Don't Worry, You Can Still Get Mortgage Loans
Well, 2010 is here, and with it comes some new guide lines for mortgage loans. Shockingly, this has been on the table for over 5 years with the feds. Some of the changes were the result of predatory lending practices we so fondly remember from 2006-2007. You know the ones where buyers were treated to low low rates for 3 to 5 years on homes they really should not have purchased. The loans where the loan officer looked the husband in the eyes and said” Don’t you think you’ll be making much more money when it’s time to pay the much larger amount” ? It is good for us, those types of lending practices, are going to the wayside. Another issue with some of the loans came at the table when the closing took place. Sometimes the loan officer made a slight mistake in the calculations and the buyer had to pay more than expected to get the deal done. 2010′s programs or rules will help with the process. Here’s how.
The loan officer will need the buyer’s full name, SS#, date of birth, 2 years address history, and a signed credit authorization form to pull their credit. They should not ask for a loan application or give any loan information at this time. They can however give the buyer a verbal estimate of what they could possibly purchase. Once a property is found, they will ask for all of the above plus the loan application, property address, property value or sales price, and gross monthly income. Once all information is recieved, a Good Faith Estimate (GFE) of all charges can be given to the buyer. The buyer will have 10 days to agree with the amounts. In 2009, this information could be given just as an estimate and was likely to change. The difference now is the GFE can only change in the buyer’s favor.
So, you can still find a house, apply for the loan, and buy it with the help of a good real estate broker and loan officer. It might take a little longer, but it’s worth it. Good home hunting. Hunting season is open until April 30, when the $8000 tax credit is scheduled to go away.
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Doug White, Real Estate Broker
