Independence Day

July 3, 2008 by Leave a Comment

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In observance of Indepenence Day, Mortgage Master will be closing at 2:00 pm today, July 3, 2008,  and will re-open for business as usual on Monday, July 7, 2008.   Should you need assistance with a mortgage for a property in Washington State, please give me a call or email…I’ll be around this weekend.     

As the bond markets will be closed tomorrow, I will be posting rates this morning (not Friday).

I hope you and yours have a safe, sane and FUN fourth of July!

This photo is from the Statue of Liberty at Alki, West Seattle.    

Filed Under: Current Affairs

A Question Regarding Mortgage Rates for Investment Property

July 1, 2008 by Leave a Comment

One of my clients contacted me with this question:

"We’re in the early stages of thinking about buying a rental house.  If we were to buy a house for $260,000, how  much would we have to put down and what would the payments be like for a 30 year mortgage?"

Mortgage interest rates for investment properties are priced based on loan to value (how much money the investor is putting into the property) and the lowest mid-credit score of the borrower(s).   The price breaks are based at 70, 75 and 80% loan to value (LTV).   Based on a sales price of $260,000; here is what current rates would look like using a 30 year fixed rate mortgage and a mid-credit score of 720.

Non Owner Occupied with 20% Down — Loan amount of $208,000 with a rate of 6.875% (APR 7.074%).  Principal and Interest (P&I) = $1366.41 plus taxes and insurance (on all payments shown).

Non Owner Occupied with 25% Down — Loan amount of $195,000 with a rate of 6.750% (APR 6.952%). P&I = $1264.77.

Non Owner Occupied (NOO) with 30 % Down — Loan amount of $182,000 with a rate of  6.625% (APR 6.830%).  P&I = $1165.37.

Another option to consider may be a 30 Year Fixed Rate with the 10 Year Interest Only payments.  You must qualify at the fully amortized rate and after 10 years, assuming you still have retained the mortgage, the mortgage balance at that time will be amortized for 20 years.  If you never pay additional towards your principal during the first 10 years, your mortgage balance will be the same as when the mortgage was originated.  Here are rates based on the same scenario above with the interest only feature.

NOO with 20% Down — Loan amount of $208,000 with a rate of 7.250% (APR 7.439%). Interest only payment of $1248.00.

NOO with 25% Down — Loan amount of $195,000 with a rate of 7.000% (APR 7.188%).  Interest only payment of $1137.50.

NOO with 30% Down –Loan amount of $182,000 with a rate of 6.875% (APR 7.066%). Interest only payment of $1042.71.

I’ve written more about about financing investment properties here.

Do you have a mortgage question for me?  Send me an email, I’m happy to help and your question may help others.

Filed Under: Investment Property

Mortgage Professionals: Don’t Miss Out on DFI’s Next Rulemaking Meeting

June 30, 2008 by Leave a Comment

On Wednesday, July 2, 2008 at Renton City Hall from 1:30 – 3:30 p.m., there will be a Rulemaking Meeting regarding SHB 2770’s Disclosure Form.   This is a form that’s required to be provided from certain loan originators prior to a consumer completing a loan application effective June 12, 2008.  If you think a loan package for an application all ready wastes a tree, you can expect more paperwork and disclosure forms on top disclosure forms thanks to our elected officials who just want to make sure you really do understand your mortgage (hint, if you don’t understand your mortgage…you probably need to be working with a different mortgage originator).

Click here to see DFI’s sample form.

Filed Under: Legislation

Take a Sunday Drive to Queen Anne

June 29, 2008 by 2 Comments

David_karen_bell053nobckgd_2 This week’s Sunday Drive is brought to you by husband and wife team David and Karen Bell, Associate Brokers from ReMAX Metro.   Be sure to check out their blog Seattle Real Estate Bells.

Just north and west of downtown Seattle lays one of the most popularly of all Seattle’s neighborhoods, Queen Anne.  Queen Anne Hill was developed in the late very 1890’s and early 1900s, at about the same Rp_sunday_drive_2_2 time as North Capitol Hill, but generally with smaller homes.  Later, in the 1910’s and 1920’s, many larger homes were built on Queen Anne’s South Slope because of magnificent views of Elliott Bay and Mt Rainier. Today that south facing view includes the spectacular view of downtown Seattle.  Queen Anne is renowned for its extraordinary architecture that includes many fine examples of Queen Anne, Craftsman, Bungalows, Seattle Box, and later, Colonial styles of architecture. The highest hill in Seattle, Queen Anne rises 456 feet above Elliott Bay.

Many people know Queen Anne as the home of Kerry Park, with its incredible views of the city and Puget Sound. Queen Anne offers simple pleasures such as lazy morning Rp_sunday_drive_blog_1 strolls to admire the beautiful homes and gardens, as well as sophisticated amenities like fine dinning and an exciting variety of specialty shops. In the past 30 years Queen Anne has become one of the most desirable and expensive neighborhoods in the city. Queen Anne is arguably the most centrally located neighborhood in the city and it is literally just minutes to downtown…or for that matter just about anywhere you want to go.  With all the traffic snarls Seattle has, Queen Anne is just minutes to Highway 99 (Aurora) and I-5, making getting just about anywhere very easy.  For the frequent traveler, they simply drop down to Highway 99 and in 20 minutes they will be at the airport.  Queen Anne is a delightful walking community…and a great place for a Sunday Drive!

While in Queen Anne, David and Karen Bell recommend that you try The 5 Spot for breakfast and if you like Thai food (who doesn’t?), Orrapin Thai Cuisine on the corner of Queen Anne Avenue and Boston.

Filed Under: Seattle, Sunday Drive - Neighborhood Tours

Join Me Tuesday at Rain City Radio featuring The Tim (aka the Seattle Bubble)

June 28, 2008 by 2 Comments

Once again we have a great show lined up at Rain City Radio, featuring "The Tim" who author and moderates The Seattle Bubble blog.  It should be a very interesting conversation and you are welcome to join the RCG panel.   For more information, click here.

I will update this post as more information becomes available.

Update:  Click below to listen to the interview with Tim Ellis from Seattle Bubble.  This is a great interview that expands beyond "the bubble" and also discusses blogging, and Tim’s Naked Loon.

Filed Under: Interviews, Podcasts, Seattle

Issues with Changes to the Estimated Settlement Statement after Signing

June 27, 2008 by Leave a Comment

A Seller from Battleground, Washington sent me this question regarding how their closing cost contribution was treated with the Escrow Officer:

I recently sold my home and…I was to pay up to 6% of buyers costs. I was presented with good faith estimate of costs two weeks prior to closing, everything looked fine. We signed our documents at closing and carefully reviewed and signed the HUD-1 [Settlement] Statement.  The deal was recorded the next day and we were wired the money as noted on our documents minus around 3025.00.  We called escrow officer and she said that there was a problem at closing and she added a FHA-MIP charge to the hud-1 statement because we agreed to pay up to 6% of buyers costs in our sale documents. She did not notify us or even attempt to notify that she added this change to the hud-1 document and closed anyway.  Is that a legimate thing that can happen at closing?  It seems very very wrong to me…

Let me begin by saying that it does feel wrong.  The Escrow Officer should have called you immediately to let you know of the change to your Estimated HUD-1 Settlement Statement. It’s very poor service from the escrow company at the very least. 

Unfortunately, the Estimated HUD-1 Settlement Statement is just that: an estimate.  And when purchase and sale agreements are written with the Seller to pay up to a certain amount instead of a specific dollar amount, then it is the responsiblity of the lender to make sure that as much of the closing cost credit is used per the buyer’s loan guidelines.  Obviously there was a lack of communication with your transaction between the mortgage and escrow company to have this last minute change to your HUD happen.

You may want to review your escrow instructions (you would have signed them at closing too) which probably have language stating that the escrow company has the right to modify the Estimated HUD-1 Settlement Statement at any time.

You did everything correctly as far as reviewing the Good Faith Estimate and seeing what costs were being paid.  When you agree to pay "up to" a certain percentage, the Seller needs to be prepared to have that entire amount used.  When I have a closing cost credit from a Seller, we use as much as possible to pay for allowable closing costs and possibly buy down the buyer’s interest rate. 

I suggest contacting the manager of the escrow company and the real estate agents to let them know about your displeasure with your closing.      

Filed Under: Escrow and closing

Will DFI stop Countrywide from providing Washington State Mortgages?

June 25, 2008 by 2 Comments

Washington State DFI just came down with a huge hammer on Countrywide with a plethora of charges, based on a sample of 600 hundred examined loan files, including (but no limited to):

  • Charging higher fees and interest rates to borrowers of protected ethnicity than others with similar situations.
  • Inaccurate reporting of HMDA.
  • Good Faith Estimates and Federal Truth in Lending not provided within 3 days of application along with violations of other disclosure forms.

The State has also charged that Countrywide has understated their loan volume from 2002 – 2007 and are requiring Countrywide to pay $5,594,785.78 in back assessments.

If DFI’s Deborah Bortner and Governor Gregoire have their way, Countrywide will have their license to provide mortgages revoked and be banned for 5 years from operating as a liscened consumer loan company in Washington State plus an additional $1 million in various fees and fines.

DFI’s STATEMENT OF CHARGES and NOTICE OF INTENTION TO ENTER AN ORDER TO REVOKE LICENSE, IMPOSE FINE, ORDER RESTITUTION, PROHIBIT FROM INDUSTRY, AND COLLECT ANNUAL ASSESSMENTS, EXAMINATION FEES, AND INVESTIGATION FEES. Whew!

Governor Gregoire’s  Press Release

Last but not least, Jillayne Schlicke’s post at Rain City Guide:  What do Governor Gregoire’s actions mean for local Countrywide employees and short selling homeowners?

I have to wonder with the pending merger with Bank of America, how this will be impacted?  Is it still valid?  (I believe that Countrywide will no longer be under the Consumer Loan Act once it becomes Bank of America).   This drama is far from over.

Filed Under: Legislation

Catch Me Tomorrow at RCG Radio featuring the West Seattle Blog

June 23, 2008 by Leave a Comment

Dustin Luther of Rain City Guide will be hosting Rain City Conversations at 4:00 p.m. PST on Tuesday, June 24, 2008. Our featured guest is non other than Tracy Record, Editor of the infamous West Seattle Blog.  I’m really looking forward to having the chance to actually chat with Tracy.   I have a very small neighborhood blog in West Seattle as well…I bow down and curtsy to WSB!   I do hope you join us at 4:00 p.m. PST to participate — for more information, click here.

Dustin continues to line up the great guests and topics…plan on tuning in Tuesdays at 4:00 p.m.

Update:  Listen to a West Seattle Conversation featuring Tracy Record, Editor of the West Seattle Blog.   

Filed Under: Interviews, Podcasts
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