Good morning Memphis on this beautiful Memorial Day weekend 2012. As we are going about our day, let’s remember and say thanks to our military service people who sacrificed in order for us to stay free. Thank you to these service people AND their loved ones.
Our real estate closing wizards today are Attorney Ron Cohen affiliated with the Memphis Law Firm of Ballin, Ballin & Fishman and an owner of Premium Title.
And also Dale Jacobson owner of Premium Title . Dale, its great to have you with us today. Sitting in for a visit is Tom King of King and Vaughn Consulting, certified Shelby County tax appeal expert and a fairly regular on the show.
Join in with us. Pull up a chair, grab a cup of coffee. We are here to help YOU find solutions to YOUR real estate and real estate financing challenges. What do YOU want to talk about?
Here’s a day in the life at our mortgage office this past week:
Start to work early. Work through lunch . Work until late. There is no such thing as a 9 to 5 job for a mortgage officer these days.
Mortgage rates surprised us by staying low throughout the week with a few bumps in the road. 30 yr mortgage rates are staying about 3.97 or lower if you want to pay a little extra for points. FHA and VA rates are even lower than the conventional rates. The 15 year rates fell 1 basis point to 3.19 percent. The average rate for 30-year jumbo mortgages , was 4.52 percent, the same as last week. (jumbos are the loans generally over $417,000.
The 5/1 adjustable-rate mortgages rose 2 basis points to 3.02 percent. With a 5/1 ARM, the rate is fixed for five years and adjusted annually after the first 5 years.
Our phones are ringing and my very capable assistant Susan Belew and our team are busy every day all day working with customers. We are helping them get the right loan terms for what they want to do and getting their loans to closing. Even though it’s hard work, it’s really fun because we’re helping free up several hundred dollars a month for people. How many people get a several-hundred-dollar raise all at once? Happy customers give me that feel-good sensation.
The reason our mortgage rates are so low right now is partly because of the instability in the European markets and of course our Federal Reserve supporting the low rates here. But that could all change with one or two major economic reports. So if your purchase mortgage or refinance terms make sense to do today, my advice is to lock your rate today. Don’t take a chance on missing out if the rates go up.
Just to put in perspective the opportunities we are enjoying today: Rates are almost HALF what they were at the peak of the housing bubble in mid-2006 when the median house price was about $250,000 dollars and the average interest rate was about 6.75% for a 30-year term.
A person who bought a home in 2006 with 20% down would have made payments of $1,300 a month. Today, a person who buys a median priced of home of about $162,000, would pay less than half that amount, about $600 a month. Its time to buy houses and its time to refinance some.
The government Home Affordable Refinance Program otherwise known as HARP is helping several of the 4 million underwater homeowners–underwater meaning they owe more on the home than their home is currently worth. If Fannie Mae or Freddie Mac (the government sponsored mortgage holders) have backed your loan since before May 31, 2009 and you have not made any payments over 30 days late in the last year, then you probably qualify to refinance your primary residence, vacation home and rental properties with NO APPRAISAL.
If your mortgage is NOT backed by Fannie Mae or Freddie Mac but you have a government FHA or Veteran Administration mortgage, you could STILL qualify for a no -appraisal refinance
My assistant Susan and I will be happy to do a free evaluation for you or anyone you know to see what type of refinance terms we can offer you on lowering your payment, shortening your term or both Just call us privately and directly at (901) 482 0354 .
Some of you have called and want to know what you can do to refinance without an appraisal if you DO NOT fit any of the programs for HARP, FHA or VA. Susan and I would still like the opportunity to talk with you.
A couple of years ago the first version of the HARP program was released but there were so many restrictions on it that it failed to help that many people. Then in March of this year HARP 2B was released and it’s helping a larger segment of underwater borrowers–but not all.
But the good news for you is that the housing experts believe the old saying “the third time is the charm” and told the Senate Banking Committee Thursday that they support releasing a HARP 3 program in the future. The bill, called the Responsible Refinancing Act of 2012, would remove additional barriers still preventing underwater borrowers from refinancing and reducing the interest rate on their mortgages. So stay tuned and stay in touch. We will let you know what happens with upcoming programs for refinancing OR for home purchase programs.
But let’s hear from Attorney Ron Cohen and attorney Dale Jacobson, owners of Premium Title company. They are our real estate closing experts today and we are talking about “The Way To A Smooth Real Estate Closing: Follow The Yellow Brick Road”
What are some tips you can give us for a smooth real estate closings?
Questions on podcasts are answered by Dale and Ron.
Steps To A Seamless Closing:
Sellers:
Have you left the agreed upon personal property.
Have you removed the unwanted personal property.
Have you completed the agreed upon repairs
Verify sale price and loan payoff on your closing statement.
Confirm what date by which you must vacate the property.
Make sure the movers have everything in order to accomplish your move.
Confirm elevator reservations.
Better not to attend the closing. Especially if negotiations have been heated.
If you are going to sign documents at the closing (even though I suggested not attending) bring a government issued photo ID.
If you are required to deposit money at the closing you must bring good funds.
Cancel your homeowner’s insurance.
Don’t forget to make the keys and other items available.
Transfer the utilities. Do not shut them off.
Forward your mail (unless you don’t want it).
Purchasers:
Verify the time, date and location of the closing (it might not be where you think).
Make sure your movers have everything in order. Confirm how they expect payment otherwise you might not get your stuff off of the truck>
Confirm that all of your loan conditions are satisfied. You wouldn’t want to start scrambling around while the closing is in progress (especially if it is raining).
Bring a government issued photo ID.
Confirm that good funds are available. Best to wire. If it’s a cashier’s check, make sure that you are the remitter so that it does not look like a gift. Bring extra money just in case (you might have to take everyone out to lunch).
Bring your real spouse, just in case.
Confirm that you have your homeowners insurance (your lender will insist).
Make sure you get the keys and other stuff (the movers might want to get in).
Verify the lender’s numbers on the closing statement.
Put the utilities in your name.
Attorneys:
You are on your own. Take a class.
Ron A. Cohen
Of Counsel: Kusper & Raucci, Chartered
30 N. LaSalle Street
Suite 3400
Question 1 answered by Jo Garner : Home prices are low and so are the rates. It seems like everyone would be buying AND refinancing a home right now. What are some steps to a smooth loan process.
Jo’s answers: If you are buying a home or refinancing one the mortgage rates and historic low prices on homes are like a Saturday in the park on a balmy 70 degree day with sunshine and a gentle breeze . The storm clouds can bluster in during the loan process if you’re not prepared for providing detailed income documents and asset documents that are part of the ever-tightening loan requirements we have not seen in decades. Its not 2006 when you didn’t have to prove income or assets to get a loan. We are NOT in Kansas anymore.
Today you need to prepared to provide all pages of your signed personal tax returns (and business tax returns if you are self-employed in a corporation.
When you are choosing which bank statements to send to the mortgage company, try to choose one that does not have a lot of large deposits other than payroll, because these days underwriting is requiring that you show a paper trail on the source of large deposits. Creating that paper trail can cost you time and trouble.
If you are purchasing a home and using down payment assistance, be prepared to document household income, even if your spouse is not on the loan.
A good mortgage officer can walk you though some of the loopholes and work arounds. So can a good realtor, if you are buying a house.
Question 2 for Jo Garner : You have been talking about the high number of refinances and purchases coming through your door. What are some of the trends you are seeing with people purchasing homes?
Jo’s answer: The most common purchase transactions we see vary but most people want to pay the least amount down and avoid private mortgage insurance. And there are a number of people buying bank-owned property, foreclosures and fixer uppers since that is where you can buy at prices below market.
Evolve Bank and Trust are one of the few banks who offer the FHA 203K Renovation and Repair mortgage. We also offer Fannie Mae’s Homepath and Homepath Renovation loan for specified houses. After closing on one of these, you can enjoy bragging about what a great bargain you snagged.
One of our newest conventional programs is giving FHA a run for the money. It is a 95% loan to value and the 5% down payment can come from a family gift.
We offer the 100% financing for Veterans and for Rural Housing financing.
And then there is the Tennessee Housing Development loan with down payment assistance and other down payment assistance programs through the city and county and other organizations.
Real Estate Tip of the Week: If you or someone you know is in the process of getting a mortgage loan, here are a few tips:
(1) Read over the loan application and disclosures carefully. Check to make sure your name is spelled correctly, your social security and birthday are correct and the property address is correct. Check the rate and terms of the loan to make sure you are getting what you agreed to on the rate and terms. You may get more than one set of disclosures if anything on your numbers change.
(2) The credit bureaus are sending summaries of your credit report to you in the mail after the mortgage company pulls your credit. These bureaus have a few paragraphs in their report that makes it sound like your credit has problems, but check with your mortgage officer. A lot of the language in the bureau letter are describing their criteria for grading loans in general -not necessarily YOUR loan.
Jo Garner, Mortgage Officer with Evolve Bank and Trust
6070 Poplar Ave Ste 100
Memphis, TN 38119
(901) 482 0354 ck me out online at www.MoneyShoppe.NET
For answers to your real estate and real estate financing questions or if you are what is the best terms on a home mortgage. Let’s talk about getting the best deal on a mortgage loan.