Before you get a mortgage there are a number of things you should know that will make the process much quicker, easier and safer for you.

Closing Costs: Closing costs are the various fees associated with the loan. These include the appraisal fee, the fee for title insurance, the mortgage filing fees, the underwriting and processing fees, origination fees and discount fees. The fees to pay particular attention to are the origination, discount and processing fees. These are fees that are generally discretionary to the broker or banker handling the loan. As a general rule, the origination fee should be no more than 1% of the total loan amount and the processing fee should be no more than $300. If you are being charged a discount fee, this means that you are paying extra money up front to get a lower interest rate. This is fine if you want to do this, but you are not required to do this.

Another key fact to understand when it comes to closing costs is the difference between how they are applied on a purchase mortgage compared to a refinance mortgage. On a purchase loan, the closing costs are paid outside of the loan amount. In other words, the closing costs are not financed into the loan and must be paid separately, either from the buyer's personal funds or by the seller from their equity in the property. On the other side of the coin, the closing costs can be part of the loan amount in a refinance loan. In other words, the closing costs can be included in the loan and do not have to be paid out of pocket.

Appraisal: The appraisal is a key factor in any mortgage transaction. The amount of the mortgage is based upon what the property is worth in the current market and the appraisal is what establishes that amount. Appraisals take into account the age and features of the house, the amount of square feet of living space and recent sales of similar properties in the same neighborhood. It is important to understand that the appraisal is a reflection of the current local real estate market. If homes are not selling well and taking a long time to sell, this will have a negative affect on the appraisal. If the real estate market is strong, the property will tend to appraise higher.

Time line: Be prepared for the loan process to take at least four weeks. There are exceptions to every rule, and mortgages will sometimes close in just 1 to 2 weeks, but this is rare. The loan process, especially recently, is a complex and detailed process with many components. If any part of the process is delayed, the whole loan is delayed. However, with a competent loan officer or mortgage banker, the loan will generally take 3 to 4 weeks.

Documentation: Be prepared to prove your income and assets. Usually, you will have to provide two recent pay stubs and the last two W2s, or complete tax returns for the past two years. Any money in the bank or in retirement accounts will need to be verified with recent statements.

 Disclosures: In any loan process, the lender is required to provide initial disclosures detailing rate, closing costs and federal disclosures within 72 hours of pulling your credit report. The two documents to pay the most attention to are the Good Faith Estimate (GFE) and the Truth In Lending (TIL) disclosures. The GFE is an itemization of all the closing costs you will be charged. The TIL discloses the interest rate you will be charged and if the rate is fixed or adjustable. In all, you understands how the appraisal affects the loan process, know what documentation will be required, know what to look for on the closing costs disclosures and understand the timeline of the loan process, you will be able to get a loan that suits you with a minimum of stress and hassle.

The Callen Agency is a new Farmers Agency located in Lawton, Oklahoma at 1416 NW 52nd St.  We are pleased to be part of the Farmers Family and to offer the community the quality insurance products backed by Farmers.

The Callen Agency also has extensive experience with individual and group health insurance, including traditional plans and no-deductible hospital/surgical plans.

In addition, in January 2010 we will begin to offer free space to Realtors, Loan officers and Appraisers on a quality website dedicated to promoting and driving traffic to Oklahoma real estate.

Callen Agency

580 248 5704

jcallen@farmersagent.com 

Websites for Small Business

 Small business online marketing has become an almost crucial factor in the success or failure of many small businesses. Today, a business without a website is regarded by many as behind the times or even with suspicion. A website should be regarded as a standard business tool. For some businesses, a static website that simply lists the location, contact information and a brief bit about what the business is and what it does is enough. However, for many businesses, remaining competitive depends on having a dynamic, optimized site that attracts and funnels targeted traffic into a marketing machine.

A good example of this is the real estate industry. Almost all Realtors have a web presence, and the effectiveness of their sites has a direct impact on their contacts, listings and ultimately sales. As with any business, the Realtor's website should be designed with two goals in mind: attracting the right sort of targeted traffic and then feeding that traffic into a marketing machine. The targeted traffic is primarily attracted through the correct use of keywords that are relevant to the housing market the Realtor is in. The marketing machine is the mechanism by which the Realtor gets that traffic to contact them or gets that traffic to register their information to be contacted.

For almost any small business starting up, a website that is properly optimized with relevant keywords and that contains the elements that filter traffic into the marketing machine should be regarded as a standard business tool.

 There are many talented loan officers and realtors in Lawton, Oklahoma.   We work with all of them that we can to facilitate the home-buying process.  

Let me outline a situation that happens all too often in the loan process;  the customer has been pre-approved, the titlework is done, the appraisal has come in above the purchase price, everyone is just waiting on final approval and closing instructions.   Then, out of the blue there are problems.   The insurance is higher than the loan officer initially estimated in the loan application.   So what?   Here is why this can be a potentially huge problem;

1. The loan officer can only make a somewhat educated guess as to how much the insurance premium will be
2. The debt to income ratio is affected by the insurance premium and if the premium comes in higher, the underwriting decision is invalidated and has to be re-run.
3. For loans underwritten to conform to Fannie Mae/Freddie Mac guidelines, debt ratio can be a huge issue; sometimes causing an otherwise clean deal to be either turned down or put in a different pricing tier---higher rates.

While it is true that the insurance premium is derived in a large part from the property itself, an equally important factor in deriving premium is the individual borrower's insurance score.    In other words, I'll pay a different rate than you will to insure the same exact property for the same exact amount of coverage.   Why?   My consumer history is different from yours.  My credit history is different from yours and my claims history is different from yours. 

What's the point?

The point is, until the loan officer or realtor or the customer gives an insurance agent the exact customer specific and property specific information, the premium the loan officer used to get the pre-approval is a guess.  Which means the debt ratio is a guess, which means the pre-approval could be meaningless.   

As a loan officer, I could take a customer's information, input it, pull credit and generate an automated Fannie Mae/Freddie Mac underwriting decision in minutes.    This almost always has to happen first, because realtors and sellers usually will not take an offer seriously until they know a customer has been pre-approved for the loan.   The pre-approval process is done by the loan officer, not by an insurance agent, so there is simply no way for the LO to know the true premium.   Most LO's will overestimate the premium to protect against premium swings.    A truly experienced LO will ask permission to get an insurance quote as well, or instruct the borrower to obtain one BEFORE issuing a mortgage pre-approval letter and BEFORE the deal goes to contract.  

Homebuyers in Lawton, Oklahoma.......please contact us for a prompt and exact homeowners insurance quote.

580-470-6048

Obviously, living in Lawton, Oklahoma is a little more laid back than living in New York City, L.A. or Miami.   Living here comes with a little bit of baggage---100 degree summer days, tornados, major allergies---but it also comes with many positives.   Many people like to retire here because of the relatively low cost of living.  

New York and L.A. may be the financial centers of the country, but that doesn't mean that you are unable to find financial products and services here that are every bit as good as what you could acquire there.   A good example is home and auto insurance.  

Lawton may be a relatively small city, but the insurance and financial services industry is very well represented here.   All of the major companies are available to you;  Farmes, State Farm, Allstate, Progressive, etc.   

When you are shopping for home or auto insurance, what should you consider when making your decision?   Should you make your decision solely upon cost?    What about the quality of the coverage and the level of service?    Here are a few key things to keep in mind when shopping for auto insurance:

• Can I get local face-to-face service?   Yes, almost every company has local agents with business locations.
• Are the billing options flexible?  Usually.  This will vary some among companies.  Most will offer monthly billing.
• What discounts do I qualify for?   This is an important question.   Remember this;  you should get a discount for having multiple policies with the same insurane company.   You should get a discount on your auto insurance if you have your homeowners with the same company and vice versa.  
• You should get a discount if you have more than one vehicle insured with the same company.   You should get a discount if you are willing to set your bill up on electonic draft from you checking account.  
• Also, you should get a discount for defensive driving courses. and for being ticket and accident free for 1, 3 or 5 years.  

On your homeowner's insurance, you should get a discount for:

• Having an interior/exterior inspection done.
• Being able to prove you updated your wiring/plumbing/heat and air system
• Having a life insurance policy with the same company
• various occupations qualify for discounts---teachers, military, nurses, etc.
• Various age classes will qualify for discounts.

These are the discounts that you should think of as standard discounts.  You may not qualify for all of them, but you should qualify for some of them.    If the company your are talking to does not offer these, you should consider shopping around.

Oklahoma Insurance Solutions writes for carriers that do offer these discounts and more. They can be found at http://www.oklahomainsurancesolutions.com. 

If you are buying a home in Lawton, Oklahoma there are a few things you should know about homeowners insurance.

• If you have a loan, the lender will require you to insure your house for at least as much as you will owe on it.  However, this amount may not be enough coverage to protect you. 
• In general, you should insure your home at replacement cost(the cost to re-build your home at today's prices)
• In many cases, replacement cost will be more than what you finance on your home. 

How insurance can affect your loan approval

Lenders consider your insurance premium to be part of your monthly financial obligations.   In other words, they factor whatever the monthly insurance payment is as one of your bills.    Your total monthly bills affects your debt ratio, which is a significant part of your loan approval.  

When a loan officer gets you pre-approved, he or she is supposed to factor in an amount for your homeowners insurance and property tax.   Unless the loan officer gives your information and the property information to an insurance agent and gets an official  quoate, the loan officer is guessing at the insurance amount and your pre-approval might not be valid.  

Why????

If the loan offier estimates the insurance premium too low, your pre-approval is based off of a debt ratio that is lower than what it should be.    Many times, a loan approval decision can be swayed one way or the other by a very small change in debt ratio.    

Before your loan can close, the lender has to be show evidence of insurance, including the exact yearly premium.   If the premium is higher than what the loan officer has represented, the lender will compute the new debt ratio and see if the borrower still qualifies.    Unfortunately, this is usually done at the last minute and can be a recipe for disaster, or at the very least a lot of unnecessary stress.  

As a borrower, the best thing you can do is to make sure that you have an accurate insurance quote early in the loan process based on not just the property information, but on your personal information as well.  

We provide accurate homeowner's insurance quotes within minutes. 

When shopping for auto insurance in Lawton, Oklahoma, you have a lot of different companies to choose from.   Most companies now offer monthly billing options, many choices of deductibles, and various discounts.   We write auto insurance for a company that consistently leads in billing flexibility, available discounts and affordability.  

We are able to insure drivers that have had DUIs, multiple tickets, gaps in insurance coverage as well as young drivers.   We take the time to analyze each driver's unique situation in order to not only get him or her insured, but to help that customer save money on the best coverage available and become our customer for life.  

Just like our auto insurance, our homeowner's insurance is a superior product with flexible billing options, multiple available discounts, and affordable premiums.   If you are purchasing a new home, we are very experienced at working with realtors and loan officers to ensure that you get affordable coverage in a timely manner to facilitate your loan process.  

If you are shopping for more affordable coverage for your home, we can tailor a package for you that not only saves you money, but enhances your protection.    In many situations, our customers take advantage of our home/auto discount, that saves them money on both their homeowners insurance, but on their auto insurance as well when we write both policies. 

Please keep in mind that regardless of what carrier you are with for your home or auto insurance, there are most likely available discounts that your are not currently receiving.   Customers can usually get multiple discounts for having both their home and auto with the same company, putting their auto billing on electronic draft, having more than one car insured, for some types of occupations, and even for having young children in the household.   Moral of the story?   It pays to shop around a little in Lawton, Oklahoma. 

Two weeks ago I received a call from an HR manager for a defense contracting company headquartered in Virginia.  Her company had just been awarded a contract on Fort Sill, which is a huge military base located here in Lawton, OK.  

She was looking for group and individual employee benefits packages for all of her new employees, and needed a local agent to go and sit down with her workers and get them on a plan.  I told her I'd be happy to help her and asked her how she found me.   She said, "I did a Google search for medical insurance and Lawton, OK and you were the top search result.   I followed the link and looked at your Active Rain profile." 

Proving that AR activity pays off.    Yesterday I had the pleasure of calling the guy who referred me to look into AR and thanking him for giving me one of my most important business tools. 

Let me outline a situation that happens all too often in the loan process;  the customer has been pre-approved, the titlework is done, the appraisal has come in above the purchase price, everyone is just waiting on final approval and closing instructions.   Then, out of the blue there are problems.   The insurance is higher than the loan officer initially estimated in the loan application.   So what?   Here is why this can be a potentially huge problem;

1. The loan officer can only make a somewhat educated guess as to how much the insurance premium will be
2. The debt to income ratio is affected by the insurance premium and if the premium comes in higher, the underwriting decision is invalidated and has to be re-run.
3. For loans underwritten to conform to Fannie Mae/Freddie Mac guidelines, debt ratio can be a huge issue; sometimes causing an otherwise clean deal to be either turned down or put in a different pricing tier---higher rates.

While it is true that the insurance premium is derived in a large part from the property itself, an equally important factor in deriving premium is the individual borrower's insurance score.    In other words, I'll pay a different rate than you will to insure the same exact property for the same exact amount of coverage.   Why?   My consumer history is different from yours.  My credit history is different from yours and my claims history is different from yours. 

What's the point?

The point is, until the loan officer or realtor or the customer gives an insurance agent the exact customer specific and property specific information, the premium the loan officer used to get the pre-approval is a guess.  Which means the debt ratio is a guess, which means the pre-approval could be meaningless.   

As a loan officer, I could take a customer's information, input it, pull credit and generate an automated Fannie Mae/Freddie Mac underwriting decision in minutes.    This almost always has to happen first, because realtors and sellers usually will not take an offer seriously until they know a customer has been pre-approved for the loan.   The pre-approval process is done by the loan officer, not by an insurance agent, so there is simply no way for the LO to know the true premium.   Most LO's will overestimate the premium to protect against premium swings.    A truly experienced LO will ask permission to get an insurance quote as well, or instruct the borrower to obtain one BEFORE issuing a mortgage pre-approval letter and BEFORE the deal goes to contract.