Following is a chart based on Fannie Mae's new bankruptcy and foreclosure
policies as of 08-2008. I will follow this up (in the next week or so) with
part 2 of 2 which will contain a revised chart with the remaining policy
changes.
The following table outlines Fannie Mae's current and new policies for
manually underwritten loans related to the time period that must elapse before
borrowers can demonstrate they have reestablished an acceptable credit history
after the occurrence of the bankruptcy or foreclosure. The table also includes
new "Additional requirements" that apply to foreclosures.
Fore more information and great real estate tools, please visit my website at
www.IntuitiveLoans.com. We are growing ever strong in this "stabilizing
market" and hope to gain your trust as we provide you with value tools and
resources.
Action
Current Requirements
New Requirements
Bankruptcy (All Except Chapter 13)
4-year time period from discharge date.
The 4-year time period remains the same, but will now be applied
from either the discharge or dismissal date of the bankruptcy
action.
Chapter 13 Bankruptcy
2-year time period from discharge date.
The time period for Chapter 13 bankruptcy actions is measured as
follows:
• 2 years from the discharge date,
or
• 4 years from the dismissal date.
Exceptions for Extenuating Circumstances - All Bankruptcy Actions
2-year time period from discharge date. No expectation to the
2-year time period for Chapter 13 bankruptcy actions.
The 2-year time period will be measured from the bankruptcy
discharge or dismissal date. No exceptions are permitted to the
2-year time period after a Chapter 13 discharge.
Multiple Bankruptcy Filings
No existing policy.
5-year time period from most recent dismissal or discharge date
required for borrowers with more than one bankruptcy filing within
the past 7 years.
Exceptions for Extenuating Circumstances - Multiple Bankruptcy
Filings
No existing policy.
3-year time period from the most recent discharge or dismissal date.
Note: The most recent
bankruptcy filing must have been the result of extenuating
circumstances.
Foreclosure
4-year time period from the date the foreclosure sale was completed
("completion date")
5-year time period from completion date.
Additional requirements that apply after 5 years up to 7 years
follo9wing completion date:
• The purchase of a principal residence is permitted with a minimum
10 percent down payment and minimum representative credit score of
680.
• Purchase of a second home or investment property is not permitted.
• Limited cash-out refinances are permitted for all occupancy types
pursuant to the eligibility requirements in effect at that time.
• Cash-out refinances are not permitted for any occupancy type.
1) Calculate monthly PITI payments 2) Calculate interest-only payemnts 3) Automatically calculate approximate mortgage insurance. 4) Calculate DTI (debt-to-income) 5) Calculate approximate tax write-offs for home ownership 6) And much more!!!
Hello everybody,
I have just UPDATED my awesome qualification chart with the capability to CALCULATE APPOXIMATE TAX WRITE OFFS for purchasing a home. This adds even more value to my chart by giving your clients a tool to help them understand the "true" costs of home ownership. If you can show them how much they would be saving in taxes as compared to renting, they may be more likely to purchase.
If you need any help in working the chart, please contact me via email at Aaron@IntuitiveLoans.com. It should be pretty easy for those of you with Excel experience. For others, it may take a little getting used to, but it will be well worth it. Kiss those late-night calls to your mortgage broker goodbye. :)
Below is a picture of the conventional loan qualification tab:
Do not waste another minute showing properties to unqualified borrowers!
Hello everybody,
I have just totally revamped my website www.IntuitiveLoans.com and I thought that all real estate professionals and home buyers would be interested in an Excel spreadsheet I've created. It's taken about a year to get it into its current version 2.1 and I think you'll love it. This chart was crated to be the best and easiest borrower-qualifying tool for professional real estate agents.
If you need any help in working the chart, please contact me via email at Aaron@IntuitiveLoans.com. It should be pretty easy for those of you with Excel experience. For others, it may take a little getting used to, but it will be well worth it. Kiss those late-night calls to your mortgage broker goodbye. :)
Below is a picture of the conventional loan qualification tab:
I've got a couple of really nice leads for residential loans. One is 8M and one is 15M. They are both 60% LTV and full doc. I know these leads are real because I just closed a 2.3M and 5.025M loan given to me by the same company.
8M and 15M!
Without breaking the law, I'm sure I could find a way to make it worth your while for helping me. I probably cannot offer $ without being in violation of some RESPA law, but I think I can offer gifts without getting into trouble.
Anyway, if you know of any lenders who are offering this type of super monster jumbo loan, please let me know.
With the industry changing daily (sometimes twice daily), I wanted to give everybody a heads up as to where we stand right now. FHA loan limits have been increased for the rest of 2008. This means that you can purchase a home that is 700K+ in some areas with only 3% down (which can be paid for by the seller or can also be a gift!!!)
However, there are a few things to consider before jumping on the preverbal bandwagon:
1) If you are in a declining area, your loan with be cut by 5% meaning that you would have to come in with 5% down.
2) If you exceed a certain limit (417K in California for example) you will not be able to receive the 3% down payment as a gift. This would bring your down payment total to 8% in a declining market. On top of this, your rate could go up significantly.
3) All of your income will need to be proven via pay stubs, bank statements, taxes, etc. However, most loans are headed this way already, so that is not a huge negative factor.
4) FHA loans are paperwork intensive and often take 45 days to close.
5) If you can only afford a 0%-3% down payment, maybe you shouldn't be purchasing a home right now. ;)
With all of that said, FHA is a great way to go to avoid the 10%-20% down payments that many lenders are requiring in this "stabilizing" market.
If you have more questions, call us 1(888) 66-ADVICE, or directly at (661) 291-2205.
Recently, the #1 question that I have been asked is, "Should I refinance my property while rates are low?"
How can you tell if the benefits of the monthly savings out weigh the cost? As I am fond of using actual figures to demonstrate my view point, please allow me to explain how to calculate the "real" savings.
For example, let's say you currently have loan in the amount of $400,000.00 at 6.5%. Starting with this assumption, we can guesstimate the following based on today's rates:
1) Current Loan = $400,000.00 @ 6.5% = $2,528.27/month
2) New 0 Point - 0 Cost Loan = $404,000.00 @ 5.75% = $2,357.63/month a. Monthly savings of $170.64 b. Return on investment = 23 months (about 2 years)
3) New 1 Point - 0 Cost Loan = $408,000.00 @ 5.375% = $2,284.68/month a. Monthly savings of $243.59 b. Return on investment = 33 months (about 2 ¾ years)
What does all of this mean? If you still have equity in your house and you wish to lower your payment, doing a 0 cost refinance may be a viable option for you. If your main concern is the monthly savings, you may even consider paying a point or two.
Feel free to contact me if you have specific questions or would like a further explanation.
I have been approached my many people recently for advice on whether or not to wait for the market to "bottom out" before they buy their next house. These clients wonder if it would be more beneficial to move now or to wait for a better (different) market.
These questions can only be answered by looking at what each client is trying to do. For example, if you are moving up to a bigger and/or more expensive home, it may be in your best interest to sell your home and buy your new home while the market is adjusting downward.
In order to explain why this is, please see the following chart:
Value of Current Home
$300,000
Value of Future Home
$500,000
Market Decline
15%
Market Decline
15%
New Value of Home
$255,000
New Value of Future Home
$425,000
Equity Loss
$45,000
Savings
$75,000
Savings - Equity Loss = $30,000 Net Gain!
The opposite is true if you are downsizing to a less expensive home. The following chart will explain why:
Value of Current Home
$600,000
Value of Future Home
$300,000
Market Decline
15%
Market Decline
15%
New Value of Home
$510,000
New Value of Future Home
$255,000
Equity Loss
$90,000
Savings
$45,000
Savings - Equity Loss = $45,000 Net Loss!
Taking no other factors into consideration (such as work relocation, family emergency, etc.), the above charts can be summed up in the following way:
• Move up when the market is declining. • Move down when the market is rising.
The above explanation is in no way intended to be a complete guide to buying and selling simultaneously.
For further information please feel free to contact me.
As you may have become aware, many lenders are now requiring 5% of the purchase price of a home to come from the borrower. Lenders want to make sure that the borrower has some of their own money invested in the property. This helps to insure that the borrower will do everything in his/her power to avoid foreclosure. The loan products that used to be 100%, will now be 95% in many cases. This has become the norm in both California and Florida.
However, not all lenders have caught onto this yet and 100% loans are still available in many cases. Also, if you qualify for a VA loan, there are loan programs now available up to $1,000,000.
In some cases, the 5% down payment can come in the form of a gift. These gift monies often come from relatives and/or friends. On top of this, many of the loan programs still allow up to 5-6% seller contribution. This contribution can go towards all of the buyers closing costs as well as towards purchasing points to "buy" a cheaper rate from the lender. I.E. Paying one point (1% of the 1st loan amount) might take your rate from 5.875% to 5.75% on a 30-year fixed rate loan. This is usually a good idea when somebody else is paying for it.
In short, while it is becoming more difficult to get a 100% loan in this adjusting market, it is not impossible. If your credit is not perfect, now is the time to make sure you clean up any marks or inaccuracies on your report.
Feel free to contact me if you have specific questions or would like a further explanation.
Today, I wanted to share my views on using your home as an Automated Teller Machine. Over the past decade, more and more families have been pulling equity out of their home in order to make purchases and investments. While there are many view points on this subject, I thought that I would take the time to add mine to the debate.
There are good reasons and poor reasons to pull money out of your home. Let's start with a few of the poor reasons:
POOR REASONS TO PULL MONEY OUT OF YOUR HOME
The purchase of a depreciating asset such as: • An automobile • A boat • A vacation • A video console
GOOD REASONS TO PULL MONEY OUT OF YOUR HOME
The purchase of an appreciating asset or investment such as: • A down payment on an investment property • Home upgrades which significantly increase value • Separating equity from your property for emergencies (HELOC) • Investments which have a higher yield than your mortgage note
Of course, the above is a very limited and brief list. The items in each category could go on and on forever. However, the gist of this blog is to provide a brief explanation of good and poor reasons to pull equity from your home. While I'm sure we can all justify our decisions, please take a realistic look at the pros and cons of pulling money from your property before acting on your "I've got to have it!" feeling.
Feel free to contact me if you have specific questions or would like a further explanation.
With all of the negativity surrounding and permeating the real estate and mortgage industries today, I wanted to share my thoughts and perspective. Rather than write a long and drawn-out thesis, I'll summarize today's thoughts in the following 10 bullet points.
1) The more real estate professionals that leave the business, the better for us that remain! 2) Falling home prices mean better investments for us! 3) If professionals complain that the market is bad, agree with them and tell them to get another job! 4) This is a GREAT market to buy and hold! 5) You never know when you've hit the "bottom" of the market until the prices start creeping back up! 6) As more banks go under, our choice of who to use for a mortgage become easier! 7) Housing prices are down and so are rates! 8) There is no such thing as the "bubble." If a home is too expensive to purchase, don't buy it! 9) Don't make a risky investment if you can't afford to lose the money invested!
-AND FINALLY-
10) We (real estate professionals) influence the market as much as the government. If you want 2008 to be a great market, tell everyone you know WHY it's a great time to buy and sell real estate. Don't wait for somebody else to do it for you. WE are the professionals, NOT the media!!!
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Here you can find a variety of topics to broaden your knowledge of mortgages. Here, you will find everything from mortgage basics to advanced topics. Your upfront education will help to save you significant money during the life of your loan.
Disclaimer: ActiveRain Corp. does not necessarily endorse the real estate agents, loan officers and brokers listed on this site. These real estate profiles, blogs and blog entries are provided here as a courtesy to our visitors to help them make an informed decision when buying or selling a house. ActiveRain Corp. takes no responsibility for the content in these profiles, that are written by the members of this community.
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