Buyer Tip-3% Increase in Debt Ratio Causes Loan to be Re-underwritten

Presidential Mortgage Update

Buyer Tips From John Melnick

After your credit is checked, do not increase your debt or apply for any new credit. The 2 months before closing are the most critical. Make no changes to your financial situation while you're in the process of getting a mortgage to buy a home.

Jeff Pearl / REALTOR

RE/MAX Distinctive

703-727-4876

jeffpearlhomes.com

Equal Housing Opportunity Provider

Another new all time low for mortgage rates

Freddie Mac reported the average 30 year fixed rate mortgage fell again to 3.83% from 3.84%.  The basics are the bond market is holding its ground and rates moved little.  Uncertainty in Europe is muting better news on the national economy and that keeps investors buying safe U.S. treasuries and mortgage bonds.  This is supportive of low mortgage rates.  Market watchers advise buyers not to hope for rates to go much lower and that mortgage rates take the stairs down and the elevator up. The Mortgage Bankers association reported that weekly mortgage applications rose 1.7% from the prior week. The home purchase share of the average also rose again.  The average rate for 15 year conventional loans was at a another new record 3.05% down from 3.07%.  The average rate for 5/1 conventional ARMs was 2.81% down from 2.85%.  Average surveyed rates are quoted with .50%-1% discount points.  

Points of interest for you and your clients

I will be holding a Mortgage Application Workshop Saturday June 2^nd for prospective homebuyers (and Realtors).  We will discuss how to prepare for a mortgage loan application and increase the chances of loan approval.  The workshop will be from 10AM-12PM in my Fairfax office and RSVP is requested.

I advise home buyers not to apply for new credit or increase their current debt load once they have had their credit reports run.  Lenders are required to perform a “soft pull” of the borrower’s credit before settlement.  If the debt ratio increases more than 3%, the loan must be re-underwritten.

Have a Mother of a weekend!  I am available on the cell phone 703-303-6434