What questions should I ask a mortgage lender in Hawthorne ? If you’re dealing with a mortgage broker there’s some questions that you should ask both on your first meeting with the mortgage broker and throughout working with your mortgage broker to make sure that you’re getting the best service possible.
USDALoanInfoNJ is going to go through 10 different questions that you can ask your mortgage lender in Hawthorne. Be aware that your USDA Loan or Mortgage broker will be getting the loan that you need and the service that you want.
How Much Will a Mortgage Broker Cost?
Most mortgage lenders in Hawthorne actually work for free.
So it doesn’t actually cost you anything in order to do it.
They get money because they are paid by the banks when you successfully get a loan.
So they get a small commission of the loan that you apply for and if you get it.
How Mortgages Work in the Primary and Secondary Market
So most mortgage brokers in Hawthorne will work for free and it won’t cost you anything.
How much do Mortgage Lenders earn in commission from me and from my loan?
This is less to understand exactly how much they make.
You can see what percentage of commissions they make and things like that by visiting USDALoanInfo.
But it’s more to understand whether or not they’ll be willing to give you this information.
Mortgage Lenders - How to Choose the Right One For You
If they skirt around this issue and they don’t tell you how much they earn.
So, I’m just trying to establish whether or not this mortgage broker in Hawthorne is someone that I can trust.
So ask that question and see how they respond.
Do Mortgage Lenders Invest Themselves?
However, if they are interested in property in Hawthorne, if they do invest themselves, then that is going to go a long way to help you because they understand what it’s like to be in your shoes.
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The best mortgage loan you never heard of? How about a USDA guaranty loan?
So what's so good about a USDA loan?
- 100% LTV - the highest LTV is mortgage lending today.
- Market interest rates.
- Less than perfect credit accepted.
You didn't know it, but the USDA has been in the real estate business for years. The program was initially designed to stimulate rural development and assist the agriculture community with housing. Agricultural stimulus packages are a long standing pillar of US economic policy going back to the turn of the last century. In fact, most our early prominent government economists were from the agricultural school. A famous alumnus of this school was John Kenneth Galbraith. USDA guaranty loans were designed as a modest program to provide housing in areas that large lenders shunned.
National lenders often penalized rural loans by raising rates and lowering LTV ratios because it was thought that rural properties could not be liquidated at prices high enough to cover the loan.
The trick to USDA loans is that the property must be located in an USDA approved area. Now here's the trick - the USDA uses the 2000 census data for its map. Areas that were rural in 2000 are now smack dab in the middle of huge growth patterns. Areas such the Kyle/Buda area south of Austin; Pflugerville east of the tollway; some areas of Leander/Cedar Park; Liberty Hill; the area across from the Dominion in San Antonio; parts of Comal County.
Real estate developers are nothing if not resourceful, and they're exploiting this loop hole to the extreme. Paired with a 96.5% LTV FHA loan, a 100% USDA makes a great partner - and a great way to sell out a subdivision.
Loans are processed similar to an FHA loan. Lenders authorized to make and sell USDA loans will process and underwrite the loan. Guidelines are much more flexible so there is a degree of common sense underwriting. Loans are then sold to Wall Street with the USDA guaranty fee.
This is a great loan for first time homebuyers, or anyone, looking to move into the suburbs at extremely beneficial terms. This is a much better program than even the sub-prime loans of the last 5 years.
This is also a great loan for seniors looking to retire to country, buying a home and some acreage.
The down side to this great opportunity is that the USDA will soon update their maps and the hot areas are sure to lose their designation as rural.
Check out our website below for more information and USDA resources, or call us with your questions.
So I would want to find a mortgage broker who either had that experience themselves or who had clients that they had got similar deals for cause that way I know that they can negotiate on my behalf and they can get this deal across the line.
What details do Lenders need from me?
You might need pay slips; you might need proof of identity, all of that sort of stuff.
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So the easier you make it for them, the more likely you are going to get better service.
What can I do as a client to make this go as smoothly as possible?
You want to see them get paid.
You want to see them do an easy mortgage so they get paid easily.
And so you can develop a relationship into the future.
Which lenders can I borrow the most from?
Most people go into a mortgage broker looking for the cheapest interest rate possible.
Because, yes, interest rate is important but how much you can borrow is also important as well.
Can I see a full list of my borrowing options?
Most mortgage brokers will provide you with, usually, like a top three or sometimes only a top one.
You’re probably going to still choose from one of the top three ones.
But you just want to see that they’re giving you the full amount of information.
Will this put a mark against my credit file?
And so this is when you’re trying to work out how much you’re going to borrow and stuff like that.
But if you’re getting lots and lots of marks against your credit file, then that could be an issue.
How soon can I revalue or borrow again?
There are a lot of lenders out there who don’t allow you to revalue within a 12-month period.
So, speak to your mortgage broker about the lenders that will allow you to revalue faster.
And basically, this will give you an idea of how quickly you can revalue to consider going again.
You’re also going to want to ask them, “After I invest in this property, how soon can I borrow again or what do I need to do to put myself in a position to be able to borrow again and to purchase the next property?” Because hopefully, your goal isn’t just to purchase one property but to grow your property portfolio and to achieve that financial freedom and that financial security that you’re striving for.
Will My Loans be ‘cross-collateralised’?
And basically, you want to avoid this at all costs from what I hear.
Did You Know – You Can Get Pre-Approved for a USDA Loan in Hawthorne?
There are many institutions that loan money to home buyers. Commercial banks, private lenders, credit unions, mortgage bank companies, insurance companies and pension funds. It can get confusing as things are always changing in the mortgage industry.Policies, interest rates, mortgage programs, where the funds come from, and investors are all changing and can affect where, from who, and the type of mortgage you will get to purchase the property you have chosen. Certain entities may offer you better rates depending on your credit history, debt, income, and expenses. It is a good idea to shop many different resources so you can get the best deal possible.The mortgage market is comprised of a primary and secondary market. These two markets work together to give money to a borrower and offer returns on investments to investors.The primary market occurs on the retail end, meaning a mortgage lender sells directly to the consumer. You may use the services of a broker or loan officer in order to have this transaction run smoothly. This is the place where mortgages are originated and the money is given directly to the borrower. In the primary market, mortgage lenders make there money on processing fees. There are often many fees associated with getting a mortgage that the buyer is responsible for.Because there can be many fees as charged by the mortgage lender, it is important to know exactly where your money is being spent. You should ask for an itemized report for every fee. Unfortunately there dishonest mortgage lenders and they will make up charges and fees that really don't have any effort or actual action behind them. This is how some borrowers can get scammed, and often they may not even know it!The secondary market manages mortgages that have already been originated in the primary market. What occurs here is the mortgage lenders package many mortgages together and sell the notes to investors. Mortgage lenders replenish their cash reserves that can be used towards the origination of more mortgages. The investors make money off of the interest that is charged on the mortgages.There are both private and public investors that buy these notes. Public investors include Fannie Mae, Ginnie Mae and Fannie Mac that are all government supported. Private investors may include banks, thrift institutions and other individual private investors.The mortgage lender really has a circular pattern, originating loans, selling them to investors and then using that money from the sales to issue more loans.Many times, you do not even know that your mortgage is going to be sold into the secondary market. However, the mortgage lender should always notify you of this transaction if the mortgage is sold to someone else. If you have questions about this process, you can ask your mortgage lender as to what his or her process is.So when you purchase a mortgage, then you are working in the primary market. The secondary market is for mortgages that have already been originated by the mortgage lender and they are being bought and sold as investments for either private or public investors. This mortgage process keeps money flowing through the industry and makes more money available to the public to continue property.
How To Pick A Mortgage Lender When Buying A House
Good afternoon this is Bubba bachelorwith Austin's lender right here in Central Texas this video was designed tohelp you get a better understanding of what it takes to qualify for an FHA loanand why there's so many different stories about what FHA really has tooffer and what it takes to get qualified so I've taken some notes and if youdon't mind I'm going to go through them as we go I don't want to miss any of theimportant factors that are going to help you get qualified or you the realtorhope you get your borrower qualified to purchase a new home so we're going to goover understanding FHA and some of the misconceptions in how to qualify for anFHA home loan FHA is a great option for first-time homebuyers for buyers thathave a little bit more debt ratio than is allowed under Fannie Mae or FreddieMac it even borrowers with less than perfect credit it's easy to say that FHAis probably the most lenient of all the lending programs out there but it'simportant to know that FHA is not a lender FHA is an insurer and they writeguidelines and then they give the guidelines to lenders and say if youwill approve a loan based on our guidelines we agreed to insure it butyou can also put any extra conditions on that you feel are important and that iswhy it's very important to know which lender you're going to go with becauseevery lender is going to underwrite FHA a little bit differently in very fewaustin's lender is one of them we underwrite exactly to FHA guidelinesallowing more customers to get approved to own a home and be part of theAmerican Dream it's also good for borrowers with a limited down paymentbecause with FHA you only need three and a half percent down and that actuallycan come in the form of a gift from a family member or 401k funds so there's alot of flexibility with FHA again with FHA the minimum downpayment is three anda half percent if your credit score is over 580 if your creditsis between 500 and 579 you would need 10% down plus closing costs again all ofthat can come from your own funds retirement funds 401k or even a giftfrom a family member FHA loans are not just for first-timehomebuyers they're also great for people who have again restricted income or theyhave a high debt ratio or you just are trying to buy a little bit more homethan Fannie Mae or Freddie Mac would be willing to give an approval for sohere's what they're looking for when qualifying for an FHA loan the firstthing is verifiable income so there's two different categories you either havea person who's employed or a person who's self-employed and they're lookedat somewhat differently every lender is going to take a complete loanapplication and run it through an automated underwriting approval systemand the underwriting approval system is going to tell that lender exactly whatthey need in order to verify and get the loan finally closed and approach so ifyou're an employed person that means that you go to a job and you get a w-2in taxes are taken out so your gross income from that job is going to be usedto calculate your qualifying income if you're self-employed that means that youcontrol your own income in your own expenses so they're going to want to seea two-year average of your tax returns to get qualified so if you're employedat your w2 if you're self-employed it's to your stature terms so you have to beself-employed for at least two years in the same occupation in order to getapproval through FHA now if you're employed that means you get a paycheckin a w-2 you only have to be on your job for six months with a two-year historywhat that means is if you were a college student and you've recently started ajob and you've been on in six months that's fine they're going to ask for acopy of your transcript showing your student and then verifyof employment shown that you've been employed for two years one of the nicethings about FHA if for a first-time homebuyer or somebody just gettingstarted you can also have a non occupying co-borrower so in the old dayswe used to call them Kitty condos you're going to go off to the University ofTexas or maybe to another school and you want to buy a condo that you can live inall four years but as a student you clearly wouldn't qualify because youdon't have a regular and recurring income so in that case the loan could goin your name and your parents name assuming you're over 18 years of age andthe loan would be based on your income if you have any your deaths and yourparents income and debt so it's a great way for a person who's trying topurchase a home to find a family member that's willing to be a non occupyingco-borrower now remember that non occupying Co borrowers credit scoretheir income and their liabilities are all taken into account so finding theright non-occupied code borrower is going to help you substantially ingetting approved so really what they're looking for an income is stability ofincome they want to make sure that the work history is good as we mentioned twoyears for self-employed and at least six months on the job if you're employed youreally shouldn't have more than four jobs in the last two years if you areemployed so job stability is very important under FHA shorter work historyis accepted but it is underwriters discretion so I really wouldn't ridethat too hard I want to make sure that you do have a good work history thesecond thing is you want to be able to afford the housing payment in any otherdebts that you have so what they're going to do is we're going to take thehouse payment plus taxes and insurance plus any other minimum payments thatappear in your credit report in all of those combined need to equal in a goodrule of thumb is about 50% of your gross monthly income so if your income is$4,000 a month fifty percent would be two thousand and inside of thatyou should be able to pay the house the taxes insurance if there's an HOAhomeowners association and any other bills that appear at your credit reportunfortunately we see some people that go out and get an $800 car payment wellunfortunately they're driving their house so they either have to get afamily member to finance the car into their own name or some or maybe evensell a house that just comes down to what's more important to you that fancynew truck or the boat or having a home that you can live in many lenders saythat your debt ratio should not exceed 50% but in all reality FHA does not havea maximum debt to income ratio per the guidelines so when you run into thesesituations where a lender says oh you have to have a 580 credit score or youhave to have a 640 or even a 680 credit score that's where the lender hasimposed additional guidelines on top of the actual FHA guidelines because FHAsays you can have a credit score as low as 500 but with a low credit score likethat you're gonna have to have 10% down and you're just gonna have to be a goodstory behind why the credit is what it is for example maybe you were part of ahurricane maybe you had a bad accident and the credit report is littered withmedical bills so there has to be a compelling reason why you should getapproved but it is possible we actually were able to approve a customer with acredit score of 504 so I'm living proof it happens it is very possible but theyhad a big 401k the guy was a fireman had money in the bank they were putting downI think 20% so there was a good reason why those people deserve and they have asick job many lenders also said that the housing ratio shouldn't exceed thirtyfive percent that is thirty five percent of your income should equal or less thanthe house payment plus taxes insurance that also is not a hard-and-fast numberwe've been able to get him approved as high as forty and forty five percent sowhat I'm trying to tell you is there's a lot of stories on the street and thereason is because lenders impose what they call overlays so even though FHAsays they'll take score as low as 500 some people say nowe're gonna say 580 or maybe 620 or maybe 680 if your credit score is belowtheir self prescribed minimum they're going to decline your loan so choosingthe right lender is more important than anything and I will tell you that hereat Austin's lender we follow the guidelines we go all the way down to a500 credit score and we have the ability to approve loans that other locallenders are turning down every single day you know how I know it because we doand you know what all the customers say mama why did my realtor send you to meto you first and I good question I don't know but I'm glad you're here now so wecan get your loan approved another thing is downpayment now with a credit scoreof 580 and above you only need 3 and a half percent down plus closing costs ifthe credit score is 579 all the way down to 500 you're going to need 10% downplus closing costs so you keep hearing me say closing cost what are the closingcosts well you have to order an appraisal you also have to establish anescrow account that way the lender can hold taxes and insurance so that at theend of the year the taxes and insurance can be paid for you the size of theescrow account depends on what time of the year you're buying a home so whenyou call our office we can go into more detail with you on that but remember thedown payment can be a gift from a family member in the down payment itself thethree and a half or the 10% has to come from the borrower or a gift from afamily member the other closing cost can actually be paid by the seller so let'ssay that you find a home that you want to purchase in it's $300,000 the sellercan contribute up to 6% of the sales price for your closing costs rememberthat down payment has to come from you the closing costs can actually be paidby the seller so let's pretend that you find a house that you want to purchaseand it's listed in MLS for 310 thousand dollars and you've negotiatedit down to 300 but you need an extra seven thousand for closing costs so youcan write the contract for three hundred and seven thousand with the sellercontributing seven thousand they still get their three hundred you agreed uponand seven thousand dollars will go towards your closing costs to reduceyour out-of-pocket cash so you can get the home that you truly desire credit isalso very important they're looking for an established credit history generallywe're looking for three trade lines an automobile a credit card something thatappears on the credit report for at least twenty four months the minimumallowed is to trade lines and we can use alternative trade lines for example ifyou've paid Allstate insurance or you paid Liberty Mutual and you paid yourauto insurance on a regular basis we can use that as a trade line as anacceptable pay history your mobile phone your electric bill your health insurancebill so there are other things that can be used and those are referred to asalternative trade lines and those will allow you the trade lines required inorder to fulfill the FHA guidelines we talked about credit score a little bitepic Jaison minimum credit score is five hundred a lot of people are going totell you five eighty six hundred six twenty six 4680that's because they have overlays and let me under hope you understand that alittle better if you went to a bank like Chase Wells Fargo Bank of Americathey're all regulated by the FDIC the Federal Deposit Insurance Corporationand what they're doing is making sure that all the people who put money in thebank their money safe so the FDIC says they can't make a loan to anybody whenthe credit score below 620 so even though FHA would approve five hundredcredit score if you go rolling into the bank with a five ninety three creditscore they're gonna turn you down because your credit score is below theirinternal set number of 620 some banks say 640 some banks goes like 680 but theactual guideline for FHA is five hundred so choosing theis very important a lot of Realtors don't understand how important this isthey work hard trying to find a customer they get them all lined up they sendthem to the preferred friend at the bank and the bank turns them down thecustomer is told that FHA turned him down and that's not true F actually didnot turn them down they were turned down by the bank if they could come to uswe're mortgage brokers and what a mortgage broker does is we sent yourloan directly to the investor we know will close in fund your loan so workingwith a mortgage broker is extremely important because we don't have thoseoverlays other overlays may be minimum credit score or if you're going to use agift letter sometimes they'll say you have to have three months reserves thatis property your payment taxes and insurance whatever it totals let's sayit's $1,000 then after closing you'd have to have an extra three thousanddollars in the bank that's an overlay that's imposed by thelender not FHA so really I can't stress how important it is to make sure thatyou use a great lender and I'll tell you also the lender is great I teach lendingand have for the last 25 years we know the guidelines we don't open a long thatwon't close so if you call us at five one two nine five three seven three fivenine or visit our website www.
Com get higher andthey find the perfect home that they can buy for three hundred and they year fromnow that house is gonna be three thirty so by waiting a year to try and save aquarter on the interest rate they ended up spending thirty thousand dollars morefor their home that's a big mistake if you can qualify for the home by thehome you can always refinance it a year or two when you get your credit scoreincreased so the problem is if you go to a lender with overlays and they havea higher minimum credit score or they have additional reserve requirements andyou don't meet those they're going to turn you down and they're going to tellyou that you were turned down by FHA which again is not true and itinfuriates me because people deserve a home they deserve to be part of theAmerican Dream home ownership makes people better citizens better employeesbetter parents it makes children feel more secure so I can't stress you howimportant it is to choose the right lender remember FHA is not the lenderFHA is the insurer they write the guidelines the lenders follow alllenders don't follow the exact guidelines they put on overlays I thinkI beat that to death but I really want you to know how important that is thenext thing is a home purchase price FHA has federally set limits on how much youcan borrow with an FHA money in it varies by state and by countyfortunately the limits are pretty high here in Austin the limit is threehundred and eighty nine thousand eight hundred and fifty dollars that's themaximum loan amount so that means you can buy a house probably for about fourhundred thousand with a little bit of doubt three and a half percent downyou're there so that's good news FHA does not have income limits some ofthe other programs you may have heard of home possible or home readythey have income limits again based on County FHA does not have income limityou can make as much as you want and still qualify for an FHA loan which isgreat news lenders offer a variety of different loans in addition you can tothe standard FHA is a 30-year fix you can get a 15-year fixed you can even getan adjustable rate mortgage I don't suggest that because we know that ratesare on the increase so locking in a good rate right now ismore important than ever earlier we were talking about thedifference between a mortgage broker and a mortgage banker the mortgage bankerself imposes some overlays that you have to be able to jump that hurdle to getapproved which brokers do not have in addition to themortgage bankers have layers of management you have the bank and youhave a regional manager and an area manager and a branch manager all ofthose people have to get paid when you go to a mortgage broker you'regetting pure pricing and pure guidelines so I can tell you at Austin's lender ourrates beat the market by almost a full point because we don't have all thelayers of management as a matter of fact we have the guy who teaches mortgagelending for the state of Texas right here our office and that's about thebest thing you can get as a consumer because we're going to tell you thetruth we don't have to call somebody and ask an underwriter quite often I findmyself sending the guidelines to the underwriter telling them no this is whatthe guideline says please approve my borrowers loan and they always did inthe last five years we have not turned in one loan that did not close in fundfor the guidelines and we're really proud of that so the next thing that wewant to talk about is the drawback to FHA now if you qualify with a 620 orhigher credit score Fannie Mae and Freddie Mac are great options they havea 3% down program they have the home possible program they have the homeready program in their brain options so if the credit score is 620 or higheryour lender should automatically look at Fannie Mae or Freddie Mac unless thedebt ratios too high because Fannie Mae and Freddie Mac do have a hard and fastrule debt to income ratio cannot exceed 50% it can't even be 50.
0 one it willnot approve the loan so if the debt ratio is a little bit higher if theychange your way together if you've got a low debt ratio in a credit score over620 Danny Mae Freddie Mac is going to be the way to go and of course here atAustin's lender we have those available so we're here to serve you all the wayaround now to draw back to FHA is you have to have mortgage insurancenow what mortgage insurance is is it's insurance that in case you default thelender gets help in getting the loan paid off if the house sells at a loss soif you go traditional Fannie Mae Freddie Mac and you20 percent down which you don't have to I can't tell you how many people say ohI'm waiting to my house still have 20 percent down you don't have to have 20percent down 3 percent with Fannie Mae Freddie Mac three and a half percentwith FHA USDA is zero money down in the same with VA and we offer all of thoseprograms so when you apply in Austin's lender comwe're going to evaluate your loan application your credit report yourability to prove income and we're going to put you in the program that is inyour best interest it doesn't make any difference to us we get paid regardlessso we want to make sure that you can get the absolute best loan you can excuse mebecause when we're finished we're going to ask you to do a survey and we'regonna ask you to tell people that we are awesome and that we do what we saidwe're going to do we show up on time we say please and thank you and that iswhat we do with every customer we serve so the only drawback with FHA is you'reborrowing more than 80% of the value and you have mortgage insurance mortgageinsurance protects the lender in case the home goes into default to cover anyshortage when the house is sold so FHA used to allow you to get rid ofthe mortgage insurance once the value of your home was 80% where the lum was 80%of the value that changed you can't do it anymore so the only ready to get ridof the mortgage insurance or you've heard it called mi or PMI privatemortgage insurance the only way to get rid of that is to refinance your housewhich is fine not a bad option unless the rates are higher then you wouldn'twant to do with the mortgage insurance ends up being a less expensive thing buteven still mortgage insurance is not that expensive and with FHA it's even areduced rate to allow you to get along because this is for first-timehomebuyers specifically but you don't have to be a first-time homebuyer so ifyou think that you are ready to purchase a home I hope you'll visit our websiteaustin's lender com if you have any questions youcan email me Bubba at Bubba bash or a compbu VBA at BU B ba ba sh 8 EUCOM we our current market incorporateddoing business as Austin's lender and we loan all over the state of Texas and mypartner is in Florida and we loan there as wellso visit Austin's lender or Austin slender calm and begin by clicking onthe apply button at the top of the screen once that application comes inwe're going to call you we're going to fill in any empty areas and we reallywant to understand from your perspective what's important to you because at theend of the day if we don't fulfill your needs and wants we've wasted our timeand we understand that so thank you for watching this video FHA is the best wayto go don't let anybody tell you 680 or 640 or 620 or even 5 80 credit score FHAapproves all the way down to 500 but if you've got a lower credit score and I'mgonna say 540 and lower you are gonna have to have a decent downpayment 10% isthe minimum probably 15 or 20% down the good news is there are options availableand everybody should be a homeowner it's such a great opportunity because itbuilds a retirement plan for you if you buy a house today in Austin for 300,000next year to probably sell for 330 the next year to probably sell for 370that's 70 thousand dollars of equity think how long it would take you to save$70,000 in the retirement plan and that money accumulates just by virtue ofowning your home now we've been in a great market and I hope we stay in agreat market but as you know the value of homes goes up and downluckily Austin in Central Texas has been pretty stablebut there's no guarantee of that but I do know that the values always end uphigher than they were years past so you may see a short dip but it won't staydown long it always comes back it always has with that being said thank you forwatching Austin's lender wants your business and we do have one advantageover everybody else we call it our dhoklas system so once you do thatapplication that austin's lender calm we can click a little button and it sendsyou an electronic form that you can complete and send back and we willgo get your tax returns your pay stubs your w-2s you don't have to go diggingthrough boxes and storage to try and find all that stuff we're one of the fewlenders that offers that and we have 24-hour underwriting we can close an FHAloan in as little as 10 days and we do it all the time we want your businessaustin's lender is your lender.