By Jennifer Klein and Derek Sandoval
FHA mortgage insurance premiums rose on April 1, 2013. Placer County Association of REALTORS® YPN members Jennifer Klein and Derek Sandoval discuss exactly what has changed as well as what these changes mean for real estate professionals and those applying for a loan.
Jennifer Klein is a REALTOR® in Northern California who is experienced in short sales, investments, and property management. Connect with Jen at RosevilleAndRocklin.com, JenKlein.com, and @JenKleinSac.
Derek Sandoval has worked for Keller Williams Realty in Roseville, Calif., since 2009, and specializes in residential, REO, and short sales. Find Derek at www.dereksellshomes.com and dereksellshomes.featuredblog.com.
By Marc Guzman
We all know how important your credit score is when it comes to borrowing money for credit cards, auto loans and home loans. But how many of us really take the time to educate our clients on the benefits of preparing their credit score before they buy a home?
Buying a home can be very exciting and a daunting process. Home buyers do a lot from preparing paperwork for the loan officer, research and viewing properties with their REALTOR®, reviewing disclosures and signing paperwork, to saving enough money for the down payment. But in working with many buyers, both first-time and experienced, it is amazing to me how many buyers overlook the importance of their credit score. Many buyers think saving the down payment is sufficient as long as their credit score is above 620. You know that question, “What is the minimum credit score I need to qualify?”
But the truth of it all is, no matter what the credit score, it is important to begin working on improvements 6 months to 1 year before buying a house; longer in other cases. It takes some time to significantly increase the score. You may also want to partner with a company that specializes in credit counseling. Now why place so much emphasis on improving an already qualifying score?
- Average score for buyers using conventional financing is 760
- Average score for buyers using conventional financing in which the loans were purchase by Fannie Mae or Freddie Mac was 755
- Only 1 percent of loans were offered to buyer with less than 620 credit score
- 75 percent of loans were offered to buyers with credit score of Continue reading »
By Nobu Hata
With the down market and the inevitable mass exodus of “those” loan officers, you’d think we could rest easy knowing that the loan officers left would be – for lack of a better word – decent.
Holy Hannah, would we be wrong.
In the last couple weeks, I’ve had various buyers shop their loan around, including those using FHA. What I thought were set guidelines and fees isn’t what it seems. One particular buyer of mine asked for Good Faith Estimates based on the same home, price and mock closing date, from each of the loan officers he’d met with who’d pulled his credit, on my recommendation. Lo and behold, one origination fee was $1,100 more than the other. The rest of the meeting was an eye-opening study of mortgage v. mortgage.
Now, I’m not going to get into specifics of big bank versus broker, nor the merits and drawbacks of each. But what I will say is that there’s no better time to brush up on the new GFEs and fees associated with them. Fees and guidelines for all types of loan products are changing at a lightning pace, and while it’s largely up to our clients to perform their due diligence, it’s up to us to impart some insight. Continue reading »