Matthew's Blog

HR 5017: The Entire Text is shorter than my last status and it has sat in the Senate for over a month now.

Matthew Watts (Icon Mortgage Lending) — Sat, 22 May 2010 00:06:35 -0700

Rural Housing Preservation and Stabilization Act of 2010 (Introduced in House)

HR 5017 IH

111th CONGRESS

2d Session

H. R. 5017
To ensure the availability of loan guarantees for rural homeowners.

IN THE HOUSE OF REPRESENTATIVES

April 14, 2010
Mr. KANJORSKI (for himself, Mr. HODES, Mr. WILSON of Ohio, Mr. HINOJOSA, and Mr. COURTNEY) introduced the following bill; which was referred to the Committee on Financial Services

--------------------------------------------------------------------------------

A BILL
To ensure the availability of loan guarantees for rural homeowners.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Rural Housing Preservation and Stabilization Act of 2010'.

SEC. 2. LOAN GUARANTEE FEES.

(a) Fees-

(1) UP-FRONT AND ANNUAL FEES- Paragraph (8) of section 502(h) of the Housing Act of 1949 (42 U.S.C. 1472(h)(8)) is amended to read as follows:

`(8) GUARANTEE FEES- With respect to a guaranteed loan under this subsection, the Secretary may collect from the lender--

`(A) at the time of issuance of the guarantee, a fee equal to not more than 3.5 percent of the principal obligation of the loan; and

`(B) an annual fee during the term of the loan equal to not more than 0.5 percent of the outstanding principal balance of the loan.'.

(2) CONFORMING AMENDMENT- Section 739 of the Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriation Act, 2001 (as enacted by Public Law 106-387; 114 Stat. 1549A-34) is hereby repealed.

(b) Authorization of Amount of Loan Guarantees- Section 513 of the Housing Act of 1949 (42 U.S.C. 1483) is amended by adding at the end the following new subsection:

`(f) Authorization for Loan Guarantees- The Secretary may, to the extent approved in appropriation Acts, guarantee loans under section 502(h) in aggregate amounts not to exceed $30,000,000,000 for fiscal year 2010 and for each fiscal year thereafter.'.

What to do now?

Simple! Help us get the program refunded and continue funding independent from appropriations for the life of the program.

How, you ask? Again, Simple but it will take a few moments of your time and a couple of long distance minutes on next month's phone bill.

The bill in question is HR 5017, or S3266. Call Any or Preferrably ALL of the following individuals and DEMAND attention on this important issue. You can also look for my soon coming blog that will provide a form letter that you can send to each of these people via their website, and oh yes...I WILL provide links.

Debbie Stabenow (202) 224-4822. Your trusted local Michigan Senator that doesn't even realize that Michigan accounts for 28% of ALL Rural Housing Loans or that in Michigan- 31% of all mortgage loans originated are Rural Housing loans, or that 45% of First Time Home buyers in Michigan rely on USDA Guaranteed Financing.

BTW-Carl Levin, no matter how you feel about him, was an original co-sponsor of the bill.

United States Senate Committee on Banking, Housing, and Urban Affairs. (202) 224-739.

These are the people who are so busy passing pet project regulatory legislation that will be obsolete in 2 years that they have ignored this pertinent issue and now are just so drained that they want to recess until after the Memorial Day Holiday. DEMAND that they don't, We need your support.

Members of the Banking and Housing Committee that were original supporters of this bill. Be nice to these ones, they were trying to do well, but were met with Senator Dodd's opposition.

Bennet (CO) (202) 224-5852
Johanns (NE) 202) 224-4224
Brown (OH) 202) 224-2315...

Jon Tester (D-MT) (202) 224-2644

All of the Senate Housing and Banking Committee:

Christopher J. Dodd Chairman (D-CT) (202) 224-2823

Richard C. Shelby Ranking Member (R-AL) (202) 224-5744

Tim Johnson (D-SD) (202) 224-5842

Jack Reed (D-RI)(202) 224-4642

Charles E. Schumer (D-NY) 202-224-6542

Evan Bayh (D-IN) (202) 224-5623

Robert Menendez (D-NJ) 202.224.4744

Daniel K. Akaka (D-HI (202) 224-6361

Sherrod Brown (D-OH) 202-224-2315

Jon Tester (D-MT) (202) 224-2644

Herb Kohl (D-WI) (202) 224-5653

Mark Warner (D-VA) 202-224-2023

Jeff Merkley (D-OR) 202-224-3753

Michael Bennet (D-CO) (202) 224-5852

Robert F. Bennett (R-UT) (202) 224-5444

Jim Bunning (R-KY) 202.224.4343

Mike Crapo (R-ID) (202) 224-6142

Bob Corker (R-TN) 202-224-3344

Jim DeMint (R-SC) 202-224-6121

David Vitter (R-LA) (202) 224-4623

Mike Johanns (R-NE) (202) 224-4224

Kay Bailey Hutchison (R-TX) 202-224-5922

Judd Gregg (R-NH) (202) 224-3324

Senate Majority Leader Harry Reid 202-224-3542
The Big Dog....

For more information, Call Today or Visit our website:

810-953-4266 or www.iconmortgagelending.com

Well, RD is out of Money...What Now???

Matthew Watts (Icon Mortgage Lending) — Fri, 21 May 2010 23:32:20 -0700

Simple! Help us get the program refunded and continue funding independent from appropriations for the life of the program.

How, you ask? Again, Simple but it will take a few moments of your time and a couple of long distance minutes on next month's phone bill.

Jon Tester (D-MT) (202) 224-2644

All of the Senate Housing and Banking Committee:

Christopher J. Dodd Chairman (D-CT) (202) 224-2823

Richard C. Shelby Ranking Member (R-AL) (202) 224-5744

Tim Johnson (D-SD) (202) 224-5842

Jack Reed (D-RI)(202) 224-4642

Charles E. Schumer (D-NY) 202-224-6542

Evan Bayh (D-IN) (202) 224-5623

Robert Menendez (D-NJ) 202.224.4744

Daniel K. Akaka (D-HI (202) 224-6361

Sherrod Brown (D-OH) 202-224-2315

Jon Tester (D-MT) (202) 224-2644

Herb Kohl (D-WI) (202) 224-5653

Mark Warner (D-VA) 202-224-2023

Jeff Merkley (D-OR) 202-224-3753

Michael Bennet (D-CO) (202) 224-5852

Robert F. Bennett (R-UT) (202) 224-5444

Jim Bunning (R-KY) 202.224.4343

Mike Crapo (R-ID) (202) 224-6142

Bob Corker (R-TN) 202-224-3344

Jim DeMint (R-SC) 202-224-6121

David Vitter (R-LA) (202) 224-4623

Mike Johanns (R-NE) (202) 224-4224

Kay Bailey Hutchison (R-TX) 202-224-5922

Judd Gregg (R-NH) (202) 224-3324

Senate Majority Leader Harry Reid 202-224-3542
The Big Dog....

For more information, Call Today or Visit our website:

810-953-4266 or www.iconmortgagelending.com

Icon to Continue closing RD loans despite exhausted USDA funding

Matthew Watts (Icon Mortgage Lending) — Wed, 12 May 2010 23:50:39 -0700

Many of you may have read that the USDA will exhaust funds allocated for the Guaranteed Rural Housing Loan Program some time on Thursday May 12th. In response, Icon Mortgage Lending is pleased to announce that we will continue to close all RD loans just as if it were "business as usual".

This announcement comes after months of various unqualified sources disputing over when the USDA in fact would be exhausted of funding. Many had alleged that the Rural Housing Program had already closed its doors as of April 1st.

Of course, those that follow the Icon Mortgage Lending blogs and news sourced knew that this was indeed an April Fool's Joke of the highest order. As promised, we have continued to close and table fund Guaranteed Rural Housing Loans over the past two months as other lenders dropped out of the program despite the massive needs of their local communities.

In the future you can follow all of the most up to date and accurate Rural Housing News by subscribing to this blog, or checking out our website: www.iconmortgagelending.com on a regular basis. Or of course, you could just always call me, Matt at 810-953-4266 and just ask away! I encourage you all to do so in the future if you were falsely told that these loans were already unavailable when Icon Mortgage Lending was still providing service. I worked very hard to get the word out, but obviously it is hard to reach everyone. So, if you or anyone you know, was given false information over the past few months...just call us.

Rural Development Sits Up and Running!

Matthew Watts (Icon Mortgage Lending) — Fri, 05 Mar 2010 22:07:21 -0800

Just a quick update for everybody, that our satellite web sites are now up and running.

www.lapeerruralloans.com

www.livingstonruralloans.com

www.brightonruralloans.com

www.howellruralloans.colm

All of these websites are finished and are already gaining a lot of recognition from local buyers. I put these sites together to help potential home buyers find localized information on the Rural Development Loan Program that can help them navigate the loan process.

These sites are all meant to simply be a resource for unbiased information on Rural Housing Loans in each specific area. Any Realtor, Loan Officer, Appraiser, or other helpful related industry that wishes to take part in the website need only email me: matt@iconmortgagelending.com to do so. I will be checking you out to make sure that you are legit, but other than that I am doing these sites as a completely separate resource to help buyers and for no other reason.

Please check them out and pass the word along that these sites are a great starting place for any buyers that are looking for very detailed information on buying a home in each specific area.

Thanks,

Matt

Ask a Realtor

Matthew Watts (Icon Mortgage Lending) — Wed, 24 Feb 2010 23:11:57 -0800

A great blob by my buddy Jeff Davis.

Via Jeff Davis (John Burt GMAC):

I feel that as a Realtor I have a duty to keep everyone informed about the world of real estate. I find that the more I teach my clients the better they are at making decisions on what to do and what not to do.

I talked with a friend of mine and he was saying that he would like to move to a different home because his family was growing. As he was saying this, and without even taking a breath he said but the market is terrible. This of course sent me into a 20 minutes speech and when I was done he listed the home. We sold it fast and he made about $30,000 in equity on his new home.

I ran into a lady at the gas station who was telling me she was having a hard time getting a mortgage last year so she is stuck renting a place where the landlord never fixes anything and she has to put her own money into the home just to keep her family alive. I talked with her for a while that day and we now, a few months later, have a purchase agreement in on a home in which she calls "the home I have always dreamed of"

A former employer of mine started asking me questions, stuff about how the market was doing and if anything was selling. Turns out he had his home for sale in Berkley MI for a very long time (over a year I think) and it wasn't selling. He asked if I work that far away. Being a Mobile Office Realtor I said absolutely and we listed it. 4 months later it sold for asking price and he purchased a home in Sterling Heights for about $100-120,000 below regular market value. When the market comes back up, and it will, he is going to be sitting on a lot of equity just for moving into a newer, larger home that doesn't have have any of the older home problems of repair and maintenance.

On a listing appointment an owner almost through me out the door when I showed her what the market was saying about how much she could sell her home for until she said "thats less then what we owe and we are already missing payment and you want us to sell it for that, we can't pay to sell this." We listed it that day and sold it.

A few months ago I received an email about a house I had an ad for on the Internet. After finding out more about the home they decided it wasn't right for them. We got to talking/typing and turns out they are selling their home by owner but have not had any interest in the property. They are not ready to list the home with a Realtor and want to try for a while by themselves. Which is very understandable, I would be doing the same thing if I didn't know what I know about why homes sell and why they don't. But I gave them some advice and they are now getting several calls a week and have had a few showings, as of a week ago when I was checking up on them. I have also helped them prepare for the purchase agreement to make sure everything is legal and when they close the deal the title company wont kick them out of the office and delay or kill the deal.

In this "different" market, as I tend to call it, we as home owners need to get very informed. We need answers to what should we do and what should we not do, in order that we don't find ourselves in foreclosure, debt, or find that in 5-10 years that we should have done this or should have done that back 2008. Retrospect is great for learning from but can often make us regret the decisions we made or the ones we didn't make based on something we could have found out if we would have asked.

My clients buy and sell in the Lapeer County, Oakland County and Genesee County areas. I list vacant land, residential properties and commercial real estate. I can help you buy or sell short sales, great deals, distressed homes, foreclosures, investment property, vacation homes, first time homes, longer term residences and can help you flip homes - yes even in this market.

I have contacts with contractors, inspectors, septic and well inspection and repair, appraisers, mortgage officers, private investigators, mold clean up, landscapers, tree removers, carpet cleaners, video and alarm security, investors, lawyers, employment locater, home stagers, dog breeders and trainers...just to name a few. So anything you ever want for your home or business, just ask and I most likely know someone.

So again if you have any kind of question please let me know. The answer could help you sleep better, keep you from foreclosure, point you in the right direction and or make you rich and money safe. Could even get you that early retirement or pay off debt. If you don't ask you will not know. So let me know what you need or need to know and I will get you an answer. Thank you in advance and talk with you soon.

Short Sale 101

Matthew Watts (Icon Mortgage Lending) — Wed, 24 Feb 2010 21:20:31 -0800

Check out some Quality Short Sale info from my buddy Jeff Davis.

Via Jeff Davis (John Burt GMAC):

Short Sale Basics

I have put together just some Short Sale basics because I have found that there are many people out there that are very unclear and are unsure about what a Short Sale really is and how they work. If you would like more information, ask me, your agent or if you are an agent you can also talk with your Broker. It is very critical that a Short Sale is done correctly as the seller only has one shot at this, there are no do-overs.

The Short Sale or Shorted Sale

A short sale or some times called a shorted sale is when the lender agrees to accept a discounted payoff when a property is sold because the owner owes more then what the home is worth in the current market. The short sale is dependent on two major things. One, a buyer making an offer to purchase and two, your lender accepting a buyer's offer that is less or short of what you owe. If the lender cannot or will not accept the offer, the short sale will not take place.

Short Sale vs. Foreclosure

There are many ways to lose a home and none of them will put a smile on your face. The signing away of ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity such as with a foreclosure, is always hard on the whole family and is in many cases unnecessary. For owners who can no longer afford to keep mortgage payments current and can't sell the home for what they owe to the bank, there are alternatives to foreclosure, like the short sale. Sometimes, to avoid going through the costs of foreclosure, a lender will agree to a short sale and takes less for the home than the mortgage balance while the home is in this pre-foreclosure stage.

Short Sale Consequences for Sellers

This is not a get out of your mortgage free card there are consequences. A short sale will show up on your credit report as a pre-foreclosure that has been redeemed, if in fact your bank has already issued a foreclosure notice. In this case there will be damage to your credit report, however, it is significantly less then a full foreclosure and you should be able to obtain another mortgage with a reasonable interest rate in approximately half the time as with that full foreclosure. And there is good news, President George W. Bush signed legislation into law on Thursday 12-20-07 that will ease the tax burden for home owners who have had debt forgiven on a mortgage due to a foreclosure, short sale, or deed in lieu of foreclosure. The tax code used to require a lender who forgives debt to provide a Form 1099 to the IRS stating the amount the borrower had been forgiven. If the property was sold at foreclosure or was sold for less than what was borrowed, that difference was considered income and subjected to income tax. But now as long as the property is your primary residence you should not be subjected to the Form 1099 income taxes.

Do You Qualify for a Short Sale

and

What to Do as a Seller

If you are thinking that a short sale is an option that you would consider or if you feel that a short sale is the only way for you escape a full foreclosure and want to find out how to engage this process then here are some ways to know if could qualify for a Short Sale. With a Short Sale, time is not on your side. Below is a basic guide to the Short Sale process and a list of what to do and what you can expect.

1. Answer the following questions:

a. Has the real estate market values dropped in your area?

b. Is your mortgage in default (not current on your monthly payments)?

c. Has your family and/or you fallen on hard times (i.e. unemployment, divorce, medical issues, bankruptcy or death in the family)?

d. Is it impossible for your assets to pay the difference between market value and mortgage balance?

2. Find a good, honest and hard working Realtor with a team of professionals that can help you through the short sale process. If you have answered yes to all four questions you may qualify for a Short Sale. Your Realtor should put you in contact with the financial professional on their team to discuss lender Short Sale qualifications and precautions. If you have answered no to any of the four questions then talk with your Realtor and ask for further assistance on selling your home.

3. When or shortly before the lender has agreed to look at a Short Sale Purchase Agreement, your home will be listed with the Realtor of your choice with notification in all advertisement that the home sale is subject to the lender's approval of the Short Sale.

4. The home is marketed at a price lower then the mortgage balance and priced at fair market value, determined by a real estate professional. Then a buyer makes an offer on your home.

5. If this offer, that can by countered and/or rejected by the home owner, is accepted by the home owner then it is taken to the lender by the Realtor and his team of professionals for intense and sometime lengthy negotiations that will hopefully end in an approval.

6. If the short sale is approved by the lender then the transaction closes when the buyer delivers the funds, the lender releases the lien and the seller delivers the deed just like a normal sale. The transaction is complete with you having fought back against the hardships you are facing and won a little bit back for yourself.

Michigan Realtors: Writing a Great PA; or, Being your LO's Best Friend

Matthew Watts (Icon Mortgage Lending) — Wed, 28 Oct 2009 01:47:49 -0700

Occasionally, frustrations build as a file in processing begins to struggle a bit and the question may occur to you, "Why are these things arising now, when they seem like they should have been settled so long ago?" And as a good professional it will probably lead you to the next question, "What can I do to help prevent this with my future transactions?"

I would like to examine a few simple things that you as a Realtor can do to become your Loan Officer's best friend and subsequently write a Purchase Agreement that will be well appreciated by all involved.

Timeline. Obviously it will always be frustrating when files run into turn-time troubles and it begins to seem like it may never close. You end up feeling like you have heard the same response from the LO a dozen times, and you just want to know what to do.

We can prevent a lot of these headaches by having realistic and achievable expectations at the time the PA is set in motion. Obviously, this is mainly reliant on the communication with the LO, but in general you are going to need between 30-40 days to close a loan. It would, however, be extremely unrealistic to just blindly expect 30 days as an appropriate time frame on each and every PA. If you make adjustments for the specific factors involved in each individual file, you will greatly improve the chances of setting a proper expectation for your client. This may mean more work up front, but way less work down the road when it is more important.

Your clock starts ticking when the buyer signs the PA but for a Loan Officer we are very limited in what we can do until we receive the seller signed PA. For instance, I NEVER order an appraisal until there is a written agreement allowing the client to purchase the home. Doing otherwise is asking for trouble, no matter what someone may have told someone about how this certain bank responds quickly or how the listing agent said that they have all of the short sale terms are already agreed upon, or how you have a "verbal agreement". That means nothing until the signed PA is in my hand. So, if you write a PA dated July 1^st to close in 30 days and the bank takes until July 15^th to send it back approved, we will immediately be asking for a 15 day extension and the frustrations will begin. Simply compensate for this at the beginning if you are submitting an offer to a notoriously slow responding bank, or if it is a short sale, or any other complications you may think of. I personally put right on my Approval Letter that we need 30 days for underwriting from the day that a seller signed PA is delivered to our office. All loan officers may not do this but I can assure you that this is the case. No lender will be able to do anything other than a basic underwriting until they have a signed agreement between both parties.

Inspection Reports. I know there are a lot of people that are running into this for the first time now, but Lenders are scrutinizing the relationship between LO and Appraiser very carefully now at the behest of the Federal Government. A Home Inspection performed by a third party adds another layer of protection for the Lender to ensure that the Appraiser is not looking the other way on Property Standards in order to continue a relationship with the LO. Since you as a Realtor are typically present for the inspection or at least more aware of the scheduling, it is essential to communicate this with the LO.

If you really want to be "super agent" you can be present for the inspection and communicate to the inspector and client what should be for the buyer's information only and what should be included in the inspection report. Things that are not even an issue to the HUD Handbook or normal property standards WILL become issues if an inspector flags them. A perfect example: Inspector, in trying to provide good service, writes in his/her report that the buyer should probably have a radon test. The buyer says, yeah that's useful; we will do it after we close but before we move. NOPE! The buyer will now have to do it before they close. It may seem like this should be the buyer's prerogative, but if a Lender sees that an Inspector flagged a radon test as needed...it WILL be needed. Now just tack that on to your turn times and before you know it it's time for an argument over PA extensions and $100 Per Diem.

It is also important to discuss with the buyer whether or not they are actually going to have an inspection or not and to properly mark the PA. If you mark that the buyer will be having an inspection and they do not, then a couple of weeks into the transaction the Lender will be asking for a copy of the non-existent inspection and will require that the PA be amended to state that the buyer has waived their right to an inspection. This is just add another few days in tracking down the seller to sign the addendum, faxing it back to the LO...and so on. It may not seem like much, but that is still another two days to tack on to an already intense process.

Property Standards. We know that you are not an Appraiser, or an Inspector, but there are some obvious things that we all realize are going to be an issue when financing a home. Communicating these to your LO will not only make their day, but it will help them get you money faster.

A few of these things that I find astonishing that I have to wait until the appraisal comes back to find out about include: broken windows, busted locks, holes in walls/ceiling, unfinished flooring, missing toilets/sinks, broken plumbing, rusted out furnaces, missing siding on house/garage, missing handrails on stairways and a multitude of other visually obvious items. I'll address these things two paragraphs below, but for now let's look at the essentials in the not below.

***Special Note*** I hear this phrase all the time: "The bank will only accept Conventional Financing because (insert problem here) is wrong with the home." I, again, understand that you are not Lenders and do not know the guidelines but let me assure you, as a Lender that does mostly Rural Development and Conventional loans through Fannie and Freddie, that most problems with a Government loan are also true for a Conventional loan. So please stop the argument over the fact that you can close a home with no running water with a conventional offer. Cash offer yes, but any...repeat ANY financing will need the home to have the bare essentials. Government loans are in fact more particular, but most of the differences are easily fixable problems.

That's why I just forewarn you now- if you want to keep your Asset Managers happy- alert them to the fact that the basic utilities will have to be working if they expect to have financing on the property. It does none of us any good to argue for three weeks over how to get the power on in the property or who has to pay for it. If you want to take a financing offer for more money, you will HAVE to provide working utilities for an inspection of any sort. If you are a selling agent, eliminate the headache and note it right in the purchase agreement that the buyer will need these on to agree to purchase the property. Again, I personally put this right in my Approval Letter, but either way it will need to be done!

Now, as for the little things, I mainly do RD financing so it is much easier to deal with any other issues, because the buyer can do a post-closing repair escrow to fix them. This does require quite a bit of extra work and buyer preparation so it is best to alert your loan officer of the issues noted two paragraphs above before you write an agreement. If we have to wait until the appraisal comes back we are already 5-7 days in and just now finding out that the buyer has to make a bunch of repairs. We tell the buyer, the buyer plans on doing it that weekend since most folks work during the week, the buyers fixes everything, the appraiser goes back out to re-inspect the property and now we are 14-16 days in and we are just getting the appraisal back. Now underwrite the appraisal and the conditions that can't be submitted until the appraisal is done, wait until any further conditions come back and are then cleared, send to RD for a certificate, let the bank have 48 hours to approve a closing, and guess what we need... an extension on the PA.

Appropriate Documents. Specifically, if the buyer is applying for FHA financing, an FHA Amendatory Clause will be required so contact your loan officer for the form ahead of time. Having the document that you can find - Here - signed right up front can eliminate another step down the line. There may be others for certain loans but this is the most common. Again, a 1-minute phone call can save 2 days later on.

My Final Word. Teamwork is more essential now than it has ever been. If we are all honest with each other in the beginning we can set a realistic expectation for everyone involved and proved a rewarding experience for all. I hope I have helped, and Good Luck with your future transactions!

For more information, Call Today or Visit our website:

810-953-4266 or www.iconmortgagelending.com

First Time Home Buyer Tax Credit as Down Payment or: Dirty Deeds Done Dirt Cheap

Matthew Watts (Icon Mortgage Lending) — Fri, 29 May 2009 10:09:01 -0700

First Time Home Buyer Tax Credit as Down Payment or: Dirty Deeds Done Dirt Cheap

I think this is an important discussion to have so I am going to post this blog a few days in a row to make sure it gets out. There is a lot of confusion concerning the First Time Home Buyer Tax Credit especially now that FHA has approved the funds to be used towards down payment and I am looking to simplify things for you like I have been trying to do with all of my blogs.

This one, I feel is of great importance because I hate to be the one to you know: burst the bubble, but as I hear folks industry wide rejoice at the possibilities of borrowers being able to use their tax credit as a down payment for their new home I would like at least make a few points to the contrary.

1. Premature Jubilation: Everyone right now is scrambling to get the info to you that you can now use your tax credit as a down payment for an FHA loan. The thing they don't realize is that until lenders roll out a program which allows you to use your tax credit in such a way, it makes NO difference whatsoever. So before you get yourself all worked up, we first have to actually have it available for you.

This is most easily show with this example- in July of last year FHA approved funding for the Hope fro Homeowner program in which they were going to refinance people that were having trouble making their mortgage payments. This was the program that was supposed to stabilize our housing market. Instead, no Lender ever even touched the program, and it was ultimately just discontinued in January 2009.

2. There's a Snake in that Grass. Please also understand that they are not just letting you use your money for your down payment. What they want to do is give you a loan that you can in turn pay back. Now, if that suits you, then fine. But understand that this is not the same as the free stimulus that it is meant to be. Ultimately you allowing someone to give you a loan on that money it is going to benefit you, not them. Just understand that it is NOT in your best interest to take free money and turn it into a loan. DON'T LET THE VULTURES GET TO YOUR MONEY!!!

So, I shouldn't take it? I am not saying that it can't help anyone...but use your head, weigh your options, ask more than one person, and always read the fine print. If you don not absolutely NEED to use the money as a down payment...DON'T.

You may not even be thinking about it now, but there are so many good ways to use this money, please do not get ripped off before you even have the chance! Here are just a few examples of what to do:

Pay down the principle balance of your mortgage. In fact, if you get $7500 and put it directly on your principle balance of a $100,000 mortgage, that one payment will cut 4 years and $60,000 in interest payments right off of your mortgage!

Pay down high interest credit cards. Pay that high credit card loan off, use the boost in credit score to get a better credit card at a lower interest rate, let the paid off card sit there open with no balance and enjoy a great credit score for quite some time and save thousand on future mortgages, credit cards, car insurance...you name it.

Invest it. Ok, so maybe the stock market isn't so hot now, but if you can find something safe that it sure to yield, it is a win-win for you my friend. Heck, even a high yielding savings account or a 2-year CD will make you great money.

Take advantage now, because the tax credit goes away if you close on your new home after November 30th, 2009. Happy Home Hunting to you all!

For more in-depth help, go to our website:

www.iconmortgagelending.com

*This has been an Emily inspired blog.

First Time Home Buyer: Conforming at a glance

Matthew Watts (Icon Mortgage Lending) — Tue, 26 May 2009 15:26:42 -0700

First Time Home Buyer: Conforming at a glance

The following was a general overview of the Conforming loan programs such as those offered by Fannie Mae or Freddie Mac and a guide to figure out if this is the loan program for you.

Availability: Available in all areas.

Type of Homes they finance: Single Family Properties and Multi-Family Properties will qualify. Site Condos are viewed the same as Attached Condominium Properties and are acceptable if they are approved condominium projects. You can search approved projects here: ******. Manufactured properties, Modular, Stick-Built, or BOCA-code properties are acceptable in some circumstances but not likely to be accepted. Working Farms, unique properties, and dome-homes will not qualify.

Down Payment Required: 10% or greater in conjunction with Private Mortgage Insurance. 20% to meet conforming loan standards. In general, funds for down payment can be a gift from family.

Private Mortgage Insurance: Emphasis on the "Private" since it is obtained through a private asset insurance company such as MGIC, PMI, RMIC, or RADIAN. Generally 1% is billed monthly, though some discounts can apply. No PMI is required with 20% down.

Interest Rates: Vary greatly between lenders. Careful shopping will be required in obtaining the best interest rates. With a 20% down payment, rates are generally lower than FHA or RD financing.

Maximum Loan Amount: $417,000.

Income Limits: No income limits apply.

Credit Requirement: Varies from lender to lender. In general, a 720 FICO and 3 credit references at least 24 months old with no late payments is required, though a lower FICO is required with a down payment of 20% or greater. 36 months from Bankruptcy or Foreclosure with 3 credit references established after the discretion.

Reserves: Varies between lenders, but in general, 2 months or greater of mortgage payments are required. Can come from retirement savings, checking or savings account.

Repair Escrow: Acceptable with certain programs, but good luck finding a lender that accepts them.

General Overview: For borrowers with great credit history and available down payment sources. Interest Rates will blow away government financing if you have the means to qualify.

First Time Home Buyer: FHA at a glance

Matthew Watts (Icon Mortgage Lending) — Tue, 19 May 2009 13:01:47 -0700

First Time Home Buyer: FHA at a glance

The following was a general overview of the FHA loan program and a guide to figure out if this is the loan program for you.

Availability: Available in all areas.

Type of Homes they finance: Most property types. Single Family Properties and Multi-Family Properties will qualify. Site Condos are viewed the same as Attached Condominium Properties and are acceptable if they are approved condominium projects. You can search approved projects here: ******. Manufactured properties are acceptable if they meet individual lender requirements. Modular, Stick-Built, or BOCA-code properties are acceptable. Working Farms, unique properties, and dome-homes will not qualify.

Down Payment Required: 3.5%. Can be a gift from family, friend, or employer. Down payment assistance is only available from grant programs.

Mortgage Insurance: 1.75% financed into your loan and and .55% is billed monthly.

Interest Rates: Vary greatly because of the great variance between lenders offering FHA financing and the Yields paid to those making the loan for you. Careful shopping will be required in obtaining the best interest rates.

Maximum Loan Amount: Varies by county. Most counties in Michigan fall at $278,000 or lower.

Income Limits: No income limits apply.

Credit Requirement: Varies from lender to lender. In general, a 620 FICO and 2 credit references at least 12 months old with no late payments is required. 36 months from Bankruptcy or Foreclosure.

Reserves: Varies between lenders, but in general, 2 months of mortgage payments are required. Can come from retirement savings, checking or savings account, or as a gift.

Repair Escrow: Available on HUD-owned properties with no contingency plan.

General Overview: Available to all borrowers meeting credit standards, emphasis on credit requirements in regards to payment history within 12 months, credit discretions explainable to underwriter are acceptable, easy qualifying with acceptable credit references.

First Time Home Buyer: Rural Development at a glance

Matthew Watts (Icon Mortgage Lending) — Mon, 18 May 2009 16:01:49 -0700

First Time Home Buyer: Rural Development at a glance

The following was a general overview of the Rural Development loan program and a guide to figure out if this is the loan program for you.

Availability: Available outside of high-density urban areas. For a more detailed area of qualification contact your lender or view our website: www.iconmortgagelending.com

Type of Homes they finance: Most property types. Single Family Properties, Site Condos, Multi-Family Properties, Modular, Stick-Built, BOCA-Code, large parcels, and some unique properties will qualify. Attached Condominium Properties are acceptable if they are approved condominium projects, you can contact your lender to check on approved condominiums. Manufactured properties will NOT qualify unless they are newly built and permanently attached to a property. *Properties with in-ground pools will come under added scrutiny.

Down Payment Required: No down payment is required. Any down payment can be a gift from family, friend, or employer.

Mortgage Insurance: 2.04% financed into your loan, no monthly mortgage insurance is required.

Interest Rates: Little variance between lenders, though some shopping may still be required.

Maximum Loan Amount: No maximum loan amount.

Income Limits: Income limits vary by County. You can view income limits for Michigan Counties here: *********.

Credit Requirement: 620 FICO with no minimum credit requirements, though this may vary by lender. 12 months from Bankruptcy or Foreclosure.

Reserves: No reserves required.

Repair Escrow: Available on all properties with contingency plan.

General Overview: For moderate income borrowers, easy qualifying with 620 FICO score, $0 down, Repairs can be included.

Mortgage Payment Chart

Matthew Watts (Icon Mortgage Lending) — Fri, 15 May 2009 15:05:47 -0700

Purchase Price	MTG PMT @ 5.5%	Taxes	Insurance	Total Payment
$ 30,000.00	$ 170.34	$ 150.00	$ 50.00	$ 370.34
$ 35,000.00	$ 198.73	$ 150.00	$ 50.00	$ 398.73
$ 40,000.00	$ 227.12	$ 150.00	$ 50.00	$ 427.12
$ 45,000.00	$ 255.05	$ 150.00	$ 50.00	$ 455.05
$ 50,000.00	$ 283.90	$ 150.00	$ 50.00	$ 483.90
$ 60,000.00	$ 340.67	$ 150.00	$ 50.00	$ 540.67
$ 70,000.00	$ 397.45	$ 150.00	$ 50.00	$ 597.45
$ 75,000.00	$ 425.84	$ 150.00	$ 50.00	$ 625.84
$ 80,000.00	$ 454.23	$ 175.00	$ 50.00	$ 679.23
$ 85,000.00	$ 482.62	$ 175.00	$ 50.00	$ 707.62
$ 90,000.00	$ 511.01	$ 175.00	$ 50.00	$ 736.01
$ 95,000.00	$ 539.40	$ 175.00	$ 50.00	$ 764.40
$ 100,000.00	$ 567.79	$ 175.00	$ 50.00	$ 792.79
$ 105,000.00	$ 596.18	$ 175.00	$ 50.00	$ 821.18
$ 110,000.00	$ 624.57	$ 175.00	$ 50.00	$ 849.57
$ 115,000.00	$ 652.96	$ 175.00	$ 50.00	$ 877.96
$ 120,000.00	$ 681.35	$ 200.00	$ 50.00	$ 931.35
$ 125,000.00	$ 709.74	$ 200.00	$ 50.00	$ 959.74
$ 130,000.00	$ 738.13	$ 200.00	$ 75.00	$ 1,013.13
$ 135,000.00	$ 766.52	$ 200.00	$ 75.00	$ 1,041.52
$ 140,000.00	$ 794.91	$ 200.00	$ 75.00	$ 1,069.91
$ 150,000.00	$ 851.68	$ 200.00	$ 75.00	$ 1,126.68
$ 160,000.00	$ 908.46	$ 200.00	$ 75.00	$ 1,183.46
$ 170,000.00	$ 965.24	$ 200.00	$ 75.00	$ 1,240.24
$ 180,000.00	$ 1,022.02	$ 200.00	$ 75.00	$ 1,297.00
$ 190,000.00	$ 1,078.80	$ 250.00	$ 75.00	$ 1,403.80
$ 200,000.00	$ 1,135.58	$ 250.00	$ 75.00	$ 1,460.58
$ 210,000.00	$ 1,192.36	$ 250.00	$ 75.00	$ 1,517.36
$ 220,000.00	$ 1,249.14	$ 250.00	$ 75.00	$ 1,574.14
$ 230,000.00	$ 1,305.92	$ 250.00	$ 100.00	$ 1,655.92
$ 240,000.00	$ 1,362.69	$ 250.00	$ 100.00	$ 1,712.69
$ 250,000.00	$ 1,419.47	$ 250.00	$ 100.00	$ 1,769.47
$ 260,000.00	$ 1,476.25	$ 250.00	$ 100.00	$ 1,826.25
$ 270,000.00	$ 1,533.03	$ 250.00	$ 100.00	$ 1,883.03
$ 280,000.00	$ 1,589.81	$ 250.00	$ 100.00	$ 1,939.81

Just something for you buyers to print out. It can come in very handy when you are out shopping around for houses and can't refer to a mortgage calculator.

First Time Home Buyer Tax Credit as Down Payment or: Dirty Deeds Done Dirt Cheap

Matthew Watts (Icon Mortgage Lending) — Thu, 14 May 2009 15:21:03 -0700

First Time Home Buyer Tax Credit as Down Payment or: Dirty Deeds Done Dirt Cheap

You may not even be thinking about it now, but there are so many good ways to use this money, please do not get ripped off before you even have the chance! Here are just a few examples of what to do:

Take advantage now, because the tax credit goes away if you close on your new home after December 31st, 2009. Happy Home Hunting to you all!

For more in-depth help, go to our website:

www.iconmortgagelending.com

*This has been an Emily inspired blog.

Michigan Real Estate Purchase: Lending Update

Matthew Watts (Icon Mortgage Lending) — Tue, 12 May 2009 11:33:57 -0700

So, regardless all of the jibber-jabber out of Washington lending is continuing to tighten. I figured I would write just a general overview of some of the significant changes or non-changes here in my blog in case any of these issues may affect you.

First Time Home Buyers: Most of the news for you is good. So much is aimed at finding you and inspiring you to help get the economy moving again, that your business is still in demand. The current change is that banks are looking for a little more investment on your part to ensure that they are making a good investment with you. This doesn't necessarily mean a down payment, but do expect to be accountable for past credit discretions and to able to show paperwork on where you are getting the money to pay for your appraisal, down payment, or other requirements. This can still be a gift from family, but expect to show proof of where you are getting it. More emphasis if being put on the 620 FICO phenomenon on a daily basis. Those borrowers over 620 will succeed on those under will continue to face more and more hardships as time passes. Open new credit...first and foremost. Always continue to strive to a higher FICO by managing current credit properly and you will be fine.

Buying a Home when you already own one: This is where some of the more significant changes have been made over the last year. If you want to move into a new home as your Primary Residence and already own a home, you will come into a lot of restriction. Even if you have a good reason- such as job transfer, more space, or just want better home at a better price. The banks see you as a huge risk of buying a new home and letting the other home go into foreclosure...and rightfully so. This doesn't mean that it can't be done; you will just need to meet the extra requirements. You will need to be able to afford to make the payment on both houses and the rest of your bills within the normal guidelines of 41% of your gross income. You will also need to have 6-12 months of both payments in savings (this can include 401k accounts too, so if you have one that hasn't been raided by AIG or Countrywide you are in a decent position to obtain financing).

Buying and Investment Property: Ah the Catch 22. Affordable prices driving investors to the market and tightening credit restriction driving them away. Well, let's face it, if you do not have some cash to work with you are not in a position to invest anyways. The good news is that prices have gotten so low that putting 25% down on a $30,000 property only means about $10,000 out of pocket including closing costs. If you have taken care of your credit over the years you can borrow most of that from sources outside of the mortgage and still leverage the majority of your investment as long as you can show your invest as liquid for two months prior to the purchase- meaning you can get a loan but have to deposit the cash for a few weeks before you find your property. I understand that Michigan is a down economy but I can't express to you how much I hate seeing Californians being the ones gobbling up our properties when buying the home next door is so much better of an investment for our own neighbors that have the means. Maybe it's time to weigh how much you are losing in your 401k or stock investments against how much risk you are willing to take...think about it people, you are losing cash hand over fist where it is now.

Buying a Second Home: Well, chances are if you are buying a Vacation Home, you have the resources to do so. You will certainly find that it takes a little extra down payment now, but any changes will not be significant enough to dissuade you.

Overall: Things are continuing to tighten, and they will follow this trend for a while. Don't believe everything you hear on CNN, it will not serve you well. Most serious buyers will not feel the crunch anymore than has been happening over the last two years, but those that are getting into the market with timid steps will not succeed. You need to have money down, proof of your benefactors, and as always a steady income. Borrowers that do have the means to repay will continue to qualify.

For more in-depth information call or visit our website today

810-953-4266 or www.iconmortgagelending.com

(First Time) Home Buyer’s Frequently Asked Questions

Matthew Watts (Icon Mortgage Lending) — Fri, 08 May 2009 13:02:23 -0700

I will be adding to this list as I go along, but I wanted to start a nice comprehensive FAQ for homebuyers. I put "first time" in parenthesis because really this can apply to anyone buying a home, but this will apply mainly to the questions I get from first time homebuyers.

Q: Why buy instead of rent?

A: Well, pride of ownership and having something that is yours to do with what you want. A home is also a long-term investment for your future. Don't let all of the exploding market talk scare you. Real Estate prices go up and down, but just like investing in stocks, you buy low and sell high based on when you enter the market. If you put yourself in a position where you have to sell within a very short period of time you had better make a sound investment or you will fail as many are now failing because they relied on an implied return without realizing preparing for a long-term goal. In addition to the equity investment, a home is also a valuable tax incentive. You can deduct your mortgage costs and property tax costs from your income taxes that you file each year whereas your rent is simply paid and gone forever rather than reinvested.

Q: What documents will I need when applying for a mortgage?

A: You can follow our guidelines laid out here: Documents for any documents needed to apply for a loan. A quick synopsis would be: 2 years w2s, 1 month of pay stubs, 2 months of banks statements, 401k/Retirement savings statements, driver's license, and social security card.

Q: What is my interest rate going to be?

A: A loan officer should never quote you an interest rate before they take all of your pertinent information. Beware of loan officers that do this, because they have no reason to keep their promise and all the reasons in the world to change it before closing. For more info read this blog: Deciphering Interest Rates.

Once you have given all of your information, and a loan program can be chosen, you should then demand some type of rate lock agreement. Even if it is in your best interest to float at the time of application, it is something that should be discussed with your loan officer as to when you will be locked in.

Q: What are the closing costs?

A: Any loan officer worth their salt and offering the truth to you, will offer a Good Faith Estimate of all closing costs. In fact they are legally required to, but the oversight of such practices is pretty light so many just don't even bother. For more info on what the GFE should look like, check out this blog: Closing Costs

Q: Once I am pre-approved will something go wrong?

A: There will always be the possibility of something going wrong after a pre-approval. If you are smart you will ask to be approved through AU before you actually make an offer on a property. AU or Automated Underwriting will render a pretty solid decision on your loan, and will give you added security but most loan officers will not offer this service to you because of the cost to them. If you have a less than perfect situation, it will be worth your time to find a loan officer that will offer you an AU decision before you get too far into the process only to be let down. AU is not the end all though because it will not be able to make any decisions about the property such as the title situation, the value of the home, or the validity of the collateral at all; but AU will ask all of the questions needed to close your loan in regards to your credit and ability to qualify for the loan.

Q: What is the best loan program for me?

A: Lots of options still exist to this day even though there has been a major credit crunch. The three main options that every loan officer should discuss with you regardless of any other factors are Conforming- though they require more down payment, it may be worth it to get the drastically smaller interest rates; FHA which has lower down payment requirements and greater qualification flexibility and is available in all areas; and RD (Rural Development) which is not available everywhere but requires even less down payment than FHA and has no monthly mortgage insurance. If a loan officer does not offer you all three of these options and describes the differences in detail, they are not the loan officer for you because they are either unaware or uneducated in all loan types available, or are simply steering you away from a loan that they can not offer. ALWAYS beware of a loan officer that says something like, "Oh that isn't even worth talking about." That is just a way for them to deflect a question about a loan they are uneducated about. If they say that, THEY aren't even worth talking about as an option for your financing. You can read more about each loan program here in my blog.

Q: My uncle told me that he got 4%, why am I hearing something different?

A: People love to give advice and share opinions we all know this. Generally when people talk about something that they are not trained in providing, they are only offering opinion and not fact. Once you have found your mortgage professional, it is important to listen carefully to what they tell you and look for some of the warning signs I point out in my various blogs. But once you feel comfortable with that person, you should be aware that many many people will offer random opinions based on their own experiences that may of may not have anything relevant to your situation. Bring these up to your loan officer but I do caution you against taking too seriously what someone that does not work in the business says about your mortgage. Take in into consideration, but listen to professionals that you choose to serve you for the answers. If the answers they give make you feel uncomfortable, then you can make your choice accordingly.

Q: What about this tax credit I heard about?

A: Well there are many situations arising that are less than clear in regards to the tax credit. For the simple questions though, you can check out this website for the answers: www.federalhousingtaxcredit.com

Q: How long does this take?

A: The simple answer is 30 days from the time a signed purchase agreement is delivered to your loan officer. Any longer than that and you are probably doing something wrong, however there are certain situations that will take longer. Discuss this with your loan officer before you apply and if things are taking longer without a decent explanation, it may be time to switch. For a more detailed answer, read this blog: Time Table

Q: What is closing a loan like?

A: Whew, unlike anything you will ever do. Basically it is 30 minutes of signing your name. You will be seated with your loan officer, real estate agent, and a closing agent and going through many important documents. It is a good idea to go through and read each document, and consult your loan officer and real estate agent for any questions you may have.

Q: What if I have trouble paying my mortgage payment?

A: I always tell my clients to contact me directly if this happens so that we may point them to the proper channels, however you may not get that answer from everyone. If not, there is always help available. Some important resources can be found in this blog of mine: Help for Homeowners

For more information you can call or visit our website:

810-953-4266 or www.iconmortgagelending.com

Where to go when you can't make your mortgage payment

Matthew Watts (Icon Mortgage Lending) — Thu, 07 May 2009 14:20:42 -0700

Life happens and along with it comes many challenges that we all face. These normal challenges can sometimes be magnified when you have a mortgage payment bearing down on you each and every month. There is always help available for you, but it is essential to remember a few things when you are having trouble making your monthly payment.

Never Wait!!! Simply missing payments is the worst thing you can do. It is important to be as on top of you payments as you can be, and that does not always mean making the payment. Recognize as early as possible when you know you will not be able to make your payment and contact your lender to let them know that you are having trouble. Often times they will have a solution for you. Simply waiting and waiting and missing payments and avoiding the situation will only further the difficulty in helping you out of your current situation.
Never purposely miss a payment. Many times you will hear advice from friends, family, your lender, or from advertisements from companies that claim to help you out of your current situation, or just out of your own anger over a certain situation with your lender. No matter what ANYBODY tells you, if you have the means to make your mortgage payment, the best course of action is to make the payment. Missing a payment will wreck your credit standing and force extreme difficulty on you including other creditors using your lowered credit score as an excuse to raise your interest rates on installment loans or credit card payments only furthering your troubles. Any program designed to help you out of a bad situation will not require you to purposely miss a mortgage payment.
Do not refinance your loan simply because you can not afford a singly monthly payment. Now if your monthly payment is too high and you need to lower it, it is a good idea to explore the option of refinancing. But if you can not lower your interest rate and you simply need to pay back taxes or get a month off from a mortgage payment because you are in a bind is not a good reason to refinance. In most cases you will end up with a lot of undue stress and extending your loan balance and term only to end up in the same situation down the line.
Read, review, review again, ask questions, and make sure that you FULLY understand the implications of any program your lender offers you that is based on missing a payment or rolling a payment in to the back end of your loan. Most lenders will fail to tell you that they will be marking your payments as late until you make up the missed payment. Meanwhile you are relieved from the payment you didn't have to make and your lender has ruined your credit and any chance of refinancing. Why would they do that? Duh, because if you can't refinance then you are forced to keep paying them interest every month!
If your lender can not help you, contact a HUD-approved debt counseling agency which are easy found here:
Be smart about it. If something seems too good to be true it probably is. If you do get yourself into a situation where you feel taken advantage of, tell your lender about it- you will be surprised how powerful your own words can be if you express yourself to your lender in a calm and confused fashion. If they seem to just run over your concerns with no resolution, don't be afraid to contact an attorney about the matter. Many attorneys will consult you on the matter without an up-front charge.

If you need further information check out some of these websites:

First Time Home Buyer: How to Demand Transparency from your Loan Officer

Matthew Watts (Icon Mortgage Lending) — Thu, 07 May 2009 12:18:48 -0700

There are so many ways for a loan officer to fool you and I have heard them all in my time in the business. Now I bring this knowledge to you in how to demand that your loan officer never fools you. I will also cite all of the documents that your loan officer is legally required to show you yet rarely will. I will make you as close to impenetrable as possible.

Interest Rate: Ah the interest rate. As a consumer it is always the first thing on your mind, and always the first tool you use to shop for the best deal possible on a mortgage. Of course, us in the "know" realize that there the interest rate alone rarely dictates a good deal on a mortgage. So how do you decode what your interest rate will be and if it is in fact a good value when a loan officer is so well equipped to talk his or her way around this subject? Well the value part will be covered under the APR heading below, but first let's talk about how to know what your interest rate is and what it will be at the time you close.

The Rate Lock Agreement: The rate lock agreement sounds like a form that you would have to sign and consent to. In fact most companies will have you sign a rate lock agreement, but this does not have to be a form according to Michigan law (MCMPA). In fact it can also be a verbal agreement between you and your lender. If a loan officer promises you a certain interest rate, it is literally against the law to change it. You can in fact, sue your loan officer if they made a verbal promise to deliver a certain interest rate and then changed it unless you yourself have provided misinformation or request changes to your loan program. Most people don't realize this. Just always require that your loan officer is honest with you, even if that means they tell you that they don't know what your rate will be. In most instances, the most honest loan officer will give you a fair range of current rates

Key phrases a loan officer will use in deceiving you about your interest rate:

Well we can't lock your rate because they change so often. (They change often but a loan officer should still be able to offer you a lock based on when you qualify)

I can get you that rate, for sure, but we need to see if you qualify first (a loan officer should never say for fact they can get you any rate until they know you qualify and if they do they are breaking the law and breaking your trust).

Oh yeah, like 6% (before they even know your name).

And ALWAYS be aware of any advertisements that come with an interest rate printed on them, no matter what the form they use. Any advertisement with an interest rate contains so many opportunities for a loan officer to lie to you that it is NEVER worth it in the end.

APR or Annual Percentage Rate: This is one of the most confusing numbers in all of mortgage lending and is even confusing for the very person that is meant to teach you about it if they are not properly trained. The APR is an expression of the "cost of your credit" as a percentage. In other words it takes in account all of the "cost of your credit" or fees you will pay in connection with getting a loan and breaks it down into a percentage. A lender is legally required to provide you with this figure in accordance to the Truth-in-Lending Act (TILA) within three days of applying for a loan. They come on a form referred to as the T.I.L. that features other important information as well, but the APR is the most prevalent feature.

Key phrases a loan officer will use if they are trying to confuse you when explaining this to you:

Nobody even really understands how this APR thingy works.

It's an awful government form, you know government, everything they do is stupid.

Don't worry about that APR it is not your interest rate and doesn't affect your loan.

In fact the APR is a useful tool in comparing one loan to another. It is certainly not the end all to loan shopping, but it is useful because it breaks down all of the charges that you do not carry from one lender to the next. So things like a credit report fee or an appraisal fee are not used in the calculation because they will be a part of your loan costs no matter what. The APR does use fees like origination charges, broker fees, and. The important things to remember her are: make sure your loan officer offers you a "TIL", make sure they explain the APR the way I explained it, and make sure they show you the charges that figure it.

The Broker Fee: This is important whether you are being charged one or not. The important thing to remember is that the reason a Mortgage Broker exists in the first place is that a broker does not need the mortgage lender to pay them to sit at a desk all day even when they are not originating loans. The broker does, however, have to pay to advertise or maintain an office of their own in order to get to you in the first place. So the ultimate end game is to compare if the broker fee is cheaper than what the bank will charge you. Again this is not the only factor to consider but it is useful because if your concern is upfront fees as opposed to monthly payment, you will want to compare the broker fee as opposed to the interest rate that your payment is based on. Any broker is required to explain this to you as mandated by the Michigan Consumer Mortgage Protection Act (MCMPA) via the Borrower's Bill of Rights. You have the right to know what your loan officer is making as a result of originating your loan the same way that your bank is required to give you this document and explain this to you as well. The problems mostly arise by the fact that a bank loan officer is not required to explain exactly how much they are making by originating your loan because they are considered an hourly employee of the bank. Obviously a bank loan officer will always be able to present their origination fee as cheaper than a broker. This is where the APR can be compared to your interest rate and used a tool to distinct which is a better value.

Whether or not you are qualified. This is the tough one to decipher. By law any lender is required to give you a credit decision within 30 days. Obviously, the process gets a bit muddier once the term pre-approval comes into play and even more so when you have a less than perfect credit or employment situation that makes qualifying difficult. The important thing to remember is that if someone is telling you that you qualify before they have seen a credit score, employment information, asset information, or heard your entire story- they are lying. It is impossible for someone to tell you what you qualify for without having taken a full application so be leery of anyone that does.

The Good Faith Estimate (GFE): This is a breakdown of all the fees involved in acquiring your loan. If you look carefully, you will see on the GFE which fees are used in calculating your APR. This will further your shopping power by realizing what will be charged by anyone and what will only be charged by a bank or what will only be charged by a broker. The big thing I feel is to be aware of things that are conveniently left off of a GFE but will be added later. Specifically those charges that are used to calculate your APR that some loan officers like to leave off of a GFE, or grossly under estimate in order to make the bottom line look better. These include Tax Escrows, Pro-Rated taxes(only on purchases), title insurance, title closing fee, days of interest, and processing fees. These will all always be charged regardless of lender and will always be able to be properly estimated (with reason) at time of application. So if you are comparing GFEs and you notice a large difference between these charges or that one has been omitted, it should immediately send up a red flag that one of your loan officers is not being honest with you.

Basic Legal Forms: There are a few basic forms that you are required by law to receive within 3 days of applying for a mortgage, so be leery of anyone that does not provide them. Good Faith Estimate, Truth-in-Lending, Borrower's Bill of Rights, Servicing Disclosure, Consumer Caution Disclosure, and the Closing Costs booklet.

If you follow these guidelines and are not afraid to walk away from a loan officer that does not comply with these guidelines, you will make the loan process much simpler for you.

For more information you can call or check out our website:

810-953-4266 or www.iconmortgagelending.com

Icon breaks top 10 USDA Originators for 2008!

Matthew Watts (Icon Mortgage Lending) — Tue, 10 Mar 2009 11:05:41 -0700

I am very excited to announce that Icon Mortgage Lending was informed early last week that we finished in the Top Ten of USDA Rural Development Loan Originators for Michigan in 2008. We have been originating RD loans with consistency for the last 5 years now, but this is our first year with such an increase in our production. We would like to thank all of our referral partners for keeping us so strong through these tumultuous times. Thank You.

Matt Watts

Senior Loan Officer

Icon Mortgage Lending

Rural Development Funding Still Available

Matthew Watts (Icon Mortgage Lending) — Tue, 10 Feb 2009 10:10:32 -0800

Hello all,

I, and pretty much all of our people at Icon have had many Realtors calling us over the past few days concerning the health of Rural Development loans. Apparently, some lenders are having problems dealing with the lapse in funding at the USDA.

Please be Aware that we are running business as usual with Rural Development loans.

Our main two RD channels are committed to closing and funding loans while new funds are in process of being appropriated for the USDA. There is no back up, there is no hold up, there is no closing issue. If you are having these problems you can always just call me over at Icon 810-953-4266 and I will take a look at whatever you need help with.

Thanks,

Matt

Rural Development Loans Still Readily Available!!!

Matthew Watts (Icon Mortgage Lending) — Wed, 21 Jan 2009 11:59:37 -0800

Hello all,

Please be Aware that we are running business as usual with Rural Development loans.

Thanks,

Matt

Michigan Rural Development Loans: Why it works

Matthew Watts (Icon Mortgage Lending) — Thu, 18 Dec 2008 09:52:13 -0800

I understand the skepticism of the Realtors I talk to. It seems too good to be true with everything going on. With the masses of lenders that let their imaginations run wild with all of the money they could make on unqualified buyers. So to hear that someone is still helping the very average buyer-the same as they have been for two decades- seems kind of...too good to be true.

But while FHA was running wild with 500 FICO scores and Non-Occupying Co-Borrowers, there was a mortgage insurer that never waivered from their original guidelines. Now that the bottom fell out from under the others and Steve Preston scrambles to wrangle FHA in yet continue to lend...there is the stolid conservationist guidelines that have served median income borrowers for a while now.

Oh, it's still a United States Government backed program. It's called the USDA and it is here to stay.

They have never swayed to lower scores, client base, or lower standards. The only thing lower is the rates. They had lower income borrowers' best interests at heart without compromising their own principles of what makes a good borrower.

Is it any wonder that they are still lending with fervor while FHA is dying and has no idea?

For more information Call Today, or visit our website:

810-953-4266 or www.iconmortgagelending.com

Michigan Rural Development Loans: Interest Rate Update

Matthew Watts (Icon Mortgage Lending) — Thu, 18 Dec 2008 09:34:02 -0800

Michigan Rural Development Loans: Interest Rate Update

Just a note for you and your clients, if you think those FHA or Conventional rates are good, how would they feel about 5.00% with no...yes NO MORTGAGE INSURANCE.

If you are thinking we need a large down payment to deliver such financing, you are wrong. Rural Development loans are the last 100% financing available.

I have been originating these loans for Mid-Michigan clients for the past 4 years and am pleased at the emergence of their importance. I am always available for any questions about the processing of these loans whether you are using me or another loan officer.

For more information Call Today, or visit our website:

810-953-4266 or www.iconmortgagelending.com

Michigan First Time Home Buyers: Preparing Your Docume

Matthew Watts (Icon Mortgage Lending) — Fri, 12 Dec 2008 12:46:15 -0800

I find that the first hurdle a First Time Buyer faces is getting their paperwork together. I am not sure why, but honestly this simple task dissuades many people when they start to apply. Perhaps following this list and having it ready at the outset will help the process seem smoother.

Last two years of W-2s or Tax Returns. If you can't find them, you can always contact your employer, your tax preparer, or the IRS for a copy.

Most recent month of pay stubs. 1 month worth...the most recent available.

Most recent 2 Months of bank statements. If you don't get paper statements, you can print your online statements, but you will need to take them to your bank to get verified and stamped.

Most recent 401k statement. (If you have one.)

Copy of your driver's license and social security card. The Patriot Act requires us to check these.

Have these items ready to go before you look for a loan officer and DO NOT trust anyone that will try to quote you a payment or interest rate before they even see your basic documentation! That means they are making promises with no intention of keeping them, a true professional will verify your documents and approved you before making an guaranties.

For More Information- Call Today or Visit Our Website:

810-953-4266 or www.iconmortgagelending.com

Michigan First Time Home Buyer: An Overall Guide

Matthew Watts (Icon Mortgage Lending) — Tue, 09 Dec 2008 09:34:29 -0800

For a first time buyer, there is so much to worry about and so many levels of details to address, that I just want to provide a good general guide to how to start the process. You can refer to my other blogs for more detail, but I think this is a great overview.

Purchasing anything, will cost you money. A home is the biggest purchase you will ever make, but most people expect to spend less than when getting an apartment. Any decent complex will want first, last, and possibly a security deposit. That's at the very least $1000. Have this much before you consider buying a home.

Now, Before you do anything else, find a loan officer. Before you contact a Realtor, before you look at homes, you have to qualify. In today's market there are so many intricacies to qualifying that the first thing you need is to get approved. Approved, not pre-approved like so many tell you. Finding a good loan officer is finding someone that doesn't talk about pre-approval. Find one that runs Underwriting and approves you upfront. And do I really have to warn you about using 800 numbers in California or New York to get a loan? FIND HELP AT LEAST FROM THE SAME STATE!

Ok, now you can get excited and look for homes. Get a good Realtor, find what you want, and don't be afraid to pull the trigger. At the same time, don't over look the structural integrity of the home, just remember that you will ALWAYS have to paint a room or two to make it yours. Get a home inspection and listen.

Getting your loan will take time. Depending on your situation it can be anywhere from 20-40 days. Anything longer is too much, and you should start to ask serious questions around the 35^th day.

Don't be afraid to ask questions. Simple but rarely used. Just ask any question at any time and if your loan officer or realtor seems to never be available, ditch them. Ditch Them! Don't feel imposed upon or that you aren't being taken care of, a lot of sales people are taught to show you how complex everything is to sell you on themselves. Really their job, THEIR RESPONSIBILITY, is to simplify things for you.

Closing will never be simple. Hopefully you have a good loan officer that will explain this to you upfront, but be patient and let those doing the work have time to do the work. If it was simple, you could do it yourself.

The final word: work hard to find people you can have complete face to face confidence in and have confidence in them. This is the most important part of anything you do. Assemble a good team of professionals that can put everything into perspective for you and will have YOUR best interests at heart.

For more information Call Today or visit our website:

810-953-4266 or www.iconmortgagelending.com

Michigan Mortgage- Your Rights When Obtaining a Mortgage

Matthew Watts (Icon Mortgage Lending) — Thu, 04 Dec 2008 15:02:16 -0800

I thought it would be helpful to provide an online copy of the Borrower's Bill of Rights. This is a form that is required of a lender to provide to a borrower when they apply for a mortgage. If a borrower sees it at all, it is normally at the end of a big stack of paperwork and it is rarely read to them. Below you can peruse at your leisure.

"BORROWERS BILL OF RIGHTS"

1. You have the RIGHT to shop for the best loan for you and compare the charges of different mortgage brokers and lenders.

2. You have the RIGHT to be informed about the total cost of your loan including the interest rate, points, and other fees.

3. You have the RIGHT to obtain a "Good Faith Estimate" of all loan and settlement charges before you agree to the loan or pay any fees.

4. You have the RIGHT to know what fees are nonrefundable if you decide to withdraw your loan application.

5. You have the RIGHT to ask your mortgage broker to explain exactly what the mortgage broker will do for you.

6. You have the RIGHT to know how much the mortgage broker is getting paid by you and the lender for your loan.

7. You have the RIGHT to ask questions about charges and loan terms that you do not understand.

8. You have the RIGHT to a credit decision that is not based on your race, color, religion, national origin, sex, marital status, age, or whether any income is derived from public assistance.

9. You have the RIGHT to know the reason if your loan application is turned down.

10. You have the RIGHT to receive the HUD settlement costs booklet "Buying Your Home"."