Helping Washington State homeowners learn more about their mortgage options.
September’s issue of YOU Magazine is now available and features the following articles:
And so much more!
I’m still working on my latest issue of e-Mortgage Porter, an emailed monthly newsletter. If you would like to receive an issue in your email in-box, just let me know.
UPDATE: EFFECTIVE ON FHA CASE NUMBERS ISSUED AFTER DECEMBER 31, 2008, THIS PROGRAM IS NO LONGER AVAILABLE.
Since Mortgage Master Service Corporation has been a FHA endorsed lender since our inception, we are also approved for FHASecure. This program is designed to help home owners who after their non-FHA ARM resets, have become delinquent.
Here's more info:
This program is not intended for home owners to stop making their mortgage payments once their ARM adjusts. In fact, this is straight from the HUD Mortgagee Letter 2007-11:
"FHA reserves the right to reject for insurance those mortgage applications where it appears that a loan officer or other mortgage employee suggested that the homeowner could stop making their payments…"
I'm pleased to be able to offer this program and thankful that Mortgage Master has maintained their status as a HUD Approved Mortgagee.
The best option is to refinance prior to your ARM adjusting (before you're delinquent). As always, I suggest that you contact your Mortgage Professional if your ARM is scheduled to adjust within two years or less in order to make sure you're in the best position possible to refinance.
Here’s a memo that I just received from the Talon Group, the local title and escrow company that I prefer to use:
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It’s nice to have some good news from the real estate industry! |
Once again, I’m honored to be included with the other nominees of Larry Cragun’s Magnificent 7. The post receiving Larry’s nod is one that I wrote in early August at Rain City Guide, If your loan ain’t vanilla, you may be in for a rocky road.
If you’re looking for some excellent consumer content, you may want to visit Larry’s site, Real Estate Undressed, to check out his recommendations.
The answer is yes, the rate is fixed…BUT… The rate is fixed for 30 years however depending on if you select the 10 year or 15 year interest only period, once the interest only period is over, the mortgage will be amortized at the same rate for the remainder of the term.
For example, let’s assume your mortgage balance is $350,000 and the rate for the 30 year fixed with interest only payment is 6.50%.
The interest only payment is: $1895.83
If you have the 10 year interest only product (usually a slightly better rate), the payment will adjust to a fully amortized mortgage based on the remaining 20 year term. The new payment would be: $2609.51
If you opt for the 15 year interest only product, the fully amortized mortgage based on the remaining 15 year term be: $3048.88
Both of the above scenario’s are assuming that there are no additional payments made towards the principal during the interest only period. NOTE: borrowers may need to qualify at the fully amortized payment (not the interest only payment).
Here is the email from the reader:
"Currently, we have a subprime loan with a 2-year penalty which expires March 2008. We were told that it is a 40 year fixed at 8.83% and if we refinanced prior to the 2-year penalty expiration date, there will be a 6-months of interest penalty. However, we recently reviewed our loan documents and with a better understanding called the lender. The lender confirmed that we have a subprime loan and the rate will be adjustable after the two years.
We are considering the 30-year fixed, 10 year interest only, but want to be sure that the rate is definitely fixed for the full 30 years. We are in our mid-40s and have no intentions of selling our home, and consider this home to be our retirement home. From your financial expertise, do you think this is a good option for us?"
It’s difficult to provide advice for someone when you don’t have their entire financial picture. This couple does not live in Washington State (where I’m licensed to practice).
Here are factors that I would consider if I were their Mortgage Professional:
I would caution against doing "band aid" loans that will need refinancing when you’re at retirement or close to then. Depending on what you anticipate your income to be, should you need to refinance out of a 15 or 20 year term mortgage because your income is less, you may not be able to qualify. You may want to consider a traditional 30 year fixed or a Fannie Mae or Freddie Mac 40 year fixed rate (without the balloon or adjustment that you have with your current mortgage).
Here are the rates I quoted last Friday (just to give you an idea of how these rates may vary from product to product):
30 Year Fixed: 6.125% (APR 6.281%). Payment per $1000 = $6.08.
30 Year Fixed with 10 Year Interest Only: 6.500% (APR 6.653%). Payment per $1000 = $5.42.
40 Year Fixed: 6.500% (APR 6.646%). Payment per $1000 = $5.85.
I give them huge kudo’s for reviewing their loan documents and contacting their lender and for getting second opinions. Their Mortgage Professional should review all possible mortgage options with this couple and make sure they understand the terms and any consequences.
I just received this email:
Dear Mortgage Brokers,
This notice is to inform you that our 24 Hour Mortgage Trigger Database has recently been updated. This means that we are able to offer you data from either:
Equifax, Experian or Trans Union
Our leads come with:
FICO, Name, Address, Phone Number, Amount of Aggregated Revolving Debt, Mortgage Loan Amount, Lender Name, Loan to Value, Monthly Payment on Mortgage – Credit Cards – Automobile
We can target all 50 states by: County, Zipcode, Zipcode Radius, City & Major Metropolitan Area.
Response within 24 hours is required to guarantee this price.
Give me a call and I can have you setup to get leads the same day."
When you visit their website (I’m not promoting here), they offer:
"… specific credit information on consumers based on actual credit records. This database covers 50 states and over 300 million people. From this database, selections can be made on credit score, amount of debt, late payments, mortgage type and monthly payments. This data is primarily used to identify individuals based on their current credit situation and purchase indicators."
If President Bush really wants to stop predatory lending , or as he said last week regarding Loan Originators “if you’ve been cheatin’ somebody, we’re gonna find you.” Perhaps he could start by not allowing the major credit bureaus from reselling the (currently not so) private information of consumers.
In the meantime, I highly encourage you to write to your elected officials to tell them to stop "trigger lists". There is NOTHING good about this practice.
One of my past clients contacted me about refinancing their existing mortgage. In a nutshell, I advised them to consider not refinancing their mortgage at this time. They replied something to effect of:
“Not many loan officers would recommend “not refinancing”. We appreciate your advice and we’ll keep you our little secret.”
I’m thankful they contact me when ever they have a question about their mortgage planning. Typically my relationship with clients is just beginning once they’ve closed on their new mortgage. In fact it’s my goal to provide such a high level of service that my clients feel compelled to refer me to their friends, family, co-workers…anyone they know who is considering buying a house, refinancing or in need of a home equity loan.
Although it’s available at my office, I do not take “up calls”. All of my clients are either referred to me from past clients, professionals (such as real estate agents, financial planners and CPAs) or from reading my blogs.
During these times, with major lenders facing uncertain times, it’s more important than ever to select a Mortgage Professional based on their skill, knowledge, ethics, dedication and available mortgage programs. Shopping by rate alone will cost people big in the long run if the lender cannot perform.
I probably don’t ask for business or referrals enough…so since my client reminded me that if I don’t, they WILL keep me a secret…I thought this is the perfect opportunity to remind you that I am here to provide mortgage advice and programs. I only receive income once a transaction has successfully closed.
Blogging is something I’m passionate about and I’m so pleased for my readers and the kudos Mortgage Porter has received. I do not sell ad space like you’ll find on other blogs…this is a just labor of love that I hope you find helpful in your quest for information about the murky world of mortgages.
Please don’t keep me a secret.
In honor of Labor Day, Mortgage Master is closed today. We will re-open for business as usual on Tuesday, September 4, 2007.
Enjoy your day off celebrating the "working man"! This Labor Day, I think we’ll be grilling up some Turkey Burgers…hey they’re not that bad! In fact, they’re darn good.
Here’s my recipe:
Form patties and grill until cooked through. This is turkey, not beef, so you do want these burgers cooked through. I like to top mine with slices of pepperjack cheese, lettuce, tomatoe and grilled onions and with Chipolte Sauce (recipe follows).
Chipolte Sauce
Mix it up and put it in the fridge until you’re ready to use with your Turkey Burger. BTW, this is awesome with fries!
Rhonda Porter is a Licensed Mortgage Originator MLO121324 living in the greater Seattle area. Rhonda began her career in 1986 in the title and escrow industry and began her mortgage career in 2000. She enjoys helping people understand the mortgage process and started writing The Mortgage Porter in late 2006. Read More…
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