Financial Health

Did you know that the average credit score required nowadays to get approved for a loan is 140 points HIGHER today than it was just a few years ago? That’s a lot when you consider that credit only ranges from 100 to 850.

One of the most important factors in getting a loan to buy a home has been credit, and it remains to be quite significant when filling out applications for loans. This is in large part, due to the economy. The mortgage crisis we have been witnessing over the past 4 years had major impacts on the lending industry and institutions became less willing to extend credit, even to those who are well-qualified.

Financial responsibility is key! Those with poor credit are faced with less and less options, making it harder and harder to realize the American dream of owning your own home.

Qualifying for a loan isn’t the end of the story.. it’s just the beginning. Just because you qualify doesn’t mean you are getting a good rate. The difference that just 0.25% can make on a $500,000 loan is over $1000 a year, multiplied by 30 years, that’s $30,000 that could have been saved over the life of the loan. What could you do with an extra $30,000?

In this market, many people are eager to buy a home, thinking "oh the prices are so low – we gotta get this house!" but keep in mind, while the price may seem low – the interest rate you qualify for may not be as attractive. So, tend to your financial health, clean up your credit – then start making offers on homes.

For more real estate advice, or to have any questions answered regarding the home buying process, visit www.crestico.com.

Financial Health

Did you know that the average credit score required nowadays to get approved for a loan is 140 points HIGHER today than it was just a few years ago? That’s a lot when you consider that credit only ranges from 100 to 850.

One of the most important factors in getting a loan to buy a home has been credit, and it remains to be quite significant when filling out applications for loans. This is in large part, due to the economy. The mortgage crisis we have been witnessing over the past 4 years had major impacts on the lending industry and institutions became less willing to extend credit, even to those who are well-qualified.

Financial responsibility is key! Those with poor credit are faced with less and less options, making it harder and harder to realize the American dream of owning your own home.

Qualifying for a loan isn’t the end of the story.. it’s just the beginning. Just because you qualify doesn’t mean you are getting a good rate. The difference that just 0.25% can make on a $500,000 loan is over $1000 a year, multiplied by 30 years, that’s $30,000 that could have been saved over the life of the loan. What could you do with an extra $30,000?

In this market, many people are eager to buy a home, thinking "oh the prices are so low – we gotta get this house!" but keep in mind, while the price may seem low – the interest rate you qualify for may not be as attractive. So, tend to your financial health, clean up your credit – then start making offers on homes.

For more real estate advice, or to have any questions answered regarding the home buying process, visit www.crestico.com.

How to get the lowest home mortgage refinance rates?

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How to get the lowest home mortgage refinance rates?
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Are you struggling with your monthly mortgage payments? If answered yes, you must try your best to refinance your home loan as this is the best way to get back on your current monthly mortgage payments. Most mortgage loans carry high interest rates and with the unemployment rate touching a record level, an increasingly large number of homeowners are not being able to cope up with their monthly mortgage installments.  Refinancing is just taking out yet another home loan with favorable interest rates and terms so that you can repay the previous loan with ease. While there are many homeowners who want to refinance their home loans, they all love to know the ways in which they can get the best refinance rates in the market. Have a look at the ways in which you may secure low rates on the refinance loan.

1.Check your credit score: As you know that the lenders will always check your credit sore before lending you with a new line of credit, you must try your best to boost your credit score in order to get the best rate in the market. As the credit score is the best way to track the financial history of a person, you must take good care about the financial habits that can drop down your score. Most financial experts often say that one must initially go for credit repair before applying for a home loan so as to grab reasonable interest rates.

2.Shop around among different lenders: Refinancing can be done from your previous lender and from any other lender too. If you want to change the lender from whom you want to take out a mortgage refinance loan, you must shop around extensively so as to make sure that you get the most competitive rate in the market. The lenders are waiting to offer you the loans of their companies and thus you need to make sure that you're choosing a loan that has the perfect interest rate that can help you save your dollars on the mortgage loan.

3.Pay points on the refinance loan:  Even if your credit score is not enough for you to secure a loan with an affordable rate, you can still get the lowest refinance rates. This is possible by paying points while taking out the new refinance loan. A point is1% of the loan amount that has to be paid in cash during the closing. This can lower the rates.

4.Choose a different term: If you refinance your mortgage loan at a 15 year term mortgage loan, you can get low rates on the loan. However, a 15 year term mortgage loan will require high monthly payments but will also ensure low rates at the same time.

Therefore, if you want to refinance your mortgage loans at a lower rate, you can easily follow the tips mentioned above. Get a loan at a low rate and repay the loan with ease, thereby retaining your home ownership rights.

Samantha Taylor is the Community Mentor of MortgageFit and has been contributing her suggestions to the Community since 2005. Not just that, she has also made notable contributions through the various articles written on different subjects related to the mortgage industry. Few of her popular articles would include names like 'Mortgage that you can afford', 'Mobile Home Loan with Bad Credit', and How much mortgage can I borrow?

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Attention Future California Homeowners! Loan limits are dropping!

Areas that will be affected in California are Riverside, San Bernardino, San Diego, Orange, or Los Angeles county. Starting October 1, 2011, temporary conforming and FHA insurable loan limits will be lowered nationwide.

HUD has also announced new (lowered) FHA insurable loan limits across the nation. California has several counties that will be negatively affected and potentially impact home buyers who have not saved a large down payment.

"Temporary loan limits" were enacted as part of the government’s 2008 economic stimulus package. At the time, the financial sector was entering its crisis and private mortgage lending was practically done. Financing was scarce for both homeowners and home buyers for whom loan sizes exceeded Fannie Mae and Freddie Mac’s national $417,000 limit — even for those with excellent credit and income.

Riverside and San Bernardino will no longer be considered a high cost area by Fannie Mae or Freddie Mac…which will affect you if you are looking to buy a home in the $350,000 to mid $450,00 price range.

County New FHA loan Limit New Conforming Limits will be as follows:

Riverside County $355,350 for FHA and $417,000 for Conforming

San Bernardino County $355,350 for FHA and $417,000 for Conforming

San Diego County $546,250 for FHA and $546,250 for Conforming

Orange County $625,500 for FHA and $625,500 for Conforming

Los Angeles County $625,500 for FHA and $625,500 for Conforming

The max conventional and FHA loan amount in Riverside and San Bernardino county is currently $500,000, but starting October 1st, 2011, it will drop by $144,650 for FHA , and for conventional loans, it will drop $83,000.

If you live in a high-cost area, or a former high cost area, mortgage rates may be low, but the amount of loan for which you qualify may be much less than you expect. You may find yourself ineligible to use a low down payment FHA loan to purchase your home, thus requiring you to with a HUGE down payment.

Whether you’re planning a refinance or a purchase a home, keep an eye on the calendar and act sooner…..contact Crestico today!

www.crestico.com

Is Your Mortgage Loan Broker Properly Licensed and Complying With The Law?

You have a right to know! When you turn over your personal financial information to a loan officer, make sure you know who you are giving your information to. There are new laws regulating Mortgage Loan Brokers.

The new law, 12 CFR Part 226 (Reg Z Docket No. R-1366) (eff. April 1, 2011) states that mortgage loan originators may not receive compensation based on the interest rate or other loan terms.

The Federal Reserve Board (Board) has published final rules amending Regulation Z, which implements the Truth in Lending Act and Home Ownership and Equity Protection Act. The purpose of the final rule is to protect consumers in the mortgage market from unfair or abusive lending practices that can arise from certain loan originator compensation practices, while preserving responsible lending and sustainable homeownership. The final rule prohibits payments to loan originators, which includes mortgage brokers and loan officers, based on the terms or conditions of the transaction other than the amount of credit extended. The final rule further prohibits any person other than the consumer from paying compensation to a loan originator in a transaction where the consumer pays the loan originator directly.

The Board is also finalizing the rule that prohibits loan originators from steering consumers to consummate a loan not in their interest based on the fact that the loan originator will receive greater compensation for such loan. The final rules apply to closed-end transactions secured by a dwelling where the creditor receives a loan application on or after April 1, 2011.

Another law, SB 1137 (eff. Jan. 1, 2011 which amends Sections 10137, 10139, 10166.01, and 10166.02 and adds Section 10166.051 of the CA Business and Professions Code; Amends Sections 22104, 22107, 22109.1, 22109.4, 22112, 50002, 50141, 50144, and 50700 of the CA Financial Code) regulates mortgage loan originators and their license endorsements.

Among other provisions, this law makes it unlawful for a real estate broker to employ or compensate, directly or indirectly, any licensee for engaging in any activity for which a mortgage loan originator license endorsement is required if that licensee does not hold a mortgage loan originator license endorsement. It is a crime for a person to act as a mortgage loan originator without a license endorsement or to advertise using words indicating the person is a real estate salesperson or a mortgage loan originator without having a license or license endorsement. It also authorizes the DRE Commissioner to deny, suspend, revoke, restrict, condition, or decline to renew a mortgage loan originator license endorsement, or take other actions, after notice and opportunity for a hearing, under specified conditions. See the DRE Web page for all the details at http://www.dre.ca.gov/lic_sb36_safe.html.

In addition, this law requires a licensed finance lender or broker that employs one or more mortgage loan originators that makes residential mortgage loans to maintain a net worth of $250,000 and if only arranging but not making such loans to maintain a net worth of $50,000.

For more information visit: www.crestico.com

Attention Homeowners: Know What You’re Getting In The Mail

There is a new law, AB 1373 (eff. Jan. 1, 2011) which places restrictions and disclosures on grant deed copy services. This law cracks down on the mailed advertisements sent to property owners offering, for compensation, to provide a copy of the grant deed or other record of title by making it a crime unless certain disclosures are provided and the advertisement doesn't mislead a person into believing that the company is affiliated with a government agency.

For more information visit: www.crestico.com

Home Ownership

This year California housing market conditions makes a strong and compelling case for homeownership. With prices still well below the historic highs of just a few years ago and attractive mortgage rates, qualified buyers have a unique opportunity to own their own home. As seen below, a rigorous analysis of renting versus buying hears this conclusion out. As shown in the following chart, the monthly housing costs (principle, interest, taxes, and insurance or PITI) associated with buying a median-priced home of $301,430 is $1,590 (Fourth Quarter 2010 median priced home in California). This assumes the buyer is making a 20 percent down-payment and financing with a 30-year fixed rate mortgage at 4.62 percent. In comparison, the median rent on a three-bedroom two-bath apartment with renter’s insurance in California is $1,810. That means buying a home would save the homeowner $220 per month when compared to renting and the homeowner would save over $2,600 a year. Reported by the National Association of Realtors

Mitra.Karimi@Crestico.com
Direct: (949) 478-4466 | Fax: (310) 933-1619
DRE. Lic. # 01848917
Office: (877) 880-2929 x.4466 | Fax: (877) 881-2929 | www.crestico.com
1281 Westwood Blvd. Suite 102 Los Angeles, CA 90024

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