Posts

Fast Closings? We Can Close in 10 Days; Thanks Bay Equity!

We got a new loan on Monday that Wells Fargo couldn’t do. We locked the loan at a lower rate than Wells had offered. We then compiled the file, prepared disclosures, ordered the appraisal, and submitted the file. Yesterday (Wednesday) we had a formal (very clean) approval in our hands, and the appraisal was complete […]Read More

“New” Pricing Rules; Transfer Disclosure Statements (TDS)

There is a huge disparity among lenders today with respect to rates. Only Citi is at 4.75% for a “one point loan” (for the above $400,000 loan scenario). All of our other lenders are at 4.875%. More interesting is that Citi is paying a 0.30% “Commission” at 4.75%, but if we (the broker) charge 1 […]Read More

Don’t Reference ANY Reports Anywhere in “As Is” Contract

We have a condo transaction in which a seven-year-old pest report was referenced in an obscure clause in an obscure addendum, and, of course, the lender is asking for both the report and a “clearance.” The highly skilled and seasoned selling agent is flabbergasted (to put it mildly) that the lender would ask for something […]Read More

31% of Purchases are Cash; $5,000 = Payment of $26

31% of all purchases in California in January were ALL CASH. This is the highest percentage ever. All we can say after all we have been through with lenders is “no wonder”. But, we are making strides to make the process easier. A $5,000 increase in price results in an only $26 higher monthly mortgage […]Read More

Bid Aggressively; Quote from “Deal Chaser”

We have dozens of “Pre-Approved” buyers who have been on a house-hunt for months and months. Most of them are all too determined to get a bargain, thinking that there is little competition and that sellers are desperate. They are clearly wrong, as we write “Pre-Approval Letter” after “Pre-Approval Letter” for these buyers, and they […]Read More

We ALWAYS Specialized in PURCHASES; We KNOW the Issues

JVM has always closed more purchases than refi’s, no matter how low rates were. We specialize in PURCHASES. We say this b/c we have myriad acquaintances in the industry who did nothing but refi’s but who are now clamoring for purchases. We have an “Issues to Spot” worksheet with 282 issues that everyone in our […]Read More

Inflation Here; Buy Real Estate as Hedge, Investment, for Cash Flow

Inflation is clearly rearing its ugly head, as indicated by surging commodity prices. This is what pushed rates up yesterday, and this is a huge reason why we think Real Estate is a fantastic investment right now. Why to Invest in Real Estate: 1. Real Estate is a hard asset and an excellent inflation hedge; […]Read More

95% LTV Condo Purchases in Lieu of FHA; 1 Point Spread Among Lenders

Note also that we have huge spreads today among our lenders. Citi is at 4.625% at a cost of One Point, but several of our other lenders are a full quarter percent higher in rate for a One Point loan. Most Condo Complexes are NOT FHA approved, and “Spot Approvals” are no longer available, as […]Read More

Historical Perspective; 1980s – 10%; 1990s – 8%

We have a buyer looking for a home who is obsessed with getting the rock bottom lowest rate of all time. Our point to him is that ANY TIME YOU LOCK UNDER 5%, you are getting an extremely low rate from an historical perspective. And with inflation very likely in the future, 4.625% vs 5.25% […]Read More

What Could Bring Rates Way Down: Spain’s Collapse?

It is generally assumed that rates will continue to march up throughout 2011, as the economy continues to improve. And this is why, once again, we encourage people to lock in their fixed-rate loans now (and to buy now). The Fed is trying to push rates down, but its efforts are having the opposite effect […]Read More

Relieving Tight Cash Situation – Seller & LENDER credits

Borrowers with tight cash situations can garner extra cash for a purchase in two ways: (1) with Seller Credits; and (2) with Lender Credits. Seller Credits can be up to 6% of the purchase price, and they can cover both Nonrecurring and Recurring (interest, property taxes, insurance) Closing Costs, in most cases. Seller Credits can […]Read More

End of Year Thank You; Contractors Anyone??

Once again, we have a great “Handyman” and some great Contractors that we highly recommend. Please let us know if you need the info. The Handyman is particularly useful for minor repairs required by appraisers and underwriters, as he is skillful and inexpensive. We use him often with good results. Finally, JVM Lending had one […]Read More

Buying a House With a Major Roof Issue – What to Do?

We have a purchase involving a house with a very leaky roof. The buyers want to replace it in any case, but nobody wants to replace the roof prior to close of escrow (the seller does not want to pay for it; and it is risky for the buyer to sink money into a house […]Read More

EEM Loans: New Windows, Doors, Furnace, etc.

FHA Buyers should ALWAYS consider adding “EEM Financing” to their loan. EEM Loans are simply $8,000 of additional funds added on to an FHA loan (LTV is irrelevant) for “Energy Efficient” items. These items include Windows, Doors, Insulation, Furnaces, and Air Conditioners among other things. These loans are very simple to process, and they add […]Read More

Un-Permitted Additions OK; Min Number of Open Credit Accounts

Many Realtors are overly concerned about additions built without permits. Such additions are usually OK as long as: (1) No value is given to them in an appraisal; (2) they don’t contain stoves or ovens or look like a kitchen – un-permitted kitchens are never OK; (3) the addition is complete and the appraiser states […]Read More

We Need Clean “AS IS” Contracts; What Are “Necessary Repairs”?

We continue to have issues with Inspection Reports and getting required repairs done prior to close of escrow. Once again, if a Purchase Contract references ANY reports at all (even if the contract has “AS IS” plastered all over it), ALL lenders will request copies of those reports. Lenders will then request all necessary repairs […]Read More

10 Financed Properties Rule

We still get questions all the time about the Ten Property Limit imposed by Fannie Mae. 1. This rule applies only to Residential Properties of 4 or fewer units; 2. This rule applies only to FINANCED properties; borrowers can own 50 “free and clear” properties; and 3. This rule allows up to TEN financed properties. […]Read More

2 – 4 Unit Properties Offer Better Returns Than SFRs

There is a four unit property listed in Antioch, CA right now for $229,000. Each of the four units supposedly rents for $900 per month. This property can be financed with a 25% down payment and loan at about 5%. PRICE: $229,000; DOWN: $ 57,250; LOAN: $171,750; P&I: $922/month; Taxes: $238/month; Insurance: $100/month. TOTAL PITI: […]Read More

Closing Cost Credits

Please remember that Closing Cost Credits (on a purchase contract) can be for BOTH Nonrecurring and Recurring Closing Costs. We frequently have large credits on contracts of $10,000 or more that are written as follows: “Seller to credit $10,000 for NRCCs”. This is bad b/c purchases getting financed with “no points” loans typically have nonrecurring […]Read More

More than 4 Properties Financed – Issues/Prohibitions

Many of our Realtors are overly concerned about borrowers having more than “4 financed properties.” This is b/c some lenders will not offer financing to any borrower who has 4 or more financed properties. We, however, have numerous lenders that allow up to 10 financed properties. And, keep in mind that this “prohibition” only applies […]Read More

Be Nice to/Prepare for Appraiser

Agents, please see the comment below from one our best and most seasoned appraisers: “Real Estate Agents who don’t understand this will have appraisal issues far more often than an agent who does understand this: Agents or a homeowner being friendly, helpful, and accommodating to the appraisers makes a HUGE difference. When I see a […]Read More

FLIPs Still OK; Seller Credit Too Large – We Charge Extra & Rebate $

FLIPs. We still get questions about FLIPs. A FLIP is only a concern IF the property was bought and re-sold within 90 days. If it re-sells more than 90 days after it was previously purchased, there are no issues. BUT, we still have lenders that allow “FLIPs” for both FHA and Conventional financing, so it […]Read More

Non-Occupant Co-Borrowers; As Is – Reminder (Do NOT ref. Reports)

A Couple Reminders: As Is Purchase Contracts should have NO references to ANY reports of any kind. We continue to get “as is” deals that reference reports somewhere in the contract, and invariably, the lender requests the report and we have to get work done prior to close. Non-Occupant Co-Borrowers (parent co-signing for a child, […]Read More

ANNUITY Loans; Buy Annuity to Show More Income

We have a cash-rich borrower right now with very high debt ratios. All she needs to do is buy a small “Annuity” that matures more than 3 years from close of escrow, and she’ll easily qualify for the loan she wants. These Annuity based loans are a great way for cash-rich borrowers to garner low […]Read More

90% LTV for High Balance; Seasoning for Foreclosures and BKs

90% LTV High Balance Loans: Conventional High Balance Financing to $729,750 is available with Mortgage Insurance to 90% LTV in most areas. This has been the case for several months now. Credit Seasoning: FHA financing can be obtained: (1) 2 years from a Bankruptcy; (2) 3 years from a Foreclosure; and (3) immediately after a […]Read More

Do Not Report “Dispute” to Credit Bureaus – Just Endure the Error

Fannie Mae no longer allows loans to close if a borrower has a “Dispute” on his credit report. This used to not be an issue, as Fannie and most lenders turned a blind eye to a “Dispute” on a credit report. “Disputes” arise when borrowers see something reported in error on their credit report and […]Read More

“Short Refinancings”; DU Refi Plus

We get questions constantly in regard to “upside down borrowers” who want lower rates but who also want to maintain their credit. Option #1: Du Refi Plus – If a borrower has a Fannie Mae loan, he can refinance into a new Fannie Mae loan with No Mortgage Insurance even if his loan-to-value ratio is […]Read More

Asset Loans for Down Payments (instead of liquidation)

We have many borrowers and “donors” (parents giving money to their kids) who are very reluctant to liquidate stocks or other assets either b/c values are currently so low, or because they want to avoid the major tax consequences. There are numerous companies that offer short term, low rate and inexpensive loans against stock and […]Read More

Getting Condo Complexes FHA Approved

We get inquiries constantly regarding whether or not Condo Projects are FHA approved. With FHA so dominant in today’s market, such approvals are extremely valuable. While we are able to get some complexes approved ourselves, the process can be complex and cumbersome. This is why we now recommend that Realtors and HOAs, interested in FHA […]Read More

Do NOT need 30% Equity Cushion in Departing Residence

There is a concern among many of our Realtors about the necessity of a 30% “Equity Cushion” in a borrower’s departing residence (the “departing residence” is the house a buyer is moving out of). Such a cushion is NOT a necessity. The 30% Equity Cushion is only a requirement if we need to use the […]Read More

Return of Sound Alt A (Stated Income) Loans Delayed

Our Pricing Engine, by the way, is an on-line database that lets us instantly compare approximately 30 of our 45 lenders after we input a particular loan scenario. Such Engines are invaluable in today’s mortgage arena because there are so many parameters that influence pricing or rates. These parameters include Loan-to-Value Ratios, Credit Scores, Impounds, […]Read More

Keep Payments Current Until Short Sale Closing Date!

Homeowners looking to short sale their home should NOT skip or miss payments, if possible. We beat this dead horse often, but it comes up so often we want to drive home the point again. First of all, lenders are not more likely to accept a short sale proposal if you are behind on payments. […]Read More

Far More REOs

Today Citi is leading the charge again, after getting completely out of the market yesterday. Today rates improved initially because jobless claims came in higher than expected; again, such signs of economic weakness typically portend lower rates. BUT, we just received several “price change for the worse” announcements from some of our lenders. So we’ll […]Read More

Broker Loans are 10% of Total Business – Good for Us and You

In any case, many analysts now expect rates to remain low through 2011. The percentage of total home loans originated by Mortgage Brokers has fallen to only 10.1%. This is extremely good news for us and our clients for several reasons. Brokers used to originate the vast majority of all home loans, but many of […]Read More

Why Housing Will Come Back – Forbes.com Article

We have been suggesting that housing is now a good investment for several reasons, including: (1) prices are much lower; (2) can lock in very low interest rates; (3) investment properties now yield great cash flow; and (4) real estate is a great inflation hedge. A recent Forbes.com column called “Why Housing Will Come Back”, […]Read More

Follow Ups: Too Much Service; Successful Short Sales

We mentioned a borrower who kept her payments up to date while negotiating a short sale yesterday, and several Realtors questioned us as to whether or not it was true. It is in fact very true, and she is an interesting case. The borrower is a well-off, highly polished and highly professional woman who negotiated […]Read More

Short Sale – Keep Payments Current Until Short Sale Date

A Short Seller (people who sell their homes for less than they owe against the home) can get FHA financing right after a short sale IF they keep their payments current right up to the date of the short sale. This is big news from FHA, as there used to be at least a 2 […]Read More

Nordstrom’s Values

We got lectured by a 30 year old Nordstrom’s manager recently about the importance of service. She has been through 4 Realtors, but she is now in contract. We asked her how she finally settled on a Realtor, and she said very sternly: “At Nordstrom’s we ALL go the extra mile for customer service no […]Read More

Housing as Inflation Hedge

We remain less concerned b/c this week was the start of Rosh Hashanah, and a surprisingly large percentage of traders honor the holiday. And that could well-explain the temporary lull in demand, according to one of our more astute market analysts. If rates remain higher all next week, we will then get concerned. We read […]Read More

Tale of One City: LA – Best of Times; Worst of Times

Forbes Magazine tracks Real Estate Appreciation for the 500 Most Expensive Zip Codes in the US. In the most recent issue Forbes showed the “Five Biggest Losers” and “Five Biggest Gainers” year over year from 2008 to 2009. What was interesting is that LA had One of the Top Five Losers, as well as Two […]Read More