Register Real Estate Advisors

This is a fascinating article I thought you would enjoy.

Daily Real Estate News | Thursday, July 21, 2011

A provision in the Dodd-Frank financial reform law, which took effect this week, is requiring lenders to provide consumers with a free credit score, which will help provide new insights into why they may have been rejected for a loan or did not qualify for the best, lowest rate.

While borrowers can access their credit scores from the credit bureaus, the credit score that a lender uses isn’t always the same one that the credit bureau provides you. According to a report by the Consumer Financial Protection Bureau, some credit bureaus sell consumers “educational” scores that aren’t the same ones used by lenders, or these bureaus may base the score on a different model than the one lenders use.

Now, borrowers for the first time will get a more accurate view of what credit score lenders are using to base their mortgage on.

Under the new provision, lenders will be required to provide potential borrowers with a free credit score whenever they reject an application for a loan. Lenders must provide borrowers with an “adverse action” notice, which will include their credit scores as well as an explanation of why they were rejected for a loan.

Lenders will also be required to provide a free credit score and an explanation whenever they approve a loan but at a higher rate than what is given to their best customers.

Mark Greene, CEO of FICO, says that many borrowers may be surprised to learn that they didn’t qualify for a lender’s lowest rate when applying for a loan.

Source: “Turned Down for a Loan? Now You Can Find Out Why; Consumers Can Also Get Free Credit Scores if Loan Rate Isn’t Best Available,” USA Today (July 21, 2011)

Over the years many clients have asked for my advice when it comes to choosing a mortgage lender.  Usually they have been trained either by the media or previous lenders and Realtors to compare interest rates.  There is a lot more to comparing lenders than just comparing interest rates.  Sometimes a low interest rate can come with high fees and other problems.  The big question in today’s market should be, “Can this lender get this deal done?”  So many lenders cannot get the loan closed on time, and sometimes cannot ever get it to close.  The worst thing for a buyer is to have invested time and money in a home they have their heart set on purchasing and the deal falls apart before closing because of their lender.  I have seen lenders go out of business, I have seen lenders change the terms they had promised buyers, and I have seen lenders unable to qualify a buyer they previously had qualified for a loan.  I rely heavily on RREA’s in-house lender, Terry Traylor.  That’s because I know Terry and he has closed many loans for my clients in the past.  Terry is available if I need to get in touch with him or have questions.  Terry shows up to closings for my buyers.  If Terry can get someone pre-approved, I know I can count on him to close the deal on time.  Our RREA in house lender offers very competitive rates and you can trust him to get your loan closed on time.  If you would like to get pre-approved for a mortgage, you can apply online at RREA.com and complete the loan application and you’ll hear back about your loan approval the same day.  Terry Traylor offers exemplary service, or he would not be part of the team at Register Real Estate Advisors.  When you are considering which lender to use, make sure you choose a lender that will close their loan on time, as promised.  You want a lender with experience and the ability to manage the guidelines and every changing regulations within the lending industry.  You also want someone that will communicate with you regularly and with your Realtor so that the entire process closes smoothly.

I had a borrower that was employed for many years as a W2 employee but transitioned to a 1099 independent contractor and/or self employed status working with the same company. This created a major problem as the borrower was self employed for only 6 months and the mortgage guidelines call for a 2 year history of self employment income.

My first step was to find out what the borrowers assets consisted of. The borrower had an investment account that I felt would do what was needed to help me close this loan. With the borrowers permission, I contacted the investment account representative and had her develop a monthly automatic withdrawal agreement for a specific dollar amount that would put the borrowers Debt to Income Ratios at an acceptable level for loan approval. The investment account had to have enough money in it so that the monthly withdrawal amount we needed could continue for a 36 month period after the closing.

If you have a borrower that is self employed and their adjusted gross income is not enough to qualify them or perhaps they are recently self employed and their income cannot be used to qualify, I have a legitimate option to consider. Terry Traylor 713 705 1244.

The Price of Business airs on Houston’s 650 AM and is powered by CBS Radio. On this segment of the Price of Business, RREA Owner Shannon Register introduces Register Real Estate Advisor’s new in-house lender, Terry Traylor. Terry has been in the mortgage industry for years and joins Shannon in the RREA Studio in Spring, Texas to discuss his role in helping the Agents at RREA and helping the RREA Buyer’s get pre-approved for mortgages. At RREA, clients can use a Realtor and Lender that work out of the same office and communicate throughout the home buying process until the purchase is complete.

Welcome Terry Traylor, mortgage specialist with Network Funding, to Register Real Estate Advisors! Terry is here to ensure our clients get approved and into the home of their dreams.

If you are a first time homebuyer, navigating all the new information about homeownership, the home buying process, and mortgages can seem overwhelming. If you are beginning the mortgage shopping process, but have no clue as to what information you’ll need and whether or not you’ll even qualify, here is some information that may make the process a little smoother.

Will I Qualify For A Mortgage?

There are essentially three things that lenders look at to determine whether or not you qualify for a mortgage.

Income Verification

When purchasing a property, all income of a homebuyer must be validated by a mortgage underwriter in order to receive a loan. Income verification can be done using several types of documents such as a W-2 statement, paycheck stubs, or income tax statements that show proof of income. These documents usually will have to span a period of two years or more to show you have a history of a steady income. Income proof can include such things as child support payments, disability payments, or income from the Social Security Administration. These additional monthly payments can increase your potential to qualify for a mortgage, as well as the amount you will qualify for, but like regular income, must be validated in order to count.

Debt-To-Income Ratio

Another important factor in getting a mortgage will be your debt-to-income ratio. This involves looking at your total debt load and monthly payments, including car payments, credit card debt, and any student loan debt. If the ratio of debt exceeds 40 % of your income, you will likely have to pay off some debt before you will qualify for a loan. In this case you may want to seek out the advice of a financial advisor to help with this process.

Credit History

The final consideration that lenders will take into account in determining whether you qualify for a mortgage is your credit history and score. They will not only be looking for a strong history of on-time payments for all your debts, but also that you have already established credit. You can arm yourself with this information by getting your free credit report from sources such as Equifax, so that you are able to check that it is accurate and up to date.

When getting a mortgage, being prepared with a little background research and all required documents will make the process simpler and less stressful. Armed with this information, you will be able to get the best possible deal with a lender who is right for you.

So you have made the decision to buy a home?  Congratulations!  Buying a home is always exciting and can be very emotional too.  To help you make this process go smoother, a pre-approval letter is definitely recommended as it provides you many benefits by having one.  Be prepared to give lenders the documents they need in a timely manner.

The documents generally needed for the pre-approval process is as easy as 1…2…3…

1…month of pay stubs
2…years tax returns and W2’s
3…months of bank statements

I suggest keeping these documents in a file where it is easily accessible when you are asked for them.  Lenders may (and most likely will) ask for further information and for other documents as everyone’s situation is different.  If lenders do ask you for more information and documents, place those in the file as well.  Stay a step ahead and don’t wait for lenders to ask you for these documents. Fish for them in your sea of paperwork now.  It definitely makes for a much smoother pre-approval process.

Paying off your mortgage is one of the biggest financial goals of most homeowners, and retiring debt-free can certainly give your golden years a greater sense of financial freedom and stability. Whether you’re nearing retirement age or are just looking to reduce your largest debt load more quickly, here are some great tips for paying off your mortgage faster!

Principal Versus Interest

Essentially, to pay off your mortgage you have to reduce the principal owing on your property. There are really two ways you can do this without dramatically reducing your monthly budget.

Increase Your Monthly Payments

Even increasing your monthly payments by a small amount can take years off the life of your mortgage. You can also choose an accelerated plan whereby you can make weekly or biweekly payments rather than monthly. This will allow you to make a few extra payments each year. Combining these efforts can really have a surprising effect on the principal of your mortgage over a short period of time. There are a number of free online calculators that can help you figure out the exact numbers for your particular situation.

Reduce Your Interest Rate

If increasing your monthly payments is not an option, you can still pay off your mortgage faster by refinancing your mortgage to negotiate a lower rate. Keep your eye on the financial markets to gauge the best time to make this move, and seek out the advice of a REALTOR® or financial advisor to confirm that this is a viable option for your current financial situation. If you have a good history of payment and an excellent credit score, finding a lender shouldn’t be a problem.

Make A Lump Sum Payment On Your Mortgage

Another way you can decrease your mortgage principal and pay off your mortgage faster is by making a large lump sum payment. If you have come into extra money, have received a large income tax return, or just have a considerable amount of savings, this may be a wise financial decision. It will also dramatically decrease the amount of interest you will pay over the life of your mortgage and thus save you money. Just be sure your mortgage does not include a clause that will penalize you, and then determine whether it is still a good choice before going ahead.

The satisfaction a homeowner feels when they make that last mortgage payment is really unmatched by any other financial achievement, and following these simple steps can more quickly make that dream a reality.

Original Article: http://www.foxnews.com/politics/2010/10/10/lawmakers-struggle-address-foreclosure-fiasco/

Congressional lawmakers are struggling to come up with a quick fix to the foreclosure fiasco that has threatened the economic recovery and thrown a monkey wrench into their re-election campaigns.

Hearings. Investigations. Court orders. Moratoriums. These are among the many options being floated by members of Congress as they try to demonstrate their sensitivity to the problem and eagerness to address it. The latest housing mess has handed them a new dilemma just when it seemed the economy couldn’t be more of a drag on incumbents. And while some warn a heavy-handed government response could make a bad situation worse, others are calling for across-the-board government intervention.

“The fundamental fairness of the entire foreclosure process is now in serious doubt,” the bipartisan members of Maryland’s congressional delegation, along with Gov. Martin O’Malley, wrote in a letter to the state’s highest court Sunday. They requested a minimum 60-day foreclosure suspension in their state.

Others are calling for a national freeze.

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There are several lenders that I recommend to my clients, depending on their needs. If you need to get a loan pre-approval, call me for a reference. I work with lenders all the time and I can help you. You want to be sure the lender you are using is truthworthy, professional, and dedicated to getting you to the closing table so you can purchase your new home.