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New Condo Insurance Rules - 04/26/09 07:18 PM
There are new rules regarding insurance coverage for attached condominium projects. For all loan applications dated on or after March 1, 2009, lenders are now required to verify that hazard insurance covers fixtures, equipment, and other personal property inside individual units.
If the master insurance policy provides this type of coverage, then the borrower does not need to purchase additional insurance. The master insurance policy is the one that is included in the HOA dues. Most master insurance policies for condos DO NOT include this type of coverage, so the borrower needs to purchase additional insurance before the loan can close.
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Can a Buyer Borrow Money from a 401(K) for the Down Payment? - 04/22/09 09:04 AM
A number of people recently asked us if they could borrow money from their 401(K) or mutual fund account and use that to pay for their down payment. The answer is yes, and here are the underwriting guidelines:
If the 401(K) is being listed as an asset on the loan application, the total amount of the 401(K) must be reduced by the amount that was borrowed. However, the 401(K) loan payments do NOT have to be counted as liabilities against the borrower. This is a great way to secure the funds for a down payment or closing costs without increasing a … (1 comments)
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What Are the Processing and Underwriting Fees For? - 04/17/09 10:04 AM
Ever wonder what the processing fee and the underwriting fee are for on a Good Faith Estimate and final settlement statement?The processing fee pays for the person who does all the paperwork involved in getting a loan into underwriting, taking care of any conditions, and making sure the loan closes. The processor orders the appraisal, the insurance certificate, the flood cert, any verifications that are needed, etc. If the loan officer hires a processor to do this work for him, then the processing fee goes to the processor. If he does the work himself, then he keeps the processing fee for … (2 comments)
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Property Tax Credit - Can it be Used to Pay for the Down Payment? - 04/14/09 09:40 AM
We are often asked if the property tax credit (the pro-rated share of the property taxes that is taken out of the seller's account and put into the buyer's account) can be used to pay a part of the buyer's down payment requirement.
The answer is no. However, the property tax credit can be used to pay some of the buyer's closing costs.
As an example, assume someone is buying a house for $100,000 and the down payment is 3.5% of the purchase price, or $3,500. The property tax credit cannot be used to pay any of this amount. It doesn't … (2 comments)
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Tax Credit Reminder - 04/14/09 09:15 AM
By now, you would think everyone knows all about the $8,000 tax credit. Don't make that assumption, because many of your prospects do NOT know about it, and even fewer understand it. Here's what they need to know:
- If you (or your spouse, if you are married) have not owned your main home in the past three years, you are eligible for the tax credit. A "main home" is defined as the house you live in most of the time. This means you could have owned investment properties, or even a second home, as long as you did not own … (4 comments)
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99.395% Financing with CHFA Loans - 04/14/09 09:11 AM
Need 100% financing with an FHA loan WITHOUT getting a gift or a loan from a relative? Check out CHFA loans. The Colorado Housing and Finance Authority (CHFA) can't quite get you to 100%, but they can get you to 99.395%, which is pretty close.
Only a small percentage of mortgage brokers and lenders are approved to sell CHFA loans, so you might not know how good they are. Here's how they work: There are two loans. The first mortgage is a regular FHA loan. It requires a 3.5% down payment.
The second mortgage is for 3% of the first loan amount. … (3 comments)
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Chris Thomas
Denver,
CO
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The Mortgage Experts at America's Mortgage
Office Phone: (303) 345-3683
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