NEW RESPA CHANGES GOING INTO EFFECT

OMG - It's going to be a nightmare come January 1st.  I know it's supposed to HELP buyers and save them hundreds, but it's actually going to cost them money.  I don't think our elected officials really understand how these new rules are going to affect things.  I'll be the 1st to say there were a lot of predatory lenders out there and they needed to implement change.  Evil people will always find a way to be evil, don't penalize everyone for their actions.

With these new rules, I, as a lender, will most likely end up paying for things I have no control over.  I have to "estimate" what I think costs will be and there can be little or no change from my estimate to the final closing figures!  I know what MY figures are, but I don't know what a seller's title insurance will cost when I meet with a buyer. 

These changes will result in lenders severely OVER ESTIMATING costs just to make sure they don't end up paying the difference if costs of others involved in the loan come in higher. 

Buyers are supposed to take the estimate from one lender and SHOP with several others.  To effectively shop with a lender we have to know what your credit score is, and each time a lender checks your credit it lowers your score.  The rate you get is dependant on credit score and if people are out checking with several lenders this could, in all reality, cause their score to lower to where they can't get a mortgage. 

What it all boils down to is talk to people, find out who they trust and would refer you to, and DEAL WITH A REPUTABLE LOAN OFFICER who's been in the lending business for years like I have. 

I've seen a lot in 23 years of lending.  I have always quoted people high on closing costs.  One of my pet peeves has always been lenders who will under-estimate the costs to trick borrowers into going with them because their costs are higher.  One thing the new changes will do is stop this.  If they underquote, they pay the difference!

Here's to a challenging and great 2010!

Short sales ad how they affect you in the future

If you are selling your home with a short-sale (your lender agrees to take less than you owe to allow you to sell the home) you may not be able to purchase another home for at least 3 years after the short sale.

One of the catch-22's to short sales most of the time is that a lender won't approve a short-sale unless you are delinquent on your loan. 

If you go to buy another home after 3 years, one of the requiremnets to qualify is you were not late on your payments.  There in lies the catch 22!

MORTGAGE TAX CREDIT - 4 MONTHS LEFT!

Do you want to qualify for the $8,000 or $6,500 homebuyer tax credi?  Don't wait too long, you have to find a home and have your offer accepted by 4/30/2010. Now this may seem like a long time, but it will go fast. Don't find yourself waiting till the last minute. Give me a call to see if you qualify for one of these credits and get your loan pre-approved today.

I doubt they'll extend this tax credit a 2nd time!

Have you owned your home for 5 of the last 8 years? You're not a 1st-time buyer, but you may qualify for $6,500 buyer credit.

I'm here to help.

Jolyn

HOMEBUYER TAX CREDITS: $8,000 OR $6,500

DON'T WAIT TILL 4/30 TO GET YOUR OFFER ACCEPTED! The Homebuyer tax credit, part of the stimulous package, was extended and MODIFIED. It extended the possible $8,000 tax credit to people who have not owned a home in the past 3 years. It also expanded and repeat buyers who have occupied a principal residence for 5 consequtive years out of the last 8 years may qulaify for $6,500 if they buy a home to occupy. Offers to purchase must be accepted by 4/30/2010 and the loan can close no later than 6/30/2010. With the changes in the mortgage industry, don't put it off - find that house now. We used to close loans in a couple days, now it takes a couple months. That doesn't mean it can't close in a few weeks, but MURPHY'S LAW is running rampant. Plan on 2 months! Call me 608-498-1959 to start your loan application today!

HELP GET THE WORD OUT - $6,500 REPEAT BUYER CREDIT

When they extended the tax credit for 1st-time buyers (buyers who haven't owned a home in the last 3 years) they amended it to include a $6,500 credit to qualified buyers who have lived in a home as their primary residence for 5 of the last 8 years. That means if someone owns a home they've lived in for 5 years, they can sell that home, purchase another home and get a $6,500 tax credit. This is a great opportunity for people who want to down-size, move up to a bigger house, or buy the home of their dreams. Help me get the word out. Their offers to purchase have to be accepted no later than April 30th and the loans have to close by June 30th to get these credits. Call me if you want to find out more. 608-498-1959.

Seems like borrowers aren't buying

Rates are awesome and inventory of listings is great. You've got till the end of April to get your offer accepted and you have to close by the end of June to get the $8,000 or $6,500 tax credits.

Up to $8,000 for borrowers who qualify and haven't owned a home in the past 3 years.

Up to $6,500 for borrowers who have lived in their home for 5 consecutive years out of the last 8.

Don't wait till last minute. It's getting impossible to get a mortgage closed in 30 days. It's taking more like 45-60. If you miss these cut-off dates, there's no exception. I'd hate to see you miss it by one day. Start home-shopping now.

If you know anyone who's thinking of buying, tell them to get in touch with their lender (preferrable me) right away. Better safe then sorry.

I'm here for you!


Jolyn - Mortgage Expert
Universal Mortgage>

DON'T WAIT YOURSELF OUT OF THE MARKET!

What a bright and cheery day in Wisconsin! Hope everyone made it home safely if you drove Wednesday. I stayed home.

If you or anyone you know is holding off on buying a home, my advice is DON'T WAIT!

It's going to get tougher before they ease up on guidelines. The mortgage guidelines are still tightening, shutting buyers out who may have qualified a month ago. Minimum credit scores on FHA loans with me have gone from 620 up to 640 and some lenders are requiring 670.

Waiting is not a good idea these days if buying is in your future. You could qualify for a loan one day and the next you're out of luck! FHA guidelines, which had been the same for years and years are changing fast like other loans.

All aspects of loans are being looked an analyzed to find reasons not to loan. Get in and see your mortgage lender today (I'd love to be your mortgage lender). If you plan on taking advantage of the stimulus money, you need to have your offer to purchase a home accepted by the end of April and close by the end of June. I wouldn't push it to the last day, as it's getting harder and harder to get a loan closed fast. Don't wait - Rates are awesome, and you may qualify for a tax credit of $8,000 if you haven't owned a home in 3 years, or $6,500 if you have owned and occupied a home for 5 of the last 8 years. Call me today, 608-498-1959.

$6,500 tax credit for repeat buyers

Why isn't anyone talking about the repeat buyer tax credit of $6,500? Now that's news!

Call me for details 608-498-1959

Jolyn

DON'T APPLY FOR A CREDIT CARD

The holidays are upon us. On TV this morning they were talking about pitfalls of credit cards this shopping season. One thing they mentioned that I wanted to pass on: If you're house-shopping, it's a very good idea NOT TO APPLY FOR ANY NEW CREDIT!
With minimum credit scores and no leeway on qualifying ratios, applying for a new card might lower your ratio or put your debts too high and you could loose that house you were planning on buying. I'd hate to see anyone unable to get a loan because their score was to low because they opened an Old Navy card to save $10 off their purchase. RESIST THE TEMPTATION to open any new credit if you're trying to get a home loan. Even if you've already been to your lender, that credit report can't be more than 120 days old or we have to do another one. Your score may have been high enough, but with inquiries and new credit, a new report might get your loan denied.

SOME MORE HOOPS TO JUMP THROUGH!

Today's topics: Home inspections and property flipping

I'm not surprised it's happened, but Rural Housing is asking for copies of the home inspections and every repair noted in the home inspection needs to be done before closing. In the past, they didn't ask to see home inspections, just relied on the appraisal. Now if a home inspection is in the offer or on the HUD, they want to see it. In the past, we never had to provide home inspections. We've got a loan right now where Rural Housing requested the inspection. They want windows fixed that are stuck shut, electrical outlets fixed, and the home inspector has to go back out and confirm the repairs have been done.

Property Flipping: A home can not be sold that transferred ownership in the past 90 days. If it is selling and was sold within the past year, it may require additional info and two appraisals.

What wonderful news!

Effective January 1st, FHA appraisals will be ordered through the Appraisal Management companies. This is a sore subject with me. They could just go back to the old system where FHA assigned the appraiser, but instead they are requiring the use of a 3rd party, adding additional time, and more expense for borrowers.

I know there's reasons for all these rules, but sometimes they go a little too far to the extreme and it hurts borrowers.

Together we'll get through it!

REPEAT HOMEBUYER TAX CREDIT

With the last 2 home buyer tax credits, you couldn't have owned a home in the past 3 years. With the extension and amendment to the tax credit, someone who hasn't owned in the last 3 years (1st-time buyers) are still eligible for up to $8,000 if they qualify, but now repeat buyers buying a primary residence who have owned and occupied a home for 5 of the last 8 years can get a tax credit up to $6,500.

This is fantastic news! Call me for details!

HOME BUYER CREDIT

It was official on Friday November 6th. The BUYER TAX CREDIT was extended and amended. For those who have not owned a home in the last 3 years, the 10% of sale price up to $8000 tax credit was extended. It was also amended to include a credit of up to $6500 for borrowers who occupied a primary residence 5 out of the last 8 years if they purchase a new primary residence. If they own now or owned recently, then can still get up to $6500. Income limits were also increased.

You have to have an offer accepted by April 30th and the loan must close by June 30th, 2010.

Call me for details.

MALL OF AMERICA TRIP

Had a blast at the Mall of America Thursday. Bonnie Oliver, Jean Farve and I met Kelly Overgard for lunch. After 3 hours of catching up our faces hurt from laughing so much. Thanks THE TITLE COMPANY for putting on the trip.

BUYER TAX CREDIT NOW LOOKS LIKE DONE DEAL

The home-buyer tax credit looks like it's a done deal. All it needs now is President Obama to sign, which should happen today! Yipee!!!

It extends the tax credit of up to $8,000 for 1st-time buyers. Offers must be accepted by 4/30 and the loan MUST CLOSE by the end of June, 2010. It also offers a $6,500 tax credit buyers who have owned their home for the last 5 years and want to upgrade.

I'll get you details as soon as their officially out. Income limits have also changed, so keep checking my blog.

Jolyn

$8,000 tax credit extension not a sure thing yet!

There's a lot of loan officers and lenders out there telling people the $8,000 tax credit was extended. IT IS NOT! It was passed in the Senate, but now goes to the house.

When it's approved by everyone, I'll sure let you know. You can always call me if you hear something and want to know the real truth about it. If I don't know the answer, I'll do the research and find out.

Your trusted mortgage expert,

Jolyn

It takes 45 days to 60 days to close on a house, making it unlikely a sale made today would be consummated by the end of November, said Lucien Salvant, spokesman for the National Association of Realtors.

Hey - the above quote was from the National Assocation of Realtors. Looks like people agree with what I've been saying for quite some time now. You shouldn't write an offer and expect to close in 2 weeks to a month. Give lenders 45-60 days. We'll close in 2 weeks if we can, but when you don't give us 45-60 days, don't complain about the last minute problems. There's just too many systems put in place by the government now to smoothly close in 30 days. That doesn't mean it can't be done, but MURPHY's LAW. It won't go smoothly if you give us 30 days, so if you give us 45-60, it will get a proved in 2 weeks. That's just how it always goes. If you want to have an option to close sooner, put vergiage in the offer: Will close sooner, if possible.

Call me for details, 608-498-1959 or 608-779-1519

Jolyn

IF YOU BENEFITED FROM THE $8,000 BUYER TAX CREDIT LET YOUR GOVERNMENT REPRESENTATIVES KNOW ABOUT IT

Congress is looking at extending or expanding the buyer tax credit. It currently expires 11/30 so loans have to be closed by that date. I know a lot of 1st-time buyers who have benefited from this credit and a lot more who could.

If you would like to see it extended, or you bought and benefited from the program, let your senators and congress-persons know so they can offer their insight when they decide if they should extend it.

Rumors are it may be extended for 6 months, and it may be opened up to buyers who are not 1st time buyers but are moving up to a more expensive home, selling theirs to give 1st-time buyers more to choose from. Nothing is set yet, so any input you want to give is appreciated.

Get a note or e-mail off to Ron Kind or Russ Feingold and let them know your opinions.

GPS advice

I got an e-mail from a friend of mine who works for a security company. He cautioned against using your home address as the starting point when you use your GPS. Instead, pick a gas station or bank. Someone went to a football game. They had their GPS mounted on their dash. Knowing that they'd be there for a few hours, someone broke into their car, took the GPS and the garage door opener. They could see where they started all their trips from, took a truck and cleaned out the house. I'd never have thought of something so evil.

Also, if you get a text message asking for your PIN, call back and make sure it's sent by the person you think it was in case they a hold of the phone of a spouse.

Just some good advice.

Have a great week.

MINNESOTA HIGHEST INCREASE IN LOAN FRAUD

I was just perusing Fannie Mae's website reading about fraud cases. It's pretty scary what some people were out there doing. You think Bernie Madoff is bad - there's some equally bad mortgage brokers out there. That's why it's important to deal with someone trustworty like ME.

I wanted to pass along to you that from 2007 to 2008, Minnesota was ranked #1 in increased loan fraud. It increased 435%. That's a whole lot!!!

I complain a lot about all the extra hoops we have to jump through, and how picky underwriting is, but it's very understandable.

I was talking to another lender who does a lot in Illinois. One of their underwriters was reviewing an appraisal. She thought some of the furnutire and decor looked a little like she'd seen it before. These people were going into vacant houses, fixing up the rooms that require photos in the appraisal, bringing in the same furniture and furhishings, taking photos then moving the stuff to the next house. Faking appraisals and entire deals. They just happened to be unlucky enough to get the same underwriter who reviewed appraisals thouroughly and caught them. Then uncovered a huge fraud ring.

Some just have to ruin it for everyone!

OPTIONS OTHER THAN ALLOWANCES ON OFFERS

Since simply putting cash to a borrower as an allowance for repairs or negotiated things, have the seller pay it toward their closing costs. If the borrower was going to pay their own closing costs, by having a seller pay what they would have given in an allowance, you're doing the same thing except a lender won't have a problem with it. Call if you have questions on what would be an acceptable solution and satisfy mortgage requirements.

Allowance is just a reduction in sale price

As far as lenders are concerned, ALLOWANCES in offers is unacceptable. If there is a problem with a property, the problem must be corrected by closing. Giving a borrower $1,000 allowance at closing is not going to work for a secondary market loan. Just giving a buyer $ at closing will not work. Why: If it's a sever problem like an electrical or structural problem, a borrower could get a credit at closing and not fix the problem. Unfortunately most loans will not allow escrows for anything. Sometimes, weather-related items are permitted, but otherwise, all repairs need to be completed prior to closing.

If it's not a structural problem or safety issue, just reduce the sale price as you will not be able to just give a buyer a credit on the closing statement. Once a loan is closed, there's no guarantee it's going to be completed, and the reason they don't allow escrows is costs can always change and there may not be sufficient funds to complete the repair.

If you keep in mind that all repairs must be completed by closing, you won't have any problems.

30 WORKING DAYS LEFT

If you're still shopping for a home thinking you'll be able to close and get in on the $8000 potential 1st-time buyer credit, you may be out of luck. If a bank or credit union guarantees they can get it done - you might not want to believe them.

I'll clue you in to secondary market vs. in-house loans. An in-house loan can be closed in time to meet the 11/30/09 deadline for this tax credit, but secondary market loans are iffy at this point.

In-house loans can be done fast. These loans will NOT BE a 30-year fixed rate. Rates will probably be a bit higher, and you'll need at least 10% down. If you don't want to jump through all the hoops, this is your only option.

Otherwise, for 30 year fixed, with 3.5% down (FHA) or Zero down (Rural Housing) at low rates, we can not speed things up to get the loan done. FHA might squeak by in time, but no guarantees. Rural Housing I would bet can not be closed in time. They are backed up nationwide.

If you plan on buying by 11/30, give me a call to discuss your options. I'm not going to paint you a rosie picture or blow smoke - you'll get the truth from me.

Give me a call or e-mail me.


Jolyn - the MORTGAGE EXPERT

SOME DAYS MY JOB SUCKS

Things are going pretty good, and I've adjusted to all the changes over the past year in the mortgage industry and tried to keep my Realtors and customers aware of them before they went into effect.

One change that we need to inform our government representatives about is the re-disclosure requirements. It's designed to protect borrowers, but it's causing a lot of stress instead. It's only gong to get worse come January 2010 when our good faith "ESTIMATE" has to be exact with the final closing costs. If it doesn't, we'll have to re-disclose and wait 7 days before we can close. Now keep in mind we don't know exact costs till most times a day or two before closing. It's already a bit of a pain and I've had to re-schedule 3 closings in the last week because the APR and finance charges can't very more than .125% or no more than $100.

I had a closing where many of the closing costs actually came in lower than what I estimated. The only differenc was instead of closing on 9/30 we closed on 10/9. There was 10 days of interest due at closing because of it, which was about $500. I think a borrower should be able to waive this and choose to close. There were no suprise added costs, the closing date was merely changed.

It's getting where we will need to get the loan totally approved and ready to close, then we'll have to do the closing statement, re-disclose, and close 7 days from when the closing statement is done. If you think this is rediculous, let your senators and congressional representatives know.

We are required to run a loan through FIVE fraud systems. Some of which we can't do till we have the closing statement. This can cause last-minute issues.

I know lending was out of hand and needed to be reeled in. You can try and blame the lenders, but hey - I didn't make the rules! I couldn't turn a borrower down for a loan if they qualified 2 years ago. Ask youself who made up the guidelines that allowed lenders to approve these zero down, 1 day out of bankruptcy loans? It wasn't me. We needed the changes, but I think they've gone a little too far the other way. It will ease up, but until then, we have to adjust.

I'm not an evil person so I wouldn't have thought of this stuff. Check it out

A friend of mind who works for a security company sent me this information. It's something to think about if you use a GPS and mobile phone/blackberry. If you get a text message that looks like it's from someone you know asking for personal info, call and confirm they asked for it, don't just text it back. Amazing how evil people are. Here's info from the security company. Read on....

GPS:
A couple of weeks ago a friend told me that someone she knew had their car broken into while they were at a football game. Their car was parked on the green which was adjacent to the football stadium and specially allotted to football fans. Things stolen from the car included a garage door remote control, some money and a GPS which had been prominently mounted on the dashboard.

When the victims got home, they found that their house had been ransacked and just about everything worth anything had been stolen.

The thieves had used the GPS to guide them to the house. They then used the garage remote control to open the garage door and gain entry to the house. The thieves knew the owners were at the football game, they knew what time the game was scheduled to finish and so they knew how much time they had to clean out the house. It would appear that they had brought a truck to empty the house of its contents.

Something to consider if you have a GPS - don't put your home
Address in it. Put a nearby address (like a store or gas station) so you
Can still find your way home if you need to, but no one else would know
Where you live if your GPS were stolen.

MOBILE PHONES
I never thought of this.......

This lady has now changed her habit of how she lists her names on
her mobile phone after her handbag was stolen. Her handbag, which
contained her cell phone, credit card, wallet... Etc...was stolen.

20 minutes later when she called her hubby, from a pay phone telling
him what had happened, hubby says 'I received your text asking
about our Pin number and I've replied a little while ago.'

When they rushed down to the bank, the bank staff told them all the
money was already withdrawn. The thief had actually used the stolen
cell phone to text 'hubby' in the contact list and got hold of the pin
number. Within 20 minutes he had withdrawn all the money from their
bank account.

Moral of the lesson:
Do not disclose the relationship between you and the people in
your contact list.

Avoid using names like Home, Honey, Hubby, Sweetheart, Dad,
Mom, etc....

And very importantly, when sensitive info is being asked through texts,
CONFIRM by calling back.

Also, when you're being text by friends or family to meet them
somewhere, be sure to call back to confirm that the message came
from them. If you don't reach them, be very careful about going places
to meet 'family and friends' who text you.

I'm scheduling my pumpkin pie classes now

Hey - the pumpkins are ready and we're into the "fall weather" so it's time to learn to make a pumpkin pie from a pumpkin, not a can!

If you and 5 of your friends would like to learn how to prepare a pumpkin, make the crust and bake the pie, let me know. It's $25 per person, held at my house. I'll provide wine, all the ingredients, and you'll go home with your prepared pie, plus another pumpkin so you can recreate the experience on your own. $25 per person.

Scheduling classes now.

Chef Jolyn

CALL TO ACTION!!!!

If you want the government to continue to offer the buyer tax credit, cut and paste this link in your browser and let them know.

http://takeaction.realtoractioncenter.com/campaign/hbtc/wbku5guf2j3j8mde?

If we don't band together they might not continue this program. It has been a great incentive to get borrower's off the fence and into homes. Take a minute to let your representatives know you support continuing the buyer tax credit.

Thanks!

Jolyn

TIME IS RUNNING OUT FOR $8,000 TAX CREDIT

You have a little over a month to meet the closing deadline of 11/30 for the potential $8,000 tax credit. Don't wait till the last minute, as lenders and closing agents are going to be swamped and you might miss it by a day.

This is an excellent program for 1st-time buyers, but programs like Rural Development loans, with zero down payment, are already backed up and taking considerably longer to get approved.

If the loan has to close by 11/30 and you take weekends and Thanksgiving out of the number of days, you may be already pushing the envelope here.

Don't wait - talk to a knowledgeable lender today if you want to make sure your loan is closed by 11/30. If you close 12/1 you're too late - there are no expceptions here.

Call me if you have any questions, 608-779-1519.


Jolyn

HOW DOES INFLATION AFFECT INTEREST RATES?

To give you an easy way to remember how inflation affect interest rates:

INTEREST RATES ARE THE BOAT THAT FLOATS ON THE SEA OF INFLATION.

What this means is if inflation figures go up, interest rates will go up with them. Another general rule of thumb: If the stock market is doing well, mortgage rates will do worse. What happens is when investors are putting their money into the stock market, they are pulling it out of the bond market, which drives rates. When they want a safer haven for their investments if the stock market is not doing well, they pull it out of stocks and put it in the bond market, which makes rates get better. This isn't always the case, but it's a safe indicator.

All I'm hearing out there is the buzz that inflation is looming, and rates are going to go up. That, in combination with the fact that there's JUST enough time to buy and get in on the possible $8,000 tax credit if you close on a purchase before 12/1 makes it a good itme to buy. Rates are low, you might qualify for the $8,000 and there's a nice supply of homes on the market.

Call me if you have any questions!

Home sellers should plan to attend closings

Did you know that for Guaranteed Rural Housing loans, Federal VA and FHA loans,a seller MUST sign some closing documents? Having your sellers attend closing just makes things a little easier, as most of the time these days, closing papers arent done much before the day of closing. If you've got a loan closing soon, make sure the sellers plan on coming to the closing. If not, make sure you have plenty of time to get the closing papers completed and the signatures ahead of time.

With these loan programs, there are NO EXCEPTIONS to this rule.

Close-up of award

I wanted to show you the award up close. It's very pretty!

I WAS SO SUPRISED - THANK YOU!

Last night (Thursday 9/17) I attended the La Crosse Area Realtor Assocation meeting to support Steve Lillestrand of Meyer Assocates as he was installed as the new president of the associaton. How suprised was I to find that I received the "POSITIVE ENERGY" award. How cool is that!!! Thank you to everyone.

It's a beautiful award too! I uploaded a photo of myself with award looking like a dork.

Thank you all - it means a lot to me!

Jolyn

FHA appraiser checklist

With all the changes in the mortgage industry and guidelines getting tougher and tougher FHA loans are one of the last loans out there for many buyers who don't have the required 680 credit score or 20% down. It's a 30 year fixed rate, very competitive loan that requires only 3 1/2% down, and all the down payment can be a gift.

Appraisers are required to comment on a lot more details of a home than your regular 30 year fixed. It makes sense if you think about it. You've got a person putting minimal down. This usually means they don't have excess cash lying around if the roof is going to be needing replacement soon. So to avoid a borrower incurring high home repairs right after purchase, they want the home to meet certain requirements.

I've got a copy of the check-list FHA appraisers use when they inspect a home. If you are wondering if a home you're listing will have problems, check out the list. If you're working on getting a listing, explain to the sellers the importance of FHA loans in selling their home and what repairs would need to be done for the property to meet FHA minimum property standards.

If we're all proactive, you'll sell more homes, loans will go smoother, and more people can make their dream of home ownership a reality.

Shoot me an e-mail and I'll forward this appraiser checklist to you.

Let's work together to sell more homes!

FLOOD MAP TIP OF THE DAY!

I found a pretty cool link today while trying to research whether a property is in the flood plain or not. Cut and paste this into your browser.

http://wi-lacrosse2.civicplus.com/index.aspx?NID=1088

you can pull up a map index that will give you an idea of what panel to go back and open, or you can click on FEMA MAP SERVICE and type in the address.

All lenders have to use an independent flood determination company to give us the final determination as to whether or not a property requires flood insurance, but this will give you a heads-up on your listings or if you're on the buyer-end of it, you can let your buyers know they will need to figure flood insurance into their monthly payment.

It's amazing what you can find out there if you know where to look!

POSSIBLE PROBLEM-TYPE PROPERTIES

Did you know you may have some trouble selling a certain type property these days?

Loans that are long-term fixed, lowest rates, least down are CONVENTIONAL LOANS that, even though they may be serviced by local lenders, are SOLD on secondary market. If you've ever heard the term Fannie Mae, Freddie Mac, Gennie Mae, these are where the bulk of the funds come from for today's mortgages. When lenders do a 30 year fixed rate loan, they use their own money to do the loan, then the loan is sold and they are reimbursed their funds so they can do more loans. The buyer may continue to make their loan payments to that lender, even though the loan is sold, or they could be paying someone else. A lender sells the loan, but can choose to retain the "servicing" or the handling of the loan payments. Loans can be sold at any time during their term.

In-house loans are loans where the lender uses their own funds and does not sell them. You will not get a 30 year fixed. Most likely, it will be a 1-3 year adjustable rate (ARM) or loan with a balloon payment that is due in 1-3 years. They will not tie up their funds for 30 years. It's not good banking business.

To get these long term, fixed rate, low rate mortgages they need to meet the requirements of secondary market, or as I like to say, borrowers have to JUMP THROUGH THE HOOPS. Believe me, there are a lot of hoops these days. Secondary market, to simplify, only wants cookie-cutter homes that will sell easily and fast if they need to foreclose on them. The hoops are their way to ensuring the chances of getting that loan back minimal.

Because of the continual tightening of mortgage guidelines, properties that may be difficult to get the secondary market loans on these days are:

1) Investment property - 1-4 unit non-owner occupied income/rental properties need 25% down, a high credit score, and unless the borrower has had a 2 year history of being a landlord, they probably won't let them use any rental income to help qualify them for the loan. Most people need that rental income to qualify.

2) Unique properties - Secondary market doesn't like unique properties. If it's unique they may have trouble selling it if they foreclose on the property. Also, to be acceptable on secondary market, there needs to be 2-3 comparable sales that have sold in 30-90 days. Unique properties are an appraiser's nightmare and hard to appraise. Unique properties are Dome houses, earth homes, log homes, 1 bedrooms, multiple out buildings, holding tanks, 2 homes on one lot.

3) Manufactured homes - Loans for manufactured are VERY DIFFICULT these days. Borrowers are most likely going to need a substantial down payment, and won't be able to get a fixed, long-term loan. Don't get manufactured confused with MODULAR. Modular are not as tough. Make sure you let your lender or Realtor know upfront you are selling or buying a manufactured so you avoid problems. Make sure you know the obstacles involved with manufactured homes.

4) Acreage - We're back to minimum acreage again. Years ago, no one liked loans with excessive acreage (more than say 5-12 acres). Over time, as long as there were comparable sales, 40 acres was OK. Not any more. The land value can't exceed 30% off the total value. You may need to plan on splitting off the house and 5-10 acres and buying the excess acreage separately.

If you have a unique property you're tyring to sell, give me a call and I'll walk you through some possible options.

Have a great day.

Do you know someone selling a home?

Good morning –

After my BNI (Business Network International) meeting this morning, I thought I’d give you something to think about. I usually ask people to refer buyers to me because what I do is help people get a home loan. I think I can be of as much, if not more, help to sellers. Chances are I won’t benefit directly from this contact, but it can help make their home sell faster, help Realtors and potential buyers, and it’s good Karma for me. (Did you hear about the dog named Karma – it always comes back to bite you)

If you have someone you know who is thinking about selling their home, have them give me a call. I can help them understand the current mortgage industry, and some of the hurdles buyers have to jump over these days. It may help them understand what can make their home more saleable than others on the market.

I can explain to them….

> 75% of the buyers can only manage the minimum down payment or don’t have the required 680 credit score, which leaves FHA loans as a very viable option. There’s a good chance someone looking at their home will be an FHA buyer these days. FHA doesn’t mean a borrower is a looser. You can have perfect credit and have a credit score under 680. Young buyers who don’t have a long credit history have this problem as part of the credit score is based on how much credit they have and how old the credit accounts are. A longer credit history means a better score. And let’s face it – it’s hard to save 5-20% down these days.

> What property minimum standards there are with FHA loans

> How offering incentives like paying closing costs for the buyer may help a buyer get a loan and be able to purchase their home vs. the competition

> What can they do to get their home ready to sell so they avoid problems like peeling paint when they get offers.

> Does their well and septic meet the distance requirements that FHA has.

> How fast can they expect to close once they get an offer accepted.

> How reliable is an "approval letter" these days.

I would like to help them be pro-active and sell their home faster, whether I benefit or not. Just having them call makes it worth my while!

Forward on my blog, or have them contact me. I'm here to help.

Office: 608-779-1519 Cell: 608-498-1959 e-mail: joelfke@umc123.com

Have a great day!

Jolyn - your Motgage Expert from Universal Mortgage

when you get an offer on your listing, call me right away

Hey beloved Realtors! When you get an offer on one of your listings, find out what kind of loan the buyer is trying to get call me and I'll give you some things to check on to make sure you won't run into last-minute issues that could delay your closing.

If it's an FHA loan, there's lots of guidelines the property has to conform to. Better to know them upfront and if you can meet the guidelines right away. I can share my 23 years of FHA lending experience with you that most lenders don't have. A lot of lenders are getting on the FHA band-wagon now, but don't know what to watch out for when doing these loans.

With the ever-tightening lending guidelines, about 75% of the buyers are shut-out of getting a 30 year fixed CONVENTIONAL loan. You can't get a loan with a credit score under 680 unless you have 20% down. How many home buyers do you know that have 20% down these days - not many! You can have a credit score as low as 620 and have access to FHA loans. You can have a very low score and possibly get a Rural Housing (GRH) loan. These are great fixed-rate loans that most buyers qualify for. There is NO INCOME LIMITS for FHA loans so anyone can get an FHA loan as long as they have at least a 620 credit score. But....with FHA, there are certain requirements for properties, and when most of the buyers out there are using FHA, we need to know if your listings are suitable for FHA financing.

Call me - even though I may not be doing the loan for the buyer, I can help you make sure your closing goes smooth. We all hate last minute problems!


Talk to you soon!


Jolyn Oelfke - Mortgage Expert
Universal Mortgage
608-779-1519

would you like to make a pumpkin pie from a pumpkin?

As most of you may know, I love to cook. I'll get a picture of my Kitchen for you on my blog soon. I'm sure you've heard about my "CLOSING COOKIES". I've been making them for my home loan closings for over 20 years.

I'm in the planning process, but I'd like to give cooking classes at my home. I'm thinking small groups of about 6, (wine may be included). I'm going to start this late October, maybe early November with my HOW TO MAKE A PUMPKIN PIE FROM A PUMPKIN class. I'm growing the pie pumpkins now (yes - there are specific pumpkins better for making pies). I'll have you make the pie crust, prepare and bake the pie, drink some wine, and send you away with the finished pie, the recipe and instructions, and another pumpkin so you can amaze your family with your cooking abilities at Thanksgiving. How many people do you know who can say they made a pie from a pumpkin.

Let me know if you'd be interested. If there's something else you'd like to know how to make, I can arrange a class on that.

Just went to the movie Julie and Julia with Melissa Bakkestuen Wednesday. If you like to cook, you'll love the movie. Cooking isn't hard - it's fun to learn.

Some other class ideas:

How to make a Thanksgiving Turkey
How to make an apple pie
How to make stuffed french toast (OMG! You'd love this recipe!)
Homemade Jam
Making Quiche
Making a rich chocolate cake from scratch
How to make homemade puddings and cream pies
Bar-b-que ribs that just fall off the bone

The list goes on and on. I LOVE TO COOK.

I could do a class on how to prepare an entire breakfast or dinner.

I don't buy hash browns, I make my own about every other day. My hubby eats very well.

I digress - if you have an interest, just let me know.

Have a wonderful day!

When you trust me with your borrower's loan you're trusting me with your hardearned commission check and hoping I don’t screw it up.

When you give me your deal, I know you are trusting me with your commission and want to know I'll get the deal closed!

This is a challenging time we're in. I've been here before. I was selling Real Estate during the demise of the Savings and Loans. I remember the industry-wide panic all the changes when the Savings and Loans went into receivership. The government took control then like they are now.

One constant in this industry is change. Right now, we are going through the most changes to ever hit our industry. There are programs and companies that are gone and not coming back, so we need to move on!

There are no more NO DOC loans. There are no more 100% conventional loans and no 125% loans. The sub prime market as we knew it, is gone. I'm not going to cry about it, I'm moving forward - come with me. It's actually a great time to be a expert loan professional with 23 years of experience who's been through challenging times before.

We need to stop focusing on the programs we had the the way things used to be and find the people who are in need of the programs we do offer.

Lets stop listening to all the negative talk out there. There is still plenty business to be had. People are still buying and selling, transferring for their jobs, downsizing, buying that larger home, moving into nursing homes or becoming snow birds. Yes, the market is tougher and yes, deals are harder to put together, but people still need us and our services. Lets get out there and make them find us!

Trust your loans to an expert - Jolyn @ Universal Mortgage!

1ST-TIME BUYER TAX CREDIT

Borrowers still have time to get in on the tax credit of up to $8,000 if they close on a home by 12/1/09.

Definition of 1st-time buyer: Someone who has not owned a home in the past 3 years.

You can get the money AFTER you buy the home by either amending your 2008 tax return to get it right after you close, or you can get it when you file your 2009 tax return.

Loan programs now want a borrower to invest their own funds for the down payment. A majority of the loans that are being foreclosed on are loans where a borrower had zero down, so lending guidelines have changed to require a borrower invest something into a home. There are 2 loans in our area with zero down. Federal VA where you need to be a qualified Veteran to get the loan, and the Guaranteed Rural Housing (GRH) or Rural Development loan, which has income limits that must be met. All other programs require a down payment from the borrowers funds. FHA or HUD required 3.5% down, but that down payment can be a gift from a parent, grandparent, brother or sister.

So, if you or someone you know is a 1st-time buyer and would like to take advantage of this potential tax credit (there are maximum income requirements for this credit) time is of the essence! It's taking 45-60 days to close a home loan these days, so you've only got 4 months to get into that new home!

Call me for details, 608-498-1959

delays in closing dates if any changes are made

There's a new law in effect effective NOW that all banks, credit unions and lenders must follow. If anything changes on a loan (rate, closing costs, fees) that affects the APR, we are required to get all new disclosures signed by a borrower. Now this may sound simple, but if something were to change right before closing that affects the APR, the closing can not take place until 6 working days AFTER the borrower receives the new disclosures. Saturdays, Sundays and Holidays do not count toward this. So, last minute changes can really screw up closing dates.

Help me explain to sellers a closing date it just a target date, and the actual closing is hard to set up till the loan is fully approved. Appraisals are causing huge problems right now.

I'll keep you posted!

Thinking of sellig the Beeemer

It's a blast to drive! Amazing power. Now this isn't a cheap Z-3, it's an "M-roadster". There's a huge difference. The M's are shipped back overseas and suped-up with better suspension, more horse power and features. Regular Z-3's can be 1.9 litre motors, M's can be 3.2 litres. When they ship it back to the US, they are required to have a governor that only lets the car go 136mph, but you can get a chip to remove it. You see a few around, but not a yellow M. Still books at $19900. It's stored in a heated garage all winter. Thinking about buying a better winter car. I stopped by Auto Sport to look at a sport utility and he told me I shouldn't sell it, but that I'd have no trouble selling it with the shape it's in and low mileage. It's a 2000. There are on auto trader for $20,000.

Here's the 1st one

I'm trying to think of a way to keep all my friends, customers and associated informed on changes in the mortgage industry.

It seems like there's changes every week, and they really affect a borrower's ability to buy a home or refinance.

Since I've been in mortgage lending for 23 years, it's interesting that we are back where we were 20 years ago. Back when I started in lending, you needed 20% down, had to pay your bills on time and have a stable job. You may think DUHHH but over the past 5-10 years, guidelines have loosened up so much you didn't need any down payment, and you didn't even have to list a job or income! There was a lot of greed out there. It didn't matter that people couldn't afford the homes, all that mattered was to do more loans. This is everyone's fault, not just lenders. Did you have a retirement account? Did you want 12-20% return on your investment? Your retirement account probably invested in mortgage backed securities. The more loans that were done, the highter returns we were all getting on our 401K's. That's kind of simplifying it a bit, but the guidelines kept getting more and more lienient because of the hunger to do more and more loans.

With the Mortgage Crisis the lending guidelines have done a complete 360.

Here's an apprimate comparison:

1990 Had to prove you pay your bills on time, needed a down payment from your own money, they wanted 28% of your net income for your house payment, real estate taxes and insurance, and 36% for housing and all other monthly payments. You had to have a stable job with a 2 year history.

2006 Didn't even have to disclose income or job if you had a credit score in the upper 700's. You could get a zero-down loan, combo loans allowed you to have zero down and pay no mortgage insurance, you could get a loan 1 day out of bankruptcy.

Today: Most loans (there are Federal VA and Guarantee Rural Housing with zero down yet) need 5% down and it has to come from your own funds. FHA needs 3.5% down and it can all be a gift from an immediate family member. Most loans allow you to stay around 40% of your pre-tax income for all your monthly debts. Very difficult to get a loan with a credit score under 620 and you'll pay a higher rate it it's not 740 and above.

If you were pre-approved for a loan a month ago, get back in touc with your lender to make sure there weren't any guidelines changes that would prohibit you from getting a loan.

If you follow my blogs, you'll eventually see that it may not be what you want to hear, but I will tell you the truth. I don't tell you I can do something I can't.

I look forward to builing a blog-following! E-mail me any time if you have questions regarding home loans.

I'm going to give Blogging a hand!