Sue's Blog

First Time Home Buyer Tax Credit - TIME IS RUNNING OUT!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Sat, 26 Sep 2009 00:03:35 -0500

Here is a video that gives some important information about this credit, information that I hadn't really thought about until recently. Because I know that I hadn't thought about it, I feel it very important to share this information with any and all potential buyers - they really don't have much time remaining! If you, a friend, a client, a family member, or someone you work with is still on the fence about buying, you need to send this to them@

Click here to see the video and share with anybody you know that is contemplating on buying a home but is still undecided and hasn't yet put an offer on a house!!!!

What Makes a Loan Officer a Success?

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Sat, 11 Jul 2009 00:16:02 -0500

I am being interviewed for a podcast that will be on iTunes this coming week and the subject is "What Makes a Loan Officer a Success". Having pondered this, I have concluded that two traits are needed: knowledge and involvement.

While trying not to appear demeaning, all of us can market, learn to market, or hire someone to do our marketing for us. However, unless and until we know what it is that we are marketing, even the best marketer will be scrambling to make their car payment or keep their cell phone on!

In these days of ever-changing guidelines, it is imperative that we, as loan officers, learn those guidelines, relearn those guidelines, study them and commit as much of them as possible to memory and then keep up on the changes as they happen. Several months ago, I took a Friday, Saturday and Sunday and spent them holed up in a hotel room going over and over my investor's guidelines and the mortgage insurance guidelines (I'm in Florida, which is a market that has different rules than other states in many cases.) Doing this, while somewhat boring at first, showed me so much more that we CAN do as opposed to what we can't do. My object wasn't to find out anything other than what limitations the different investors we work with and the MI companies were placing on us but I found ways to get loans done that I didn't realize even existed! It's amazing how many people will say that they are "loan officers" or "mortgage consultants, advisors, or experts" only to find out that they really don't know how to get a loan closed from beginning to end. They may not know all of the correct documents that are needed for the underwriter and have to keep going to the client and asking for more, which is extremely unprofessional and frustrating to the client, they may not know the maximum loan to value or debt to income ratio or minimum credit score needed, and they may just throw answers out to appear knowledgeable that, in the end, makes them look as unknowledgeable as they really are. It is better to respond to a question with either (a) the right answer that you know because you study your guidelines continuously or (b) an "I am not 100% sure but I will check on it and get right back to you" than it is to every try to appear that you "know your stuff" and throw out an incorrect answer!

The second trait needed is INVOLVEMENT. All the knowledge in the world won't help unless and until you have someone to share it with. As a loan officer, the best place to start spreading that knowledge is with Realtors®. I have found that being involved in my local association through committees and sponsorships, being an active member of the local chapter of Women's Council of Realtors, and being involved in community and/or charitable organizations allows me to share my knowledge when questions are asked that tell the other party that I know what I am talking about. If a Realtor® asks me a question and I just give an answer to "appear" knowledgeable and then it turns out that my answer is wrong, I wouldn't expect to do business with that Realtor® again, and rightfully so. Even worse, they will probably tell other Realtors® and then your reputation will be sullied going forward. When you are at functions for your Board or other organization functions, DO NOT MAKE IT ALL ABOUT YOU OR YOUR COMPANY! Being involved means doing the task that is required of that committee or group and it isn't about self-promotion! It is through these efforts, however, that you establish relationships and some of the other people in these groups may ask you questions and if you give the right answers, they may then refer you business. Nobody "owes" any of us their business; it is up to us to "earn" it.

My creed is and always has been: "If I help you to grow your business, it will then, in turn, help me to grow mine". The key to doing this is patience and making sure that in any and all answers in conversations you have with the Realtor, borrower, title company, etc. is one that you don't just make up to look like you're smart. In my head, the "smart" person I picture is Einstein........if you prove you're no Einstein, you will also find you're no Trump or Gates, either!

Condotel Financing Available!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 29 Apr 2009 19:00:32 -0500

I have been getting a LOT of calls about financing condos in our area and throughout the Southeast. At this point, we have been told that if any of the following are present, the project is considered a "condotel":

If an underwriter can Google the name of the project and the city and finds that they can rent a unit for a short term there (ie: a day or a week), they are considering that project a condotel;
If the project has the word "Resort", "Inn", "Hotel" or "Motel" in the legal name, it is being considered a condotel;
If a project offers maid or concierge services, it is being considered a condotel;
If a project has an on-site rental desk, it will be looked at as being a condotel.

Please keep in mind that a project only has to have ONE of the above characteristics in order to be considered a condotel, not all of them! Do you know of more than a handful of projects in the Destin/Panama City Beach/Ft. Walton Beach market that do NOT have one or more of these characteristics??!!

Here at Northstar Mortgage Group, we are very aware of the frustrations you, as Realtors, are dealing with in getting buyers financed for condo projects in our local market and we have found solutions for you and for your buyers. We have made efforts to find portfolio lenders (lenders who won't sell the mortgages on the secondary market) and have come up with some that can offer the following financing for condotels:

Second home financing on 3, 5, 10 year ARMs or 10 and 15 year fixed rate mortgages with 25% down;
Investment financing on 3, 5, 10 year ARMs or 10 and 15 year fixed rate mortgages with 35% down;
Up to 100% financing as second home or investment property with additional collateral (lendable equity in other property owned; we can put as many as 4 properties on one mortgage to accomplish this). We would need to speak with the buyer to determine if they have "lendable equity" and determine the maximum loan to value based on other property that they own to determine if this is an option for them.

If the project has either or both of the following features, the down payment required will be 45% but we can still do financing:

Less than 750 square feet (excluding balcony) and/or
Doesn't have a full kitchen (must have full size refrigerator, full size stove/oven and full size sink).

If any one or more of the following features are in the project, we can not do financing except with special exception for low loan to value and/or if additional collateral is pledged:

Managed by national hotel chain;
Owners are REQUIRED to participate in a rental pool;
Homeowner's Association is controlled by the developer and not the unit owners;
Project has timeshare or fractional ownership units in it.

If you are leery of listing a condo unit because you are unsure of the available financing, please feel free to call us and see if we will be able to help with any prospective buyer. If you have a buyer and feel as if you are beating your head against the wall with the financing, please feel free to call us, as well!

The investors we are using do have a maximum exposure that they will do in each project and we have a list of projects that they are already maxed in and can help you before you write an offer/take a listing to make sure we can do financing in a particular project. Feel free to call me to find out if you have a listing or a buyer to make sure we can do the project they are buying/selling.

Please do not hesitate to contact me with any questions or to have your buyers contact us for financing on condotels! We can finance condotels in Florida, Alabama, Georgia, North Carolina and South Carolina.

USDA Rural Housing Mortgages - Increased Income Limits

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 22 Apr 2009 14:50:10 -0500

On Monday, April 20, USDA Rural Housing income limits were increased. Here are our local limits and, if you are located elsewhere, just email me and I can tell you the limits in your area.

Okaloosa County:

If there are 1-4 persons in the household, maximum income is $76,250 and if there are 5-8 persons in the household, maximum income is $100,650

Escambia, Santa Rosa, Holmes, Bay and Walton Counties:

If there are 1-4 persons in the household, maximum income is $73,600 and if there are 5-8 persons in the household, maximum income is $97,150.

This is a great tool to allow prospects who were sitting on the fence to purchase now and close before December 1, 2009 and take advantage of the $8,000 tax credit. How many buyers do you have that would love to finance 100% of the sales price PLUS ANY CLOSING COSTS THAT THE SELLER ISN'T PAYING AND/OR THEIR PREPAIDS??!!

Did you know that the funding fee for the USDA loan is also tax deductible?? (It works on a VA and FHA loan, too!)

Don't hesitate to contact me - we can help you get to closing!!!

It's Official - USDA Rural Housing Increased Income Limits to go Into Effect April 20, 2009!!!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 08 Apr 2009 09:58:29 -0500

USDA Rural Development has confirmed that the proposed change in the income limit structure for the USDA Guranteed Rural Housing Program will be implemented as planned on April 20^th! This will allow a lot more people to qualify for one of the only 100% financing programs left, and certainly one of the only ones that allows you to include closing costs in the mortgage (if supported by the appraisal)!

In summary, the current income limit structure that is based on household incomes will be restricted as follows:

Okaloosa County:

Household of 1-4 persons in it: Max Gross Income of $72,650

Household of 5-8 persons in it: Max Gross Income of $95,900

Walton County/Bay County/Santa Rosa County/Escambia County:

Household of 1-4 persons in it: Max Gross Income of $70,750

Household of 5-8 persons in it: Max Gross Income of $93,400

We cannot submit any loans with these increased income limits to USDA until April 20 but we can take applications and get the file processed prior to that date. This should be a huge boost to our market as more people will be able to purchase with absolutely no money down!!!!!

Contact me and let's get you or your client prequalified and closed with NO MONEY DOWN!!

10 Real Estate Deal Killers........

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Fri, 06 Mar 2009 15:04:44 -0600

I attended a class the other day called "10 Things to Ask Your Buyers Before Taking Them House/Condo Hunting" and will be addressing those issues in an upcoming blog entry but wanted to put together a list of what can kill a deal for a buyer or a seller. Please feel free to share this information with your buyers and sellers!

Skipping the Mortgage Preapproval Process: For buyers, getting preapproved for a mortgage gives them a clear idea of how much they can safely borrow, plus it addresses credit issues and kick-starts other financial paperwork. What's more: it identifies them as a SERIOUS BUYER. With mortgage guidelines changing almost daily these days, a buyer needs to be 100% sure that they can afford the down payment requirements and meet the credit score requirements of a particular property type. Sellers with a hot property should demand nothing less than proof of preapproval from the potential buyer's lender (hopefully it's Northstar Mortgage!) There is no sense in wasting time on time wasters! I know most Realtors require their clients to get preapproved prior to ever showing them the first house but I also know Realtors who spend sometimes months showing prospective clients properties, taking them to lunch and/or dinner, searching the MLS for them and then find out that the client cannot get approved for a mortgage at all! On top of having spent countless time with an unqualified prospect, the Realtor has also spent money on them. IF A CLIENT IS UNWILLING TO GET PREAPPROVED, HOW SERIOUS CAN THEY POSSIBLY BE??

Not Knowing What a Condotel is: As Fannie Mae, Freddie Mac, FHA and VA tighten up their credit guidelines, they have basically choked the ability to do a fixed rate mortgage for a condo in a resort area. If you have a client that is buying a condo and you can go on Google, put the name of the project and the city in, and find that you can rent a unit in the project for a day or for a week, chances are you seller will NOT be able to get a fixed rate mortgage to buy a unit in that project as it will be considered a "condotel" or "condohotel". If the HOA has 10% - 15% (depending on the investor) or more of the units in the project as delinquent on their dues, it makes the financing in that project even that much more difficult. If the project has the word "Resort" in the legal name of the project, it is a condotel. Here in our local market in the Panhandle, one or all of these affects about 99.9% of the condo projects! Before you show condo units to a prospective client, MAKE SURE THEY ARE AWARE THAT THE AVAILABILITY OF A FIXED RATE MORTGAGE IS ALMOST NON-EXISTENT! While we are able to finance condotels with several investors utilizing adjustable rate mortgages, you would be very surprised at how many calls A DAY I get from clients who are at contract on a unit and then find out that they can't get a fixed rate mortgage. You would be doubly surprised at how many of them end up not buying at all! (It's currently noon as I am writing this and I have already had 5 of these calls today and in all cases: they were at contract and talking about not buying.) The investors we use do NOT require a condo checklist so it's sort of a "don't ask, don't tell" policy on the HOA dues. If your client knows up front that they can get a mortgage and the type and terms of the mortgage, they are more apt to buy a unit as opposed to finding out after they find the perfect unit. The prices and deals on condos right now are so incredibly good that some people don't care that they have to do an ARM but if they find out after the fact, it sours them and causes them to take pause and possibly not buy!

Not Understanding the Length of the Buying/Selling/Financing Process: I have no idea what the numbers are, but there is a high percentage of real estate being sold that is either a short sale and/or REO that have to be approved by the bank currently holding the note. This process can take as little as 3 weeks or as long as 3 months (and even longer) and sometimes, buyers lose their enthusiasm. Make sure your client knows going in that buying one of these properties (or selling one, if you are the listing agent) will not happen overnight. If they know up front, it doesn't create a fear in the buyer or seller because it takes longer than they may have expected. On the financing side: because rates have dropped to almost historical lows, most underwriters are taking more time to get files underwritten than what it used to take. Talk to your loan officer and get a realistic idea of how long it may take (I have heard of some underwriters taking 5 to 6 WEEKS to underwrite files based only on the sheer magnitude of the number that they have received recently!!!)

Assuming the Appraisal Equals the Actual Value: In theory, appraisals are objective estimates of value. But several different appraisals can yield several different numbers. For example: an appraisal that's been done for a possible refinance may have been slightly inflated to encourage that refinance. So make sure that, as sellers, when a house is put on the market the agent do a CMA to better indicate the home's worth. As a buyer, get similar comps from your agent! But realize that the TRUE VALUE of a property is what someone is willing to pay for it. There is no emotional value added to an appraisal.

Exposing Your Hand During Negotiations: Buyers should never let their love for a house cloud their vision. They need to try to contain their enthusiasm. Otherwise, the sellers and/or their agent will know they've hooked a live one and assume you may forgive certain flaws because they think a particular property is right for them. Also, I always suggest to my clients that when they make an offer on a home that they tell me the amount and I will send a preapproval for that exact amount. If a client is preapproved for $200,000 but is offering $179,000 for a house that is listed at $190,000, they are giving the seller an unfair advantage in knowing that they can afford more!

Opting to Use An Agent That is a Friend of a Friend or a Family Member (aka: choosing the wrong agent): Buyers and sellers should interview several agents from small and from large firms. Get references and success stories. Opting for a friend or family member who is a Realtor doesn't assure one of the best results in all cases and it could cause a rift. Choosing an agent who suggests the highest list price is not a recipe for success and neither is opting for the agent who charges the lowest commission. Remember that the following qualities in a Realtor will usually get the job done right: smart, empathetic, experienced, dedicated and one that pays attention to a buyer's list of wants and needs in a house!

Not Realizing The Other Costs Involved in Homeownership: If a client is preapproved for a mortgage with a lender, that preapproval is based on their gross, not net, income. This means that they may can qualify for a payment that is higher than they may want to spend. Mortgage lenders do not take into consideration, unless it's a VA loan, the cost of lawn maintenance, utility bills, groceries, insurance, childcare, pool maintenance, entertainment, gas, auto repairs, etc. Just because a client can afford $1,500 a month doesn't mean that they should buy a house that uses all of that to pay just the mortgage payment. Because today's largest pool of buyer's are first time homebuyers, it is very important that the Realtor explain all of the other expenses that the client may not realize will be involved with owning a home! Opting for a dream home that may otherwise create negative quality-of-life challenges (ie: longer commutes, higher taxes, bad schools) can cause buyers to question their decisions after a few months. If a buyer purchases a home and finds that the other expenses involved causes them to lose that home or not be able to afford to do much else (house poor), how many referrals do you think they will give you??!!

Not Knowing What They're Signing: The sales contract is a legally-binding document. Buyers and sellers should review it as if their legal well-being were at stake (because it is!). It should address all concerns of both parties, such as who will pay what for closing costs and repairs. A poorly written or incomplete contract can cost time, money and emotional energy and tie up a deal for weeks or months. If there have been any oral commitments, they should be put in writing. Also, realize that just because a house is being sold "as is" per the contract, most lending programs will not let a property close that has certain repairs necessary if they are pointed out on the appraisal (ie: roof leak, exposed wiring, etc.) Always address a dollar amount of repairs that a seller is willing to pay on the contract instead of leaving it blank to make sure that the house makes it to closing.

Not Paying Attention to The Good Faith Estimate: As mortgage lenders and brokers, we are all required to give a client an estimate of the costs involved in the closing of the property. In fact, we are required, BY LAW, to give this to a client no later than 3 days after they make loan application. As a Realtor, go over the estimates with your client! There are unscrupulous lenders and brokers who will intentionally leave certain costs off (ie: escrows) or intentially underestimate the cost of other items (ie: taxes, insurance, title company fees) just so that a client will go with them and then the client finds out too late (at or immediately prior to closing) that they have to bring more money to closing than they initially thought. What do you suppose happens if the client doesn't have the additional money to pay these fees??

Waiting for Prices to Go Down or For Interest Rates To Drop (aka: timing is everything, but maybe not in the sense you're thinking): Right now, mortgage interest rates are at or very close to historical lows. Housing prices have decreased, as well. I read an article that indicates that we are very close to reaching price stabilization. Once that is reached, prices will start to increase. Mortgage rates may go a bit lower, but there is always a chance that they will increase. If a buyer is hoping that the price or rate will drop and either one goes the other way, it will end up costing them. How do you know the bottom is reached until it is too late? Buyers need to get the psychology of "what is my interest rate" out of their head and look at the monthly payment - that is what you write a check for every month! Increasing rates and decreasing prices can cause a mortgage payment to be higher than what it may have been at a higher price! If you have a client looking for to purchase real estate, find out what PAYMENT AMOUNT they feel comfortable with and work back from that instead of calling your lender to ask "what's the rate". Rates these days are contingent on exact credit scores in most cases and while someone with a 740 credit score may be getting a rate of 5.25%, a client with a 650 credit score may end up with a rate that is 1-1.5% higher than that! It's not about the rate - it's about the MONTHLY PAYMENT!

I hope that this list offers you some insight into those things that we see that make buyers and sellers upset and can cause them to change their mind about buying or selling real estate or referring their friends, family and coworkers to you in the future.

If you are working with any buyers in Florida, Alabama, Georgia, the Carolinas or Tennessee, we would love the opportunity to work with them and insure that your deal gets to closing and, if it's not doable, not hesitating to tell you up front!

Update on USDA Income Limit Increases

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Thu, 05 Mar 2009 12:36:45 -0600

I wanted to share the response I received from someone at USDA today on the increase in the income limits. It still sounds very promising!

Here is my ‘canned' response sent to all inquirers. If it happens (we're very optimistic), it will be incorporated at the same time as our regular annual income adjustment, late March, early April, maybe by March 20, depending on when we get data from HUD (for the regular increase).

________________________________

NO guarantee but optimistic. Hopefully around March 20, maybe a little later. It would use the 4-person limit for the 1-4 person households, and use the 8-person limit for the 5-8 person households. Example, for your area, the limit for 1 person, 2 person, 3 person, or 4 person household would be $70,750.00. Again, no guarantee this will happen. They are waiting on final OK from the Obama team.

Please dispel the rumors.

Lenders fund the loans, not Rural Development (RD). Yes, an allocation from the economic stimulus bill is needed in order to issue the Guarantees on your loans. Rural Development has not been shut down or disbanded! It could be business as usual but that depends on the lender, not Rural Development. Most lenders are continuing to fund loans to close. We expect that the ‘stimulus' allocation will be available in a few days, mid March. That will enable any lender that had stopped processing to again offer the fantastic RD product.

Lenders successful with utilizing the Rural Development loan product have learned they can maintain a high volume by continuing business as usual. The Guarantee will come through! The economic stimulus package contains more than double the allocation received last year. In addition, we will soon receive our regular annual allocation.

For an abundance of RD guaranteed residential product information, go to www.rurdev.usda.gov/fl/guarrhs.htm

Thank you for participating in the USDA, Rural Development guaranteed loan product.

The Stimulus Package

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Fri, 13 Feb 2009 18:31:28 -0600

Today may be the day that the American Recovery and Reinvestment Act of 2009 (aka the Stimulus Package) is passed; the Senate is voting on it right now. It is anticipated that it will be on President Obama's desk to sign into law this weekend. While we don't have all of the information about this Act, here are some highlights:

Contains a record-setting $10.472 billion in funding for the USDA Guaranteed Rural Housing Program to insure Rural Housing mortgages. These funds are in addition to funds the program has already received through the Continuing Resolution, as well as additional funding expected from Fiscal Year 2009 Appropriations legislation or further Continuing Resolution legislation. Again: WE HAVE NEVER STOPPED CLOSING AND FUNDING USDA RURAL HOUSING LOANS AND WILL CONTINUE TO DO THEM EVEN WHILE OTHER LOCAL LENDERS HAVE STOPPED AND ARE TELLING YOU THEY ARE OUT OF MONEY!
There was a rumor that the USDA guarantee fee was going up as part of the Stimulus Package; it will remain unchanged at 2.0% for purchase transactions.
There was a tax credit increase requested by the Senate; it has since been scaled down to $8,000 (or 10% of the value of the home, which ever is lower) from $15,000, which is still $500 above where it currently is. This is for any first time homebuyers who purchase homes from the start of this year until the end of November. It starts phasing out for couples with incomes above $150,000 and single filers with incomes above $75,000. Buyers will have to repay the credit IF they sell their homes within three years.

More details will be provided to you concerning the impact of the Stimulus Plan once we go through the final version that is signed into law. Until that time, none of these are in effect yet.

Fannie Mae LOOSENED a guideline - a Step In the Right Direction!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Tue, 10 Feb 2009 06:56:13 -0600

Over the last 18 months, since August, 2007, mortgage guidelines have been tightening due to the conditions of the industry. It seemed that every day since then we have gotten updates from Fannie Mae, HUD, Freddie Mac and our individual investors that made mortgage lending a little tougher, albeit still possible and not as hard as the news media states.

However, on Friday, I received an email from a fellow mortgage lender in the Tampa area with an attachment from Fannie Mae. A while back, both Fannie and Freddie tightened up lending for buyers of 2nd homes and investment properties to the point that they could not purchase additional properties if they already had four (4) mortgaged properties, including their primary home.

I have been interviewed by newspapers and Good Morning, America and my focus has always been the same: they should allow those people who have good credit, sufficient down payment, good and deep credit, and reserves after closing and who have debt to income ratios of 45% or less to buy additional properties. This would help the market because these are the people who would love to scoop up some of the great deals that are available in the real estate market these days. It appears that Fannie Mae listened!

The new Fannie Mae guideline, that goes into effect for mortgages purchased after March 1, 2009, allows buyers to have 5 to 10 financed properties if they meet strict conditions. They have to have 25% down for a 2nd home and 30% down for an investment property. There are reserve requirements dependent on the type of property they are purchasing. There are debt to income restrictions, as well as a requirement for allowing rental income only under certain conditions. But the fact remains: this is the first LOOSENING of guidelines that we have seen in a LONnnnnnnnnnnnggggggg time and it could point to better times ahead!

While Fannie Mae is loosening, I have checked with all of our investors and, so far, none of them are following suit. Some had said that since Freddie Mac hasn't loosened their guidelines that they are not going to loosen theirs. I would like to think that Freddie will follow suit soon and that the investors will then allow us to offer mortgages for buyers of 2nd homes and investment properties with more than 4 financed properties. We just have to wait and see but I truly believe that this is a good sign for the mortgage industry and the real estate industry!

USDA Does NOT Lend Money - So How Can They Be Out???

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Sun, 25 Jan 2009 08:52:40 -0600

It is amazing to me to see how many phone calls we are getting from around the country asking how we can still do USDA Rural Housing loans since they are "out of money"! It is a misconception that the USDA lends money - they don't! Their role in the USDA Rural Housing Loan is to guarantee (insure) the loan against default. That is why the have the 2% funding fee as opposed to monthly mortgage insurance.

Currently, they have used the entire appropriation that was given to them by Congress for FY2009; however, they are still issuing conditional guarantees that say "subject to new Congressional appropriation". In fact, a mortgage lender or broker used to have to reserve funds for this program but this year you don't because they have been told that they have appropriations that are perpetual, meaning that they will be reissued but they have to go in front of Congress to have them signed.

While many lenders and brokers are finding that their investors (the ones that actually DO lend the money) are not willing to fund these mortgages until those appropriations are signed by Congress, we at Northstar Mortgage Group are still originating, closing and funding USDA Rural Housing mortgages. We had one that closed Friday, one closing tomorrow, and two closing on Tuesday and they are being funded! It is up to each individual investor as to whether or not they will take the chance and our investors firmly believe in this program and in Congress to appropriate additional funds for guarantees so they are allowing us to continue to close these types of mortgages.

Because of this lack of belief on the part of many other investors, we even got 4 new mortgages in from other lenders/brokers this week that will be closed by the end of next week. We underwrite the USDA loans in house, we fund with our own money, and are able to get them closed quickly. If you are being told that your lender won't close on this program and you have a contract expiration, please feel free to contact me and let's get your loan closed while others stand on the sidelines saying they can't be done!

USDA Rural Housing Income Limit Increase Postponed

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 14 Jan 2009 06:39:08 -0600

Even though we had it on good authority (we even had it in writing that unless someone complained it would take place January 20), USDA has postponed the 2-tiered income system, which will allow more buyers to qualify for this program, until March 20. I have heard that the reason for this postponement is that they have already used their FY2009 congressional appropriations in the first quarter, from October 1, 2008 - December 31, 2008 (actually, I believe they were used up as of January 9, 2009).

While they have used all of the current appropriated funds, USDA RURAL HOUSING LOANS ARE STILL ABLE TO BE ORIGINATED AND CLOSED! Here in our market, there are several lenders telling Realtors and clients that "USDA Rural Housing is out of money". Congress has promised a perpetual appropriation this year and it is up to the discretion of the lender if they decide to move forward and continue doing these mortgages. Also, it is important to note that the USDA does NOT lend money; they insure loans. The investors are the ones that provide the money and our investors are still doing exactly that.

Here at Northstar Mortgage, we are still able to do them and to get them to closing! We are having no interruption of business with the USDA Program at all. If you are buying a property, or a Realtor who has sold a property, in FL, AL, GA, NC, SC, or TN and need it to get to closing quickly on the USDA Program, please have your client contact me or you can contact me. I hate to think that because some people are not doing these loans while others are that some buyers and sellers may lose the ability to get their loans closed and miss out on the great rates that we are currently able to get. I recently locked in a USDA program mortgage on a 30 year fixed rate mortgage at 4.875% with NO POINTS and NO ORIGINATION FEES! These rates won't last forever so don't miss out on this great opportunity to buy a home, or have your clients get a home, with NO MONEY DOWN!

2008/2009 Mortgage Guideline Changes

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Sun, 11 Jan 2009 16:00:23 -0600

We have now had our first full week of a new year and I wanted to tell you "Happy New Year" and I hope that 2009 will be awesome for you.

As you are aware, there were many changes implemented in 2008 and at the beginning of 2009, and will be more forthcoming. I wanted to give you a run down on them since it affects all of us and how we can get buyers to the closing table. I feel it is a lenders' responsibility to keep you, the Realtor®, abreast of what is happening to help you to keep and grow your business and I take that responsibility extremely seriously!

If you have any questions about the following information, please do not hesitate to contact me! I am going to use bullet points for these changes but please know that there may be a lot of information in regards to each one so this may be a little lengthy. However, I feel it is so important that you should take some time and make sure you read it so that you know how your business has been or will be affected!

· USDA Rural Housing Loan - Increased Income limits/Availability of Funds: Effective January 20, 2009, the income limits for this program are being INCREASED for those persons/families that have 1-3 in the household and for those that have from 5-7 in the household. This will help a larger number of people qualify for this program! **PLEASE NOTE: MANY OF YOU ARE HEARING THAT USDA IS OUT OF MONEY - While they are not currently insuring loans (they do not EVER lend money, only insure the mortgage), we are STILL DOING THEM AND EXPECT NO INTERRUPTION OF THIS PROGRAM! I am a national trainer for this program and have been in contact with personnel at the national level of USDA and we see this continuing uninterrupted for us based on how we are set up with the USDA so please, if you have any current loans in process somewhere that were going USDA and have been told they can't do it, which IS happening, have your client call me and let's get them closed before their contract expires!

· Maximum Mortgage Amounts: FNMA has kept their conforming loan limits in our area to $417,000. FHA has DECREASED the maximum loan limit in Okaloosa, Walton, and Bay Counties as follows: Okaloosa: $271,050 (was $312,500 in 2008), Walton: $325,450 (was $362,790 in 2008), and Bay: $271,050 (was $396,250 in 2008). In Santa Rosa County, it remains in 2009 where it was in 2008, which is $271,050.

· Repairs to Properties that Are Being Purchased: Many properties being sold are short sales or foreclosures and are being sold "as is". In some cases, the condition of the property isn't such that a lender can do a mortgage secured by the property and sales are falling by the wayside. Please note that there are programs available where a buyer can finance in costs of repairs and close prior to those repairs being completed. On an FHA loan, the maximum amount of the repairs is $35,000; on a USDA Rural Housing loan, the maximum amount of the repairs is $6,650. In the case of the USDA, these most be repairs that are noted by the appraiser on the appraisal; in the case of the FHA, a buyer can purchase a home and remodel the kitchen (amongst other allowable projects) and finance the costs and they do not have to be noted in the appraisal!

· Conversion of primary residences to investment property or 2^nd home: (This is used for FNMA, FHLMC, FHA, USDA, and VA currently; the only exception is if the buyer is transferring or moving a long distance.) If you have a buyer that is purchasing a new primary home but who will still own their current primary home when they go to closing, there are restrictions as far as being able to approve the new mortgage. In order for a client to rent their old home AND use the rental income to qualify, they MUST HAVE 30% equity in the old home. No ifs, ands or buts on this. If they do, and we have to verify that they do, we can use 75% of the lease amount to count against their mortgage payment. We would have to have the lease, a copy of the deposit check from the tenant, AND a copy of the receipt where the buyer deposited the security deposit into their bank account. If they don't have the 30% equity, the buyer must qualify for both payments AND have documented reserves (money in the bank) after closing of 6 full months of PITI (principle, interest, taxes and insurance) for BOTH PROPERTIES. If they are converting their current primary to a 2^nd home, the same applies as far as qualifying with both payments and having the 6 months' reserves for both properties.

· Ordering of appraisals: Currently, we are able to select the appraisers from our list of approved appraisers. On May 1, 2009, there are new guidelines in place referred to as the "Home Valuation Code of Conduct", or HVCC for short. Here is a link to this code but, in essence, mortgage lenders, brokers and bankers will no longer be allowed to be involved in the selection of the appraiser, nor to have contact with them or even give them an estimated value of the property past sending them a copy of the sales contract for purchases. We are still learning about this code and how it will affect us and I will keep you abreast as I find out more. You can read the code here to see it in its entirety and how it may affect you and your clients.

· Stated Income Loans: There are many schools of thought as to what caused the mortgage meltdown last year and a lot of people feel that the stated income and no doc loans were the biggest cause. Investors, for the most part, have done away with these loans and those that still offer them require the buyer to sign a Form 4506-T. This form is the Request for Copy of Tax Forms that is sent to the IRS to determine that a borrower's income qualifies them for the loan. These are being executed prior to closing so, in essence, a stated income loan these days is ONLY FOR CONVENIENCE TO A BORROWER - their income is going to be verified before closing. The sole purpose of a stated income loan these days is so that a client doesn't have to find and send their tax returns to the lender; the lender will still be verifying their income.

· How Bankruptcy and Foreclosure (including deed in lieu and short sales) Affect the Ability to Buy a Home in the Future: In August, FNMA developed new guidelines for how long a potential buyer must wait after certain actions that are reported on their credit report. For instance: There was no existing policy on how long a person had to wait if they had multiple bankruptcy filings, except the 2-year that WAS required for a Chapter 13; now, a person with multiple bankruptcies must wait 5 years from the most recent dismissal if they have had more than one BK in the last 7 years. It used to be that they had to wait 4 years after the date the foreclosure sale was completed it is now 5 years with additional requirements that apply after 5 years and up to 7 years.

· Down Payments and FHA: The downpayment assistance program, ie: Nehemiah and Ameridream, that were used to help buyers using the FHA mortgage program have a gift of the downpayment from a charitable organization was completely done away with. Also, effective January 1, 2009, the down payment required on an FHA mortgage went from 3% to 3-1/2% in all cases.

· Condos or Attached Properties in Florida: Most investors, and certainly FNMA, FHLMC, FHA, VA, and USDA will no longer allow mortgages on properties that have one or more of the following: the word "resort" in the title of the project, the availability of nightly or weekly rentals within the project, an on-site rental desk, a large percentage of delinquent HOA dues, housekeeping services, electricity that is not on an individual meter, etc. Because of this, we are unable to offer fixed rate mortgages in projects that exhibit one or more of these traits. HOWEVER, we have found alternative lenders offering portfolio programs, which are ARMs in all cases, and CAN STILL FINANCE THESE CONDOS AND CONDOTELS! There are larger down payment requirements that in the good old days, but we are able to assist your buyers and get these units closed. These days, underwriters are googling the name of the project and if they find these traits, we are dead in the water except with these portfolio programs. Also, many investors have stopped allowing above 80% financing on attached units in Florida, and some cap that at 70%! These are townhomes, not condos, and we are able to still finance them up to 100% in many cases so please make sure to have any buyers you have that need financing call us.

· Mortgage insurance - Mortgage insurance, or PMI as many refer to it, has changed tremendously. There are currently no mortgage insurers that will insure a 2^nd home or investment property in the state of Florida. This is why it has become basically impossible to find a 2^nd home or investment property mortgage with less than at least 20% down, and in some cases even more.

· Maximum Number of Financed Properties: Effective in 2008, most investors have now limited the maximum number of financed properties a buyer can have to FOUR, including their primary home. This includes properties that are owned in a trust or LLC and properties that they own with someone else personally. This does not include commercial or multi-family housing properties above 4 units but does include 1, 2, 3 and 4-unit properties. **This is one of the biggest points I made during my interview with Good Morning, America - if they would allow those people who truly qualify for more than 4 to purchase, there would be a lot more sales nationally as many people would love to scoop up the great deals but are unable to secure financing. If they have good credit, good (and deep) reserves, a history of having rented property, and their debt to income ratio including all of their properties is under 45%, is, in my eyes, ridiculous to not allow them to purchase a property! They should allow this and, to insure themselves, set up a fund, much like the upfront mortgage insurance on an FHA loan, that keeps funds available should any of these buyers default!

While these do not represent all of the changes made and upcoming, these are the ones that most affect us at this time. I will make sure to keep you informed of any and all changes that come out so that you are better able to perform your job and get your buyers to closing.

How Many Homes Can Be Sold With a Start Rate of 3.25% on a Fixed Rate Mortgage that Ends Up at 5.25%??

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Sat, 27 Dec 2008 07:44:20 -0600

Imagine this: You, as a Realtor have a house listed for sale and a motivated seller. This seller is willing to pay up to 4% to 6% or higher towards the buyers' closing costs and prepaids. You have a prospective buyer that qualifies for a USDA Rural Housing Loan (the income limits starting January 20, 2009 are much higher than where they currently are).

Imagine now that you send your buyer to Northstar Mortgage Group for their financing. They don't have a lot of cash to use towards closing and their credit score is a 580. Imagine that they are told that they can get a 30 year fixed rate mortgage and that the rate the first year will be 3.25%, the second year will be 4.25% and that years 3 through 30 will only be at 5.25% AND that they have to bring NO MONEY WHATSOEVER to closing. Could you sell that house?????

We are able to offer this program in a large number of areas of Florida, Alabama, Georgia, Tennessee, North Carolina and South Carolina. Many prospective buyers are fearful to even consider trying to get financing because of all that they are hearing in the national media but this program IS available!

If you are a buyer, you need to know that you can get financing as long as you qualify for the payment. If you recently started a new job and know that in a couple of years your income will be higher, this is perfect for you! If you recently graduated from college and are just getting started in your field, it is an ideal solution for you. If you recently got married or divorced, this program works for you! If you have owned before or have never owned before, this is a great way to buy a new primary home now. Why wait? Rates and prices are low and may start to go up. You can actually own your own home for less money that you currently pay in rent! STOP PAYING YOUR LANDLORDS' MORTGAGES!

You can email me for additional information or make application at my website. DON'T DELAY - the rates may never be this low again!

With Rates So Low, What Happens If I Lock in a USDA Loan and Don't Get to Closing on Time??

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Thu, 18 Dec 2008 08:03:42 -0600

Currently, the investor we use for our USDA Rural Housing loans offers two rate lock extensions up to 60 days each, so that you can actually get 120 days extension. They do charge for this and we have been told that, effective today, December 18, 2008, the price (charge) to extend is going up. This price is charged as a one-time fee and is NOT an increase to your current rate.

Here are the new costs for extending a rate lock in:

1 day extension - No Charge, but can only do 1 free 1-day extension, not 2

7 day extension - .125% (this remained the same as it was)

15 day extension - .375% (was .25%)

30 day extension - .500% (was .375%)

45 day extension - .625% (was .500%)

60 day extension - 1.00% (was .75%)

We have to request a lock extension ON OR BEFORE the current rate lock expires. Once it has expired, it can't be extended. Loans may be extended a maximum of two times, which means that if a loan is extended for 1 day and then needs an additional 15 days, for example, the total cost will be .375% for 16 days. The maximum extension time would be 120 days - can extend twice and 60 days is the max for each one.

If a lock expires, it has to be repriced subject to the higher of "worse case" pricing (were the rates higher on the day you locked or on the day you are repricing it - that is what the new pricing will be). If expired less than 30 days, it will be locked at the existing locked price or the current market price, whichever is worse, PLUS THE COST OF AN EXTENSION FEE AS NOTED ABOVE for the number of days. Obviously, it is a lot less costly to extend the loan rather than having to let it expire and relock it.

However, if the lock is expired for 30 days or more, it would be priced at the current market price with no extension fee.

Obviously, if you have a loan that is currently locked, it is very important that the borrower, the seller, the lender, the Realtor® and the title company all work together to try to get the loan closed prior to the rate expiring. If that isn't possible, there will be fees associated with extending so it is important that a loan not be locked in too early!

Good Morning, America interviewed me for show on MONDAY, DEC. 15

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Sat, 13 Dec 2008 10:18:29 -0600

I was interviewed Thursday for a show that is supposed to air on Monday, December 15 on Good Morning, America. It's about the housing market and how to help people who are behind, as well as what steps could be taken to improve the housing market. I made the following points, but they may edit a lot of it out. I hope you get an opportunity to watch! Thank you to Beth Forbes for part of her ActiveRain post - I made SURE to get that out there, as well!

Until we get housing out of it's "deep depression", the rest of the economy doesn't stand a chance and people won't buy cars until their housing is fixed!. Let's get a government program together that lends money to people who already own multiple properties, who have excellent and deep credit who actually WANT to buy up the over supply of inventory. There are a large number of investors who own multiple properties that actually produce income for them who would just LOVE to buy up some of the great deals available right now but are hamstrung by current lending guidelines that say they can't own more than 4 financed properties. They need to let QUALIFIED investors purchase real estate even if they have more than 4 mortgaged properties already! If they have good and deep credit, have low debt to income, say under 45%, using verified income, have a history of managing rental properties, and have reserves, they could HELP the housing slump by purchasing excess inventory; as it is, with the limitation of FNMA and FHLMC, they can't buy if they own 4 mortgaged properties already which includes their primary home unless they have cash or get portfolio loans which are higher down payments at higher interest rates, which don't make sense for them and they limit the properties they purchase. You can even have it where they must pay an upfront "loss reserve" payment similar to the upfront MIP on an FHA loan and monthly "loss reserve" payments much like monthly MI. Any plan that does not include provisions for these people is underutilizing a private sector solution to what is becoming a government problem.
Investors/lenders need to work quicker on approving short sales (selling a house for less than is owed on it). There are many people who get fed up with the time it takes to get a short sale approved and they end up withdrawing their offer to purchase a short sale - I just had one withdraw that has been trying since JUNE to get a shortsale approved. A lot of times, they end up selling the same properties later on for $20, 30, even 40,000 LESS than the original offer that withdrew because of the time it takes! This costs banks even more losses and it could have been avoided! They keep saying that they have more requests for short sales than they do people to handle them, so they could fix 2 problems: HIRE SOME OF THE UNEMPLOYED PEOPLE AND TRAIN THEM!!!
They need to do more loan modifications for the current owners and this will also SAVE the banks money - instead of losing principle in a short sale scenario because an owner can no longer afford their payment, they will get paid the money but it may be at a lower rate or over an extended time. And they need to make the process less difficult - there are loan modification companies popping up daily and they charge the clients $995 upwards of $4,500 - I don't think this is how the government intended this process to work! Also, a modification needs to BENEFIT the client - I have had several calls from folks that were approved for modifications but their new payments were HIGHER! Banks are borrowing money at the Fed Fund Rate, which is like 0,5% so if they reduce the rate on the current owners to around 4% they are still making money and they can potentially get their entire principle back.
People need to understand that Hope For Homeowners, the latest program HUD has come up with to help people, is not working. HUD doesn't lend money; they insure loans and although they created this program, those entities that do lend money and securitize the loans are not willing to work with this program in its current form.
People CAN STILL GET FINANCED with credit scores under 700! The news media, and even Donald Trump on Greta Van Suystern keep saying you have to have 20% down and a 700 credit score. UNTRUE! We can still do 100% financing with 580 credit and 97% down to a 500 credit score to get people in a house they can afford and we verify that they can afford it! We are financing homes for people that end up costing them $100, $200, even $300 a month LESS than they are paying in rent but most people are afraid to even try because of everything they're hearing in the news. With the rates as low as they are and with the sales prices down so much, now is a great time for people to buy but the news media has them too afraid to try. The people who can qualify to buy homes are afraid to finance, afraid they don't qualify, afraid they don't have enough money for down payment and closing costs. The people who qualify are also afraid to buy, afraid that they will over pay, afraid that the bottom hasn't been reached, afraid they may lose their job.
Foreclosures should be slowed down tremendously - if the banks were to foreclose on all of the houses in which the owners are delinquent, they would end up losing so much money that they would either go bankrupt or need even more for a bailout! At that point, who would even want to bail them out when they have the opportunity NOW to assist in fixing a part of it. Sure, mortgages were given to people that probably shouldn't have been (at the government's insistence through the CRA, which, if you add a P to it is CRAP!) but you can't go back and change that fact now - we need to work with these owners to do everything we can to keep them in their houses to help our economy and to help their neighbors - if a house is foreclosed on, it affects the value of all of the houses in that particular neighborhood in a negative way! The problem with home values is that banks continue to foreclose and there aren't enough buyers to keep up with the supply.
The average person did not create this situation but they are the ones that will have to pay for it at some point in the future in the form of higher taxes to cover the money that was given for the bailouts. These are the people that need to be helped since these are the ones that will end up paying for the bailouts!

USDA Rural Housing Program - Buyer Can Get 2/1 Buydown with Start Rate of 3.75%! Less than 4% is HERE!!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 10 Dec 2008 00:13:43 -0600

Based on today's rates, a buyer can get a 30 year fixed rate mortgage on a 2/1 buydown (rate is bought down 2% the first year and 1% the second year) with a rate of 3.75% the first year, 4.75% the second year, and 5.75% years 3 through 30! This gives you a better payment and cash out of pocket at closing than does a VA or an FHA loan!

There is a cost to do this of 2.1% of the loan amount and this can NOT be paid by the buyer - it can be paid by the Seller, the Realtor or the Lender, but NOT by the buyer. The price to do this and the rates that will be given can and do change daily and this is the rate as of today, Tuesday, December 9.

If you are a Realtor® with a very motivated seller, this program may be the perfect way to get your listing sold! If you are a seller looking to move fast, this may help you achieve that goal. If you are a buyer, this is a great program that will allow you to get in to the home of your dreams at a lower than usual rate that will gradually increase but it does cap at 2% over the start rate, hence the term 2/1 buydown!

Please feel free to contact me to discuss this, and other programs!

Proposed Income Limits for USDA Rural Housing Loan Program Go Into Effect January 20, 2009

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Thu, 04 Dec 2008 18:45:12 -0600

As long as nobody complains, the proposed income limits will go into effect on January, 20 for the USDA Rural Housing mortgage program. The tables below are for FLORIDA only; other states will have the increases, as well, but the amounts will vary. This is for 100% financing that also allows a buyer to finance their closing costs!

CURRENT TABLE

County	1-Person	2-Person	3-Person	4-Person	5-Person	6-Person	7-Person	8-Person
All counties except those listed below	49,950	56,600	63,700	70,750	76,400	82,050	87,750	93,400
Clay, Duval, Nassau, St Johns	51,400	58,750	66,100	73,450	79,350	85,200	91,100	96,950
Collier	56,200	64,250	72,250	80,300	86,700	93,150	99,550	106,000
Gadsden, Jefferson, Leon	50,000	57,150	64,300	71,450	77,150	82,900	88,600	94,300
Palm Beach	55,700	63,650	71,600	79,950	85,900	92,300	98,650	105,000
Okaloosa	50,850	58,100	65,400	72,650	78,450	84,250	90,100	95,900

Broward, Pinellas, Monroe are not eligible

PROPOSED TABLE

County	1-4 PERSONS	5-8 PERSONS
All counties except those listed below	70,750	93,400
Clay, Duval, Nassau, St Johns	73,450	96,950
Collier	80,300	106,000
Gadsden, Jefferson, Leon	71,450	94,300
Palm Beach	79,950	105,000
Okaloosa	72,650	95,900

Broward, Pinellas, Monroe are not eligible

For each person over 8-persons, add 8% of the 4-person limit.

NOTE: This is not an income increase for the 4-person and 8-person households. It simply removes the tiers for the 1-3 and 5-7 person households. It does have the effect similar to an income increase for those families in the 1-3 and 5-7 groups.

Reminder: These are NOT gross income limits. THE TOTAL ADULT HOUSEHOLD INCOME CAN BE MUCH HIGHER THAN THE "ADJUSTED" INCOME LIMITS IN THE TABLE. Deductions are allowed for: child care (12 yr old or less) to allow employment of the adult; $480/annual for each non-applicant under age 18; $480/annual for full time student over age 18; and $400 if anyone is elderly or handicapped. If the gross adult household income is less than the limit, you are good to go. If the income is over the limits, use the adjustments.

Contact me right away and let's get you or your clients into a new home by Christmas!!!!

Northwest Airlines Customer Service lacks Customer Service

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Tue, 02 Dec 2008 18:33:20 -0600

Recently, I traveled on Northwest Airlines to Washington, DC for a 30th high school reunion. The night before I traveled, I called about getting exit row seats as I am tall (5'9") and my back has problems occasionally that are aggravated by the cramped seats in the other rows. The gentleman I spoke with told me that I had to do it online, which I did, and I was charged $45 ($20 for one flight that lasted about 50 minutes, and $25 for a longer flight, about 1-1/2 hours). However, on BOTH FLIGHTS, there were seats available in the exit rows that weren't taken. The flight attendants watched as other passengers, who were not assigned these seats nor had paid for them, took them. I then emailed Northwest when I got home as I felt that I should be refunded the money since other passengers got the same exact seats that I had paid for with no additional charge being incurred by them.

I received the following from Northwest and thought I would take a moment to share it with you as I know many of you do a lot of traveling. I would suggest that you fly on airlines other than Northwest that do still have good customer service, ie: Continental or Southwest Airlines. In fact, on the flight itself, I sat next to someone who told me that he was only on the Northwest flight because he had to get home and it was the only one available and that their lack of customer service was the reason he hadn't traveled on Northwest in over 2 years - and he logs about 50,000 air miles a year, he stated!

NW/KL Passenger Refund Form:

Message:

I reserved an Exit Row Seat on this flight and on the next one, Flight #1642 from MEM to DCA. I paid $20 for one leg and $25 for the other leg for an exit row. When we were on the plane, there were some exit row seats that were not taken and other passengers used them. I feel that I should NOT have to pay for something that others got for free and would like a refund of the $45 I paid! The stewardess on each flight saw the people move and never had them move out of them. I feel that because I was able, willing and ready to provide emergency help to your other passengers, I should not have had to pay for that SINCE OTHERS GOT THE SAME THING FOR FREE.

I would like to hear back from someone asap at sue@northstarmg.com Sue Botelho

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From: Northwest Airlines [mailto:Northwest.Airlines@nwa.com]

Sent: Tuesday, December 02, 2008 5:57 PM

To: Sue Botelho

Subject: Re: PR-Other: (KMM19133233V7905L0KM) Dear Ms. Botelho,

RE: Case Number 6639069

Thank you for sharing your concerns regarding your recent travel with us. On behalf of everyone at Northwest Airlines, I am sorry for your disappointment with the fee you had to pay for the seat fee when others sat in the seats without paying the fee.

We offer customers the opportunity to purchase Coach Choice seats on select flights when using self-service check-in within 24 hours of scheduled flight departure time. The program offers choice seats for a minimal fee, based on distance traveled and seat location. I am sorry other passengers moved into these seats who had not paid for them.

However, you paid the correct fee for the seats you sat in and I must respectfully decline your request for a refund.

As our WorldPerks member, your business is important to us and given the opportunity of serving you in the future, I am confident Northwest will not only meet but exceed your expectations.

Sincerely,

Sarah Sanders

Customer Care

Northwest/KLM/Delta Air Lines

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Please cancel my WorldPerks account. I will no longer be traveling on Northwest. We have had new airlines come to our airport and it won't be necessary to give my business to someone who would charge one client and not another FOR THE EXACT SAME SERVICE. Thank you.

Sue Botelho

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Dear Ms. Botelho,

RE: Case Number 6639069

Thank you for writing and allowing me the opportunity to further review your concerns. I am sorry you were dissatisfied with my first response.

I understand you feel I have not adequately addressed your concerns.

Please know that I thoroughly reviewed your correspondence and unfortunately, there is nothing more I can add. I am truly sorry to disappoint you, as I understand this was not the answer you were expecting.

Again, I apologize. Your support is important to Northwest and I thank you for your additional time and effort. We look forward to the privilege of serving your air travel needs again soon.

Sincerely,

Sarah Sanders

Customer Care

Northwest/KLM/Delta Air Lines

100% Financing with Rate Under 4%???? Is it possible????

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Mon, 01 Dec 2008 23:44:37 -0600

YES!

With a 2/1 buy down program under the USDA Rural Housing Loan program, you can get a rate of 3.75% for the first year, 4.75% for the second year, and 5.75% for years 3 through 30!!

The buyer can't pay the fees to get these rates as it has to come from another party, ie: the seller or the Realtor but it's a program that is great for using if you are anticipating higher income over the next 24 months!

Call me at 850-424-6866 or email me at sue@northstarmg.com for further information. You can even "move in for a penny" on this program. So why wait if you're thinking of buying a new home in Florida, Geogia, Alabama, the Carolinas or Tennessee!

Thanksgiving Treat from the Fed!!!!!!!!!!!!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 26 Nov 2008 11:50:45 -0600

A Thanksgiving Treat from the Fed

Happy Thanksgiving - Mortgage Rates Plunge!

30 Year Fixed as low as 5.5% with no points/orig. fee for 100% Financing!*

Motivated Seller or Builder can Buy Down the Rate Temporarily for their Buyer To Get 30 Year Fixed Rate at 3.75% 1^st year, 4.75% 2^nd year, and 5.75% Years 3-30 For 100% Financing!!!*

Finally, some good news for the mortgage industry! In a move to increase credit availability, the Federal Reserve and Federal Home Loan Banks announced that they would purchase up to $600 billion in Mortgage-Backed Securities (MBS), exciting news that sent interest rates for 30-year fixed-rate mortgages plummeting below 6.00% and near the lows for the year!

If you have been on the fence about buying or refinancing a home, now is the time to act. Interest rates are extremely low and home prices in some areas are at 2003-2004 levels. Add to that recent declines in energy prices and lower consumer interest rates, and you have a great holiday recipe for success, but only if you give us a call.

Don't wait until next week. Call us today and get pre-approved. Rates have already been very volatile and this opportunity might not survive the holidays. In many markets, falling prices are bringing out buyers that have been waiting to buy and they are scooping up both bargains and hot properties. Let me offer you some pointers to help you negotiate a great deal and lower your costs to close.

Whether you are looking to buy or refinance, call me today. I'm here to help. If we don't speak before Thursday, however, I wish you and your family a wonderful and Happy Thanksgiving.

*Buyer must qualify with their income; property must qualify as has geographical restrictions. Can also finance all closing costs the seller doesn't pay into the mortgage so it truly is a NO MONEY DOWN mortgage program!!!*

How to SAVE the housing industry..........

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Tue, 25 Nov 2008 10:28:08 -0600

A friend of mine in Maryland was sent the following by a fellow employee of his yesterday. They both work for Mason Dixon Funding, a mortgage company. Brad Cohen sent this as a letter to the editor of the Washington Post newspaper. It hasn't been printed yet but he (Brad) told me that I was more than welcome to share it on this blog with you! I think it makes a lot of valid points that the Government needs to address, as do the banks and investors and servicers of mortgages. Please comment on this and let me know your thoughts - I will be sharing them with Brad!

Sent to the editor at Washington Post yesterday. Ken harney

Good Morning Ken,

My name is Brad Cohen, and I have been a loan officer at Mason Dixon Funding Inc since July 1997. I was recognized as #94 in the country, for loan originators, last year by Mortgage Originator magazine. I have looked forward to your column every weekend as you give your readers the truth about what is happening in the world of Real Estate and Mortgages. I would love one day to speak with you in person or on the phone, but I know you must be the 2nd busiest person in America, as the rapid changes in our industry have you working around the clock to stay on top of it. Henry Paulson, in my opinion, is the busiest, as he is constantly using smoke and mirrors to keep the truth away from the American people. J

As an American, I am embarrassed and disgusted with our leadership in this country and I know we must be mocked around the world as we cannot get our hands around this mortgage meltdown and real estate crisis. The problems are a result of greed on everyone's part. The banks have been downright nasty and unwilling to help struggling homeowners out, as they have made this problem not only limited to subprime, but now every person who owns a home a victim. Last summer, when the Fed repeatedly said this was going to be contained to subprime, was when I knew Bernanke and crew were so far behind the 8 ball as subprime represented such a small portion of the loans in our industry. I knew the negative amortizing loans done by WAMU, Indy Mac, Countrywide, World Savings (purchased and now owned by Wachovia), and Chevy Chase bank were the most toxic loans ever created. Where are these banks now? Chevy Chase's days are numbered in my opinion. These loans, typically given to good borrowers, had low start rates and they had pre pay penalties for anywhere from 1-3 years that forced a borrower to stick with it as the deferred interest mounted. There was a fantastic article on Sept, 11, 2006 in Business Week about "How Toxic is your Mortgage" and I knew somebody else agreed with me that the phantom profits for these banks would come to an abrupt end.

I am regularly featured on Channel 9's Mind Over Money and the callers I hear from constantly tell me that their banks won't help them modify their loans because they owe more than the houses are worth. The pain I hear in these callers voices is quite troubling as the banks making these decisions are again, greedy and looking for the most return on their money. If they had started modifying loans last year when this started, we would be in a much better place now. If a bank modified someone's loan and dropped the rate, and not reduce the principal balance even with the negative equity, they would receive monthly payments and would not have the potential of a house going to foreclosure, losing the monthly payment revenue, and now the bank is left paying the utility bills, taxes and maintaining the property all while they have instantly dropped the price of the house usually hundreds of thousands of dollars to move it off their balance sheet. If they dropped the rate, and the payments dropped $400 per month, they would miss out on $4800 per year. Why not go down that path rather than write off $100K or more in a short sale or a foreclosure? The numbers make total sense. Keep the homeowner in the house and the values will stop freefalling. I cannot tell you how many people I speak to that actually think that the foreclosures have not affected the values where they live. They say that the comps are low because "they went to foreclosure", when the reality is the comps are all made up of foreclosures and short sales, that is the new value PERIOD!! Also, when people are foreclosed on, they do not usually leave peacefully, as I have seen massive acts of destruction as walls are kicked in, appliances removed, paint spilled on walls and carpet, and people leaving their last thoughts as the banks have taken their homes from them, even the ones that tried desperately to work out a plan and stay.

When Fannie and Freddie tightened guidelines last year, I told our rep that they have just guaranteed that housing will plummet due to the tighter restrictions. If you qualified to buy your house with an IO payment, and now you need to qualify using the Principle and Interest payment, nobody will qualify anymore as they stretched themselves in 2004-2006 to just be able to buy in what was a crazy market. The fact that you need a 740 credit score to get the best rate and if you have lower than 680, will cost you dearly, does not promote home ownership, but curtails it significantly as the average person has a 695 score. Another absurd guideline is the 4 financed property rule. You cannot buy a house if you already have 4 financed properties. Basically, they are guaranteeing investors that they cannot scoop up the inventory and fix them up and resell them which, by the way, creates jobs. The 25% down payment is a bit excessive but not totally, as having skin in the game makes you more responsible and less willing to walk away. The rates though on these have jumped to almost more than 1% over owner occupied where they were only .25% to .50% higher previously. Now is not the time to tighten too much as you need to create a stimulus to buy.

I have been saying for the last year, to drop everyone's rates to 3%-4% and reward all homeowners, not just the ones who had late payments as you are rewarding poor performance. We do not need to teach people that being irresponsible will be rewarded in lower payments and reductions in principle. I do not agree in reducing anyone's balance, but if you drop the rates and extend the terms, you would put a floor under the housing market. I cannot believe that Paulson, Pelosi, Reed, Cox, Dodson, Frank and President Bush have not done more to help our country. They are so far removed from Main Street and they try to act like they care. When you come up with stupid programs like FHA Secure which has supposedly helped only 4000 homeowners since it began in 2007, and hope for homeowners again with lower than dismal performance, you are not doing what you can to help. When the foreclosures went to 81,000 in September, and then 85,000 in October, a light should be going off to say "Hey Washington, It Isn't Working!" Why are these supposed leaders not consulting with Mortgage Experts? Real Estate Experts like Barry Habib, Donald Trump, Robert Toll, and Barbara Corcoran. To have the $700 Billion deal try and get rushed through in one weekend with people at the helm with NO REAL ESTATE backgrounds was astonishing. The plan was flawed when Paulson yelled fire in a crowded room and the markets plunged from that point on. Every time Paulson speaks, the market sells off as he has no credibility and certainly no charisma to give the American people hope. We all need hope and faith and our leaders have let us down yet again, and not one time have I heard anyone say "I am Sorry." It blows my mind that not one person has taken responsibility for this, and they all point the finger at each other. Republicans, Democrats and everyone in between are responsible, and should act like people of character, and take ownership and show leadership to this problem and move on.

As a country, we cannot wait for Obama to get in office and start getting us out of this as everyday, the ship is sinking further. We need action now, and Paulson should listen to Sheila Bair, as she knows about banking and she knows the current plans are not working and will not work. We are basically throwing a cup of water on a burning building. I wonder if they will get it when we cross the 100K mark for foreclosures in November. When it was announced that the foreclosures by Fannie and Freddie would cease until after the holidays, I said whoopee, let's give another 40 days of unresolved solutions. We need to create a stimulus for housing again and give homeowners a real tax credit( and not a loan over 15 years) of $10,000-$25,000 depending on sales price as people who own homes spend money furnishing them and making them theirs. The spending stimulus will save this economy from the greatest depression we will ever see. I appreciate your time and look to you as the voice of reason and hope.

Sincerely,

Brad Cohen

Hope For Homeowners Appears Hopeless...........

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Mon, 24 Nov 2008 23:32:30 -0600

HUD had announced a program that was to start on October 1, 2008, to help those homeowners who are (a) past due on their mortgages and/or (b) upside down (owe more on their home than it's worth). Without going into details, this program was to help keep people at risk of foreclosure in their homes.

The national training was held a couple of weeks ago in Atlanta. My partner attended. The training was on Thursday and Friday, all day each day. Mike, my partner, called at about 10:30 on the first day to tell me that he was leaving. He had asked some questions and found out that (a) at this point, it isn't a program that any investors are willing to do, (b) in its current form, the Wall Street securitizers aren't willing to purchase this loan as there are too many ways that fraud can be committted and (c) unless Congress passes additional legislation, this program won't ever bgin.

We have now gone back to find other ways to help those who called us for the H4H program. We had gotten applications on a large number of people but hadn't put them into process nor pulled their credit. We had to try to figure out options for these people, which we have and are still working on. However, it did cause me to try to figure out how homeowner's can be helped and I wanted to share.

A business associate that I did a conference call with last week, Jeff Misaud of fhasuccessdesk.com, told me about 'the Three Stages of a Foreclosure" that an owner goes through:

Denial - most people avoid dealing with the fact that they are already late or that they won't be able to make their mortgage payment. If mail comes to them from their mortgage company, they lay it aside and never even open it. They think that if they avoid it, it will go away.
Disgust - this is the phase when a large number of people start experiencing depression. In many cases of married people, fighting amongst themselves begins. Financial stress is probably one of the number one causes of divorce and it is at this point that the reality is starting to hit and people realize that they are going to literally lose the roof over their head.
Destruction - many people who are being foreclosed upon cause damage to the house in retaliation of the foreclosure. We have seen holes punched in the walls, cabinets and fixtures removed, appliances taken, and in one case, someone took the entire stairs out of the interior of the house. There is nobody to blame for what has heppened so people blame their mortgage company and feel that in damaging the house, they are causing the mortgage company to have to pay out money, which evidently makes them feel better, at least temporarily.

The first thing a person needs to do when they realize that they can't make their mortgage company is to CALL THEIR SERVICER (the company to whom you make your payments). Now is NOT the time to avoid what is happening - you must be proactive not reactive. Keep in mind that your servicer does NOT want to take your home in most cases! If you ignore the problem, it will still be there and the best way to help yourself is to contact your servicer right away and explain what is happening. In a lot of cases, they will put you through to other individuals or organizations that may be able to help you.

If you are upside down and/or late on your mortgage, there are FREE housing counseling companies that may assist you. A list of these can be found at http://portal.hud.gov/portal/page?_pageid=73,1827662&_dad=portal&_schema=PORTAL. At this same webpage is a list of other ways to avoid foreclosure and keep your home. It is suggested that you contact one of these counselors and ask them to assist you (they are paid by the Government from money appropriated by Congress when they passed HR3221).

If you are finding it difficult to make your mortgage payment, you will need a new, tightened budget. Prioritize your bills and pay those most necessary for your family: food, utilities and shelter. Failing to pay any of your debts can seriously affect your credit rating, but if you stop making your mortgage payments you could lose your house.

A homeowner should know the statutes pertaining to foreclosure in their individual state. Contact an attorney, if necessary, and you may find that there are ways to either prolong or completely cancel a foreclosure action! This additional time will allow you, perhaps, to sell the house and avoid the foreclosure or, in extreme cases, to have the foreclosure overturned and never filed again. It's certainly worth the time, and in some cases, expense, of finding out. There are financial and legal services that are available to you to assist with these statutes. You can check out this webpage, http://www.hud.gov/local/fl/homeownership/foreclosure.cfm, for additional information on the statues, as well as your rights and/or resources available in any given state in the US.

Be extremely leary of foreclosure rescue companies. While there may be a large number of them that can and do help, we have found that, for the most part, a lot of these companies are scams and will have you out of even more money with no results.

If you have contacted your servicing company and aren't getting any results, and the housing counselors aren't able to help you, there are companies springing up that are known as loan modification companies. These companies, for a fee, will work with your investor/servicer to have either the rate on your current loan lowered, either termporarily or permanently, have the term (# of years/months of your mortgage) extended, and/or in more rare cases, forgive part of the debt to help lower your payment.

While there are some excellent loan modification companies, there are some unscrupulous ones who charge you high fees and don't do any work towards modifying your mortgage. It is very important that you screen these companies or get a referral from someone (we work with a highly reputable company that is getting great results for our clients). Don't use Google or the Yellow Pages to find one of these companies!

I know that having problems making your mortgage payment can take a toll on you, both physically and mentally. It's important that you be involved in trying to resolve this and, if you need assistance, you hire someone to help you that has proven results. This is your home we are talking about......not just a house!

2009 FHA Limits For Florida

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 12 Nov 2008 16:54:05 -0600

HUD has come out with their maximum loan limits for 2009. In the state of Florida, the following will be the maximum loan amounts that will be insured by an FHA loan:

2009 FHA Limits - Florida

All areas except those counties listed below:

One-Unit $271,050

Two-Unit $347,000

Three-Unit $419,400

Four-Unit $521,250

One Unit Two Unit Three Unit Four Unit

Monroe County	28580	FL	$529,000	$677,200	$818,600	$1,017,300
Collier County	34940	FL	$448,500	$574,150	$694,000	$862,500
Broward County	33100	FL	$345,000	$441,650	$533,850	$663,450
Miami-Dade County	33100	FL	$345,000	$441,650	$533,850	$663,450
Palm Beach County	33100	FL	$345,000	$441,650	$533,850	$663,450
Walton County	99999	FL	$325,450	$416,600	$503,600	$625,850
Martin County	38940	FL	$316,250	$404,850	$489,350	$608,150
St. Lucie County	38940	FL	$316,250	$404,850	$489,350	$608,150
Baker County	27260	FL	$304,750	$390,100	$471,550	$586,050
Clay County	27260	FL	$304,750	$390,100	$471,550	$586,050
Duval County	27260	FL	$304,750	$390,100	$471,550	$586,050
Nassau County	27260	FL	$304,750	$390,100	$471,550	$586,050
St. Johns County	27260	FL	$304,750	$390,100	$471,550	$586,050
Manatee County	14600	FL	$285,200	$365,100	$441,300	$548,450
Sarasota County	14600	FL	$285,200	$365,100	$441,300	$548,450
Lake County	36740	FL	$274,850	$351,850	$425,300	$528,550
Orange County	36740	FL	$274,850	$351,850	$425,300	$528,550

Short Sales and their Effect On Getting a USDA Rural Housing Mortgage Loan

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Wed, 12 Nov 2008 06:40:14 -0600

As a mortgage lender, we are constantly getting updates from Fannie Mae, Freddie Mac, FHA, VA and USDA on guideline changes.

This summer, the "buy and bail" memo was released. This policy dictates the circumstances under which a buyer can convert their current primary home to either a 2nd home or an investment property and how we, as lenders, have to count the payment of the current primary home against them or under what circumstances we can count rental income on the property if they rent it. It makes it tougher to qualify because they fear, and rightfully so in some cases that I have seen, that people may be buying a new property and then "bailing" on their primary home for a number of reasons, the main reason being that they owe more on that property than it is worth and have found that they can get a similar home, or even a larger one, with a payment that may be less than what they currently have.

Prior to these changes, if the buyer could provide a fully-executed lease agreement, we could count rental income that would be generated, or at least 75% of it as they used a 25% vacancy factor. The buyer also had to have 2 months reserves for principle and interest and taxes and insurance on a single family residence and 6 months reserves if they were moving out of a 2-4 family property (ie: a duplex).

Under the new policies, which went into effect on August 1, 2008, the following conditions are required:

If current home is pending sale but won't be closed before closing on the new property, we must count BOTH payments in order to qualify for the new property.
If the buyer is going to keep the former primary home as a second home, we must count both payments AND either the buyer must have 6 months reserves (PITI) OR if we can prove they have at least 30% equity in the property (we have to get an appraisal, Automated Valuation Model, or a Broker Price Opinion to do that), we only have to show that they have 2 months reserves.
If the buyer is going to keep the former primary home as a rental property, we can still count 75% of the rental income with a fully-executed lease, a copy of the deposit check the tenant writes them and a copy of the receipt showing the buyer deposited the funds in their account IF AND ONLY IF we can document that they have at least 30% equity in the property they are leaving, again with either an appraisal, AVM or BPO. If they don't have the 30% equity, we can not count any of the rental income even if they have a lease, AND we have to count both payments against them to qualify them for the new property purchase AND they must have at least 6 months' reserves of PITI for BOTH properties.

There are also limits on how long ago a person can have been 30 days late on their current mortgage payment before they are able to purchase a new primary home. Fannie Mae, Freddie Mac, VA, and FHA have guidelines that are stronger than the ones that are used for a USDA Rural Housing Loan (aka a rural development loan). I have a buyer who is military and sold his home under a short sale scenario (he was never late on his mortgage but he had received orders to move and knew that he couldn't afford his new house, even if he rented and his old house and also knew that if he moved into military housing and his BAH (military housing pay) went away, he couldn't afford his old house. So he sold it for less than he owed. He had a first and a second mortgage on that property and he negotiated the short sale but when it was paid off, the second mortgage holder reported him as being 30 days late.

They have contacted the second mortgage holder and they will not remove this reporting. I spoke with all of my investors (Chase, Suntrust, Amtrust, Wells Fargo, etc. etc.) to see if they would accept a VA loan on him - I had run it through automated underwriting and it gave me an "approve/ineligible" - the ineligible being for having a 30 day delinquency in the last 12 months and the approval meaning that with his credit score, amount of assets, and income, he qualified for this new purchase. Not only would they not allow a VA loan, they wouldn't allow an FHA or conventional loan on him, either, as the first mortgage was reporting that he had facilitated a short sale. We have a copy of his orders and a letter of explanation detailing that he had to do the short sale as he had to move (Uncle Sam said so!) but that didn't matter.

After checking everything I could, I found that we COULD close on a USDA Rural Housing Mortgage for this client, even with the short sale and the 30 day late reporting because we had compensating factors and a letter of explanation in the file.

This client had been denied at 4 other mortgage companies - he was frustrated and wary when he came to me. He is now extremely pleased that he and his family will be allowed to purchase a home and I have created a raving fan of our company!

As I have said in some of my blog entries, the USDA Rural Housing program is one that helps a lot of customers that may not think they can purchase a home to be able to not only buy a house, but buy one that allows them a low monthly payment and little or no money down at closing.

If you are in the market to purchase a primary home, or if you are a Realtor® with clients looking to purchase in Florida, Alabama, Georgia, North Carolina, South Carolina, or Tennessee, please don't finalize your mortgage until you contact me - we may be able to save you thousands of dollars and get you a low, fixed rate mortgage that other lenders may sometimes overlook!

USDA Rural Housing Loan.........With Rate of 4.25%!!!

Sue Botelho-USDA Rural Housing Mortgage Pro (Northstar Mortgage Group) — Tue, 11 Nov 2008 08:27:37 -0600

We can offer a buydown on a USDA Rural Housing loan to clients. What this means is that the first year, the rate is 4.25%, the 2nd year, it is 5.25% and the 3rd through 30th year, it is fixed at 6.25%!

This is done by having the seller pay for the buy down. If there is a motivated seller, they can pay points to get the rate lowered the first and second years and then fixed for the remainder of the term. This is NOT an adjustable rate mortgage; it is fixed but just has the feature of having the 1st and 2nd year lower than the remainder of the term to allow a buyer to have a lower payment at the beginning.

Because it is a rural housing loan, the buyer can finance any and all closing costs that the seller doesn't pay which means that the funds a seller is willing to pay towards closing can be used to buy down the rate and the buyer still comes out of pocket with no money down for a true 100% financing program!

If you are a buyer and would like to take advantage of this, or if you are a seller who would like to explore this option, or if you are a Realtor® with motivated sellers for your listings, please contact me and we can discuss this program for you! We are able to offer these rates in Florida, Alabama, Georgia, North Carolina, South Carolina, and Tennessee!