The Road to Mortgage Ready Credit eBooklet

January 19, 2013

by Brian Short

Mortgage Ready Credit coverThe Road to Mortgage Ready Credit with Brian Short – The 22 page booklet carefully explains 1) What is good credit, 2) What is a Credit Score, 3) What improves your credit, and 4) Other Credit Issues which could keep you from qualifying for your upcoming home purchase or refinance loan.  Down load this eBooklet for your use or forward to a friend or loved one who is considering a home purchase or refinance in the coming months.

Advertisements

Just the Facts, Ma’am, Just the Facts!

May 19, 2011

 

Sgt. Joe Friday (Jack Webb) from 50's & 60's hit TV show Dragnet

Buying a home has always been a big decision. But for some people today it’s a difficult decision because of all the conflicting information coming from the media. To make matters worse, that information is often outdated…or even inaccurate.

If you know anyone who is thinking of purchasing a home this year, please share the following information with them:

FACT 1. Mortgage options are still plentiful for borrowers with good credit scores and documented income. All assets & income will need to be fully documented in most all cases for the past 2 years.

FACT 2. There are still programs available, like FHA, that allow as little as 3.5% down payment, and many others that allow less than 20% down.  VA Loans still allow an eligible Veteran to buy a house up to $417,000 with $0 down payment!

FACT 3. Jumbo mortgages are still available on loan amounts even in excess of $2 million dollars.

FACT 4. Vacation/second home financing can be obtained with as little as 25% down, even with jumbo mortgages.

FACT 5. There are FHA Renovation (203k) Mortgages available which can be used to update or repair an existing home. Small projects (under $35,000) can usually be done in such a way where the homeowner or buyer can use up to one-half of this money upfront to purchase materials and then pay the contractor once the project is completed. 

FACT 6. Senior citizens can use their current equity in their home and actually relocate and buy a house and have NO MONTHLY PAYMENT on their new home for the REST OF THEIR LIVES.  The FHA Reverse (Home Equity Conversion) Mortgage can be used by those 62 years of age or older to refinance their currnet home or buy their idea retirement home.

FACT 7. As of today, rates on most mortgages are still at historically low levels when compared to the last 30 years.  Every indication is that rates will likely begin to increase before the end of 2011 – so delay if low interest rates are desired.

FACT 8. Most homes are selling at a big discount relative to 5 years ago.

Make sure your friends and family know the facts! Owning the home of their dreams may not be as hard as they think. Send your friends and family this link and let them know I would be happy to meet with them and help them determine what options are available in their personal situation.

Getting pre-approved for a mortgage BEFORE speaking to a Realtor could help make them a much stronger buyer in the eyes of a seller.

If there’s anyway I can lend a hand, I’ll be happy to do so. Thanks for your help and continued support, and if you have any questions about your own situation call or email me anytime!


GOING UNDER: America’s Debt Dilemma

November 1, 2010

STEPS TO END IMPULSIVE BUYING

1.  Identify your problem.

2.  Build a support network. Have friends, or relatives help talk you out of unnecessary purchases and share your successes in resisting temptation.

3.  Assess current debts and income and build a workable budget for paying off debts. (Do not continue to increase debts.)

4.  Approach your creditors to negotiate payment plans you can fit into the budget you’ve built.

5.  Use your support network to help you change your buying behavior.

6.  Set up realistic financial goals and a timetable for meeting them.

7.  Keep track of your progress; share your successes. Do what you can to stop backsliding, but don’t dwell on it.

8.  Pay off all outstanding credit card debts.

9.  Set up new guidelines for responsible credit use.

10.  Begin saving money for your financial goals.

11.  Reward yourself for accomplishments (not by spending money).

12.  Check your financial status regularly and adjust any backsliding. Set new financial goals as you accomplish the old ones. And, most important — now that you know the way, help someone else who might be tangled in debt.

Source: Debtors Anonymous


 Answers to the Credit Dilemma

What students can do:

1.  Educate yourselves by reading and checking the Internet on what card companies are up to. (See accompanying Web-site information).

2.  Don’t give up just because you’re in debt. Most students can salvage their situation by addressing it early. Don’t be afraid or embarrassed. Ask for help early. Problems with long-term blemishes on credit reports occur when students feel they can’t win and give up.

3.  Get only one card, for emergency use only. Not many horror stories of debt occur when students have one major card. The danger comes when other companies continue to mail pre-approved offers — and students take the bait. Do not get cards from furniture or department stores. Nightmares about credit seem always to include those secondary cards.

What parents can do:

1.  Teach children early. MasterCard is not shy about putting a card bearing its likeness into a Barbie doll’s hand, so parents should work equally as hard to combat those approaches.

2.  Be ”nosy” about your child’s finances even if he or she is 20 or older. That may be when they need snooping most.

3.  Be a role model. Children will follow Mommy and Daddy’s lead. Will yours see you do the right things?

What companies can do:

1.  Give people accurate information about interest rates. Eliminate the fine print on the back of monthly statements. Bring that information out front, in clear language and charts. Looming legislation may help.

2.  Put the owner’s picture on every card, as Citibank does now. If the industry truly wants to lower card thefts, this would be a major step forward. The idea is simple: If the shopper doesn’t match the picture on the card, clerks should not sell them anything.

3.  Stop targeting teen-agers.

 

What universities can do:

1.  Make personal finance mandatory to graduate. Students should be required to get at least a ”C” for credit. National statistics, surveys and personal testimonies show that students need lessons in personal finance.

2.  Ban solicitors from campus, or at least limit their visits. Make them put away the candy, toys and T-shirts — free gifts designed to attract student interest.

3.  Credit is a privilege. Require people under 21 to take a test on money matters before qualifying for a card. In most states, no teen can get a driver’s license without passing a test. It should be that way with credit cards.

TIPS FOR AVOIDING DEBT

How you handle your credit and finances is as individual a choice as picking a toothbrush. But here are some general tips to help you stay out of debt, or avoid getting there.

•If you have many cards, cut up all but one. Experts say one is enough. Two is OK for theft of the other card or an emergency.

•Ignore the Joneses; keep up with yourself. Much of credit card hype involves status. Chasing fads can tempt even the most disciplined consumer to spend.

•Pay your entire balance every month. If you can’t, pay as much as possible. Some months, double or triple a payment, but make reaching zero balance a priority.

•Don’t be intimidated by card firms. NCCU sociology professor Ike Robinson likens them to bullies.  ”It’s about power,” he said. ”These are very, very powerful companies with vast resources preying on vulnerable, unstable young people. And most of these youngsters are coming from homes that are not usually affluent.”

•Be like David: Grab your slingshot and fire away at Goliath. Complain if you get hit with improper penalties, late fees or over-the-limit fees. Scrutinize your statement for phony or wrong charges. At least once, photocopy the fine print so you can enlarge it and see what it is saying.

•Network with friends and family to find ways to deal with card companies. Just as you discuss getting the best deal on a car, talk about how you can combine brain power to get the best credit deals possible.

•If you are a parent, teach your child about responsible money management, regardless of age.


Get familiar with your credit report

One of the most important tools you have to rebuild financially is your credit report.

It is the one item that will tell you what creditors are saying about how you handle money, loans, car payments — and credit cards. It also will show how often you apply for credit.

In an age when employers increasingly are asking to see credit reports, you need to arm yourself with information. Become familiar with every item on your report and get them from all three major agencies: Experian (TRW), Equifax and TransUnion.

The first step is to contact the agencies. Call to find out what information you need to send them. TRW will send a free report if you request it. Call 1-800-392-1122. Equifax charges $8. Call 1-800-685-1111. TransUnion charges $8. Call 1-800-916-8800.

Be sure to order a report from all three agencies — to compare and to have the most complete information about your credit history. One agency sometimes will have information that conflicts with figures from another agency.

Here are some common questions you may have when the reports arrive.

Q. How can I get a mistake off my record?

A. According to Equifax, you will have to document the details of the problem in writing.

Some reporting agencies will include a form to use for disputes over information you believe is wrong. The reporting agency then will check with the companies that say they gave you credit. Information that cannot be verified will be removed from your file.

Take up disputes with the company that is the source of the information in question.

Q. What if I still disagree with an item after it has been verified?

A. Send a brief statement for your credit file that will be disclosed each time your file is checked.

Q. What in my credit file could keep me from being approved for credit?

A. The answer varies. It could be directly related to items in your file. Your credit could appear to be perfect, but you could be denied because of not living at your current address long enough. Also, having too many inquiries could make stores think you constantly are applying for credit. If you have questions about why you were not approved for credit, contact the store that turned you down and ask why.

Q. How long will bad credit information stay on my report?

A. Most comes off after seven years. If you filed bankruptcy, it might stay on there for 10 years.

Q. Who can look at my credit report?

A. The law says credit bureaus can disclose any information about you to any person with a ”permissible purpose” for seeing the information.

That could include landlords, car dealerships or employers — anyone who wants to see your financial habits. Your report will show who has been requesting information about you and when they requested it.

Sources: Equifax Credit Information Services; ”Get a Financial Life,” by Beth Kobliner

 CREDIT HELP ON THE WEB

Listed below are Web sites and telephone numbers that should help anyone seeking more information on credit companies’ relationship with college students:

1.www.JumpStart.org — JumpStart is dedicated to increasing financial literacy among teen-agers and children. It is excellent for parents and children. (202) 466-8613.

2.www.ftc.gov — The Federal Trade Commission has a site loaded with information in easy-to-understand English. The publications page should be helpful. (404) 347-4836.

3.www.abiworld.org — The American Bankruptcy Institute site is a must for anyone thinking about filing bankruptcy. This a nonprofit organization that won’t push for or against filing. But it will provide a plethora of information for you to make an informed choice. (703) 739-0800.

4.www.debtorsanonymous.org — This is the site of one the first national help organizations for over spenders and debtors. (212) 642-8220.

5.www.fraud.com — This is the national fraud information center. It has vast resources on how to protect your cards and account numbers. (800) 876-7060.

6.www.powersource.com/cccs/ — This is a national site for the Consumer Credit Counseling Service. The service also has a local office that provides counselors who can help people analyze their debt and how to get it under control. The CCCS also can be contacted by calling 800.251.2227,* Books: ”Get a Financial Life,” by Beth Kobliner; ”Expressing America,” by George Ritzer.

Download this Debt Seminar: Click Here


Choosing Your Mortgage Professional

June 20, 2009
By Brian Short, CMC, CRMS, GMA
 
“Shopping for a Mortgage Professional is much like shopping for a medical doctor or an attorney. Choosing your medical or legal care based on “who is the cheapest” may not really be the best strategy. You want you choose a professional who is trained, certified, experienced and has a good reputation.” 
 
Often times, this is my response to those asking for me to give them a detailed list of all their closing costs if they select me and my company to provide the financing for their upcoming home purchase or refinance of their current home.
 
I have heard of real estate industry partners telling their customers that choosing a mortgage professional is as simple as getting a “Good Faith Estimate” and comparing the costs contained on those documents.  This sets up the borrower to work with the “best liar”, too early in the 30-60 day process of finding a home, rather than getting the most professional financing help to get the deal closed correctly.
 
How can this be?  Aren’t all “Good Faith Estimates” accurate?  Aren’t all mortgage professionals the same?  Aren’t all mortgage companies the same? 
The truth is: the numbers on the “Good Faith Estimate” given too early in the process are RARELY CORRECT!  You see, the numbers on that document are affected by one or more of the following 13 variables below:

-> Sales pricegood-faith-estimate

-> Appraised value

-> Loan amount

-> Borrower’s employment status and history

-> Credit scores and payment history

-> Amount and source of down-payment

-> Date of closing

-> Immigration or citizenship status of the borrower

-> The housing type and location (Single family dwelling, Duplex, Condo, Townhouse, PUD, suburban, rural, urban, etc.)

-> The county where the home is located

-> Mortgage Interest Rate

-> The Term (length) of the Loan

-> The Title Company being used to close the loan

I have worked for several mortgage companies during my mortgage career and even owned my own company for 5 years. I know that some “loan guys” will “low-ball” the initial estimate, only to pull out the “surprise” at the closing table when your options for making any changes are very limited.  Of the 21 separate line-item fees on the “Good Faith Estimate” I give to my borrowers when they sign their loan application forms and disclosures, only one of those fees is the same for every loan and is not dependent on any of the variables listed above.

Mortgage interest rates change daily (sometime, even more often!). I could simply print off a “Good Faith Estimate” with made up numbers as some customers request (as other “loan guys” may do) but it will not be accurate because of all of these variables I have mentioned.  That process of collecting “Good Faith Estimates” prior to having all of the above variables identified will very time-consuming and wasted effort by the borrower and “loan guys” passing out worthless forms with inaccurate numbers.

My goal is to take the worry and uncertainty out of the process of originating, processing, underwriting and closing the loan.  I help guide my borrowers through their negotiations with their seller by providing honest numbers as they become available rather than simply making up numbers to get “my hook set”.

I have been in the business for over 11 years and nearly 100% of my business comes from referral and repeat business. A businessman can not build that kind of business by being a con-man, cheating others or participating in the bait-and-switch tactics that have riddled this industry for years.

This helps my my borrowers understand how I have built my business and how I provide a level of confidence and professionalism which will make my borrower’s Real Estate purchase a very smooth and cost effective transaction over the next.

So, you ask, how should I select the Mortgage Professional to close my loan for me?  I’m glad you asked.  Allow me to give you a few guidelines for starters:

1. Choose a Mortgage Professional who is EXPERIENCED.  Was he selling shoes or washing cars last week and then some buddy of his talked him into “trying out the mortgage business”?  Does he really know what he’s doing?  Has he been originating mortgage for 5-10 years?  Does he do this full-time or this just a hobby or part-time gig? 

NAMBCertified2. Choose a Mortgage Professional who is CERTIFIED.  Has proven to anyone that he knows the laws, the process, the programs and theory and mechanics behind the mortgage industry.  Has he taken courses and exams to measure his competency?  Is his certification a national designation? Is his certification from a professional association who can objectively measure and monitor his expertise or from some mail-order outfit looking to make few bucks?

3. Choose a Mortgage Professional with a GOOD REPUTATION.  Is your selection a true professional who is respected and well-known in his industry.  Who knows him and what kind of work he does?  Who has ever closed a loan with him?  Who can speak for his level of trustworthiness, honesty and attention to detail?  What do you know of his character and personality?

4. Choose a Mortgage Professional who is a PROFESSIONAL.  Does your choice know the market, the industry, the community, the history, the trends and your desires?  Is he a member of his professional association?  Has he been awarded and recognized by his peers and fellow business associates for his contribution to the industry and community?

During the month that your loan is supposed to close it is the most important transaction in your Mortgage Professional’s office.  “Getting it cheap” doesn’t mean much when your “loan guy” drops the ball and makes a mess of the whole deal simply because  he has “never seen anything like this before.”  That stack of bogus “Good Faith Estimates” collected 30-60 days prior to your closing will mean very little when you find out that returning phone calls, diligently following up on underwriting conditions, and working long hours to insure that all of the bases are covered on your deal are not his priority or part of his work ethic.

Paper is cheap, and ink toner to print fictitious loan estimates is even cheaper.  Experience, Certification, a Good Reputation and Professionalism are priceless life-long attributes and qualities you want in your Mortgage Professional.  Leave the spreading of such worthless papers to those lying, low-balling, bait-n-switching, short-termers who do not deserve to work with someone like you who, understandably, expect it to get done right the first time.