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ON ANY GIVEN DAY
Last evening my husband asked how my day had been. "Outstanding" I replied, and then I started to think how tired my mind was.
A few months ago I was invited to a Financial Seminar at Vestavia Country Club to listen to Doug Lennick, CFP. There was lots of excitement in the air since Doug had not been in Birmingham in years. He spoke about his new book Financial Intelligence. After I decided my mind was "full" I was reminded of of this from chapter 5 Recognizing...
At any given moment, there is a phenomenal amount of activity going on within us -- much of it we're not even aware of. Each day the average person:
- Thinks 12,000 thoughts
- Pumps 2k gallons of blood through 60k miles of blood vessels
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Blinks his or her eyes 17k times
- Breathes 23,040 times
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Sheds 14 million particles of skin
- Replaces 400 billion cells
No wonder! The above, was an average day and mine was above average. My mind was tired but I was thankful, it was an outstanding day!
You think about purchasing or refinancing a home a few times in your life, I think about every day, I am here to help you!
My name is Valerie Springer nmls 198479, Home Mortgage Expert and writer for Dear Val in Birmingham, Alabama. You may contact me by email at valerie.springer@nflp.com or call 205-995-7283 x 305.
Seller-paid concessions, when used properly, can mean the difference between closing a home sale and losing one. A concession is anything of value added to the transaction by the seller, builder, developer, salesperson or any interested party. A concession may also include any closing costs that would normally be paid by the buyer or cash given to the buyer to lower non-housing debts. Funds received from a relative to assist with a home purchase, or cash contributed from an employer as part of a corporate transfer are not considered seller concessions. These are gift funds or transfer funds. When buyers and sellers are negotiating, a few hundred dollars one way or the other can make a huge difference. However, it's important for sellers to understand how concessions work and how nonallowable concessions can work against buyers. From the seller's perspective, there may be little difference in offering a monetary concession or lowering the property price. Either choice reduces the net gain realized at closing. However, buyers may have another view of concessions versus lower prices. To a buyer, the concession may be more preferable, because it is money that can be applied directly to the purchase. In addition, making a concession rather than cutting the price helps maintain property values in the area. It's important knowing which seller concessions are allowable by lenders. If a concession is considered nonallowable, the lender may reduce the home price by the value of the concession. This, in turn, lowers the maximum loan the lender will make, and could foil the transaction. The Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corp. (Freddie Mac), which purchase residential loans from lenders, have restrictions concerning allowable seller concessions for conventional mortgages. Both entities permit sellers to pay some or all closing costs, depending on the down payment and type of financing involved. The closing costs sellers may pay include: fees for the loan origination, discount points, credit report, appraisal, title insurance, survey, loan underwriting, tax service, document preparation, deed recording, home inspection and loan assumption. (Allowable closing costs may vary by area.) Sellers also are allowed to pay private mortgage insurance out of the buyer's "prepaid" costs collected at closing. Fannie Mae and Freddie Mac also limit the amount of money sellers can give as concessions. The maximum contribution for conventional loans is 3 percent of the lesser of the sales price or appraised value, if the buyer's down payment is less than 10 percent and the property is to be occupied as a principal residence. The maximum allowable contribution is raised to 6 percent if the down payment is 10 percent or more. A contribution of 2 percent is permitted if the property will be used as investment property and the mortgage is a fixed-rate loan. Few seller concessions are permitted in transactions involving single-family mortgages insured by the Federal Housing Administration (FHA). Sellers are allowed to pay up to six discount points (one point equals 1 percent of the loan amount); but other concessions may cause the buyer's down payment to be increased. The Department of Veterans Affairs (DVA) is more lenient in its treatment of seller contributions. Under its home loan guaranty program, a seller is allowed to pay all closing costs, plus up to 4 percent of the sales price, to reduce other costs paid by the buyer. The 4 percent limit includes the VA funding fee, prepaid and escrow costs, discount points and payment of any debt to help the borrower qualify for the mortgage. Credit given to American Associates Inc. Library. My name is Valerie Springer nmls 198479, Home Mortgage Expert and writer for Ask Val in Birmingham, Alabama. You may contact me by email at valerie.springer@nflp.com or call 205-995-7283 x 305.
- NO Monthly Payments
- NO Credit Report
- NO Employment Qualifications
- NO Medical Qualification
- NO Income Requirements
- NO Asset Verification
- NO Recourse
- NO Tax or Insurance Escrows
- NO Restrictions on Use of Funds
If you would like more information on Reverse Mortgage, please contact me at 205-995-7283 x 305 or email me at valerie.springer@nflp.com I will be happy to answer your questions and show you a financial opportunity which could be available to you.
My name is Valerie Springer nmls 198479, Home Mortgage Expert and writer for Ask Val in Birmingham, Alabama. You may contact me by email at valerie.springer@nflp.com or call 205-995-7283 x 305
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If you are purchasing or refinancing a home in Alabama you have several different loan products available to you if you qualify. Today I am going to talk about Conventional Mortgage Loan for Purchase and Refinance. A Conventional Loan is really the "Cream of the Crop". In most situations they are for folks who have excellent credit, 5% or more for a down-payment and assets. What is considered excellent credit? By today's standard an excellent credit score is considered to be 740 or higher. Credit scoring models go up to 850. A 740 middle score will yield you the best interest rate available. When I pull credit for approval, I will receive a credit score from Experian, Equifax and TransUnion. The middle score is the one I will use. Once your score drops below the 740 mark you will begin to take a hit to the rate based on this number. How much do I need for a down-payment on a Conventional Mortgage? The minimum down-payment for a conventional loan is 5% of the sales price. The more money you have for a down-payment will also get you a better interest rate and reduce your monthly private mortgage insurance (PMI)if you don't have at least 20% to put down. If you are refinancing your home the percentages on equity are the same. Loan to value may not be over 95% worse case scenario. I do however have a great product to eliminate your monthly private mortgage insurance when you purchase or refinance. This is a single up front premium which is paid by the borrower on a purchase, or rolled into to closing costs if refinancing. This is one of the greatest things since sliced bread. What is considered an asset? An asset is anything that is or can be liquid. Your checking accounts, savings accounts, IRA's, Money Market, 401k or stocks and bonds. All of these would be considered assets because if push come to shove you could cash out and have money available. The more assets you have the better you look to an investor about to lend you large sums of money. A few more things to remember...If you are purchasing or refinancing a home between $271k and $417k you will pretty much have to go with a Conventional Mortgage. $271k and below have many other options and $417k and up are considered JUMBO. It is very important to keep your credit in tip top shape and also have a mortgage loan specialist look at your scenario every year. You may spending hundreds of dollars that could best be put to use in other ways. Today I closed a Conventional Mortgage refinance and his 15 year mortgage is lessthan the monthly payment he was making on his 30 year mortgage. It takes about 10 minutes for me to assess your individual needs so please let me show you what I can offer.As always, Yours to Count On. Valerie Springer 205-995-7283 x 305 My name is Valerie Springer nmls 198479, Home Mortgage Expert and writer for Ask Val in Birmingham, Alabama. You may contact me by email at valerie.springer@nflp.com or call 205-995-7283 x 305.
There are 5 key points to think about when you decide a HECM Reverse Mortgage may be your best option. Most important find an expert loan officer willing to help you make a determination.
1. Why do you feel a reverse mortgage would benefit you? If you are thinking of taking a vacation or reinvesting the money it would be very costly. If someone is trying to sell you something and suggests you take out a reverse mortgage you should be very cautious of their intent.
2. Can you even afford a reverse mortgage? A reverse mortgage is very expense, You do not make monthly payments but interest will accrue on the loan every month. The younger you are when you take out a reverse mortgage (min age 62) the longer the interest will grow which in essence will increase the amount you owe.
3. Can you afford to use your home's equity? If you are not facing a financial emergency you may consider another option.
4. Do you have other options? If you have the means to take out a home mortgage and make the monthly payments this would be a less costly option than a reverse mortgage. Have you thought of downsizing and selling your current home to buy one with lower costs or in an area that offers more services?
5. Do you understand how a reverse mortgage works? You need to find out up front if this could benefit you or if there is a better option. You must complete couseling and receive a certificate to move forward. Your HECM Reverse Mortgage Loan Officer can give you the names of counseling agencies in your area.
A reverse mortgage can be the best thing since sliced bread if you understand and limited income. It gives you the opportunity to use your home's equity while you need it. It can help supplement an income, help with medical expenses or long term care. You can make repairs on your home or purchase a vehicle and not worry about adding high debt to your monthly budget. The money is yours to spend as you wish but wisdom is important.
If you are interested in a HECM Reverse Mortgage in Alabama, call Valerie Springer . 205-995-7283 x 305
It always amazes me when my phone rings and on the other end their is a voice who says, "What is your current interest rate?" Through the years I have had many different answers, but today I answer that question with several questions of my own.
- What is your middle credit score?
- What is your debt to income ratio?
- What is your loan to value?
- How much money do you have is your accounts?
- What type of loan product are you interested in?
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What type of loan transaction will this be?
The list could go on and on. If you do not know the answer to the above questions, then how can I quote you a rate?
There are so many details that go into truthfully quoting an interest rate that without the full picture, shoppers are wasting their time. The same could be said for those that ask for a GFE without giving all of the details. The Good Faith Estimate is full of "estimates" and the bottom line may look better from one lender but the truth is, it is only as good as the person estimating. Some will estimate low to secure the deal and worry about the explanations of increase later and some will estimate higher so there are no questions.
What determines my rate?
Mortgage Backed Securities (MBS) move the market. This market moves much as the Stock Market. Generally mortgage bonds are a safer investment than stocks and if stocks are worse, usually MBS is better therefore as money goes in, rates come down. In reverse, if the stock market is thriving usually money is coming out of MBS and as it goes down, rates go up.
Emotion drives these markets in both directions based on consumer and investor emotions.
When the FED changes interest rates, what does this mean for me?
The Federal Reserve influences short term rates aka Fed Funds Rate. Example of short term rates are Home Equity Line of Credit (HELOC) where rates change monthly. The Federal Reserve Board meets every six weeks and this always causes speculation.
Remember, when short term rates drop, we can usually look for long term rates (fixed mortgage rates) to go higher creating potential for inflation.
Do different loan programs and products have different interest rates?
Sure they do, otherwise every loan would be identical and no need for different programs. Conventional, FHA and VA loans can all have very different rates on the same 30 year fixed product. FHA and VA loans are insured by the Federal Government. Conventional loans are insured by Private Mortgage Insurance companies (PMI) if loan amount is over 80% loan to value.
Most investors view government backing as less of a risk so FHA and VA financing usually have a lower interest rate. Once again rate may be lower with FHA but overall it takes a skilled loan officer to compare the two and give you the long run benefits of each based on your individual needs.
Why did my friend get a better rate than I did? Did I get ripped off?
Mortgage interest rates are based on risk based pricing. This allows pricing adjustments to par pricing for, credit scores, loan to value, type of property, occupancy and mortgage type, loan product etc...
This allows the investor who lends money for mortgages to receive a higher interest rate for taking additional risk lending to less than perfect borrowers.
If your rate is higher or lower than your friend, it is probably because your overall picture was better or worse. Also keeping in mind rates could be lower today than they were yesterday so timing could have made a difference. To effectively compare, you must know what you are doing and that takes years of practice. Stick with the expert, integrity and honesty will shine through and the whole process will be much easier.
Yours to Count On,
Valerie Springer
My name is Valerie Springer nmls 198479, Home Mortgage Expert and writer for Ask Val in Birmingham, Alabama. You may contact me by email at valerie.springer@nflp.com or call 205-995-7283 x 305.
REVERSE MORTGAGE AND POWER OF ATTORNEY
I receive many calls asking if we can close a HECM Reverse Mortgage with a Power of Attorney (POA). The answer is yes but we have to establish a few things along the way.
A Power of Attorney can only be used if the homeowner is physically unable to sign the closing papers, documented by a letter from a physician or mentally incapable of signing the closing papers, documented by a letter from a physician.
The Power of Attorney has to contain specific verbiage and it must also be established that the Senior was of sound mind at the time the POA was given. Many Senior's did POA years ago and family may not be able to find the physician who was treating them at that time to get a letter of competency. If your parent has alzhiemers in 2011 AND you are trying to do a Reverse Mortgage AND POA was given in 1995 AND you cannot find the physician who was treating them at that time there is no option to do a Reverse Mortgage. In this scenario the parent is incompetent today and we cannot prove competency at the time the POA was written.
(If you having aging parents who gave you power of attorney many years ago, you may want to check into having that re-worked now, while they are of sound mind and also get a letter of competency from their physician to hold on file.)
In the past, I have referred my family and friends to Bailey & Holliman, Estate Planning Law Firm. They specialize in Elder Law, Asset Protection and Estate Planning. You may reach Steve or John at 205-663-0281, http://www.estateplan-al.com/ or john@estateplan-al.com . A couple times a month they have free seminars to explain what you need and what they can do with your specific circumstance. They also help with VA benefits for the Veteran and Spouse even if you have been told you don't qualify or have been turned down in the past.
As always, if you need a HECM Reverse Mortgage in Alabama, Valerie Springer would be honored to answer your questions and help you with your financing. 205-995-7283 x 305
My name is Valerie Springer nmls 198479, Home Mortgage Expert and writer for Ask Val in Birmingham, Alabama. You may contact me by email at valerie.springer@nflp.com or call 205-995-7283 x 305.
Dear Val is written by Valerie Springer, Birmingham, AL, Home Mortgage Specialist. www.vshomeloans.com www.valeriespringer.blogspot.com 205-995-7283 x 305.
Thunderstorm Safety
Spring is the time to start thinking about weather safety. Spring can bring severe thunderstorms and tornados. Knowing what to do in the event of a weather emergency can be crucial.
* Listen to local news or NOAA Weather Radio for emergency updates. Watch for signs of a storm, like darkening skies, lightning flashes or increasing wind.
*Postpone outdoor activities if thunderstorms are likely to occur. Many people struck by lightning are not in the area where rain is occurring.
*If a severe thunderstorm warning is issued, take shelter in a substantial building or in a vehicle with the windows closed. Get out of mobile homes that can blow over in high winds.
*If you can hear thunder, you are close enough to be in danger from lightning. If thunder roars, go indoors! The National Weather Service recommends staying inside for at least 30 minutes after the last thunder clap.
*Avoid electrical equipment and telephones. Use battery-powered TVs and radios instead.
*Shutter windows and close outside doors securely. Keep away from windows.
*Do not take a bath, shower or use plumbing.
*If you are driving, try to safely exit the roadway and park. Stay in the vehicle and turn on the emergency flashers until the heavy rain ends. Avoid touching metal or other surfaces that conduct electricity in and outside the vehicle.
*If you are outside and cannot reach a safe building, avoid high ground; water; tall, isolated trees; and metal objects such as fences or bleachers. Picnic shelters, dugouts and sheds are NOT safe.
Know the Difference
Severe Thunderstorm Watch- Severe thunderstorms are possible in and near the watch area. Stay informed and be ready to act if a severe thunderstorm warning is issued.
Severe Thunderstorm Warning- Severe weather has been reported by spotters or indicated by radar. Warnings indicate imminent danger to life and property.
Thunderstorm fact:
A thunderstorm is considered severe if it produces hail at
least 1 inch in diameter or has wind gusts of at least 58 miles per hour. Every thunderstorm produces lightning, which kills more people each year than tornadoes or hurricanes. Heavy rain from thunderstorms can cause flash flooding and high winds can damage homes and blow down trees and utility poles, causing widespread power outages.
To Learn More visit www.alredcross.org
www.vshomeloans.com
Yours to Count On,
Valerie Springer
205-995-7283 x 305
When applying for a mortgage whether it be for purchase or refinance a tri-merge credit report is pulled for an evaluation of the clients current and past credit history.
The three bureaus are Equifax, Experian and TransUnion.
Depending on the creditor they many report to one or all bureaus. Credit scores can vary between agencies so to qualify for financing I will work off your middle credit score to determine your rate.
It is a great idea to get a credit analysis at least once a year. In doing so you can keep on top of your credit report and quickly take care of any discrepancies.
The burea information is as follows:
Experian Consumer Relations, 888-397-3742, P O Box 2002, Allen, TX 75013 www.experian.com
Equifax Consumer Relations, 800-685-1111, P O Box 740241, Atlanta, GA 30374-0193 www.equifax.com
TransUnion Consumer Relations, 800-888-4213, P O Box 1000, Chester, PA 19022 www.transunion.com
The above addresses would be where disputes are mailed to the individual bureau. I suggest dispute be sent certified mail return receipt requested. Credit bureau has 30 days to investigate and then derogatory is either confirmed or removed.
205-995-7283 x 305
www.vshomeloans.com
Yours to Count On,
Valerie Springer
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Valerie Springer, Home Loan Officer AL FHA, VA, Conventional and Reverse Mortga
Birmingham,
AL
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Network Funding Residential Mortgage NMLS 2297
Address: 248 Inverness Center Drive, Birmingham, AL, 35242
Office Phone: (205) 995-7283 x 305
Cell Phone: (205) 746-1284
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