Archives for October 2009

Fall Back, Seattle

PA240040Just a reminder to set your clocks back one hour when you go to bed tonight…or you can be official and roll your clocks back at 2 a.m. on Sunday, November 1, 2009.

Daylight saving time is over after this evening.

Friday Funny: Seattle Tunnel Vision

We’ve all seen the nicely produced video (to the tune of $80k) of what could happen to the viaduct if Seattle experiences an earthquake… but have you seen the low budget version of what would happen to the proposed tunnel in a similar circumstance?

Note: I’m trying out posting mortgage rates at Rain City Guide on Friday’s and on Mortgage Porter on Mondays.

PS:  Don’t forget to VOTE by next Tuesday.

Do I Really Have to Provide All Pages of My Bank Statements?

A fisheye image of a mid-30's business woman pouting and looking angry.

A fisheye image of a mid-30’s business woman pouting and looking angry.

When assets are being used for down payment of a new home, towards closing costs on a refinance or even to document that the borrower has enough reserves (typically a couple months of mortgage payments) in the bank after closing; they need to be documented.

[Read more…]

Book Review: The Big Score by Linda Ferrari

Ferraribookcover2 Last month I had the opportunity to speak at The Mortgage Girlfriends Mastermind Summit and to meet Linda Ferrari.  Linda is someone who I’ve known of for a long time.  She’s an expert at credit scoring and is passionate about consumers knowing and understanding their credit score.  She is the author of “The Big Score — Getting It and Keeping It”.

This book is a great resource–for young and old alike.  We are impacted everyday by our credit scores and Linda does an excellent job shedding light on mystery of credit scoring.   Her book is structured in an easy to read and research format.   If you need help working on repairing your credit, you’ll find step by step advice in this book.  It could be the best $20 you ever spend.

For the record, I paid for my copy and I am not receiving any compensation for my review. 

Count Down to November 30th and the First Time Home Buyer Tax Credit

You may be surprised to see how many days are available to close a transaction by November 30, 2009 in King County when you factor holidays and furloughs.  

New Credit Card Regulations and Games Creditors Play

The Credit Card Act of 2009 was recently signed into law by President Obama with many positive benefits for Americans.   Here's some of the Act's features:

  • written notice must be provided at least 45 days in advance of a rate increase or significant change in terms. 
  • prohibition of universal default.

Consumers have the right to refuse a proposed higher rate, and the credit card company may close the account and demand the account be paid off within five years.

One of my clients, with excellent credit scores, recently had two of her department store credit cards inform her that they were going to jack up her interest rates around 5% higher for really no reason at all.   She has the right to refuse this and if she does, they will close her accounts.   This will most likely show on her credit report as a "closed by grantor" which doesn't look pretty.  Even though my client has great credit, this looks as if she had an issue with paying credit and it was the creditor who closed her account–not her.  Regardless, a closed account with a balance on it may be damaging to your credit score.  Here choices were to accept a 5% higher interest rate or have her account closed with a payment amortized for 60 months (much higher payment).

What did I recommend for her personal scenario?  NOTE: Your scenario may require different actions…everyone's situation is unique.

She is currently in the process of a rate-term refinance to reduce her interest rate and to convert her adjustable rate mortgage to a 30 year fixed rate.  With her personal scenario, she will use a combination of the refund of her existing reserve account from the mortgage servicer who is being paid off and the "skipped" mortgage payment to apply towards paying off these two department store credit cards.  She's lucky.

And it's not just department stores who are jacking up credit card rates on consumers…banks are too:

"Millions of Wells Fargo & Co. credit card customers will soon feel the pinch of higher rates, as the bank and other major credit card issuers rush to get ahead of new consumer protection rules that would limit their ability to jack up rates.

The San Francisco-based bank, the nation's eighth largest issuer of credit cards with $22.3 billion in total balances, said Wednesday it plans to raise interest rates by 3 percentage points on the "vast majority" of its 5.9 million credit card customers. The higher rates will go into effect on Nov. 30 — one day before Congress wants to enact new rules that put strict limits on rate increases on existing credit card accounts. Customers of Wells Fargo will begin receiving letters as early as today notifying them of the change."

Although the Credit Card Act of 2009 is intended to help consumers, it's not going to totally stop the games credit card companies and banks play.  Before you react, it's important to know what your options are and how it may impact your credit scores.  This is a great "excuse" to obtain a tri-merge copy of your credit report to review your scores and what's being reported about you and your credit.

Mortgage Companies are Protecting Themselves from December 1, 2009 Closings

I am seeing disclosures from wholesale lenders advising that they will not be held responsible for transactions that do not close in time for the first time home buyers tax credit which is currently set to expire on November 30, 2009.   Here’s an example from a memo I received this morning from one of the lenders we work with:

Currently, the American Recovery and Reinvestment Act of 2009 authorizes a tax credit of up to $8,000 for qualified first-time home buyers purchasing a principal residence on or after January 1, 2009 and before December 1, 2009.  For purposes of the tax credit, the purchase date is the date when closing occurs and the title to the property transfers to the home owner.

“Wholesale Bank” is providing this notice to our Correspondents and Brokers that “Wholesale Bank” cannot guarantee that the mortgage closing will take place prior to December 1, 2009 and therefore it is possible that your Borrower(s) will not qualify for the first-time homebuyers tax credit because of the date of purchase deadline.

“Wholesale Bank” strongly recommends that you use the attached form, or any similar from that includes this information to inform your Borrower(s) of the tax credit guideline…

In anticipation of the deadline nearing and the recent increase in loan volume, please plan ahead and get your loans in underwriting, closing and funding in ample time to meet the above deadline.

“Wholesale Bank” will not be responsible or liable for the purchase of the home failing to meet the deadline requirements of the first-time home buyer’s tax credit program.

Mortgage Master has adopted a similar disclosure which is being provided on our purchase transactions. 


As I’ve mentioned several times here at Mortgage Porter, if you’re counting on receiving the $8,000 First Time Homebuyer Tax Credit, and if you’re buying a home in the Seattle/King County area, please try to close no later than mid-November due to the holidays and county closures due to the furlough dates (and the increased volumes of transactions). 


Don’t risk closing the day after November 30, 2009.

Fall Photos of West Seattle

These are just some quick photos while doing errands in West Seattle.  I just love this time of year with the maple trees changing to brilliant colors.   And I've been meaning to capture the sunflowers during summer….next year!


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