When to Take Social Security - 07/27/11 02:34 PM
People qualify for a Reverse Mortgage at age 62 and for early retirement benefits from Social Security also at age 62. The older the person the more money he or she qualifies for a Reverse Mortgage. And, the Social Security benefits continue to rise until age 70. So the question. When to take a Reverse Mortgage or when to start taking Social Security?   Sometimes the answer is based on immediate need. If the money is absolutely needed now then now is the time. Also when will you die? Of course no one knows but you could play the game and … (1 comments)

Loan Underwriting Gone Mad - 07/27/11 02:31 PM
Once I wrote a blog titled "Income is not Income". Here is an excellent example.My client told me how much income she made and this was in general discussion. At one point she commented that in addition to her home she owned a duplex free and clear and the monthly income was approximately $3000 a month. Good. But when we received the income taxes her CPA had taken the mortgage interest that was paid for the residence and counted it against the rental property. My client receives the same amount of money every month but because the interest was now deducted … (1 comments)

A SIMPLE Real Estate Contract - 07/27/11 02:15 PM
This is an actual real estate contract on a sale that closed in 2001...the names and address are the only things that have been changed. Today contracts are perhaps 100 pages of words and phrases that most of us don't understand. How simple was this.
Porky and Bess Pigg, hereafter named as "Buyers" and Micky and Minnie Mouse hereinafter named "sellers" hereby agree to the following:
Buyers shall purchase real property located at 123 Circus Ave, Funville, California (APN 408-55-5121) for the amount of $380,000.00. Terms and Conditions as follows:
Buyer to secure a loan equal to 80% of purchase price, … (1 comments)

If you are an Attorney: Get your financing before you make Partner - 07/20/11 08:06 PM
An attorney worked for 10 years with a prestigious law firm and finally made partner. Recall in the movies when a person makes partner it is a celebratory event. But, this attorney is in the market to purchase a home. Had she purchased the home before she made partner she would have been approved for her loan. Now, having made partner per the Lending Rules she is self employed and needs to wait 2 years before she can qualify for a mortgage loan. Am I the only one that thinks we are penalizing success?   Partners in a law firm are … (0 comments)

The Stress of Financial Problems - 07/20/11 12:28 PM
If a person earns $50 a week and the bills are $51 there is a financial stress. I have been told that the financial stress of not having money for a $400 rent payment is the same as the stress of not having a $4000 mortgage payment. The stress on your child wanting to do something that you would like the child to do and you don't have the money- that is stress. The stress of a bill collector calling or the stress of being behind with taxes or being sued. These are all tremendous financial psychological stresses.I wish I were … (3 comments)

House not in great shape? Purchase with an FHA 203 (k) - 07/19/11 07:38 PM
OK. So, you want to buy the house but it has problems; broken windows, missing toilets, some holes in the wall, bad carpet and the counter tops are outdated. And you can't get financing because the seller or perhaps the bank will not fix all the repairs before the escrow closes. The bank making you the loan says, "we won't make a loan on the property until these things are fixed."  
 Catch 22 and no place to go. But, there is. You can purchase the home with an FHA 203(K) program. There are two versions of the FHA 203(k). The first … (3 comments)

After a negative credit event. How long do you have to wait to buy? - 07/18/11 05:43 PM
How long do you have to wait to purchase after a negative credit event? Unless you are a veteran and qualify for a VA loan then the quickest way to purchase a home after a significant derogatory credit event is with an FHA loan.   Here are some guidelines listed per event:  
Foreclosure/Deed in lieu   3 years from the date the foreclosure was completed and transferred back to the bank. Less than 2 years if the cause of the delinquency was caused by a major event; death, illness, accident.  
Short Sale   3 years from the date closed and … (0 comments)

7 Reasons I love Reverse Mortgages - 07/16/11 11:50 AM
As a mortgage broker why I love reverse mortgage loans over other mortgage loans>1. I don't have to worry about the credit score2. There is no debt ratio to compute3  I am not concerned if the borrower quits his/her job4. The loan application is so much simpler5. I don't have to worry if the underwriter cannot read tax returns6. Matter of fact,  I don't even give them tax returns !7. No pay stubs, bank statements, 401K's- none of that stuffOf course the loan benefits the client but these are reasons that I like doing the reverse mortgages !Doug JonesMortgage Magic NMLS 286668
… (1 comments)

Banks Profit Up...Lending Down - 07/16/11 11:46 AM
Interesting data from the FDIC; The year ending March 2011 shows that bank deposits rose by $300,000,000,000 (300 Billion)....assets grew by $80 Billion and profits were up $12 Billion.Loan Volume fell $260,000,000,000 ($260 Billion) -------------------------------------The existing loan limits are set to expire on September 30th unless Congress extends the current limits. What will this do? According to the National Association of Realtors if the limits revert to the previous lower FHA limits 612 counties in 40 states will be impacted and the average loan limit will reduce by $50,000.-------------------------------------Sometimes I feel bad because I did not "manage well or save well". … (0 comments)

The Money Goes Round and Round - 07/16/11 11:41 AM
Years ago there was a company called PSFS; Philadelphia Saving Fund Society. If you are in the Philadelphia area you will probably know that the PSFS Building is the first skyscraper in the US built in the International style (functional architecture without any decoration). PSFS no longer exists but they were a prominent lender until the late 1980's and today the building is the Loews Philadelphia Hotel.Back in the 80's PSFS had a retail branch in Campbell, California and they used to broker second mortgages to my office at Old Stone Credit. PSFS wrote mostly first mortgages and I wrote mostly … (0 comments)

Reverse Mortgage Volume is Growing - 07/13/11 09:39 PM
Reverse Mortgages seem to grow more and more every day. Even though Bank of America and Wells Fargo have left the reverse mortgage business the number of loans continue to grow. Very simply we are all getting older and the qualifications are simple:62 years or olderEquity in the homeNo Credit or income requirementsThe reverse mortgage volume has grown each of the last 4 quarters.2010    Q2    $2,474,930,000 volume2010    Q3    $3,004,970,0002010    Q4    $3,128,470,0002011    Q1    $3,452,380,000Doug JonesMortgage Magic NMLS 286668
… (1 comments)

7 Reasons I love Reverse Mortgages - 07/13/11 09:36 PM
As a mortgage broker why I love reverse mortgage loans over other mortgage loans.1. I don't have to worry about the credit score2. There is no debt ratio to compute3  I am not concerned if the borrower quits his/her job4. The loan application is so much simpler5. I don't have to worry if the underwriter cannot read tax returns6. Matter of fact,  I don't even give them tax returns !7. No pay stubs, bank statements, 401K's- none of that stuffOf course the loan benefits the client but these are reasons that I like doing the reverse mortgages !Doug JonesMortgage Magic NMLS 286668
… (0 comments)

Good Advice for the Homeowner or Buyer - 07/05/11 03:12 PM
Upgrade your old bathrooms and kitchens. These are often selling points on a house. A modernized bathroom can provide over a 100% return, while a modernized kitchen can return about 90%. Refinance your mortgage if you can cut at least one point. The costs of refinancing are considerable, so it should only be done if you can trim your interest rate by at least 1%.. This formula works for most loans but for a large loan even a half percent reduction can save you a lot of money. Never spend more than 2 1/2 times your income on a home. Know … (0 comments)

Reverse Mortgage Update - 07/01/11 01:24 PM
Will the higher Reverse Mortgage Lending Limits expire in October 2011? The present limit is $625,000 and this was temporarily increased in 2009. The rumor mill says that the limit will reduce to $417,000. If you are thinking of a Reverse Mortgage and have a lot of equity you may want to act now.California is the leader in Reverse Mortgages. This year the state will fund just over 9,000 reverse mortgage loans. After California come  Texas, Florida, New York, and Maryland. Pat Boone is to become a Reverse Mortgage spokesperson for Security One Lending. He will be joining celebrities, Fred Thompson and … (0 comments)

Short Sale Fraud Expected to increase 25% this year - 07/01/11 01:22 PM
This was reported by Origination News and it is really hard to understand with all the publicity that anyone would continue to try and "beat the system".
"Short sale fraud is estimated to rise by 25% in this year of 2011. Unnecessary losses related to risky short sales are approximately $375 million annuallyaccording to CoreLogic. Tim Grace, senior vice president at CoreLogic, said it is common for a limited liability company to negotiate a short sale with the bank and have a buyer ready to purchase the same property simultaneously to this closing for approximately 30% more than the rate agreed … (0 comments)