FINDING YOUR TREASURE IN REAL ESTATE—HOW TO QUALIFY FOR THE MORTGAGE YOU WANT

In Uncategorized by Jo Garner0 Comments

It’s finally the month of March and we will soon see which men’s basketball qualifies for the golden trophies. Like in basketball, to win the gold it takes vision, preparation and putting the ball through the basket. Today we are going to talk about some ways to find your treasure in real estate-specific things you can do to qualify for the mortgage you want.

Let’s stay connected! Subscribe to Real Estate Mortgage Shoppe podcasts with show notes at www.JoGarner.com What do YOU want to accomplish with YOUR mortgage? Call me at (901) 482-0354 and let’s talk about YOUR plans.

To Your Success,
Jo Garner, Mortgage Loan Officer NMLS #757308
(901) 482-0354 Jo@JoGarner.com

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Good morning, Memphis! Welcome to our internet listeners and podcast listeners across the 50 states! You’re on Real Estate Mortgage Shoppe. I’m your host, Jo Garner, Mortgage Loan Officer. You can connect with me at www.JoGarner.com. Our general topic is FINDING YOUR TREASURE IN REAL ESTATE—HOW TO QUALIFY FOR THE MORTGAGE YOU WANT. Subscribe to get our weekly blogposts with podcasts at www.JoGarner.com. Call us while we are live at (901) 535-9732

 

Today is March 2, 2019.

It’s finally the month of March and we will soon see which men’s basketball qualifies for the golden trophies. Like in basketball, to win the gold it takes vision, preparation and putting the ball through the basket. Today we are going to talk about some ways to find your treasure in real estate-specific things you can do to qualify for the mortgage you want.

Sitting in the co-host chair today we have our expert real estate appraiser, Tom King of Bill King Appraisal Service. Tom has been in the appraisal business for over 40 years. A big part of laying claim to gold is knowing the value of what it is when you find it. Tom King is an appraiser expert who can help you know the value of the home you want in your treasure chest. Tom, tell our new listeners a little bit about yourself and what you do for your clients. (Tom King does mortgage appraisals, appraisals for relocation companies, banks, appraisals for estate sales, divorce settlements and cash real estate sales)

(Jo) We are heading into the month of March is an exciting time for basketball fans. March is the time of final tournaments to determine who walks away with the golden trophy. The winners are teams that were very intentional in their goal and their preparation to reach their goal, even if they have failures along the way to the top. Michael Jordan is known as one of the best basketball players in the nation. But did you know that Michael Jordan was cut from his high school basketball team when he was in high school? He says that the failure then is the impetus it took to make him work harder to be the best-and to GET the best.

Jamie and Jenny Jernigan (not their real names) have told their story more than once on the air on Real Estate Mortgage Shoppe. During the real estate crash, the Jernigans experienced heart-breaking loss and seemingly endless rounds of economic punches that could have convinced them to throw in the towel to realizing their desires to own their own home. They yearned to have their own home and continue growing their family. Other lenders turned their mortgage request down because of messy credit snafus still lurking on their credit reports.

But, like Michael Jordon, Jamie and Jenny Jernigan rolled up their sleeves and started, one step at a time, making their plan and working their plan. They put some experienced reputable professionals around the. One faithful day they held up their prequalification letter and later the deed to the house. Kudos! to you, Jamie and Jenny.

For mortgage clients like the Jernigans, one of the most common challenges to qualifying for a mortgage to buy a home or refinance one, is to get credit issues corrected and cleaned up.
Most of you all know I have been in the mortgage business for almost 30 years. One of the biggest gold mines for my customers comes with clean credit and high credit scores. Even though I am not a licensed credit repair person, I can share with you some common habits and some habits that may surprise you on how to keep your credit clean and your scores high.

Most everyone knows that you need to make ALL of your payments on time. Even one recent over-30-day-late report from a creditor can sink your credit scores 40 or 50 points. But did you know that a 12-months-same-as-cash account, even if you pay it on time can drop your credit scores sometimes 100 points? Did you know that if you use over 50% of your credit line on a credit card, even if you make your payments on time, it could drop your scores 30 to 50 points or so? Later in the show, I will be sharing with you some other simple places to do a little digging to help you qualify for the mortgage.

Tom King, as the real estate appraisal expert on Real Estate Mortgage Shoppe, what are some specific type repairs you see in homes that mortgage companies tend to require to be fixed before they will allow the buyer to close? (Tom talks about 3 minutes or so on repairs that mortgage companies tend to require to be completed before allowing the transaction to close. …… During the real estate crisis a decade ago, lending guidelines changed to help prohibit illegal collusion between mortgage companies and appraisers. Today, mortgage companies are required to order appraisals through a government-approved third party agency. The third party appraisal ordering company “spins the dial” to assign an appraiser to do the appraisal on a mortgage)

You’re on Real Estate Mortgage Shoppe. I am your host, Jo Garner, Mortgage Loan Officer. Connect with me at www.JoGarner.com You can now find me at Home Vantage Mortgage here in the Memphis Area. What do YOU want to accomplish with YOUR mortgage? Let’s talk! You can still call me (901) 482-0354. When we come back Tom King of Bill King Appraisal Service will be sharing some more about home appraisals.

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2nd segment after 9:15 break:

Our Look Back Memphis Trivia Contest is brought to you by notable Memphis Historian, Jimmy Ogle. Our Look Back Memphis Trivia Contest is sponsored by John and Jennifer Lawhon of Lawhon Landscape (901) 754-7474 the Lawhon’s can help you plan your landscaping if you have a BIG, BIG project or a smaller project . The Lawhons are giving away a $25 gift card to the first person with the correct trivia answer. If you know the answer to our trivia question, call us at 901 535-9732.

MALCO (Powerhouse Theatre)
Question: I will be the newest in a long line of family “entertainment centers” in Memphis. Who am I?

Hint: I began in Memphis in 1929 and my name comes from my founder’s initials.

Hint: I took ownership of one of the “South’s Grand” Facilities in 1940.

Final Hint: I am opening my latest venture this Thursday, March 7 near Central Train Station.
Answer: MALCO Powerhouse Theatre. MALCO Theatres’ history began during World War I, when Morris A. “M. A.” Lightman, Sr., (known as M.A) went to Colbert County, Alabama, to work on the Wilson Dam project as an engineer. Although he held a degree in engineering from Vanderbilt University, he thought of himself more as a showman and entertainer. Lightman decided it was time to try something new one day while in Northwest Alabama, when he came upon a long line of people waiting to get into a local theatre. He decided he wanted to operate a movie theatre. Upon his return two months later to Northwest Alabama, in February 1915, Lightman formed The Sterling Amusement Company and opened his first theatre in a storefront he had rented in Sheffield, Alabama.

After leaving Northwest Alabama, M.A. partnered with his father, a stone construction contractor, to build the Hillsboro Theater in Nashville. It was in North Little Rock that Lightman partnered with M.S. McCord and M.J. Pruniski forming the MALCO Amusement Company. They began building a theatre chain by buying and building single screen cinemas throughout Arkansas. In 1929, Arkansas Amusement Enterprises became MALCO Theatres, Inc. This is also the year that the company started installing Vitaphone and Movietone equipment to add sound for the first time in their theatres.
MALCO Theatres began acquiring cinemas not only in Arkansas but also in West Tennessee, Louisiana, Northern Mississippi, Western Kentucky, and Southeastern Missouri, and now operates over 170 screens in six states. It was in 1929 that MALCO Theatres purchased its first location in Memphis, Tennessee, the Linden Circle Theatre. In 1940 MALCO purchased the Orpheum Theatre and ran movies on the big screen until 1976. MALCO introduced “quartet” movie theatres in Memphis in 1970 at the Highland Quartet. MALCO also operates the only drive-in theatre in Memphis – Summer Trio Drive-In. This coming Thursday (March 7) MALCO will open the MALCO Powerhouse Theatre (7 screens) on the grounds of Central Station in the South Main Historic District of Downtown Memphis. Malco.com.

Jimmy Ogle will be presenting a FREE “encore tour” of the Judge D’Army Bailey Courthouse on Friday, March 15 at 11:30 a.m. Go to JimmyOgle.com for more information.

 

TOPICS COVERED BY TOM KING, REAL ESTATE APPRAISER

1. What are some of the types of repairs needed in homes that mortgage companies require to be fixed before closing in order for the loan to be qualified to close?
2. Talk about the firewall between real estate appraisers and the mortgage companies?
3. What are the different types of real estate appraisals that you perform? What are the benefits on each of these type appraisals?
4. What is the difference between a qualified mortgage appraisal and the values people see on Zillow.com, and the Shelby County Assessors Site?

 

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TOPICS COVERED BY JO GARNER, MORTGAGE LOAN OFFICER

1. Talk about the top areas where borrowers need to look to qualify for their mortgage.
A. Credit –
Most of you all know I have been in the mortgage business for almost 30 years. One of the biggest gold mines for my customers comes with clean credit and high credit scores. Even though I am not a licensed credit repair person, I can share with you some common habits and some habits that may surprise you on how to keep your credit clean and your scores high.
Most everyone knows that you need to make ALL of your payments on time. Even one recent over-30-day-late report from a creditor can sink your credit scores 40 or 50 points. But did you know that a 12-months-same-as-cash account, even if you pay it on time can drop your credit scores sometimes 100 points? Did you know that if you use over 50% of your credit line on a credit card, even if you make your payments on time, it could drop your scores 30 to 50 points or so? Later in the show, I will be sharing with you some other simple places to do a little digging to help you qualify for the mortgage.

B. Digging for treasure when you need funds to close.
First let’s dispel one big gorilla-sized myth- The minimum required down payment to purchase a home where you will live is NOT 20% down. You can actually buy your home with 3.5% or even zero down. Call me at (901) 482-0354 or connect at www.JoGarner.com and let’s look at some of YOUR mortgage financing options.

To find your pot of gold to use for down payment funds, here is some places to sink your spade.
Three areas to search are the borrower’s forgotten assets, gifts from family or employers and move-in costs paid by third parties. Sinking a shovel into these three areas has turned up pay dirt in the past. Here is a treasure hunting map detailing some clues.

Gift From Family: Gifts can come from family members or employers. The amount of the donation varies according to different loan programs. The donor will be required to document the source of his funds and that the money is a gift to the donee not requiring repayment. If the family member giving the money does not want to cash in a certificate of deposit or stock fund, he can borrow against the asset to give to the donee.

Borrower’s Forgotten Assets: Whole life insurance policies or annuities may have a cash value that can be borrowed. Many times the borrower does not realize the insurance she purchased years ago has a cash value that can be borrowed to pay the move-in costs.

Loans secured on certificates of deposit, stocks and bonds, and durable assets such as cars can be used as acceptable sources of funds to close as long as the loan is secured on an asset owned by the borrower. The payment must be added into the debt-to-income ratios for qualifying purposes

IRAs, 401(k)s and Retirement Funds. There can be heavy financial penalties for pulling money from these sources. However, many companies allow the homebuyer to borrow against these assets with no penalty. The repayment terms may be calculated in the borrower’s debt-to-income ratio.

Sale or Cash Out Refinance of Existing Real Estate Property can generate needed funds to close on another property. Lenders will require the HUD 1 Settlement Statement or sufficient proof of the source of funds.

Tax Refunds can provide a surprising source of closing funds.

Move-In Costs Paid By Third Parties: Sellers are as motivated to sell a house as the buyer is to purchase. Sellers can pay up to 3% of the sales price toward the buyer’s costs if the borrower is getting a conventional loan above 90% loan-to-value. If the loan-to-value is 90%, the seller is allowed to pay costs up to 6% of the sales price or value whichever is less.
On certain loans, the sellers are allowed to pay more and even loan the borrower the equity on a second mortgage. Investor loans allow the sellers to pay no more than 2% no matter how much money the investor pays down.
FHA loans allow the seller to pay up to 6% of the price toward the buyer’s closing costs and prepaid taxes and insurance.

Lenders are motivated to close the transaction and sometimes can bump up the interest rate slightly in order to use “premium pricing” to pay the borrower’s prepaid taxes and insurance or some of the closing costs. In most cases the rate is increased .25% and the difference in the monthly payment is minimal.

Government agencies such as Tennessee Housing Development Agency have programs that provide down payment assistance to borrowers. Some of the well known programs are City of Memphis Down Payment Assistance, Shelby County Down Payment Assistance, United Housing, Inc. Rural Housing, Mississippi Bond money, H.E.L.P. For the down payment assistance grants and loans, the borrower is required to meet a minimum or maximum annual income guideline and sometimes are required to be first time homebuyers. First time homebuyers are defined as buyers who have not owned real estate in the last 2 to 3 years.
(Buried Treasure Story: Great-Granny’s Golden Goodies

When bankers talk about the difficulty to verify source of funds for closing, I chuckle when I remember one of the first loans I ever closed. It was a family building a nice home with a very large down payment. “A piece of cake. This will be easy,” I thought.

Much to my chagrin, the underwriter asked for a paper trail showing the source of funds the family was using for down payment. When I asked my borrowers where they got the large down payment, they replied, “We found buried treasure.” I laughed thinking they were joking. They weren’t.

When their great-grandfather enlisted into the Army during the Civil War, great-grandmother buried the family wealth under a tree on their property intending to dig it up after great-grandfather came back from war. He didn’t.

Great-grandmother, for whatever reason, did not dig up the treasure after the war and eventually the old tree came down leaving no marker for the family.
Great-grandmother was finally laid to rest and a few of the family members
began searching for a map that surely must be there. It wasn’t.

Not until several years later when the family began clearing ground to build their house on the inherited property did the back-hoe turn up the surprise. Their part was over $20,000 dollars and was discovered still securely contained where great-grandmother had buried it during the Civil War.

By: Jo Garner)
C. Qualified Income sources:
Guaranteed salary income is normally accepted even if you have been getting this income for less than a year or two. Being employed in the same type business continuously for over a year or two helps.

Being employed for less than 2 years , getting an 1099 instead of W2, can be problematic. If your employer does not deduct your taxes and FICA, and you get a 1099 as a self-employed contractor or subcontractor, most of the loan programs require a two-year history
Of working like a contractor with your business. There are some exceptions though. If you or someone you know is working like this, call me and let’s explore how to best get them qualified with their income.

Self-employed borrowers are unique also. It has been my pleasure to work with business owners who had been turned down by one or more banks due to not enough income. But when these borrowers give me a chance to look at ALL pages of their tax returns, so many times I can find items in the back pages of the tax returns that can be added back to their income to help them qualify for the mortgage they want. (This does not happen 100% of the time, but it is a beautiful thing for everyone when it does work)

D. Appraisal- (Tom covers this ) (Talk about escrowing for some of the repairs when permissible) (Mention renovation-repair loan programs)

 

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REAL ESTATE TIP OF THE WEEK (Tom King shares a real estate related money-saving or time-saving tip):

 

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ANNOUNCEMENTS:

Talk Shoppe offers free networking & education to anyone interested in real estate or in business. Talk Shoppe meets every Wednesday 9A-10A CT at Pinot’s Palette 8225 Dexter Rd Cordova, TN. This Wednesday March 6, 2019 Talk Shoppe presents: “Three Ways To Increase Your Bottom Line” by Nita Black of www.901Elearn.com (901) 413-1315
Talk Shoppe events are free thanks to supporters like Leah Anne Morse of All Things New—helping you and your loved ones organize to upsize or down size. Leah Anne can make your transitions to new living spaces smoother. www.allthingsnewwtn.com (901) 488-9733
Thank you to Jana Cardona, Executive Director of Business Network International of the Mid-South. Helping you build your business with a business referral system www.bnimidsouth.com

4. Subscribe at www.JoGarner.com and you can get our weekly blog posts with podcasts conveniently in your inbox.
5. Real Estate Mortgage Shoppe reminds you to MAKE YOUR PLAN. LET’S WORK YOUR PLAN. IF THE DEAL WORKS FOR YOU TODAY, DO IT TODAY.
SPECIAL NOTE: REAL ESTATE MORTGAGE SHOPPE RECOMMENDS THAT YOU CONSULT WITH A FINANCIAL, LEGAL OR OTHER CERTIFIED, LICENSED PROFESSIONAL BEFORE ACTING OR INVESTING ON ANYTHING YOU HEAR OR SEE FROM THE CONTENT ON THIS SHOW OR BLOG POSTS. THE INFORMATION WE SHARE ON REAL ESTATE MORTGAGE SHOPPE IS GENERAL IN NATURE MEANT FOR GENERAL EDUCATIONAL PURPOSES ONLY. ALL EXAMPLES GIVEN FOR ILLUSTRATION PURPOSES ON REAL ESTATE MORTGAGE SHOPPE USE FICTIONAL CHARACTERS AND DO NOT REFLECT REAL PEOPLE OR ACTUAL DETAILS IN ANY OF THE SITUATIONS.

 

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QUOTE CORNER:
Joe Caruso “Learn to treasure the chase as much as your treasure the trophy.”

 

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REJOINDERS:

1. Pat Goldstein, Realtor with Crye-Leike Realtors in West TN and North Mississippi. 901 606-2000
2. Mary Lou Nowak Mid-South Home Helpers (901) 414-9696 for non-medical help in the home for your elderly or handicapped loved ones www.homehelpershomecare.com
3. Eric Eurich, Kaizen Award-Winning business coach. eeurich@focalpointcoaching.com

Transitional Music:
Money Money Money by ABBA; “Money Honey” by Elvis Presley; “For the Love of Money” by the O’Jays; “Memphis” by Johnny Rivers for the Look Back Memphis Trivia Contest

 

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ABOUT TOM KING, APPRAISER WITH BILL KING COMPANY

Tom is a well- respected and sought after appraiser in Memphis, Tennessee. He is a second generation appraiser with 40 years experience. He has been elected to the Memphis Area Association of Realtors Board of Directors three times.

Tom is a certified residential appraiser in Tennessee. He have appraised over 20,000 homes in his career. A graduate from the University of Tennessee with a degree in real estate, Tom is also a Certified Relocation Professional (CRP). Tom also has vast experience in dealing with the county and state boards of equalization and in valuations of property for tax appeal purposes. (901) 487-6989

 

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ABOUT JO GARNER-MORTGAGE LOAN OFFICER:

WHAT DO YOU WANT TO ACCOMPLISH WITH YOUR MORTGAGE?
www.JoGarner.com (901) 482 0354 jo@jogarner.com twitter @jogarner NMLS# 757308

“Whatever YOUR personal priorities are, my job is to help you get the mortgage terms that will give you bragging rights when you talk about it and help you score on hitting your goals .”
As a mortgage loan officer, my job is to help you get to the benefits you want from your financing terms. What is most important to you? I can help you find the financing terms that will help you get to what you want. What is your comfort level on a house payment? How much are you comfortable paying down,? What type of financing do you need to get the house you want to buy or refinance?
Different clients have different priorities in life—some are buying their first home with very little down payment funds. Some are recovering from medical challenges, divorces or preparing to send children to college and some are embarking on a long term goal of buying properties to build rental income.”
Jo Garner is a mortgage officer with extensive knowledge in tailoring mortgages to her customers who are refinancing or purchasing homes all over the country. She offers conventional, FHA, VA or other loan programs for refinancing and purchases.
Jo can help you look at rent vs buy, when it makes sense to refinance, how to get the best deal on your home purchase financing.
Jo Garner has been in the real estate/financing business for over 20 years. She got her start in Portland, Maine where she first began her real estate career. She received her real estate education from the University of Southern Maine and was personally mentored in San Diego, California by Robert G. Allen, author of Nothing Down, Creating Wealth and The Challenge.
On moving back to West Tennessee in 1987, she went into business buying and selling discounted owner-financed notes secured on real estate. In 1990 Jo went to work for a residential mortgage company and has been a mortgage loan officer for over 20 years. Her goal is to offer excellent, affordable service to her customers, tailoring the loan programs to the specific needs of her clients.
In addition to her work in the mortgage field, Jo Garner is the primary sponsor and founder of Talk Shoppe in Memphis. www.TalkShoppe.com She was also the editor of Power Shoppe, a free weekly e-zine designed for real estate professionals and others indirectly connected to the real estate industry and currently publishes on her blog www.JoGarner.com

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