potential good things refinancing can provide, there are some things you need to look at carefully before you go ahead with the deal. Refinancing costs money up front, and some of the closing costs can be pretty hefty. Once you know those costs, you need to see how long it will take you to get them back from the savings on your monthly bill.

The reason this is so important is because people rarely stay in one house for the duration of their loan. If moving is something you might be doing in the near future, you’re simply giving away money. You should be reasonably sure you’ll be in your current house at least long enough to make up what you spend in closing costs.

Also look at the potential pre-payment penalties on your new loan. Most new loans will have them, and the average cost is 2-5 years. If you will be moving and need to take out a new loan, this will be an expensive problem. It’s also a problem if you want the loan to be paid off early. So be sure to determine those pre-payment penalties and again, measure them against your monthly savings.

Finally, and perhaps most importantly, you’ll want to look at your monthly payment. This is especially true if you’re planning on taking advantage of a cash out option. The cash out option will give you spending money now, but it will also increase the balance on your loan. If your new interest rate is not significantly lower than what you are currently paying, your monthly payment could go up just because the balance is higher. You want a rate low enough that your payments will go down, in spite of the fact that your balance increases.

Clearly there are a lot of potential advantages to home refinancing. But doing it at the wrong time can be very costly. Make sure you check all the savings against the fees and the outside factors such as a potential move. If it all makes sense, shop around for a good lender. You’ll be surprised at how different their terms can be. Don’t be afraid to ask friends and relatives for recommendations.

Do this right, and it’s like money in the bank. Do it wrong, and you could be paying for years to come.

The workplace relationship-victims of Society

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Are you a Victim or a Victor? With the rising cost of goods and services around the world, Most people are feeling the economic CRUNCH! In America fuel prices are well above $4.00 per gal and much higher than that in many other countries. Many people are searching for answers.

Who do you blame for all of this? Well in America the biggest target is the President. Many blame him. I thought his position was the Commander and Chief of the armed forces. He has the power to sign into law or veto bills passed by both houses of congress. Have you fallen victim or do you have the victory?

Excuse me, but what does that have to do with the price of gas? Does his duties have ANYTHING to do with or include “Micro-Managing” Oil refineries? I think not. Don’t get me wrong. I am not a Presidential apologist. But I am a realist. So let’s get REAL People! The CEO’s of the Oil refineries and their stock holders have everything to do with the production, the distribution, and the price of oil (fuel) in the US and the World.

Are we to point fingers and direct our frustrations at them? I know, how about protesting all gas companies! Well you could but I don’t know what good it would do. Then your only mode of transportation will be your two feet, a bicycle, and public transportation. That’ll be the idea thing for a family of five wouldn’t it. Yeah right. So, now that we’ve established that what are we to do.

Are you beginning to see what’s happening here? You and I fall into one of two categories…either you are a victim or a VICTOR. “Old-Schoolers” might say the have’s or have-nots. In today’s society there is not much middle ground. The Grey area (middle class) is quickly disappearing.

I’ll connect the dots for you. Now do you really believe that a rich person is concerned (AT ALL) about fueling up his Mercedes, Jaguar, or Bentley, OR PRIVATE JET! (maybe you couldn’t see the picture well with “just the cars.”)

The “middle class” person living from check to check has a hard time keeping his Hyundai, Chevy, or Ford fueled up at the current price of $4 to $5 dollars per gallon. And forget about the Private Jet! Did I paint the picture well enough.

Are you a victim or a VICTOR. The question still remains. Let’s analyze the two shall we?

Living from pay check to pay check, a victim is barely able to pay the bills. A VICTOR writes the pay checks to the victim, and lives Debt FREE!

A victim don’t make enough money on their “JOB” to send their child to college. So they take out loans or mortgage their house to pay for college, and remain in debt for many years to come Only to see their child graduate from college Just to get a “JOB” like his parents that took out the loan, then the child has children, and the cycle starts all over again.

Learn to break the cycle. Be VICTORIOUS! (Here’s free information to you, Because VICTORS’ will NEVER tell you this) A VICTOR brings up his child to take over his Business. A college degree is only a trophy for them. VICTORS’ don’t live from check to check, they have multiple streams of residual income! (I will explain that in my next article) You must have this if you are ever to “break the cycle” of being a victim.

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