Dec 10
23

Homeowner Beware: Refi Scams from “Your Lender”

As a homeowner, you probably have received a letter or flyer in your mailbox with offers from “Lenders” saying that you qualify for a home loan refinance.

Beware that these mail promotions may not be from your direct lender. Other lenders and financial institutions pull your property title information (which is public knowledge) in an effort to promote their financial services to homeowners. Some might even look like official “government” notifications or state that you have been “preapproved”. Below is a short video describing some of these direct mail marketing techniques and some tips on how to look out for potential mail scams from unscrupulous companies representing themselves as your lender. If you have received a letter from a financial institution stating you qualify for a refinance and are wondering if it is legitimate, feel free to call us at 661-290-3765, or visit http://411loanoptions.com for more info.

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Aug 10
29

What is a VA Loan?

While it may seem obvious, many questions arise as to exactly what a VA loan is and who is eligible. There are a few misconceptions about how the VA loan works as well.

VA stands for Veteran’s Administration, and VA Loans are available only for military service veterans. A veteran is described as a member, or former member, of the United States armed services (Army, Air Force, Marines, Navy, Coast Guard) who has served either a minimum of 180 days of active duty, or has been discharged other than dishonorably from service.

VA loans were initiated in 1944 as a way to help returning servicemen during and after World War II be able to obtain a home loan. A VA loan allows the veteran to purchase a home with no money down, and may qualify for reduced rates or even no closing costs (Called a “VA No-No”. No down payment/no closing costs). These qualifications rely upon the lender the veteran chooses in his home loan qualification, and also the veteran’s credit.

It is a common misconception that a veteran can buy a home with a ‘dollar down.’ Veterans may qualify for a no money down home loan based on their income and credit (as in a regular loan), but the Veteran’s Administration will guarantee the loan (Called the VA Loan Guaranty Service) in that they may assume the liability in case the lender experiences any losses as a result of the loan. This does NOT mean that the homeowner will not face foreclosure or other means of collection in case of default.

Enlisted veterans who have entered service after September 7, 1980 and officers who have entered service after October 16, 1981 must have completed 24 months of continuous active duty or the full period (181 days) for which you were ordered or called to active duty and had been discharged under conditions other than dishonorable. Active duty personnel on regular duty (not on active duty for training) are eligible after having served 181 days (unless discharged or separated from a previous qualifying period of active service). Qualification also requires that the home purchased be used as a primary residence. You do not have to be a first time homebuyer, and you may reuse the benefit to purchase another residence.

Aside from no down payment, VA loans do not require primary mortgage insurance (PMI), the VA rules the limits on closing costs, and the lender can not charge a prepayment penalty if you pay the loan off early. The VA does not specify a maximum loan amount, but loan guaranty limits do vary by state and/or area. For a list of VA loan limits in your area, click here.

To qualify for a VA loan you must show proof of service by supplying a copy of DD214 to your lender, as well as obtain a certificate of eligibility from the VA.  Again, you must still qualify with sufficient income and credit worthiness, as the VA is not a co-signor nor a guarantor of the veteran’s ability to pay back the loan. The VA acts as a guarantor for the maximum allowable loan limit with the lender, not with the veteran. Surviving spouses of veterans who died in the line of active duty or died as a result of service-connected disabilities are eligible. In certain cases, spouses of active duty personnel who are missing in action, captured in the line of duty by hostile forces, or forcibly detained by a foreign government or power are also eligible.

To view more on VA loan eligibility requirements, click here.

If you have questions about home loan eligibility, please contact us and be sure to visit http://411loanoptions.com.

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Aug 10
25

FHA Offers 2-1 Buydown Loan Program

Good news for home buyers!

The FHA (Federal Housing Authority) is now offering a program titled “2-1 Buydown”, which allows qualified home buyers to enjoy a temporary decrease in their mortgage rates with a 30 year fixed loan.

The way the program works is that the qualified buyer’s mortgage payment is calculated at 2% below their final locked in home loan rate for a 30 year fixed loan. The interest rate will increase 1% per year for the next 2 years until the mortgage payment reflects the original loan rate for their home loan.

The benefit of this program is that the homeowner can move into their new home with a lower initial mortgage payment, but unlike a traditional Adjustable Mortgage Rate (ARM), the loan is a fixed 30 year mortgage, and the increase is 1% per year for 2 years. Also unlike ARMs, the homeowner’s final rate is securely locked in place and the concerns about changing market conditions, rising interest rates,  or indexes are eliminated.

For more information, or to find out if you qualify for the FHA 2-1 Buydown Program, please contact us or visit http://411loanoptions.com for more details.

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Aug 10
12

FirstHOME Homebuyer Program Available for Santa Clarita Residents

Good news for first time homebuyers! The City of Santa Clarita has initiated the FirstHOME program that provides a low interest, deferred interest second mortgage for lower income households who have not owned a home for three years.

Program Assistance
The FirstHOME program sponsored by the City of Santa Clarita offers low income households a low-interest, second mortgage to be used as a down payment on a home purchase. Payments are deferred until the house is sold, changes title, ceases to be y our primary residence, or at 30 years (whichever comes first).
Maximum second mortgage down payment assistance is 50% of the sale price of the home, subject to limits based on number of bedrooms. (See requirements below for details).
Second mortgage is for only the difference between the purchase price of the home and the value of all other funding sources (first mortgage, buyer contribution, and any other grants or loans used).
Purchaser must be moderate income or below for houshold size (See requirements below for details). Household income is projected for the first year in the home. Must qualify on the projected income amount.

Qualifications
All buyers must be legal residents of the United States, and must purchase a home within the Santa Clarita city limits. They cannot have owned a home in the last 3 years, including all on property title.
Buyer must pre-qualify for a minimum 30-year fixed-rate mortgage based on income, amount of debt and credit history. Temporary interest rate buy-downs, balloon payments, no adjustable rate mortgages do not qualify.
Minimum front-end ration of 30%, maximum back-end ratio of 40%.
Co-signers for first mortage is okay, but co-signers cannot be on title or reside in the home.

Restrictions
Manufactured homes on permanent foundations are eligible only with a land lease which is at least as long as the first mortgage. Mobile homes are not eligible.
The home cannot be the subject of a current foreclosure process or be in default on mortgage payments. Bank-owned homes are acceptable.
The home must be listed in the Multiple Listing Service (MLS) and cannot be purchased through a foreclosure or property auction.
Current home purchase prices are $555,750 for single family homes, or $369,550 for condominiums or townhomes.
Buyer must contribute at least 2% of the home’s sale price. Buyer contribution cannot be borrowed funds, but gift funds may be used.
Buyer must reside in the home as princible residence until they pay off the loan. Buyer cannot rent out any portion of the residence at any time.
The home purchased cannot be a rental property for at least 3 months before the date of the sale contract.

2010 Income Guidelines

Household size/Maximum Household Income
1 person/$46,000
2 persons/$53,000
3 persons/$59,650
4 persons/$66,250
5 persons/$71,550
6 persons/$76,850
7 persons/$82,150
8 persons/$87,450

Maximum Program Loans

Number of Bedrooms/Maximum Program Loan
0 bedrooms/$118,000
1 bedroom/$135,000
2 bedrooms/$165,000
3 bedrooms $213,000
4 bedrooms/$234,000

In order to be eligible to apply for the FirstHOME Program at least one borrower from each household MUST attend one of the meetings below:

Saturday, August 28, 2010
9 a.m. to 11 a.m.  OR  11 a.m. to 1 p.m.

Wednesday, September 1, 2010,
12 noon to 2 p.m.  OR  7 p.m. to 9 p.m.

In order to reserve your seat, please RSVP by Friday, August 27, 2010 by emailing redevelopment@santa-clarita.com, or by calling (661) 286-4141.  Include your name, the number attending, your phone number and address.  Please do not bring children under 12 years of age.

To find out how to qualify for a home loan, please contact us, or visit http://411loanoptions.com for more information.

SEARCH HOMES FOR SALE IN SANTA CLARITA! CLICK HERE…

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Aug 10
10

What is a FICO Score?

You might have heard the term FICO score when referring to your credit history, or when applying for credit whether it be a consumer credit card, car purchase or home loan. We all know a FICO score has something to do with our credit rating, but what does it really mean?

The first credit scoring system was developed by Fair Isaac Corporation (that’s where the FICO comes from) in 1958 for American Investments, and the first scoring system for a credit card was developed in 1970. Using credit scores, lenders can determine a credit applicant’s qualifying indicators such as interest rate and credit limit.

The three major credit reporting bureaus (Experian, Equifax and TransUnion) collect credit data on individuals, but they may have different reporting information on any individual regarding their credit history. They each use FICO scoring software to generate FICO scores, and then sell the information to lenders, who use the score to determine the credit worthiness of an individual applicant. The FICO score is considered to be the most fair and objective underwriting tool available to lending institutions.

A FICO score is between 300 and 850, with 300 being the lowest credit score, and 850 being the highest. The higher the FICO score, the more credit worthy the applicant appears to the lending institution reviewing the applicant’s ability to qualify for a loan, whether secured or unsecured.

How is the FICO Score made up?

Credit scores measure the risk of the loan applicant by taking into account many aspects in a person’s financial history. Although the exact formulas for calculating credit scores are closely-guarded secrets, FICO has disclosed the following components and the approximate weighted contribution of each:

35%  Payment History:  Late payments on bills, such as a mortgage, credit card or automobile loan, can cause a consumer’s FICO score to drop. Paying bills as agreed over time will improve a consumer’s FICO score.

30%  Credit Utilization: The ratio of current revolving debt to the total available credit limits. Consumers can improve their FICO scores by paying off debt and lowering their use ratio.Alternatively, applying for and receiving the credit limit increase will also drive down the utilization ratio. Closing credit accounts will actually have a reverse effect and have a potentially negative impact on their FICO score.

15% Length of Credit History: As good credit history that shows a consumer pays their bills on time can have a positive impact on their FICO score.

10%  Types of Credit Used:  Consumers can benefit by having a history of managing different types of credit including consumer credit, car loans, house payments, etc.

10%  Recent search for credit and/or amount of credit obtained recently:  Multiple credit inquiries for a consumer seeking to open new credit, such as credit cards, retail store accounts, and personal loans, can hurt an individual’s score. Applying for lots of new credit in a short period of time is also viewed as risky and can cause a drop in an individual’s score. However, individuals shopping for a mortgage or auto loan over a short period will likely not experience a decrease in their scores as a result of these types of inquiries.

Tax liens, court judgments, wage garnishes, or similar issues can have a negative impact on one’s FICO score.

Some employers will request permission from job applicants to run a credit check as part of the application/pre-hiring process as an indicator to determine a hiree’s financial responsibility. Under the Fair Credit Reporting Act, a job applicant is not required to give consent to a credit check. Employers receive a credit report that is different from reports generated for lenders, and they never receive a copy of your credit score when performing a pre-hire credit check.

If you have questions about your credit report, credit scores, or loan qualification, feel free to contact us, and please visit http://411loanoptions.com for more information.

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Aug 10
6

Prospect Mortgage Loan Volume Higher than National Average

As a division of Prospect Mortgage, Country Ridge Financial offers you direct access to a variety of loan options with spectacular service.

For the second quarter and year to date, Prospect Mortgage’s PURCHASE loan percentage of total volume was 78%(Conv) and 74% (Gov), which is 30% and 32% above the national average for the same periods, respectively.

This exceptionally high percentage of purchase transactions versus refinance transactions is a reflection of the continued focus, dedication and execution of our Sales Team in establishing and maintaining high-trust relationships with our customers and Real Estate Partners across the spectrum of FHA, VA, renovation, REO and short-sale financing transactions.

Prospect Mortgage continues to grow its market share in key loan categories and markets. Through May 2010, here’s where Prospect ranked:

• #2 in HomePath (Fannie Mae REO loans) nationwide and #1 in retail HomePath nationwide
• #9 in government loan origination nationwide
• #6 in government purchase loan origination nationwide( FHA, VA)
• #6 in total purchase origination nationwide
• #15 in total volume origination nationwide
• #18 in VA purchase loan origination nationwide
• #2 in 203K loan origination nationwide
• #3 in conventional purchase loans in California for first half of 2010, trailing only Wells Fargo and Bank of America.

For more information on how you can qualify for a home loan, please visit http://411loanoptions.com.

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Jul 10
28

How NOT to be Approved for a Home Mortgage Loan

There is a lot of talk, articles, videos, blogs etc. about how to get approved for a home loan. Unfortunately, some potential borrowers, even if they are pre-qualified for a loan, can ultimately get turned down due to doing the wrong things during the loan approval process. Remember, even if you have a purchase contract signed by the seller of the home you are borrowing, the home is in escrow AND you are pre-qualified or even pre-approved for a loan, your loan may not close and process if you overlook a few basic “no-no’s” of the qualifying process.

Don’t Make Large Purchases, Especially on Credit!
As a matter of fact, don’t make any large purchases in general (IE: Cars, boats, appliances, luxury items, etc.), but especially not using credit. Lenders will verify all qualifying aspects of your loan prior to funding, and credit purchases made during the escrow process not only affects your credit score, but tips off the lender that you are prone to impulsive spending which might affect your ability to make your loan payments.
Even if you make a large purchase by paying cash, if liquid assets are one of the qualifying factors of your loan, and you dip into those assets to make a large purchase, it once again can show the lender that you may be a loan risk. Hold off on any large purchases of any kind until AFTER the loan closes. If a large purchase is an absolute necessity (IE: Your car has totally given out and it will be less expensive to purchase another one rather than repair it), speak with your lender FIRST to see how that might affect your loan qualification.

Don’t Change Employers
This may be a hard one if a great offer comes up, but your lender is qualifying you based on your income and steady employment. A new job comes with a lot of variables in that you have no track record with the company, no references and no real proof of income. Even if escrow lasts through a pay period in your new job, one pay stub will be a tough sell to a loan underwriter. If offered a new job, if possible, see if you can hold off until your loan closes. Otherwise, consult your lender FIRST.

DO Pay Your Bills on Time
Make sure you are not late on any payments, especially credit cards, car loans, student loans, house payments, etc. Any late payments may affect your final credit score. Stay current, get funded!

Don’t Change Banks or Move Large Amounts of Money
Your loan qualification is based on assets on hand that can be verified at any time during the escrow process. Should you move money to other accounts or change banks, your loan underwriter may not be able to easily verify your assets and your loan approval may be upheld, or even ultimately denied.

Don’t Open New Lines of Credit
Even if you don’t plan on using them right away, opening lines of credit or applying for credit during your escrow can affect your credit score and more importantly, your ability to have your loan funded by your mortgage company.

Stay Put!
It is very important that your lender be able to contact you at any time during the escrow process in order to quickly handle any questions or issues regarding your loan qualification. It’s best to consider holding off on vacations and/or other travel plans until the close of escrow UNLESS ABSOLUTELY NECESSARY! Also, the best time to change your cell phone or any other contact information is NOT during the escrow process. Do your best to insure your lender has all of your contact numbers and email addresses.

And Finally…Use Common Sense
Your home loan ultimately rests on two things: 1) Your ability to qualify for a loan, and 2) Your willingness to pay the loan. Before and during the escrow process you need to keep in mind always that the above 2 items are what your lender is using to gauge their willingness to loan you money. Be prepared, be organized and be disciplined in your actions so that you can close your loan and move along.

For more information and to find out about loan qualifications, please visit http://411LoanOptions.com.

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Jul 10
8

Mortgage Rates Reach Historic Low

Interest rates on 30-year fixed-rate mortgages averaged 4.57 percent this week, Freddie Mac reported this morning, which marks the third consecutive week of record-setting lows for the most popular type of home loan.

This record rate marks the lowest in the 40 years since Freddie Mac was established by Congress in 1970.

“With mortgage rates falling to historic lows, refinance activity has been strong over the past three months,” Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

What Does This Mean?
Qualified home buyers can now get more for their money by taking advantage of these historic rates. This means that either you can purchase your home with a lower payment, or qualify for a higher loan amount. For homeowners, this means that refinance options have never been better.

If you’re on the fence about purchasing a home or refinancing your current home mortgage loan, now is the time to find out more about how you can take advantage of these low, low mortgage rates.

Contact us for details, call 661-290-3765, or visit http://411LoanOptions.com for more answers to your home loan questions and to see if you qualify for a home loan or a home loan refinance.

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Jul 10
1

The Home Mortgage Loan Application Checklist

To begin processing your loan, you will need this information from the following mortgage application checklist.

Personal Information

  • Name of borrower and co-borrower
  • Social Security number(s)
  • Years completed in school
  • Marital status
  • Address of current residence, plus address of previous residence if you’ve been at your current residence less than two years
  • Number of dependents and birth date for each dependent
  • Employment Information

Loan Information

  • If purchasing a new home, price or estimated price of the property you are buying and down payment amount
  • Amount you would like to borrow.
  • If applicable, monthly homeowners dues

Property Information

  • Address of property (sometimes yet to be determined for purchases)
  • Type of property (single family, condo, land, etc.)
  • Use of property (primary residence, second residence, etc.)

Income information

  • All sources and amounts of monthly income including salary, bonuses, commission, dividends, interest, and retirement
  • Current expenses; housing, alimony, child support, and other debts
  • Real estate assets; location, value, loan amount, mortgage payments, and rental income
  • Other assets; bank accounts, stocks, bonds, insurance, and retirement funds

Documents

Submitting the right items from your mortgage application checklist will speed the process of determining if you qualify for the type and amount of loan you want. Should you fail to qualify, these mortgage application checklist items can often help your Loan Officer determine and present alternative financing options. Be prepared to submit the following along with your application:

  • Checking and savings account statements for the last two to three months.
  • Borrower and co-borrower pay stubs demonstrating earnings for the last 30 days and year-to-date earnings.
  • Last year’s W2 (and 1099, if applicable) if applicable for each borrower and co-borrower, plus federal tax returns for the last two years (or other proof of income and employment verification).
  • Divorce settlement papers (if applicable).
  • Credit card bills for the last few billing periods, or cancelled checks for rent or utility bill payments.
  • Documentation for debts such as car loans, furniture loans, student loans, and credit cards.
  • A gift letter if you are using a gift from a parent, relative, or organization to help with you down payment and/or closing costs.

Learn more about home loans by going to http://411loanoptions.com.

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Jun 10
21

The Home Mortgage Lending Process

Once you’ve found the home you want and negotiated a price that you and the seller agree on, it’s time to get your loan. When you submit a loan application, you can expect to complete lots of paperwork and provide information about your employment history, financial assets and liabilities, and credit. You may also be required to pay an application fee.

The next step is to lock-in the current interest rates and points for your loan of choice for anywhere from 30 days to six months. You may also elect to allow the interest rate to float, so that you can lock it in at a later time. If you decide to let the rate float you may end-up with a rate that is higher or lower than the rate on your date of application.

After you have reviewed disclosures and paid any required processing fees, your lender will order a property appraisal, to determine the fair market value of the home. You and/or your Realtor should be present for the appraisal inspection. You may be required to pay for the appraisal. When refinancing with certain loan programs, an appraisal may not be necessary.

You will then sign and return to the lender all required disclosures and any additional documentation needed to satisfy the conditions of the loan. When the lender receives the appraisal, a credit report, signed disclosures, and additional obligatory documentation, your loan officer will prepare and submit your loan for final approval.

A licensed title agent should then perform the settlement and escrow process. Your Loan Officer can help coordinate this. If purchasing a home, you will be required to bring a cashier’s check for the down payment and any other fees to the settlement. In a refinance, fees are typically covered by the loan proceeds. While at the settlement, you will read and sign numerous documents regarding your transaction.

As part of the settlement phase, your lender will wire the loan funds to an escrow account or send a cashier’s check to the closing agent, which may be a title company, an attorney, or an escrow agent, depending upon the state the transaction occurs in. The property’s owner or their lender is paid in full and all fees for all parties are paid. The property’s ownership will then transfer from the seller or the seller’s lender to your lender.
Home Loans 411 is brought to you in conjunction with Country Ridge Financial. Learn more about how we can help you finance the home of your dreams by going to http://411LoanOptions.com.

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