Quick Tips On The Mortgage World

Wednesday, May 20, 2015

One Way Around A High Debt To Income Ratio…

Believe it or not it’s still very hard to get a Conventional loan approved with a debt to income ratio higher than 45%.

I wanted to give you one little trick you can use to help out with your debt to income ratio.

…Use lender paid mortgage insurance – have your mortgage lender pay your mortgage insurance in a lump sum up front. It’s called Lender Paid Mortgage Insurance.

This way there is no monthly mortgage insurance.

No monthly mortgage insurance means a lower debt to income ratio!

…You will want to make sure getting rid of the monthly MI will be enough to push you under the 45% limit.

If so, then this simple change could be your key to loan approval!

That’s it for today!

Have a good day today! …and thanks for reading.

Brett

Wednesday, May 13, 2015

An Option Money No No…

I had this situation come up again last week…

Advice: If you enter into a lease option agreement don’t give cash for the option money.

The reason is when you try to buy the house down the road you will have to prove you gave the option money to get credit for it. …it’s hard to prove cash.

You can do a personal check, cashiers check, or money order. …but, don’t give cash.

That’s it for today!

Have a good day today! …and thanks for reading.

Brett

Monday, May 11, 2015

Max Seller Help Limits By Loan Program…

Do you know the best way to get sellers to help pay your closing costs, prepaid taxes, insurance and reserves when you buy a home?

…You ask them!

You make it part of your offer to purchase.

Here is a breakdown of the maximum seller help amounts by loan program…

Program: Conventional (fannie/freddie), owner occupied…

1) 25% or more down payment = 9% allowed seller contribution.

2) Less than 25% down and up to 10% down payment = 6% allowed seller contribution.

3) Less than 10% down payment = 3% allowed seller contribution.

4) Fannie Mae Homepath: less than 25% down = 6% allowed contributions; 25% down or more = 9% allowed contributions.

Program: FHA

1) 6% maximum seller contribution.

Program: VA

1) 4% closing cost contribution.

Program: USDA

1) No limit to how much sellers can contribute (is limited by actual closing costs/prepaids). When a home appraises higher than the sales price, closing costs can be financed with USDA rural loans up to the difference between the sales price and appraised value.

That’s it for today!

Have a good day today! …and thanks for reading.

Brett

Thursday, May 7, 2015

Quick Credit Tip…

Did you realize that 30% of your score is made up of the ratio between your available credit vs your actual balances on revolving credit accounts (like credit cards)?

You don’t want to charge these accounts over 50% of the available balance, and its even better if you can keep it under 30% of the available balance.

That’s it for today!

Have a good day! …and thanks for reading.

Brett

Monday, May 4, 2015

Can You Be Too Old To Apply For A Mortgage?…

Hope you had a good weekend!

The other day I had a borrower ask me if they could apply for a 30 year mortgage even though they were 78 years old.

I can see why they asked this question. …The odds are they may not be around for another 30 years.

Just so you know… It’s against the law for mortgage companies to discriminate against a mortgage applicant for being older.

Even if you were 90 years old you could still apply for a 30 year mortgage.

That’s it for today!

Have a good day! …and thanks for reading.

Brett