National and Wisconsin FHA mortgage home loans has changed the up front and monthly mortgage insurance premiums.
Here is an example of how this change will effect your Wisconsin mortgage monthly payment.
Effective Oct. 4th the new up front and monthly mortgage insurance premiums changed. Here's an example of purchasing a home for $100,000 putting 3.5% downpayment estimating home insurance at $480 per year and real estate taxes at $2400 per year at 4.25% on a 30 year fixed rate.
The old premiums your total mortgage payment would be $769.29 per month. Under the new mortgage insurance premiums that payment is now $791.29 per month.
Ron Meyer is a Wisconsin licensed Sr. Loan Originator NMLS #222688 with GSF Mortgage Corporation NMLS #1018 located at 300 Patriot Dr. Little Chute, WI 54140 We specialize in financing purchases and refinancing home loan mortgages for all of Wisconsin. As a local lender we pride ourselves on offering quality service before and after your closing. Our underwriting is all done in house, allowing us to have quicker than normal processing time of your loan.
Wednesday, October 6, 2010
Friday, October 1, 2010
Wisconsin Mortgage lending tips for Real Estate Agents
Wisconsin Mortgage lending tips for Real Estate Agents.
Lending laws have changed considerably the past couple of years. Many of the things that could be done in the past are no longer allowed. Here are some tips for a Real Estate Agent to help make a transaction run smoothly without delays in closing.
1. Any repairs needed?
Make the seller aware if the home needs repairs they may need to be done prior to closing. More and more homes are being purchase with FHA loans. When an appraisal is completed the appraiser will list what needs to be fixed. These items can not be escrowed and repaired after closing or given as a seller credit on the HUD Settlement Statement. We do offer an FHA 203k loan that allows the buyer to receive additional funds for repairs or remodeling.
2. How is title held?
When listing a home find out how title is held. If it’s in an LLC, Corporation, Trust etc get the trust agreement or articles of incorporation from the seller. The lender will need these documents to verify the person signing the sales contract has the power to do so.
3. Earnest Money
Make sure earnest money is in the form of a personal check or bank check and not cash. In order for the lender to give this credit towards the purchase they need to be able to verify where these funds came from and that they are the buyers own funds or documented proof they were gifted. Make sure the check is cashed as soon as possible. The lender will need proof the check cleared the bank.
4. Personal items included in contract
If any personal items are included in the contract such as not built in appliances, old lawnmowers, etc include in the contract the following note: Personal items are being left behind and are of no value out of convenience for the buyer.
5. No Rush closings.
There is really no such thing as a rush closing anymore with initial and redisclosures that are now required. Try to allow 30 days for closing and loan commitments. I am still seeing quite a few offer to purchase contracts coming over with 14 day loan commitments.
6. Home Insurance
A home insurance binder is required prior to all closings. If they will be escrowing for home insurance it must be paid in full for 1 year. It’s a good idea to have this done at least 10 business days prior to the closing date. The underwriter needs to review it, then funding sends out loan documents, and the title company needs time to prepare the HUD Settlement Statement.
7. Do not apply for credit during the loan process
A recent change to conventional loans and not FHA yet is on the day of closing or the day before the lender will reorder a credit report. If the buyer has applied for credit since the original credit report was issued we will need a letter from the buyer for inquiries and include the new monthly debt into the debt to income ratio. I always instruct buyers to not apply for any credit until they close on the home, however, I see many buyers go apply for credit to get new appliances, furniture etc. In certain cased where the debt to income ratio is tight this could make them ineligible and we won’t know until the day of or day before closing.
8. Do not quit your job
As funny as this sounds we still run into on occasion someone who quits there job after they get an accepted offer on a home. The lender will call the day of closing the buyers employer to make sure they are still employed and haven’t either quit or given a two week notice. If they have changed jobs in the process we will need the new employment and income documentation and it will need to go back to underwriter for review.
Lending laws have changed considerably the past couple of years. Many of the things that could be done in the past are no longer allowed. Here are some tips for a Real Estate Agent to help make a transaction run smoothly without delays in closing.
1. Any repairs needed?
Make the seller aware if the home needs repairs they may need to be done prior to closing. More and more homes are being purchase with FHA loans. When an appraisal is completed the appraiser will list what needs to be fixed. These items can not be escrowed and repaired after closing or given as a seller credit on the HUD Settlement Statement. We do offer an FHA 203k loan that allows the buyer to receive additional funds for repairs or remodeling.
2. How is title held?
When listing a home find out how title is held. If it’s in an LLC, Corporation, Trust etc get the trust agreement or articles of incorporation from the seller. The lender will need these documents to verify the person signing the sales contract has the power to do so.
3. Earnest Money
Make sure earnest money is in the form of a personal check or bank check and not cash. In order for the lender to give this credit towards the purchase they need to be able to verify where these funds came from and that they are the buyers own funds or documented proof they were gifted. Make sure the check is cashed as soon as possible. The lender will need proof the check cleared the bank.
4. Personal items included in contract
If any personal items are included in the contract such as not built in appliances, old lawnmowers, etc include in the contract the following note: Personal items are being left behind and are of no value out of convenience for the buyer.
5. No Rush closings.
There is really no such thing as a rush closing anymore with initial and redisclosures that are now required. Try to allow 30 days for closing and loan commitments. I am still seeing quite a few offer to purchase contracts coming over with 14 day loan commitments.
6. Home Insurance
A home insurance binder is required prior to all closings. If they will be escrowing for home insurance it must be paid in full for 1 year. It’s a good idea to have this done at least 10 business days prior to the closing date. The underwriter needs to review it, then funding sends out loan documents, and the title company needs time to prepare the HUD Settlement Statement.
7. Do not apply for credit during the loan process
A recent change to conventional loans and not FHA yet is on the day of closing or the day before the lender will reorder a credit report. If the buyer has applied for credit since the original credit report was issued we will need a letter from the buyer for inquiries and include the new monthly debt into the debt to income ratio. I always instruct buyers to not apply for any credit until they close on the home, however, I see many buyers go apply for credit to get new appliances, furniture etc. In certain cased where the debt to income ratio is tight this could make them ineligible and we won’t know until the day of or day before closing.
8. Do not quit your job
As funny as this sounds we still run into on occasion someone who quits there job after they get an accepted offer on a home. The lender will call the day of closing the buyers employer to make sure they are still employed and haven’t either quit or given a two week notice. If they have changed jobs in the process we will need the new employment and income documentation and it will need to go back to underwriter for review.
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