The VA does an amazing job of keeping veterans in their homes.
Nearly three-quarters of the VA borrowers who defaulted in fiscal year 2009 avoided foreclosure thanks to the agency’s policies and procedures.
But the Department of Veterans Affairs also operates a unique program that helps veterans who are trying to sell their homes in a difficult real estate market.
Home values have fallen drastically in some parts of the country, leaving some service members with a significant chasm between what they can sell their home for and what they still owe on their mortgage loan.
The VA’s Compromise Sale program helps veterans who have seen their home values collapse recoup and rebound. Through this program, service members can receive a “compromise claim” from the VA that essentially covers that gap between the sale price and their outstanding loan balance.
There’s an array of conditions that need to be met for service members interested in a compromise sale. Among them:
Sellers must document financial hardship
No second liens can exist
There must be a purchase agreement in place before a compromise application is filed
The pending sale must be a better deal financially for the government than a foreclosure
Homeowners will need to furnish a current appraisal. They’ll also need to prepare for a reduced entitlement, at least until the VA is reimbursed for the sale.
Veterans can learn more about the Compromise Sale program by contacting the VA at 1-800-933-5499. The agency’s regional loan center in Houston also maintains a helpful page on Compromise Sales.
Contact The Mortgage Mark with any questions or for more Information.
http://www.themortgagemark.com/
mwilkins@capitalfmc.com
Wednesday, December 1, 2010
Friday, November 12, 2010
Internet Tips for Home Buyers
Save time and stress when using the Internet to find your next home.
The internet has made it much easier for people search for homes and Real Estate information than ever before however the sheer volume of information can make it difficult to use the internet effectively.
There are few free technologies and tips that can make can a big difference in your experience while researching Real Estate online.
First is Google’s email solution which is www.Gmail.com. Go and set up a new email account before you start your search and use this email to sign up for Real Estate sites and to have listings delivered to. This will keep all of your Real Estate information in one place and keep it from interrupting your business or personal email.
In addition to the free email Gmail also supplies you with a free telephone from within your account which allows you to make calls to anywhere in the United States and still keep your home and cellular phone number private.
There is also another free service that can help you in your Real Estate search which is Google Alerts. These are included in your Gmail account and can be set to deliver any keyword information you choose to your Gmail account on a daily basis such as “Levittown Homes For Sale".
If you are going to use the Google search engine to search for homes be sure to click the advanced search link to the right of the Google Search Bar which will allow you to pinpoint exactly what you are looking for in your searches and just as importantly what you are not.
It’s very important to know what your credit report looks like as you begin to look for Real Estate and unlike free credit report .com which is anything but free www.annualcreditreport.com is actually a free site created by the three major search engines where you can get copies of all three of your credit reports at no charge and with no credit card required once a year.
A final tip that can save you hours while searching online is when visiting popular Real Estate sites like www.realtor.com or www.zillow.com to review properties try right clicking on the property and then click open in new tab or window. This will allow you to look at multiple properties at the same time and keep your search results open so you don’t have to use the back arrow to try to find the list of properties you just pulled up.
Using these free technologies will help make your online Real Estate search much more productive and limit the time and stress associated with trying to negotiate the internet.
Contact The Mortgage Mark with any questions! http://www.themortgagemark.com
mark@themortgagemark.com
The internet has made it much easier for people search for homes and Real Estate information than ever before however the sheer volume of information can make it difficult to use the internet effectively.
There are few free technologies and tips that can make can a big difference in your experience while researching Real Estate online.
First is Google’s email solution which is www.Gmail.com. Go and set up a new email account before you start your search and use this email to sign up for Real Estate sites and to have listings delivered to. This will keep all of your Real Estate information in one place and keep it from interrupting your business or personal email.
In addition to the free email Gmail also supplies you with a free telephone from within your account which allows you to make calls to anywhere in the United States and still keep your home and cellular phone number private.
There is also another free service that can help you in your Real Estate search which is Google Alerts. These are included in your Gmail account and can be set to deliver any keyword information you choose to your Gmail account on a daily basis such as “Levittown Homes For Sale".
If you are going to use the Google search engine to search for homes be sure to click the advanced search link to the right of the Google Search Bar which will allow you to pinpoint exactly what you are looking for in your searches and just as importantly what you are not.
It’s very important to know what your credit report looks like as you begin to look for Real Estate and unlike free credit report .com which is anything but free www.annualcreditreport.com is actually a free site created by the three major search engines where you can get copies of all three of your credit reports at no charge and with no credit card required once a year.
A final tip that can save you hours while searching online is when visiting popular Real Estate sites like www.realtor.com or www.zillow.com to review properties try right clicking on the property and then click open in new tab or window. This will allow you to look at multiple properties at the same time and keep your search results open so you don’t have to use the back arrow to try to find the list of properties you just pulled up.
Using these free technologies will help make your online Real Estate search much more productive and limit the time and stress associated with trying to negotiate the internet.
Contact The Mortgage Mark with any questions! http://www.themortgagemark.com
mark@themortgagemark.com
Friday, November 5, 2010
7 Requirements of Mortgage Verification and Validation
Verification and Validation – how it can affect your loan.
Today’s economic crisis has taught mortgage lenders one huge lesson they are all living by - verify and validate every loan file. Documentation – sounds like an easy task, but simply turn the clock back just a few years to the days of stated income loans, no income loans and even no income, no assets, no doc loans (just give me a high credit score) and you have the reason we now live in a Full Documentationworld. Did these loans make sense? Opinions vary, but eliminating as product that was intended for self employed borrowers has restricted business owners from tapping needed equity to stay operational. Ask any business owner you know what they think the chances are of qualifying for a loan would be today.
Below are 7 items that must be verified and validated these days when applying for mortgage financing:
Employment – Even after a loan has been cleared to close, telephone confirmation of employment is now routine just before a loan is scheduled to fund. In other words, don’t quit your job!
Income – 30 days worth of pay stubs. Previous two years W 2’s. If you show any kind of business income or loss, last two years tax returns (business and personal). Signed 4506-T forms at loan application allow lenders to order tax transcripts from the IRS to match up to your income… And they all order them. If you show a loss on your tax returns tell your loan officer upfront and save yourself frustration. This is not always a deal killer but will affect your debt ratio.
Assets – When a loan is run through automated underwriting it takes into account the assets that are stated. If you show money in checking, savings, 401k or any other investment, you will want to validate it by providing statements. Many times the final page or pages of the statements are blank. Include ALL pages of your statements regardless if they are blank. Note – if you are printing these documents from the internet, as a security measure, institutions do not include name or account number. This would not be acceptable documentation.
Deductions – Provide supporting documentation for payroll deductions such as child support, alimony, garnishments, 401k loans. Anything that affects your debt ratio must be documented which would include providing divorce and separation agreements and terms of of 401k loans.
Appraisals – This verification is done behind the scenes, but rest assured, even with all the new HVCC appraisal regulations, lenders validate appraisal figures through automated valuation models (AVM’s). The days of stretching home values in order to close a deal are long gone.
Gift Funds – Lenders want to see gift money comes from an acceptable gift source. And they way to show this is a paper trail… A bank statement from the gift source showing funds were available and a copy of the transaction transferring monies from the gift account to the borrower if deposited into borrowers account.
Earnest Money Deposit – Also referred to as the EMD. Many times this single item goes undocumented and causes a delay in clearing a loan to close. Sure we need a copy of the front of the check, but lenders want to see that the money was deposited before crediting it to the transaction.
These are just a few examples of documentation to gather when applying for a mortgage. This is just a guideline to use and lender requirements can and will vary, but providing the above documentation to your loan officer, you will greatly reduce the chances of frustration and delays in your loan closing. The mortgage process can be stressful enough these days. Supplying the required documentation the first time a loan is submitted to underwriting will increase the chances of a stress free closing.
Contact The Mortgage Mark with any questions!
www.themortgagemark.com mwilkins@capitalfmc.com
Today’s economic crisis has taught mortgage lenders one huge lesson they are all living by - verify and validate every loan file. Documentation – sounds like an easy task, but simply turn the clock back just a few years to the days of stated income loans, no income loans and even no income, no assets, no doc loans (just give me a high credit score) and you have the reason we now live in a Full Documentationworld. Did these loans make sense? Opinions vary, but eliminating as product that was intended for self employed borrowers has restricted business owners from tapping needed equity to stay operational. Ask any business owner you know what they think the chances are of qualifying for a loan would be today.
Below are 7 items that must be verified and validated these days when applying for mortgage financing:
Employment – Even after a loan has been cleared to close, telephone confirmation of employment is now routine just before a loan is scheduled to fund. In other words, don’t quit your job!
Income – 30 days worth of pay stubs. Previous two years W 2’s. If you show any kind of business income or loss, last two years tax returns (business and personal). Signed 4506-T forms at loan application allow lenders to order tax transcripts from the IRS to match up to your income… And they all order them. If you show a loss on your tax returns tell your loan officer upfront and save yourself frustration. This is not always a deal killer but will affect your debt ratio.
Assets – When a loan is run through automated underwriting it takes into account the assets that are stated. If you show money in checking, savings, 401k or any other investment, you will want to validate it by providing statements. Many times the final page or pages of the statements are blank. Include ALL pages of your statements regardless if they are blank. Note – if you are printing these documents from the internet, as a security measure, institutions do not include name or account number. This would not be acceptable documentation.
Deductions – Provide supporting documentation for payroll deductions such as child support, alimony, garnishments, 401k loans. Anything that affects your debt ratio must be documented which would include providing divorce and separation agreements and terms of of 401k loans.
Appraisals – This verification is done behind the scenes, but rest assured, even with all the new HVCC appraisal regulations, lenders validate appraisal figures through automated valuation models (AVM’s). The days of stretching home values in order to close a deal are long gone.
Gift Funds – Lenders want to see gift money comes from an acceptable gift source. And they way to show this is a paper trail… A bank statement from the gift source showing funds were available and a copy of the transaction transferring monies from the gift account to the borrower if deposited into borrowers account.
Earnest Money Deposit – Also referred to as the EMD. Many times this single item goes undocumented and causes a delay in clearing a loan to close. Sure we need a copy of the front of the check, but lenders want to see that the money was deposited before crediting it to the transaction.
These are just a few examples of documentation to gather when applying for a mortgage. This is just a guideline to use and lender requirements can and will vary, but providing the above documentation to your loan officer, you will greatly reduce the chances of frustration and delays in your loan closing. The mortgage process can be stressful enough these days. Supplying the required documentation the first time a loan is submitted to underwriting will increase the chances of a stress free closing.
Contact The Mortgage Mark with any questions!
www.themortgagemark.com mwilkins@capitalfmc.com
Thursday, November 4, 2010
Mortgage Definition: Stability Of Income
Stability Of Income — A Simple Definition:
One of the factors that underwriters will consider on a loan application is “stability of income”. The stability of income risk factor is one where the underwriter will attempt to measure how likely it is that your income may continue based on what your previous work history looks like.
Stability Of Income — An Expanded Definition:
While there may be a wide range of things an underwriter can consider regarding the stability of income, there are a few specific things that an underwriter will look at when considering the stability of income.
These include:
Gaps in Employment – If there are any gaps in employment that are longer than one month, be ready to provide an explanation. If you happen to be a seasonal worker, allowances can be made but be ready to provide documentation.
The Probability Of Continued Employment — What are the chances of continued employment at your current employer? What are the chances that you can get a similar job based on your qualifications, previous work history, education and location.
Frequent Job Changes — If you have a history of changing jobs, it isn’t necesarily a bad thing as long as you can document that you have changed jobs for advancements, more money, benefits or other related topics. Remember, the underwriter is looking at the stability of income – not necessarily how long you have been at one company.
Stability of income is one of the important items that an underwriter will consider when you apply for a loan. By keeping in mind the simple items of: gaps in employment, the probability of continued employment and frequent job changes you can be ready to provide explanations — before the underwriter even asks for them.
Contact The Mortgage Mark with any questions!
http://www.themortgagemark.com mwilkins@capitalfmc.com
One of the factors that underwriters will consider on a loan application is “stability of income”. The stability of income risk factor is one where the underwriter will attempt to measure how likely it is that your income may continue based on what your previous work history looks like.
Stability Of Income — An Expanded Definition:
While there may be a wide range of things an underwriter can consider regarding the stability of income, there are a few specific things that an underwriter will look at when considering the stability of income.
These include:
Gaps in Employment – If there are any gaps in employment that are longer than one month, be ready to provide an explanation. If you happen to be a seasonal worker, allowances can be made but be ready to provide documentation.
The Probability Of Continued Employment — What are the chances of continued employment at your current employer? What are the chances that you can get a similar job based on your qualifications, previous work history, education and location.
Frequent Job Changes — If you have a history of changing jobs, it isn’t necesarily a bad thing as long as you can document that you have changed jobs for advancements, more money, benefits or other related topics. Remember, the underwriter is looking at the stability of income – not necessarily how long you have been at one company.
Stability of income is one of the important items that an underwriter will consider when you apply for a loan. By keeping in mind the simple items of: gaps in employment, the probability of continued employment and frequent job changes you can be ready to provide explanations — before the underwriter even asks for them.
Contact The Mortgage Mark with any questions!
http://www.themortgagemark.com mwilkins@capitalfmc.com
Monday, November 1, 2010
Can I have 2 FHA loans at the same time?
Why would someone have two FHA loans at the same time? Here are the reasons and the exceptions that may allow someone to have 2 concurrent FHA Loans.
Increase in family size – There must be an increase in family size in which their current house can’t support the new family member(s). You will have to prove the increase. Also, you must have 25 percent equity in your current home or pay it down to 75% LTV (loan-to-value). An FHA approved appraiser must be used to determine such new value.
Relocation – If the borrower is relocating and it is established that they aren’t in reasonable distance from their current property. Keeping in mind that reasonable can be defined differently from any lender.
Note – If that borrower(s) returns back to the same area, they are not required to re-establish residency in that property in order to have another FHA insured mortgage.
Vacating a jointly owned property – A borrower my leave a property and be eligible for another FHA loan if the co-borrower is to stay in the same property that is being vacated.
A good example of this is because of a divorce and that the vacating spouse needs to buy a new home.
Non-Occupying co-borrower – If someone previousily co-signed for a family member or relative while using a FHA loan. This type of FHA loan is called a non-occupant co-borrower loan. This borrower would still be eligible to purchase their own home using a FHA mortgage.
Without meeting any of these requirements, a potential borrower would not be approved for a second FHA insured loan.
Contact The Mortgage Mark with any questions! mark@themortgagemark.com
www.themortgagemark.com
Increase in family size – There must be an increase in family size in which their current house can’t support the new family member(s). You will have to prove the increase. Also, you must have 25 percent equity in your current home or pay it down to 75% LTV (loan-to-value). An FHA approved appraiser must be used to determine such new value.
Relocation – If the borrower is relocating and it is established that they aren’t in reasonable distance from their current property. Keeping in mind that reasonable can be defined differently from any lender.
Note – If that borrower(s) returns back to the same area, they are not required to re-establish residency in that property in order to have another FHA insured mortgage.
Vacating a jointly owned property – A borrower my leave a property and be eligible for another FHA loan if the co-borrower is to stay in the same property that is being vacated.
A good example of this is because of a divorce and that the vacating spouse needs to buy a new home.
Non-Occupying co-borrower – If someone previousily co-signed for a family member or relative while using a FHA loan. This type of FHA loan is called a non-occupant co-borrower loan. This borrower would still be eligible to purchase their own home using a FHA mortgage.
Without meeting any of these requirements, a potential borrower would not be approved for a second FHA insured loan.
Contact The Mortgage Mark with any questions! mark@themortgagemark.com
www.themortgagemark.com
Wednesday, October 20, 2010
Primary Residence — A Simple Definition
Primary Residence — A Simple Definition:
When getting a mortgage, one of the factors that will influence the rate and terms of your loan is whether or not you will occupy the property as a primary residence. Generally speaking, the best deals on mortgage terms are available to people who are going to occupy the property as their primary residence. Also, generally speaking you can only have one FHA insured loan at one time.
Primary Residence — An Expanded Definition:
When getting an FHA loan, it is generally not possible to have more than one FHA loan per borrower. Anyone who owns a home (either alone or with someone else) that is insured by FHA generally can’t get another FHA insured loan except under the following circumstances:
Relocation – if you are relocating to another area that is not within a reasonable commuting distance from your current home, you can get another FHA loan without being required to sell your existing home that currently has FHA financing.
Increase in Family Size – You can get another home with an FHA loan if you have an increase in the number of legal dependents where your present house no longer meets the family’s needs. If this is the case, you must pay your current FHA loan down to 75% LTV and a current appraisal must be used when determining the 75%.
Vacating a Jointly-Owned Property – If you are getting divorced and are moving out of your house that is currently financed with an FHA loan, you can get another FHA loan if you can qualify for it financially.
Non-occupying co-borrower — A non-occupying co-borrower on a property that is being purchased with an FHA-insured mortgage as a primary residence by other family members. This is often the case with what is known as “FHA kiddie condo loans”.
Primary residence.
It matters whether the property you are buying is going to be your primary residence or not. When getting a conventional loan, it matters for the rates and terms of the loan and when getting an FHA loan, it often matters whether or not you can get a loan at all.
Contact The Mortgage Mark with any questions!
http://www.themortgagemark.com mwilkins@capitalfmc.com
When getting a mortgage, one of the factors that will influence the rate and terms of your loan is whether or not you will occupy the property as a primary residence. Generally speaking, the best deals on mortgage terms are available to people who are going to occupy the property as their primary residence. Also, generally speaking you can only have one FHA insured loan at one time.
Primary Residence — An Expanded Definition:
When getting an FHA loan, it is generally not possible to have more than one FHA loan per borrower. Anyone who owns a home (either alone or with someone else) that is insured by FHA generally can’t get another FHA insured loan except under the following circumstances:
Relocation – if you are relocating to another area that is not within a reasonable commuting distance from your current home, you can get another FHA loan without being required to sell your existing home that currently has FHA financing.
Increase in Family Size – You can get another home with an FHA loan if you have an increase in the number of legal dependents where your present house no longer meets the family’s needs. If this is the case, you must pay your current FHA loan down to 75% LTV and a current appraisal must be used when determining the 75%.
Vacating a Jointly-Owned Property – If you are getting divorced and are moving out of your house that is currently financed with an FHA loan, you can get another FHA loan if you can qualify for it financially.
Non-occupying co-borrower — A non-occupying co-borrower on a property that is being purchased with an FHA-insured mortgage as a primary residence by other family members. This is often the case with what is known as “FHA kiddie condo loans”.
Primary residence.
It matters whether the property you are buying is going to be your primary residence or not. When getting a conventional loan, it matters for the rates and terms of the loan and when getting an FHA loan, it often matters whether or not you can get a loan at all.
Contact The Mortgage Mark with any questions!
http://www.themortgagemark.com mwilkins@capitalfmc.com
Monday, October 18, 2010
What is an escrow account?
Understanding Escrow
What is an escrow account?
An escrow account is used to collect and hold funds to pay your property taxes, homeowners insurance premiums or other charges when they become due.
The account is often established for you by your mortgage company when you take out your mortgage. However, if an escrow account was not set up when you took out your mortgage, you may be able to do so now.
Real estate taxes and insurance premiums must be paid regularly — typically, payments are due once or twice a year — and failure to pay these bills on time may cost you money in tax penalties or result in cancellation of your insurance coverage.
What are the benefits of an escrow account?
An escrow account helps you:
Manage your budget: You do not have to make lump sum payments when your taxes and insurance are due. You have made monthly payments throughout the year to cover those obligations.
Gain peace of mind: You don’t need to keep track of when your tax and insurance bills are due. The payments will be made, on time, on your behalf.
Ensure that your home is protected: With paid-up insurance coverage and taxes, you protect your investment in your home and meet your lender’s requirements.
Most mortgage companies require an escrow account for mortgages with less than a 20 percent down payment.
How does an escrow account work?
Your monthly mortgage payment includes an amount for property taxes and insurance in addition to the amount you owe for principal and interest.
The amount of your monthly mortgage payment that is for taxes and insurance is placed by your mortgage company into an escrow account. The funds can be used only to pay taxes and insurance on your behalf.
Your mortgage company pays the taxes and insurance bills for you when they are due. Your mortgage company examines any changes in your tax and insurance costs (for example, your local government may change the amount of your real estate taxes). Your mortgage company sends you a statement each year showing the prior year's activity — amounts collected from you and placed in escrow as well as the payments made on your behalf — and showing any adjustments that may be needed based on changes in your tax and insurance costs.
Here is a simplified example* of how escrow payments are calculated:
Annual real estate taxes: $1,800 ÷ 12 months = $150 per month
Annual property insurance: $720 ÷ 12 months = $60 per month
Total monthly taxes and insurance: $210
So in this example, $210 would be added to your total monthly mortgage payment and applied to your escrow account. You might hear your total monthly mortgage payment referred to as your “PITI” — for principal, interest, taxes and insurance.
Do you have an escrow account?
If you are not sure if you have an escrow account, check your monthly mortgage account statement or contact your mortgage company. Your account statement will typically indicate your “Escrow Balance” and the amount of your total monthly mortgage payment that is applied to escrow.
Should you establish an escrow account?
If you do not have an escrow account, you may want to establish one. Ask your mortgage company for more information.
Contact The Mortgage Mark with any questions!
www.themortgagemark.com mwilkins@capitalfmc.com
What is an escrow account?
An escrow account is used to collect and hold funds to pay your property taxes, homeowners insurance premiums or other charges when they become due.
The account is often established for you by your mortgage company when you take out your mortgage. However, if an escrow account was not set up when you took out your mortgage, you may be able to do so now.
Real estate taxes and insurance premiums must be paid regularly — typically, payments are due once or twice a year — and failure to pay these bills on time may cost you money in tax penalties or result in cancellation of your insurance coverage.
What are the benefits of an escrow account?
An escrow account helps you:
Manage your budget: You do not have to make lump sum payments when your taxes and insurance are due. You have made monthly payments throughout the year to cover those obligations.
Gain peace of mind: You don’t need to keep track of when your tax and insurance bills are due. The payments will be made, on time, on your behalf.
Ensure that your home is protected: With paid-up insurance coverage and taxes, you protect your investment in your home and meet your lender’s requirements.
Most mortgage companies require an escrow account for mortgages with less than a 20 percent down payment.
How does an escrow account work?
Your monthly mortgage payment includes an amount for property taxes and insurance in addition to the amount you owe for principal and interest.
The amount of your monthly mortgage payment that is for taxes and insurance is placed by your mortgage company into an escrow account. The funds can be used only to pay taxes and insurance on your behalf.
Your mortgage company pays the taxes and insurance bills for you when they are due. Your mortgage company examines any changes in your tax and insurance costs (for example, your local government may change the amount of your real estate taxes). Your mortgage company sends you a statement each year showing the prior year's activity — amounts collected from you and placed in escrow as well as the payments made on your behalf — and showing any adjustments that may be needed based on changes in your tax and insurance costs.
Here is a simplified example* of how escrow payments are calculated:
Annual real estate taxes: $1,800 ÷ 12 months = $150 per month
Annual property insurance: $720 ÷ 12 months = $60 per month
Total monthly taxes and insurance: $210
So in this example, $210 would be added to your total monthly mortgage payment and applied to your escrow account. You might hear your total monthly mortgage payment referred to as your “PITI” — for principal, interest, taxes and insurance.
Do you have an escrow account?
If you are not sure if you have an escrow account, check your monthly mortgage account statement or contact your mortgage company. Your account statement will typically indicate your “Escrow Balance” and the amount of your total monthly mortgage payment that is applied to escrow.
Should you establish an escrow account?
If you do not have an escrow account, you may want to establish one. Ask your mortgage company for more information.
Contact The Mortgage Mark with any questions!
www.themortgagemark.com mwilkins@capitalfmc.com
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