MortgagesUndressed

Yesterday was a day of questions and unsolicited comments. It was interesting, phone calls and emails. I will post a few. First, a question on a second from Terry. I have addressed this topic before. This man has a chance to pick up a home in foreclosure for $90,000.00. It is out of state. He needs a quick second. He has $250,000 in equity and is in a hurry. What lender can do this fast? He was hoping I would send him to a loan officer.

I sent him to his credit union. He has good credit. They do seconds. They charge no fees.

Last week I published a report on 10 agents in Reno, Nevada. This was driven by frustration over a person moving to Reno and wanting to search for homes first. She was asking my help in finding a website and then an agent. The stage this borrower was in was merely gathering information.

The study I performed resulted in suggesting she use Robert Range of Coldwell Banker. She has been happy with this suggestion and is on her way to Reno as I write this article. She asked an important set of questions prior to leaving for Reno. Here is a summary.

Q: Robert won’t go show me homes unless I am pre-approved. Should I do that?

A: Yes, in fact this gives me even more confidence in him as a good agent.

Q: But he wants me to use Coldwell Bankers Mortgage Company.

A: I knew that was his lender, it was on his website. Providing that information was one of the reasons I selected him for you.

Q: They said they will need to run a credit report on me, can I use the one I did a couple of months ago?

A: No. They will need to run their own.

Q: What if I am not happy with this lender?

A: You most likely will be, or Robert would’t use them. This is an important qualifier when choosing a lender.

I know people like to see their comments go live immediately. We want that too, unless you are a spammer. We have blocked too much spam.

With this as a problem we have the following policy:

The first time you leave a comment on our blog we hold it for moderation.

We do this because we are inundated with spam: Viagra, Software, Seminars, etc.

We will post opposing opinions as we did on our contraversial, but popular article: 10 reasons to list with a flat fee broker. We won’t post trash and if it gets through we delete it. Trash is foul or inappropriate writing. Remember these are G rated sites.

Of course we don’t mind debating points, it’s good for the consumer. We do mind spam and don’t understand the jerks that write it.

I apologize but this one explanation appears on both blogs.

Larry Cragun

Click Here; Thanks to Bankrate.com

Picked up by David Porter.

Comment by Larry Cragun: Our Fannie Mae and Freddie Mac entitities are the reason we have low interest rates in this country. If your loan is going to be sold to another investor, the rate will be higher. Fannie & Freddie standards are more difficult, the risk lower, and the rate to you lower.

At this time, we seem to be a nation that loves polarization. Find a scandal and jump on it. It takes place in our lives in so many ways.

I felt this positive report on should be noticed by you, these are important institutions.

..a partial quote.

WASHINGTON, D.C.

€” James B. Lockhart, Director of the Office of Federal Housing Enterprise Oversight (OFHEO), safety and soundness regulator for Fannie Mae and Freddie Mac (the Enterprises), classified Fannie Mae and Freddie Mac as adequately capitalized as of March 31, 2006.

The Federal Housing Enterprises Financial Safety and Soundness Act of 1992 requires the OFHEO Director to determine the capital level and classification of the Enterprises not less than quarterly, and to report the results to Congress. OFHEO classifies the Enterprises as adequately capitalized, undercapitalized, significantly undercapitalized or critically undercapitalized. The Enterprises are required by Federal statute to meet both minimum and risk-based capital standards to be classified as adequately capitalized.

Given the ongoing operational weaknesses at both Enterprises, Director Lockhart is re-emphasizing the importance for the Enterprises to maintain capital at least 30% above the statutory minimum capital requirement. As a result, OFHEO is now disclosing the Enterprise’s minimum capital surplus over the OFHEO-directed requirement versus the statutory requirement previously

Click Here to go to David’s full report.
Larry Cragun

1- Out of your current assets.

2- From a lender rebate.

3- From your home equity. (Refinance only)

4- From your seller. (Purchase only)

5- A combination of the above.

Experts - are there more?

During my lending career I began to believe that most people could borrower more money for a home than they would choose to borrow. With good or great credit, good cash reserves, strong employment, and/or a large down payment, even Fannie Mae or Freddie Mac will let you stretch their standard guidelines. Specialty lenders in search of higher returns create programs that help the non standard situation.

I write this short note to encourage you to investigate. Don’t assume you can’t have a particular home you want. There might be a way.

Now with this in mind I give you the advice given me by the father of one of my college buddies. “Be careful of what (or who) you go after, you may get it.”Thad O Yost.

Larry Cragun

Yesterday I noted this expert advice. It iimplied rates may go up. Today I note this expert information as to why rates just went down. These reports were two days apart, the second tracking information from a week ago. What do you take as pertinent information to your situation? What do you do about locking your rate? My answer, lock at time of application, unless closing is more than 30 days out. If it is, lock about 25 days from closing. Don’t try and beat the experts, as they often don’t agree. Larry Cragun

I have found it difficult to predict the direction of rates. One client said it seems like going to Las Vegas, deciding when to lock. This attitude certainly has merit. My upcoming article on who is gambling with your rate lock will shed more light on this.

I don’t plan on making this a forum that predicts rate directions. However, when I note what I believe credible information in this area I will post it.

So it goes today. I note a post by Dan Green. I follow Dans blog daily. The net of it is to expect rates to rise in the near term.

Only agree to a loan with a prepayment penalty at last resort. (Except FHA has a miniscule one to not worry about.) If you think you are in a situation that requires one, get a second opinion, even from those of us at MortgagesUndressed.com. Larry Cragun