joshp975's Blog: All Categories

For those of you who put down less than 20% when you bought your house, you probably have mortgage insurance on your home, and you're probably wondering how you can get rid of it.  It depends on the loan type of loan you have.  If you have a conventional loan, you have to pay down your principal balance to 80% of the value of the house.  For example, if you bought your home for 200,000 and borrowed 190,000 you would need to buy down your principal balance on your mortgage to 180,000 to begin getting rid of your mortgage insurance.  Another option would be for the value in your home to increase (not likely in this market) and make your loan to value ratio less than 80%.  Once one of these milestones are reached you can get in touch with your…

It used to be that a borrower needed a 620 credit score and a clean mortgage history for 12 months in order to qualify, but that has recently changed.  Now there are some lenders who will do the streamline as long as you just have on time mortgage payments for 12 months.  This is a great new change for some borrowers who are having a tough time keeping up with all their bills, but have made their mortgage payments on time.  With FHA 30 year fixed rates hovering around 5% and ARM rates hovering around 4% this is a great time to take advantage of the more lenient underwriting on a the FHA Streamline loans.  The best part is, it goes for both conforming and jumbo loans.  If you can lower rate down to today's low levels, and ordinarily…

A few years ago, everyone was offering "no cost refinances."  The loan officer would pay all of the borrowers closing costs for them (lender and title company fee's).  This was great for the borrower who wouldnt have to come out of pocket for closing costs, and wouldnt have to increase their loan amount to roll in the closing costs.  The way the loan worked is the borrower would agree to take a slightly higher interest rate (loan officers get paid more yield spread on a higher interest rate), and then would give a "lender credit" for the amount of closing costs.  These loans still are out there today, but since most borrowers don't understand how they work, its hard to explain why they have to take a higher interest rate.  The good thing is, with rates as…

Condo financing is getting tougher and tougher these days.  There are many different aspects to condo financing that come into play.  First is how much of the building is owner occupied vs. investment properties.  Ideally, you want at least 75% owner occupied if not more.  If its less than that, you run the risk the condo may not be warrantable, and therefore tough to get financing on.  This issue often comes up with new constrution condos because a lot of investors tend to look at condos for opportunities.  Also, if a lot of the units haven't been sold, it could cause issues.

Another issue that comes up with condo financing is interest rates.  Condo's often time have rate bumps depending on your loan to value ratio.  Most condo owners should be prepared…

Over the past few years, we've all heard that ARM's are bad, and you should only go into fixed rate mortgages.  For a while that made sense, especially when the difference in a 5 year ARM and a 30 year fix was less than .5%.  Over the past few weeks ARM rates have become considerably better, and that makes the ARM  product that much more attractive.  We've even seen 5 year ARM's get down in to the high 3% range. 

So who can bennifit from an ARM?  Anyone who will be staying in their home on a short term basis would be the perfect candatate.  For instance, a couple buying their first home, or someone who has moved to an area for work, but knows they won't be here for more than a few years.  Why not have a lower monthly payment if you know you won't be in…

It used to be anyone who wanted to could be a mortgage loan officer, and everyone was.  You didn’t need a background check, you didn’t need an individual license, or even to take continuing education classes.  Its funny how things change.  Today's loan officer is much more knowledgeable, and much more a consultant, or finical analyst than before.  Those who have made it through the rough times in the industry are now subject to background checks, must apply for individual licenses with states they choose to be licensed in, and are required to take continuing education classes every year, just to maintain their license.  Also, since we're all individually license, a bad loan officer can be reported, and it is public knowledge if someone…

Everyone wants to have the biggest and best house on the block, and there's nothing wrong with that until its time to get an appraisal done.  If you've put additions on your house, or any kind of upgrade that your neighbors dont have you might find yourself in trouble come appraisal time.  Just recently I had an appraisal done on a property in a great neighborhood.  The house was the nicest in the neighborhood...but there was a catch.  The house had an in-law suit over the garage.  Ordinarily you'd think this would help the property value.  When the appairser did the appraisal, he had to note that this house was a "unique" property since no other property in the neighborhood had an in-law suit.  Since investors don't want to lend on unique properties, this…

Beleive it or not, 100% financing is still available.  The USDA loan program offers up to 100% financing in rural areas all over Maryland, DC and Virginia.  All you need to do is make sure the property you're intersted in buying is USDA approved.  You can check with your local mortgage consultant, or check the USDA website to see if you're property qualifies.  Most people would be suprised what qualifies.  For instance, properties in both Upper Marlboro and Temple Hills Maryland, which most people wouldnt think of as rural,  would qualify for the USDA program.

In order to qualify, your property must be USDA approved, which can be check on their website, or by your local mortgage consultant.  Also, you must have a 620 credit score, and a good debit to…