I’ll be honest; the entire process of purchasing a home is not fun.  Having your teeth pulled by a dentist may be more comfortable than getting a mortgage approval these days.  When I am asked about my system, I make it clear the more that is accomplished early on will make for a smoother closing.   The system from the beginning to the end is time intensive.  I will walk through some of these steps:

1. You hire a “team,” meaning the right players helping make the outcome a positive one.  First, you hire a lender and see how much you can get approved for.  Then you hire a real estate agent to help you find a dream home.  This is just the beginning.  By the time the process is done you have hired many others including an appraiser, home inspector, termite guy and title company.

2. Get a plan (with your lender and agent).  In my experience, I have found that having a plan upfront will make the last days of closing run smoother.  Preparing early helps reduce stress levels on all parties involved with the transaction.

3.  Get a pre-approved loan.  This process can range from a couple hours to days and weeks depending on your specific challenges.  If a real estate agent tells you he can have a pre-approval by a lender in minutes, that is not the case in this market.  A pre-approval in my book is determined when;

• I have a complete and fully reviewed mortgage application on file.
• An automated approval process has been run and come back approved.
• I have received all supporting documentation to meet loan guidelines.

Once I have all of this done, your loan is fully pre-approved and I can issue a pre-approval letter or loan status report.  I can then inform your real estate agent that he or she can take you house hunting in your pre-approved range.

4.  Start house hunting.  This process could take hours, days, weeks or months depending on your specific needs, wants and requirements.  Once the real estate agent has an ACCEPTED CONTRACT is when the clock starts ticking.

5.  Signed contract.  This means that the accepted contract is signed by all parties involved in the transaction.  All parties include the buyer, seller and agents.  If you have a verbal acceptance but it will take three additional weeks to receive from the bank, this doesn’t count!  Your final approved loan starts with a FULLY ACCEPTED CONTRACT.

6.  Process, underwrite and close your loan.  Right now my turn times for these steps is in 30 days or less on FHA, VA or conventional financing.  Sometimes we can speed up that process, but be prepared for it to take that long.

Knowing and understanding the process of a mortgage approval can prepare you for your own experience.  It doesn’t have to be as painful as a visit to the dentist, all it takes is a little (or a lot) of patience.  Good luck!

Imagine yourself in your dream home, you’ve got everything you wanted including the white picket fence.  Now take a step back…how did you get there?  I will tell you one way of never getting into your dream home; bad credit.  Period.  The end.  If you have poor credit, you’ll never be able to carry out your dream of homeownership.  Some of you may be thinking that you have bad credit and you’ll never own a home.   Wrong.  There are steps you can take to make homeownership a reality.

So you’ve been behind on payments, creditors are reporting wrong.  I’ve heard them all.  Whatever it may be, you think the dream of homeownership has passed you by.  What you may not know is several companies exist to help repair your credit.  Some have charges up front and some charge a monthly fee, it just depends on the company.  You may think you cannot afford credit repair, but I say you can’t afford NOT to use a credit repair company.

It’s simple.  If you don’t have good credit, you can’t get your own home.  Why not take advantage of these companies and their expertise?  If you don’t know where to start, feel free to contact me with any questions or recommendations to get you closer to your dream home.

The days of choosing a mortgage professional based on a personality test and box of donuts in your real estate office is changing.  Today with the tightening mortgage guidelines, having a mortgage professional who can review credit, employment, debt to income ratios, calculate assets, document the file and make sure that 2+2= 4 is the smart move for a business partner.

 We just got word that in 2nd quarter of 2009, the big mortgage investors are still taking pretty significant losses on performance of their mortgage securities.  These are not just the old loans that were originated 2 to 3 years ago with guidelines allowing anyone who could fog a mirror get a home loan, but these are the more recent loans requiring verification of credit and employment for approvals through underwriting.  Based on the fact that mortgage backed securities are still not fully performing, investors will start to require stricter guidelines. 

 We are not too far along of seeing minimum requirements of 660 to 680 credit scores on conventional loans and 640-660 minimum credit scores for FHA and VA loans from the investor overlays. 

 With the lending environment getting tighter versus looser, it means more mortgage professionals will need to adhere to new guidelines. It will require a mortgage professional who has years of experience and a person dedicated to educating themselves of the new changes. 

 In recent months, I have heard a new set of complaints from our real estate community of loans denied the day or week of closing.  When I speak to someone and hear this my head spins.  Further into the conversation, I uncover that the mortgage lender did not master their craft.  Some of these folks will not be able to adapt to the new mortgage market.  In this particular situation, if the mortgage lender reviewed the file properly from the beginning, he would have discovered in 10 minutes that the borrower should never have received a pre-approval.  Instead, the lender was going off old information and wasted not only his time but the clients and all persons involved.  This is just another instance that makes our industry look bad.

 I am hoping with the new mortgage licensing requirements coming down the peak that some of these lenders will get out of the market.  Sub standard pre-approvals do not work today.

 I am asking the Real Estate Community to be aware of our always changing market. Now is the time to make the right change in your mortgage business partners for a successful business.  The “hand out 3” mortgage lender card rule given to clients in this credit tightening market, is setting your business up for disaster.  Seek out a highly knowledgeable mortgage professional and interview them.  Make sure they truly know the ins and outs of mortgage lending business.  In the long run, this will make your business more profitable and your clients happy with the results.

Have you ever seen the movie “A Few Good Men” (Brown & Reiner, 1992) starring Tom Cruise and Jack Nicholson?  Well, if you have not seen this movie I highly recommend, it is truly an American classic.  This movie has intense scenes and several of the most memorable movie quotes.  Whether or not you agree with character Col. Nathan Jepsep’s (Jack Nicholson) antics, his character portrays higher standards and values that others could not live up to.  He had all his troops buy into a system called “Unit, Core, God, Country.”

 What’s the point?  The point is that top mortgage professionals also have a code we follow and live by.  We do not need a fancy license to perform over the competition, but it is pretty clear how different our services are.  I have built my business on these direct principals of “Honesty, Integrity, Under Promising and Over Delivering.”  Top notch mortgage professionals are more concerned at the end of the day that our clients get the right advice.  Now does that means we overcharge for our service vs. the other guys? Absolutely not!  We just see the end result of little different.  I never want to hear about a client of mine losing their home because they were put into a bad loan product, or were unaware they could not afford the payment.  I am also a homeowner and I want to see the American Dream extended to all that should be afforded this opportunity, but also the understanding that with homeownership comes responsibility. 

 I pride my business on these core values just as Col. Jepsep portrayed to his troops.  This is especially not the time to refer friends and family to the wrong person for mortgage services.  If that mortgage lender did not build their business on these principals, then it’s time for a 2^nd opinion.  Please feel free to give me a call.