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Thursday, October 27, 2011
RECOUP OF FUNDS - PROPERTIES PURCHASED FOR CASH
RECOUP OF FUNDS – PROPERTIES PURCHASED FOR CASH Borrowers who purchased a primary residence or second home for cash will no longer have to wait six months to be eligible for a cash-out refinance. The following documentation requirements and guidelines must be met: • If the purchase was a non-arms length transaction or a bail-out, it would be ineligible for a Recoup of Funds-Cash-Out refinance. • A satisfactory letter of explanation with supporting documentation as to why the property was purchased using cash and the reason they are now seeking to recoup their monies. • Copy of HUD 1 Settlement Statement or Certified Final Closing Statement for the purchase of the subject property which confirms that no mortgage financing was used to obtain the subject property. The preliminary title search or report must also confirm no liens on the subject property. The Closing Statement will be reviewed for anything FLC would consider as a sales concession and any sales concessions will be deducted from the purchase price. • A copy of the sales contract with all counter offers and/or addendums and a copy of the certified escrow instructions to confirm if any personal property was included in the sales price. The sales contract must be reviewed for anything FLC would consider a discrepancy. Any discrepancies/red flags must be addressed. • LTV/TLTV will be based upon the lesser of the purchase price or appraised value, less any personal property that may have been included in the purchase. • Verification of the source of funds used to purchase the subject property must be documented from the borrower’s own funds.(bank statements, HELOC on another property, etc). The source(s) must meet FLC guidelines. • Any loans used as the source for the purchase transaction (i.e. HELOC on another property) will be required to be repaid or paid down with loan proceeds: |
Make it a great day,
Sean K. La Rue
Senior Vice President – Franklin Loan Center
“Your KEY to Moving Home!” – Yo hablo Español
Jumbo Loan Expert | FHA/VA Direct Lender | Reverse Mortgage Advisor
44800 Village Court – Palm Desert, CA 92260
Mobile: 760.835.5663 Office: 760.837.1488 FAX: 800.784.9089
DRE# 01786480 NMLS# 291852
Jan Christensen
Executive Assistant | 760.837.1486 | jchristensen@franklinlc.com
Wednesday, October 26, 2011
BORROWERS ARE ARGUING OVER THE WRONG THING
BORROWERS ARE ARGUING OVER THE WRONG THING
If you’re around home sales and mortgages for any length of time, you understand how borrowers get very excited over an eighth of point in rate.
Before securitization, there could be a pretty wide difference in rates, and it made sense to shop around. Mortgage rates were a lender-specific phenomenon, and rates could vary pretty noticeably from lender to lender.
Now, there’s pretty much a standard rate that’s determined by FNMA and by the mortgage backed securities market, and the differences between lenders are pretty small.
Still, borrowers will shop.
The internet has, of course, played a big role in this. A borrower can spend a few minutes at a computer and get rates from 20-30 or more lenders. The rates won’t vary a huge amount, but it can be very seductive.
If we do the math, though, borrowers are focusing on the wrong thing. The monthly savings by saving an eighth in rate just don’t amount to much.
Let’s look at a 30 year fixed rate loan for $300,000. At 4-1/8% the monthly payments will be $1,432. Now let’s assume the borrower shops all over town, spends hours on the internet, and he finds a lender at 4.0%. Guess what, his payment drops by only $21! That’s $252 a year, and even if the borrower stays in the house for eight years, it’s barely $2,000.
It just isn’t all that much and in today’s world where the wrong lender can mean no closing.
Wouldn’t buyers be better off negotiating a lower price of $3,000? Or a $4,000 credit towards termite repair.
When a Realtor recommends a lender, it’s because he or she knows that lender to be dependable. And closing on time can be a lot more important than saving an eighth of a point in fees.
Rates matter.
But it’s more important for borrowers to have a good Realtor to negotiate the best possible deal.
Make it a great day,
Sean K. La Rue
Senior Vice President – Franklin Loan Center
“Your KEY to Moving Home!” – Yo hablo Español
Jumbo Loan Expert | FHA/VA Direct Lender | Reverse Mortgage Advisor
44800 Village Court – Palm Desert, CA 92260
Mobile: 760.835.5663 Office: 760.837.1488 FAX: 800.784.9089
DRE# 01786480 NMLS# 291852
Jan Christensen
Executive Assistant | 760.837.1486 | jchristensen@franklinlc.com
Tuesday, October 11, 2011
10 Loan Commandments...
I thought this was a hilarious way to inform my clients, but the truth is most consumers don't know what they need to avoid during the loan process before, during, and after. One thing not on here is that opening up many news credit cards right before you buy a house could temporarily lower your credit score.
Make it a great day, Sean K. La RueSenior Vice President - Franklin Loan Center
"Your KEY to Moving Home!" - Yo Hablo Español Jumbo Loan Expert | FHA/VA Direct Lender | Reverse Mortgage Advisor Mobile: 760.835.5663 Office: 760.837.1488 FAX: 800.784.9089
DRE# 01786480 NMLS# 291852