Mortgage Matters | Borrower
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Mortgage Matters / Borrower

CREDIT RESOURCES

There are no secrets or shortcuts to getting and keeping good credit scores.  Having a better than average representative credit score is the single most important thing you can do to ensure best pricing and access to the most aggressive loan programs.

The US government requires the three major credit repositories (Equifax, Experian, and TransUnion) to provide you with a free copy of your credit report annually.  However, it does not require the repositories to provide you with your actual scores.  To obtain a free copy of the data the repositories are sharing with lenders, visit Annual Credit Report.  If you’re serious about purchasing a home within the next 3 months to one year, invest in collecting and monitoring your FICO score and credit report by subscribing to a monitoring service such as myFICO.

STANDARD FORMS, INSTRUCTIONS, SAMPLE LOX'S AND CHECKLISTS

Comprehensive Mortgage Application Checklist – A list of all the supporting documentation you will need to gather.

Condo/Co-Op Project Questionnaire – Learn the financial health of the homeowner’s association to identify which loan programs are available to you.

Sample IRS Form 4506-T and Instructions for Completion of IRS Form 4506-T – for use by your lender in verifying your reported income.

Sample SSA-89 and Instructions for Completing Form SSA-89 – for use by your lender to verify your identity.

Sample Form 1005 Verification of Employment and Instructions for Completion of Fannie Mae Form 1005 Verification of Employment – for use by your lender to obtain a breakdown of your income stream.

Model Letter of Explanation for Credit Inquiries and Known Addresses – format for a written explanation to support information appearing on your credit report.

Credit Reference Letter Instructions – format to support a non-traditional credit history.

Sample Letter of Explanation for Anything – format for a written explanation of anything to support the information in your loan file.

Sample Accountant’s Letter to Verify Foreign Sourced Income – format to follow when requesting foreign earned income not required to report on a US federal income tax return.

Sample Accountant’s Comfort Letter

SEARCH FORECLOSURES

I’m often asked for the “secret” list a lender keeps of foreclosed properties. Lenders are not in the business of selling real estate. When a property is taken in foreclosure proceedings, lenders will have a licensed real estate agent market and sell the property because lenders know the value Realtors® provide. If you’re looking for distress sales, subscribe to RealtyTrac, the premier database for pre-foreclosures, auctions, bank owned properties, new homes and for sale by owner listings. To negotiate a sales contract, have your Realtor® contact the listing agent. Use the below link to search for properties in your area:

MORTGAGE CALCULATOR

Use the below calculator to identify the principal and interest portion of your housing payment. Assuming you have selected a fixed rate loan, this portion of your payment is the only static item on your total mortgage payment (PITIA). Yearly variables will include:
Property Insurance
Property Taxes
Homeowner’s Association monthly dues (if any)
Private Mortgage Insurance (if any required)

When requesting a loan pre-qualification, keep in mind that the above variables will affect your debt to income (DTI) ratio and your final loan approval may vary with fluctuations. If the figures your loan officer used on the initial pre-qualification estimate vary from the figures confirmed on your selected property, re-engage with your loan officer prior to signing a sales contract to confirm your continued eligibility. If the figures need to be tweaked, ask your loan officer for options such as possibly paying off and closing installment loans to stay within the lender’s debt-to-income (DTI) maximum standards.

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EDUCATION

 

Are you interested in lowering your interest rate, but haven’t been able to follow traditional refinancing programs because your home value has dropped?  Learn if your mortgage is eligible for a temporary government initiative to assist homeowners in reducing their interest costs:

  • Making Home Affordable aka HARP/HAMP/The Obama Plan – Know your options and ask your lender if they offer the program.
  • Is your mortgage with Fannie Mae?   Begin your search here by entering your name and address EXACTLY as it appears on your mortgage billing statement.  If you don’t, you’ll definitely receive ineligible findings. Special note:  All closing costs and prepaid items can be rolled into new loan amount.  Confirm on your loan application in Section VII – Details of Transaction that cash-back does not exceed $250.  Otherwise, the lender will receive ineligible findings.
  • Is your mortgage with Freddie Mac?  Begin your search here by entering your name and address EXACTLY as it appears on your billing statement. If you don’t, you’ll definitely receive ineligible findings. Special note: cash-out to pay for closing costs and prepaid items is limited to $5000 in excess of principal payoff.

 

Are you a home seller interested in ordering an independent pre-listing appraisal? Find a licensed appraiser at the Appraisal Institute.  Know the rules regarding Appraiser Independence.

 

Learn the responsibilities of homeownership:

BUDGETING