Buying a home feels like surgery without anesthesia!

Buying a home today is no longer a walk in the park. Contained in this video is a little explanation and a few tips on how to make it just a little bit better!

Pre-approvals require commitment and documentation. It Matters!

I wanted to take a moment to address what it really means to get pre-approved. There are several thoughts out there and many may believe a little differently than I do. However, I am writing this to you the consumer. The times really have changed and the requirements to buy a home have come back in line with reality. Investors really want to make sure that you can AFFORD the home. This has lead to increased scrutiny of income and employment, time on the job, the line of work and overtime, bonus and commission paid.

1. Loans Officers still do pre-quals sort of and does that benefit you – The goal is to be able to buy a home. A pre-qual is nothing more than a conversation and some details being exchanged to determine whether or not you roughly fit in the box. There is limited analysis of items that are important to the overall ability to borrow. Many times the borrower says I make 5K a month. The Loan Officer fails to ask if this is W-2, 1099, this year only, consistent, paid hourly, bonus, commission, flex pay, cafe 125 accounts and many other items that could play a factor in the debt to income. They then send you on your way to look at homes and you get in contract only to find out of the 5K only 4K is acceptable. The bonus that you receive has only been this year and there is not a two year history. Now that house is history and the excitement has been lost.
2. Consumers must plan for a good experience – If you want to have the ultimate purchasing experience that is allowable in today’s market you must be ready. You would not go to Disneyland without reservations to a place to stay and an idea of what you were going to do on what day. Plans do change but a plan is in order. To get the best experience buying a home I suggest that you plan on doing the following: -Take time to put together exactly what the Loan officer request. The items should include but are not limited to: 2 years of Federal Taxes all pages and all schedules, two years w-2’s if applicable, current pay-stubs spanning 30 days, two months bank statements ALL PAGES, current statements for assets like stocks, IRAs, etc ALL PAGES!!!! - Answer a lot of questions without getting frustrated. The questions are asked to make sure that the package is presented to the source of funding appropriately. – Take time to speak with your Loan officer about all the options and get a worse case scenario for the cash you will be required to have available to make this happen.
3. Consider the Financing your solid Foundation – Without the money you wiull not be able to buy a house. A house cannot stand without a solid foundation. Assuming that you make plenty of money or are good will lead to heartache. There have been several situations that I have been called by Realtors on Transactions they are working on with Lenders. Those questions go something like this: “Matt, can I pick your brain for a minute. I have a client that is working with (XXXXXX) and the have a 780 fico score, make about 200K a year, have more than 20 % down and the bank is asking them to provide such and such. They cannot provide a full year as they did not keep this stuff on file. They have 8 months not a year worth. Is this going to kill a deal or is there a way around it?” I have seen the most qualified of buyers be put through the ringer. The underwriters want to make sure that if they sign on a loan with their name they have gotten every piece of paper that the investor may want. Falling out of escrow is everyone’s worst nightmare. Do yourself a favor by putting in the work upfront, take your time and then go look. You will not miss out on the home of your dreams if you take an extra day or two to do your due diligence.
4. Don’t worry about the past! – The past is that and it will not be re-written. Lose all ideas of how things were done in the past and do not listen to the opinions of those that bought in 2003-2007 because things are completely different and all that advice is out the window. Learn about what it takes to but in today’s market from industry professionals. We are here because we work hard at understanding our businesses. Don’t believe everything that you read on a blog and yes that includes mine. Some of it is opinion or it would not make a good story. Read and research and be a kid and ask LOTS OF QUESTIONS!!!!!!!!!

Summary – when it comes to getting pre-approved help us help you. Three tips:

1. Provide all the documentation
2. Take time to meet and ask questions either in person or on the phone
3. Do not rush as this will cause delays. Do not cut corners.

Thank you for reading. Until next time.

President’s Day Push

Ch Ch Ch Changes!!! This time for the better!

I feel that the word of the year or the anthem of the last 6 months has been change. With all the increased regulation and processing times I feel that the experience of home-ownership was starting to become a burden versus exciting. So I decided to make some changes that I know will help keep buying a home exciting and fun. Recently, I was able to throw a housewarming for a client, help another move and this is all because I made a change that got me out from behind the desk. Our job is in the field meeting, approving and working with our trusted partners and that was fading. The video below will describe five reasons I am excited to be a Loan Officer in 2010 and how I know this will help me help you!

Efficient Lenders Needed! Reason #1 on how my team can help!

With all the changes in the lending landscape I think that it is important to change as well in some ways. The era of increased documentation has lead to increased processing times and paperwork delays. How then can a Loan Officer find the time to help promote their mutual business partners, be present at the networking meetings, attend the open houses, create the flyer’s and have the important face to face meetings with the clients. Let’s also not forget picking up the phone when the agent calls.

This led me to make a change that I have been contemplating for over a year. The reason that I did not take the leap before was always a financial choice. However, much of my business has come from being there to help the homeowner and all other parties through the transaction. To facilitate phone calls, watch the market and be present and visible. The last six months I felt hunkered down in a cave dealing with paperwork upon paperwork to make sure that our deals closed. This lead to less face to face and less time to be ahead of the market with innovative ideas and  good all fashioned face to face business. I felt like a telemarketer not a loan officer.

I decided that I needed to make sure that the files moved even when I was not in the office. While I was out generating more business for myself and my partners I wanted to make sure that the file did not stagnate over an updated pay-stub. I decided that I would hire  a team member that is the best in the business when it comes to creating a sale-able clean loan package. Upfront we will do a lot of work to make sure that the back end the closing is as smooth as possible. Chris Kohler is going to be a valuable addition to the team and I feel privileged that he accepted the role. It has been 9 days that we have began and I think that we have really made it seamless. I have five reasons that I know will be positive for us and all those that we are blessed to work with. So here is the first reason that the new change I have employed will help your business in 2010!

Reason #1 : Two experienced professionals working on your closing

What does this mean?

• My new partnership with an experienced associate will make certain that the smallest details of a transaction (that make or break a deal) are quickly addressed and followed up on. Two sets of eyes are better than one and ensure that no point is overlooked on your purchase transaction.

• Your buyer will rarely wait, if at all to have their question answered.

• While I am Pre-approving your client on the spot, my inside team will make sure our other transactions are still moving forward in an efficient manner.

• Increased Time for Marketing, Open House & Tours

• Continuity in the transaction

• Imagine your life without a transaction coordinator. That is how I have been serving you over the years. Adding my associate will be like having a TA on the lending side so that we can focus on what we do best.

Stay Tuned for reasons 2-5. If you would like a copy of the power point to review at your leisure message me or if you want to hear more about the change in person let’s do coffee. I am really excited for 2010. May it be fabulous for you.

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FHA Update and More! Video Blog!

90 Day Anti-Flipping policy is waived for one year by HUD!

Have you gotten an accepted offer on a house only to find out that this is a flipped property and FHA will not insure your loan until the 91st day?

If this has happened to you worry no longer. For one year HUD is waiving this requirement with a few restrictions.  Here is the update from National Association of Mortgage Brokers:

On January 15, 2010, the U.S. Department of Housing and Urban Development (HUD) issued a Waiver of Requirements of 24 CFR Sec.203.37a(b)(2).  This regulation provides that a mortgage for a property will not be eligible for FHA insurance if the contract of sale for the purchase of the property is executed within 90 days of the prior acquisition by the seller, and the seller does not come under any of the specific exemptions that apply to the 90-day rule.

The waiver takes effect on February 1, 2010 for a one-year period, and is limited to those sales meeting the following conditions:

1.    All transactions must be arms-length, with no identity of interest between the buyer and seller or other parties participating in the sales transaction;
2.    In cases in which the sales price of the property is 20% or more over and above the seller’s acquisition cost, the lender must:
a.    provide supporting documentation and/or a second appraisal;
b.    order an inspection of the property and provide it to the buyer
3.    Limited to forward mortgages, and does not apply to the Home Equity Conversion Mortgage (HECM) for Purchase program.

You can also go directly to HUD site for information on the Flipping Waiverin Greater detail.

Please consult your mortgage professional on how and if this will affect any transaction that you are seeking or currently in. The waiver starts on the 1st of February.

Business Partner Spotlight!

I wanted to let everyone know that I will be featuring local business partners that do amazing work right here on California Home Strategies site. The format will be an interview like process, question and answer, either in video or dialogue. The first two professionals that you will see soon. are Marguerite Crespillo of Sell State Realty First and David Pabalate of Farmer’s Insurance. They are both amazing people who do a ton in the community. My goal is too shed light on the person behind the business that makes the business go. n

Stay Tuned for more! May 2010 offer everyone bright possibilities!

HUD Postpones Implementation of HVCC for FHA

Breaking news is that HUD has Postponed the implementation of HVCC for FHA loans until February 15th, 2010. This delay is too allow time for Lenders to adjust to the changes. It is a two part action plan:

1) Prohibition of Mortgage Brokers and commission based lender staff for the appraisal process

2) Appraiser selection for FHA Connection

This will be effective for all case numbers after the 15th of February.

Good Faith Exactimate, Merry Christmas and Happy New Year:)

January 1st, 2010 all loans will be subject to the new Good Faith Estimate designed to make it easier to understand. More Details soon. If you are going to get a loan after the first make sure that you understand the new Good Faith Estimate.

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