St. Louis Mortgage Help

"Can I refinance my home if I have no equity in my house?" "I am underwater on my home can I refinance?" "How can I get cash out of my home if I have no equity?" These are just a few of the questions I get asked as a Mortgage Loan Officer.

The answer is YES, you can refinance just about any mortgage to just about any mortgage program with little to zero equity in your house!

FHA Mortgages; this is one of my favorites because there are all sorts of way to make FHA work for you. If you already have a FHA Mortgage utilizing the FHA Streamline refinance works well for those with little to no equity in your house because it doesn't matter. The FHA Streamline does not require an appraisal in most situations, they will actually use the last appraisal of your home. There is no cash out at closing with a Streamline refinance only rate and term changes.

If you do not have an FHA Mortgage or can't do a Streamline Refinance FHA allows for a rate and term refinance up to 97.75% of the appraised value. If you need cash out of your home the loan to value for an FHA cash out refinance is 85% of the appraised value. In both of these situations the lender will require a new appraisal. If you would like to learn more about the FHA Mortgage click the link.

FHA has a special loan program called the FHA 203k Renovation Mortgage, if you are looking to use the equity in your home to make improvements or remodel your home this may be your solution if you have little to zero equity. The FHA 203k will allow you to borrower 110% of the appraised value of your home. The appraisal value for a FHA 203k is based on what your home will be worth once your home improvements are completed, basically giving you a valuation on your home on the future work to be done. You will have refinanced your current mortgage plus received the money needed to make the improvements to your home. I am a Certified FHA 203k Removation Mortgage Specialist and can help. If you would like to know more about the FHA 203k Renovation Mortgage follow the link.

VA Mortgages, 100% of the value of your home! No matter the type of refinance of your current VA mortgage you can borrow up to 100% of the appraised value, this includes cash out refinances. Yes, you can get cash out of your home up to 100% of the new appraised value.

Are you someone that served in the United States Armed Forces and you don't current have a VA mortgage. First, thank you for your service to the country, it is appreciated. Second, you need to consider refinancing to a VA Mortgage, follow the link to learn more.

Conventional Mortgage, Fannie Mae or Freddie Mac, 95% is the maximum rate and term refinance you can do with a conventional mortgage. If you want to do a cash out refinance you are very limited in your loan to value to 80% of the new appraised value. Nothing really special about conventional mortgages. 

Fannie Mae has a renovation type mortgage very similar to the FHA 203k Renovation Mortgage, the Fannie Mae Program is called the HomeStyle Renovation Mortgage. If you want or need a conventional mortgage AND you are want cash out for improvements to your home the Homestyle renovation mortgage will allow you to borrow up to 95% of the new appraised value. Now you have refinanced your current mortgage plus received the funds to improve your home. I close many renovation mortgages every year, if you have questions please feel free to contact me.

USDA Mortgage, no cash out refinancing with a USDA mortgage, but you can refinance to lower your interest rate and/or shorten your term with little to zero equity.

HARP, the Home Affordable Refinance Program, this program was developed my our Federal Government for the sole purpose of allowing home owners to refinance their home when they have little to zero equity. The HARP refinance will allow for you to refinance your home even when you are underwater. If you would like to learn more about HARP please click on the link. 

If you would like to talk about refinancing your home, especially if you have little to no equity in your home please feel free to contact me. 
Bob Rutledge Mortgage Loan Officer

St. Louis MO, St. Charles MO, Kansas City MO, Springfield MO, Columbia MO, Cape Giradeau MO, Branson MO, Jefferson City MO
Posted by Bob Rutledge on March 24th, 2017 3:11 PM

Loans For Remodeling, Mortgages for Renovation or Fixing Up, Home Loans for Rehabbing, Home Improvement Loans. There are a lot of different options available to you to borrow the funds necessary to complete the project you have in mind for your home or soon to be home.

You currently own your home and want to make improvements or upgrades? You are looking at purchasing a new home and are considering a fixer upper? There are home loans and mortgages available to you!

The FHA 203k Renovation Mortgage is the best known mortgage option to help a home owner or home buyer with home remodeling and renovation funding. The FHA 203k is a first mortgage that combines the sales price and the renovation costs as a combined new first mortgage when you are purchasing a new home. If you already own your home the FHA 203k would be used as a refinancing or replacement of your current mortgage.

The FHA 203k can be used to make just about any home improvement you can consider or think of. Want to add a second story to your ranch? Looking to upgrade all your appliances? Add a new room? Expand your garage? Landscaping? If you would like to learn more about the FHA 203k visit my webpage; http://www.bobrutledge.com/fha203krenovationloan

One of the great advantages of the FHA 203k is that you don't always need to have equity in your home. The FHA 203k will allow you to borrower 10% over the after completion appraised value. So if you are short on equity to start use this program to make equity building improvements and build new equity in your home.

The Fannie Mae HomeStyle Renovation Mortgage, this is the near FHA 203k equal but a conventional renovation mortgage option. All the improvements that you can make with the FHA 203k you can do with the HomeStyle Renovation Mortgage. If you are considering getting a swimming pool you cannot go with the FHA 203k but you can get it done with the Fannie Mae Home Style Mortgage.

The HomeStyle mortgage can be used as a refinance or replacement of your current mortgage or it can be used as a new purchase mortgage for those homes that need some extra work to make them your home. The minimum down payment or equity position is 5% or the appraised value or sales price.

The big advantage the HomeStyle Renovation Mortgage has over the FHA 203k is mortgage insurance. If you have 20% equity in your home or a 20% down payment you will not have a monthly mortgage insurance payment. If your loan to value ends up being more than 80% but less than 95% there is a possibility of not having a monthly mortgage insurance payment, mention it if you are interested in this option.

Cash Out Refinance, no matter what type of mortgage you have on your home you can refinance to get cash out of the equity you have in your home. Each mortgage, except USDA, has their loan to value limitations based on a new appraisal, FHA is 85%, VA is 100%, and Conventional is 80% loan to value based on a new appraisal in many instances.

Home Equity Second Mortgages and Loans, many times these are referred to as Home Equity Lines of Credit or Home Equity Second Mortgages. Professionally, I do not have the ability to provide any of these mortgage programs but I do have resources to help you with finding the right HELOC for you.

Many times these types of loans are shorter in term, require much more equity in the home, have higher interest rates, and are harder to qualify for. But, the times are changing and I am starting to see these programs loosen up. Talk with your bank to start, then a credit union or two, and then ask me if I can help. There are positives and negatives associated with these loans but they have a very useful purpose.

Did You Know? In many instances the FHA 203k, HomeStyle, and Cash Out Refinances have tax advantages that Home Equity Loans do not. This is especially true if you utilize the mortgage interest deductions on your Federal tax returns. Consult your tax preparer before making this decision.

There are a few more options available to you when it comes to financing your home improvements and remodeling projects. Consider asking your Contractor to finance the costs, many bigger companies can do this or provide you with a private lending company. But, look at the terms and conditions and compare with some of the options above. Ask you contractor if you can make payments during the work phase, many will take a percentage upfront, during, and at the end.

I am a Mortgage Lender with USA Mortgage and I am a Certified FHA 203k Specialist, I close either one or more FHA 203k and/or HomeStyle mortgages nearly every month. I closed my first renovation mortgage nearly 20 years ago. You need and want a mortgage loan officer like me if your are wanting a home loan for fixing up you house, remodeling, renovating, improving, or rehabbing.

USA Mortgage has offices in the St. Louis MO area, plus Kansas City MO, Columbia MO, Springfield MO, Jefferson City MO, Branson MO, and Cape Girardeau MO. I am located in the St. Louis and St. Charles MO area but help borrowers throughout the State of Missouri, if you have questions or want help please feel free to contact me.

Posted by Bob Rutledge on March 14th, 2017 2:43 PM

A Jumbo Mortgage is a home loan that exceeds the maximum loan limit of either Fannie Mae or Freddie Mac. In St. Louis and Kansas City MO that maximum loan amount is $424,100.00, so if you have mortgage higher than this number it is considered a Jumbo home loan.

It has been very standard that lenders required a minimum down payment on a Jumbo mortgage of at least 20% of the sale price, over the last year or so that minimum down payment has started to shrink.

If your mortgage amount was close to the conventional loan limits it was possible to do a split loan for many borrowers, to get that borrower a lower down payment. You would have at least a 80% conventional first mortgage and then a 10% second mortgage, which would then require a 10% down payment from the borrower. These split loans are still very popular and I help many Jumbo home buyers with this type of mortgage.

There are advantages to the split loan, lower interest rate, no mortgage insurance, flexible second mortgage options, and of course a 10% down payment instead of the normal 20 percent down payment. The #1 disadvantage is that your sales price cannot drift too far from the conventional loan limit.

Of late we have had the opportunity to offer low down payment Jumbo mortgages to home buyers and Jumbo home owners for refinances without having to go the split loan route. We have several 5% down payment mortgage program options available as well as 10% down payment options.

Many of these low down payment Jumbo mortgage options will provide a variety of Adjustable Rate Mortgages, 3 year, 5 year, 7 year, and 10 year ARM options, as well as fixed rate options.

Debt ratios are a little more flexible with these newer jumbo programs in that they will allow for a higher debt ratio than the guidelines for a conventional mortgage.

To help with those borrowers who have a difficulty with proving income there are a some added nuances to these programs that help provide income to the application. For instance there is the Asset Depletion income addition. On qualified asset accounts, retirement accounts or brokerage accounts for example, we can apply a formula to those assets and apply a specific amount as your income without you ever having to withdraw those funds from the asset account. This can help with debt to income qualification and strengthening a borrowers application.

Many of these new programs are now available not just for primary residences but also for second homes.

You can use these new programs not only for purchases but for rate and term refinances, AND cash out refinances.

If you are considering a low down payment Jumbo mortgage you need to look into some of these new programs that are now available with more coming. I would welcome the opportunity to discuss these programs with you, how they can match your situation, and the best possible options to help.

A low down payment keeps your money working for you at a higher rate of return than most homes in the area in most instances.

Posted by Bob Rutledge on February 9th, 2017 1:39 PM

Zero Down Payment Mortgage Options in the St. Louis MO area

Low Down Payment Options in the St. Louis MO area

There are many low to zero down payment options available in the St. Louis MO area and throughout the entire State of Missouri. These options are available to first time home buyers and any home buyer through mortgage programs or down payment assistance help.

Every mortgage program has a low down payment option, the lowest down payment requirement comes with both the VA mortgage and the USDA mortgage program. Both the VA and USDA mortgage are zero down payment mortgage programs.

Throughout the State of Missouri there are geographical areas that are eligible for the USDA zero down payment home loan. In the St. Louis MO area there are areas in Jefferson County and St. Charles County eligible for zero down mortgages.

Are you a veteran of the United States Armed Services? If you are a veteran then one of the VA benefits available to you is the VA zero down payment home loan. I consider the VA mortgage the #1 best mortgage available!

Both Fannie Mae and Freddie Mac, these are also called the conventional mortgages, have multiple low down payment programs. The lowest down payment with either program is 3 percent, but there both Fannie and Freddie have two different 3% down payment programs. There is what I will call the regular conventional 3% down payment home loans, that go by all the regular conventional underwriting guidelines.

Then there is the Fannie Mae Home Ready and the Freddie Mac Home Possible 3% down payment mortgage program. This program is designed to help more people become home buyers, there are more flexible underwriting guidelines to help, better interest rates than the regular conventional mortgage, better mortgage insurance rates, and a lot more to help you become a home buyer. I have been using this program a lot more lately since it was first rolled out.

The FHA Mortgage Program, is the best known of the low down payment mortgage programs, FHA has a minimum down payment requirement of 3.5% as long as your credit score is above 580. If the qualifying down payment is below 580 there is a required 10% down payment.

The FHA mortgage is known for helping many people with low to no credit scores become home buyers. The underwriting guidelines for FHA mortgages are the most relaxed in the industry and is sometimes referred to as a first time home buyer mortgage program but it is not just for first time home buyers.

The lender I work for, USA Mortgage, has come out with our own 1% down payment program that has been helping a lot of new home buyers in the St. Louis MO area. The USA Mortgage 1% down payment program works hand in hand with the Fannie Mae HomeReady program to make for a very flexible low down payment option.

If you can't utilize the VA or USDA mortgage programs to get a zero down payment, there are ways to get your down payment paid for you through down payment assistance programs.

BTW, down payment assistance is not just for first time home buyers! There are down payment assistance programs that serve only first time home buyers but the State of Missouri, MHDC, and the Next Step down payment assistance program is not only for first time home buyers.

The MHDC programs, First Step and Next Step, will prove up to a 4% assistance to be applied toward your down payment, closing costs, or both.

There are also many local down payment assistance programs in various counties and/or cities throughout the St. Louis area that will provide down payment help from $3,000 to $5,000 depending on where you purchase a new home. St. Louis City, St. Louis County, Florissant, Jefferson County, many cities in St. Charles County, and unincorporated St. Charles County provide a down payment assistance program that will cover some if not all of your down payment.

Confused? You don't have to know it all, that is why you hire a mortgage specialist like myself to help you. If you want to know or learn more you can find a lot of detailed information within my website at www.bobrutledge.com or you call me at 314-628-2218. Please feel free to ask me all your questions, I answer questions every day.

Posted by Bob Rutledge on January 24th, 2017 11:30 AM

You Are Not Alone

I recall the feelings that ran through me when I felt compelled to file for a Chapter 7 bankruptcy, I felt as though I was an outcast and ashamed that I could not handle my obligations. For a very long time I barely admitted it to myself much less my friends.

Now I realize that I did not have a solid handle on my finances and it took a couple small set backs to put me into the position of bankruptcy. But, when I look back I see a life lesson that was provided to me and has been instilled well into the fabric of my personal life. I will not allow this to happen ever again. It is this exact lesson that Underwriters and Mortgage Lenders are looking for from borrowers when it comes to providing a mortgage approval for a home buyer after a bankruptcy.

As a Mortgage Lender I am in a very unique position to provide both experience and knowledge in help my clients when they come to me for help in the purchase of a new home or the refinance of thier current house after a bankruptcy.

 

TIME AND PROOF

 

For the sake of brevity I will not get into all the exact rules for every mortgage program, I do at my website, please visit AFTER BANKRUPTCY here I provide what you need to get you approved.

Every mortgage program has specific time periods that you must wait after the discharge of your bankruptcy before you get started. Though most of the programs have exceptions to those wait guidelines, for instance the wait period for FHA is normally 2 years, but there is an exception called Back to Work that allows for only a 12 month wait period.

 

Something that many Lenders fail on is that after a Chapter 13 bankruptcy has been discharged it is possible to be approved for a FHA mortgage after only 12 months! BUT! You can actually get approved for a FHA mortgage while you are still in the repayment period of your Chapter 13! If you have made at least 12 months of on time payments and if your Trustee agrees you are eligible for a FHA mortgage!

 

The Underwriters will be looking for validation that you have learned from your bankruptcy. They will want to see that if you have current credit accounts that you are making your payments on time. This is important, to re-establish credit after your bankruptcy and especially with a credit card or two.

 

COMPENSATING FACTORS

 

Applying for and getting approved a mortgage application after a Chapter 7 or Chapter 13 bankruptcy requires a stronger than normal application. To strengthen your application requires COMPENSATING FACTORS. Click on the link for a long list of items that you probably already can bring to your application, here are a couple that are important.....

 

Housing payment shock, you should not have a large increase in what you are paying currently for housing compared to your new house payment.

 

12 months of on time housing payment, this is an absolute must. There are exceptions if you are living somewhere rent free.

 

Keep your total debt to income ratio at or below the recommended guidelines of the mortgage program.

 

YOUR BANKRUPTCY FIXED A PROBLEM

 

When I was an Underwriter we were told that a bankruptcy should be seen as the borrower recognizing that they had a problem with thier current financial situation and the method of solving that problem was bankruptcy. Now, let's see that the borrower has learned from that life lesson and they are practicing what they learned.

 

It takes a mortgage lender that adhers to the guidelines of the mortgage programs and don't have overlays that create roadblocks to your approval. It takes a mortgage loan officer that is willing and able to take on your special situation, don't settle!

 

If you have questions please feel free to visit my website, www.bobrutledge.com or contact me.

Posted by Bob Rutledge on April 22nd, 2016 9:52 AM

MINIMUM DOWN PAYMENT OPTIONS:

 

There are two great mortgage programs that allow for a ZERO down payment, that's right zip, nada, nothing, etc. The USDA Rural Development and the VA Mortgage Program does not require a down payment along with the added value of super low interest rates in normal conditions.

 

The FHA Mortgage is referred by many as the first time home buyer home loan, not only because of the easier underwriting, lower required credit scores, and higher debt ratios but because of the minimum down payment requirement of only 3.5% of the sales price!

 

Conventional mortgages are those insured by either Fannie Mae or Freddie Mac, this is the loan program that many think requires at least a 20% down payment. For the most part conventional mortgages have a minimum down payment requirement of only 5%! Recently, Fannie Mae came out with a new mortgage program that has very relaxed underwriting guidelines that only requires a 3% down payment.

 

Down Payment Assitance or Grants:

 

In the St. Louis area including St. Charles and Jefferson County there are basically 2 down payment assistance programs available though one of the down payment assistance programs is coordinated with your mortgage lender through several different groups.

 

MHDC; some time referred to as First Place Loans. This program is offered through the State of Missouri and is provided throughout the state and not just the St. Louis Mo area. This program is strictly for First Time Home Buyers, a first time home buyer is basically anyone who has not owned a home or had the advantage of home ownership over the past 3 years.

 

This down payment assistance program can only be provided through approved mortgage lenders, not all lenders in the area want to work with the MHDC program.

This program will provide up to 4.5% of the loan amount for down payment and closing costs assistance. This makes this a very good program to work with the FHA mortgage minimum down payment requirement of 3.5% and then you have a little extra to apply to closing costs.

 

1st Home Program;This payment assistance is also only for first time home buyers. The program is available in St. Louis City, St. Louis County with Florissant having their own separate version of the same program, Jefferson County, and St. Charles County plus with nearly every city/entity in the county having a version of this program.

There are income restrictions, guideline restrictions,  underwriting restrictions, and more that I highly suggest that you only work with a mortgage loan officer very experienced with down payment assistance. Don't lose the money that is available to you or create delays that can happen because of lack of experience.

 

More Options to Help

 

23 Down Payment Options!  There are a lot of options listed within the FHA and Conventional mortgage underwriting guidelines that tell mortgage loan officers where home buyers can obtain their down payment.  The FHA mortgage programs lists 23 options that may be something you can do already, here are some favorites and some not so well known;

  • Savings (of course)
  • Gift (this is used a lot)
  • 401k or other retirement plan
  • Down Payment Assistance
  • Sweat Equity
  • Employer Assistance Program
  • Savings at home (mattress money)
  • A family member loan
  • Sale of personal property

These are just a few of the ideas and options available to you to help fund you down payment.

CLOSING COST HELP;  there are always closing costs involved in the process of buying and financing a new home purchase, over and above your down payment. Having those closing costs paid for by you is sometimes as much as the down payment but always a cost that can be avoided.

There are many options available to you to have most if not all of your closing costs paid for by others and not you. It takes a consolidated team effort of your, your mortgage lender, and your real estate agent to make this happen. But it is possible that through your mortgage program, down payment assistance, seller concessions, and lender credits that it can become possible to purchase a new home with little to zero out of pocket expense.

 

YOU BUY YOUR NEXT HOME WITH LITTLE TO ZERO OUT OF POCKET! Down P

Posted by Bob Rutledge on March 29th, 2016 11:33 AM
POOR TO BAD CREDIT? GETTING APPROVED TO PURCHASE YOUR NEXT NEW HOME COULD BE A VERY SIMPLE AND EASY PROCESS IF YOU KNOW THE FORMULA?

Did you know that FHA allows for credit scores down to a 500 score? Then why are you hearing from other lenders that they can't help you unless you have a 640 credit score? Because of their own overlays to the FHA underwriting guidelines or because the mortgage loan officer has no ability, knowledge, experience, or mostly they just don't want to mess with it.

I have been a mortgage loan officer and/or FHA underwriter since 1996 and every month it seems that I am helping new home buyers who were turned down, turned away, or thought they could not qualify.  

Did you know that FHA provides a list of compensating factors that you as a borrower can bring to the application to off-set the bad credit items. Go to my website at www.bobrutledge.com and under TIPS and TOOLS you will find everything you need to know about compensating factors......I would bet that you already have one or two compensating factors to improve your situation, and that is normally enough to get you approved.

Did you know that there is a FORMULA to approve borrowers if the automated underwriting system turns down your application. With most lenders when the 'machine' turns you down that's the end, they have no ability to have a real human Underwriter review your application and apply a common sense approach to you and your circumstances.

FHA came out with a formula that tells the Underwriter that if you match up to what the formula asks for in regards to your exact situation then you are an automatic approval. That's right, an automatic manual underwriting approval! Want to learn more about the Formula? CLICK HERE

I know that we have all heard that it so difficult to get a mortgage today and especially so if your credit is less then perfect, it can be if YOU are not doing your homework ahead of time. Go to www.bobrutledge.com and do your homework now so that you can purchase your next new home now or soon.

Then contact me, I want to help, I want to be there from the start to the end, I want to see you closing on your next new home.





Posted by Bob Rutledge on March 4th, 2016 9:21 AM

VA Mortgage Approval


The VA Mortgage is one if not the number one best mortgage program because of its flexibility to provide more to the veteran borrower than any other mortgage program.

The advantages of the VA mortgage; zero down payment, no private mortgage insurance, very competitive interest rates, and the VA mortgage is easier for you to qualify for than a conventional mortgage and most other mortgage programs.

You can purchase your next new home with zero down payment and for most VA borrowers they will have little to no money out of pocket on the day of closing. Working with you Bob Rutledge will help to get you your next new home with very little out of pocket expense. Last year his average VA borrower came to the closing table only needing $134.oo…… for everything!

Bob Rutledge has been a mortgage loan officer since 1996 and has helped many veterans finance their new home. Contact Bob early and have him lay out your personalized plan on how you will use the zero down payment of the program as well as lender credits and seller concessions to get you into your next new home with little to nothing out of pocket.


If you serve now or have served the United States and are wanting to purchase a new home, go to www.bobrutledge.com to learn how the VA Mortgage can now serve you.


Posted by Bob Rutledge on February 18th, 2016 12:11 PM

I see it every month or hear stories from fellow loan officers that before getting our home buyers under contract on the right home can turn even the most stoic shopper into a bit of a dreamer. From paint colors to planting a garden, picturing yourself in that property is critical for many buyers. It is the house and everything about that next new home that all home buyers consider but I ask that you leave a little room for pragmatism. Remember that getting pre-approved for a mortgage is a first step necessity but once you have that pre-approval, even once you are under contract isn’t a guarantee that you will be APPROVED. That prefix attached to approval is there for a reason, a loan pre-approval is not loan approval.

A better name for pre-approval is truly pre-qualification but that term is not welcomed generally by the seller side of the house you want to purchase, so we play the game. Once you are pre-approved, you have found your home and are under contract you will have more hurdles to clear before a lender legally commits to funding your home loan. Buyers who don’t know any better can inadvertently add obstacles to that path or home ownership or even kill the entire application, between contract and closing day.

Some missteps can be costlier than others. Here’s a look at five of the worst things you can do before buying a home.

1. Go Credit-Crazy

It’s almost become cliché in the mortgage industry, but the warning still bears repeating: Don’t buy a truckload of furniture until after your loan closes. The prohibition goes beyond sofas and tables avoid obtaining credit for any major expense, such as a car, a boat or, yes, a new bedroom set.

Be careful with even minor expenses. If you absolutely need to obtain new credit or add debt before closing, talk with your loan officer as soon as possible. We are now required to check your credit report for new debts and increased monthly payments on your credit cards 24 to 48 hours BEFORE you close to insure that your debt to income ratio has not changed enough to wreck your approval.

New payments are going to affect your monthly debt-to-income ratio and not in a good way. Hard inquiries on your credit report could also lower your credit score. That might hurt your interest rate if you haven’t locked or even knock you out of qualifying range all together.

2. Shuffle Dollars and Cents

Lenders will scour your most recent bank statements as part of the pre-approval and approval process. It’s not like they forget about it after that. They will take another look at your assets and bank records again during the underwriting process and possibly afterward you have an approval.

You will need to explain any unusual deposits or withdrawals. Lenders will require clear documentation and a paper trail if you’re putting gift funds toward a down payment or closing costs. Stuffing a wad of undocumented cash into your account is going to raise red flags. By law, The Patriot Act, we are required to source and season all funds used in a mortgage transaction, this can take time, and possibly kill an approval if we cannot use the money that is in your bank account.

3. Get Behind on Bills

Having a late payment hit your credit report before closing can devastate your deal. Payment history comprises about a third of your credit score.

One solitary 30-day late payment can clip 60 to 110 points from your credit score, especially if you have a very light credit history. And 2 recent 30 day lates is almost always a major concern for an Underwriter. If you have low credit scores and anything below 660 is considered low a credit blemish or inquiry could change the outcome of your approval or change your interest rate, but it isn’t always a huge deal if you had an 800 score, right?

Possibly. But if that 30-day late blemish is a mortgage or rent payment, some lenders will deny your application altogether. Many will require at least 12 consecutive months of on-time payments to qualify for a home loan.

4. Co-Sign on a Loan

Co-signing a loan is arguably a bad financial move whenever you make it. But it’s especially risky during the mortgage lending process. It means you’re financially liable for someone else’s debt. I have seen more co-signed notes become the death of a new mortgage application than you would ever think possible, they are family, they are friends, they would never do anything to hurt me.

Yes, that someone else might be the most responsible person on the planet. Lenders will still need to factor that new monthly obligation into your overall affordability profile. Adding one more debt to the list could stretch too thin your debt-to-income ratio and assets.

5. Changes in Employment

Probably goes without saying, but losing your job is going to be a big problem. Even job-hopping can present some major hurdles. Lenders crave stable, reliable income that’s likely to continue.

Lenders are likely to slam on the brakes if you take a new job in a different field  or if you decide to start your own business, or even if you get a promotion but see some or all of your income shift to a commission basis.

The bottom line: Any change to your employment is significant. Keep your loan officer in the loop, and ask questions when in doubt. The last thing you want is to waste time and money on a home loan you’re never going to get.

Throughout the mortgage process, it can also be helpful to monitor your credit scores for changes so you can know whether you need to address any problems. To do that, you can use a free tool like Credit.com’s Credit Report Card, which updates your credit scores and an overview of your credit report every month.

You Loan Officer is not your nemesis, just the opposite, I tell my clients that in today’s mortgage world every borrower comes to the Underwriter as guilty. It is my job as your loan officer to act on your behalf to collect all the necessary information and data to prove your innocence. The more I know the better I can represent you and package your loan application in the best light possible. Do Not Doubt for a minute that eventually we will find out everything, best to tell your loan officer everything up front and during the process so there are no last minute surprises. ONLY GOOD SURPRISES ARE ALLOWED AT THE CLOSING TABLE!

Posted in:General
Posted by Bob Rutledge on March 9th, 2014 10:55 AM

The spring and summer months are traditionally the busiest times of year for the residential real estate market, and locally that will be truer this year. It is a safe bet that the weather will be more cooperative and many families like to move while the kids are on their summer break.

Also, in recent years spring, for many regions, has meant more homes on the market and with inventories so low we need more homes on the market, as well as more buyers. With more buyers and a lower than normal inventory we will see fierce competition for the homes that are being sold and an increase in prices.
 

If you are in the market for a house this spring, there are a number of steps you can take to try to give you an advantage over other homebuyers, including;

  • If you're going to work with a Realtor or real estate professional, get started early. Interview three or four, get references, research them online, and let the person you choose know exactly what you're looking for. This means you must know what you want, where, whys, and hows. The best agent for you is the agent that will work with you, how you want to work, they will accommodate your needs, situation, circumstances, and preferences. Always keep in mind they know real estate you know you.
  • Get yourself at least pre-qualified better yet, pre-approved. This will give an advantage on several fronts. First, it will be done and out of the way. Second, you'll know how much a mortgage lender is willing to loan you so you know in which price range to look. And third, it shows sellers that you're serious and ready to buy when you make an offer.
  • Figure out how much you have for a down payment. NAR says first-time buyers typically make a down payment of 6 percent on a home purchase, and 24 percent of down payment funds were gifts from relatives or friends. If that's not an option, there are many loan programs that accept down payments of five percent or less. And don't forget closing costs, which will often run two to seven percent of the property's purchase price. I am a bit biased but just as it was suggested before about interviewing and searching for the right real estate professional the same is true about mortgage providers. WE ARE ALL NOT THE SAME! Know what you want and need in how you will finance your next new home and find that lender that can provide it. Speak with a wide range of lenders, talk with a bank, talk with a mortgage lender, do your research, ask questions. Your mortgage will be your biggest investment that you may ever make, do so wisely.
  • Once you have your team is in place be ready at a moment's notice. If you're in an especially tight market (which we are), your Realtor will be reviewing new listings as soon as they're available. If he or she finds something that matches your criteria, you will want to look at the house and be ready to make an offer -- quickly.
  • When looking at houses, look at the potential. There are major factors you won't be able to change -- the neighborhood, proximity to work and schools, the basic floor plan of the house (unless you plan on renovating), and size of the back yard, among other things. If you're put off by paint or carpet color or old linoleum floors, envision what the walls will look like with your color of choice and the floors in a material you prefer. Look at all homes with an open mind, you may never find that perfect home but more than likely the near perfect will have to do. But NEVER EVER settle, this is wrong as your home will always be your place of refuge and must represent to you and your family as your place to go for peace of mind.
  • Right now you will be buying in a seller's market, listen carefully to your Realtor or agent about how much you should offer. If there's competition you may want to offer more than the listing price and you should consider whether to try asking for things like carpet allowances or a long closing date. If you know the sellers may have several offers in front of them, you'll want to make yours the best. This is when your team working for you may be able to help provide alternatives that can help with making the strongest offer. This is especially true of your lender teammate, we can possible structure your financing to provide you with what you would have asked the seller for in a buyer’s market.
  • Begin thinking about homeowners' insurance now. Begin by making sure your credit report is accurate -- credit histories are sometimes used to determine whether a company will insure you, and, if so, at what rate.

With the current housing market be such a seller heavy market many of my home buyers are having a difficult time securing their new home simply because there are so few homes available at the moment and many more home buyers.

Assemble your team members now, allow them to make your game plan, get you prepared, and then act. Your real estate agent knows the market, they understand negotiating, and are willing to share and provide it all to you.

Your lender will know you and your financial situation better than anyone else but you, tell them everything, share with them your wants and needs. We can shape a mortgage program to provide you or nearly any home buyer with what they need. You need help with down payment and/or closing costs most lenders can accommodate this need. You are willing to purchase a near perfect home many lenders can provide mortgage programs that will roll in the costs of making your near perfect home perfect.

    
Posted in:General
Posted by Bob Rutledge on March 7th, 2014 1:20 PM

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