Ask Val

December 2, 2010

Shopping for Mortgage — What is your Interest Rate?

Filed under: ASK VAL,Conventional Mortgage,Credit,Dear Val,FHA Loan,HECM,Reverse Mortgage — Valerie Springer @ 4:49 pm

 My phone is ringing, I answer and on the other end I hear…”I am thinking about purchasing a home or refinancing my home and I would like to know what your current interest rate is?”

The above question is peep-hole sized compared to the whole room of information that is needed to quote someone an interest rate.  Many will throw out a number just to get you roped in but would never be able to follow through with the rate when the chips are on the table.

An interest rate is made made up of many components and depends on a number of factors:

*Loan to Value

*Loan Amount

*Occupancy Type

*Loan Purpose

*Loan Limits

*Credit Score

*Qualifying Ratios

*Loan Product

*Electronic Approval Level

Many consumers feel like they are using wisdom by calling several companies and asking for rates but truthfully the most honest may never get a shot at the financing because the average borrower doesn’t know how to shop for interest rates nor do they understand what drives rates.  Therefore the one selling a line of deceit may seem to be the best.

If you are searching for a knowledgable loan officer the first question you should ask is “Do you what moves interest rates?”  If they cannot answer, you need to move on.  If they do answer do you know the correct answer? 

The second question “What information do you need from me so you can give me an idea of what loan type would be best for my situation”?

Third, “With the given information, what product do you think would best suit me, rate etc…and why”? (Remember you must do all of these on the same day at the same time because rates move all day long.)

If you call two or three people and do it right, you will have gained a wealth of knowledge by the time you hang up and will also have a “gut” feeling on which loan officer would work best with you and for you.  The lowest rate doesn’t always mean the best so weigh all of your options.

If you have questions, I would be glad to answer.  The present time is a golden opportunity to refinance your home to a lower interest rate or to purchase a home, second home or even an investment property.  Many will not realize until it is too late this is a “once in a lifetime” chance to make a wise financial decision.

If you are seeking residential financing int he Greater Birmingham AL area, Valerie Springer is ready to meet your financial needs.

Yours to Count On,

Valerie  Springer

www.vshomeloans.com

 

September 17, 2010

Reverse Mortgage, Is It Smart?

Filed under: Elder Law,Estate Planning,FHA Loan,HECM,Reverse Mortgage — Valerie Springer @ 6:50 pm

There are 5 key points to think about when you decide a  HECM Reverse Mortgage may be your best option. Most important find an expert loan officer willing to help you make a determination.

1. Why do you feel a reverse mortgage would benefit you? If you are thinking of taking a vacation or reinvesting the money it would be very costly. If someone is trying to sell you something and suggests you take out a reverse mortgage you should be very cautious of their intent.

2. Can you even afford a reverse mortgage? A reverse mortgage is very expense, You do not make monthly payments but interest will accrue on the loan every month. The younger you are when you take out a reverse mortgage (min age 62) the longer the interest will grow which in essence will increase the amount you owe.

3. Can you afford to use your home’s equity? If you are not facing a financial emergency you may consider another option.

4. Do you have other options? If you have the means to take out a home mortgage and make the monthly payments this would be a less costly option than a reverse mortgage. Have you thought of downsizing and selling your current home to buy one with lower costs or in an area that offers more services?

5. Do you understand how a reverse mortgage works? You need to find out up front if this could benefit you or if there is a better option. You must complete couseling and receive a certificate to move forward. Your HECM Reverse Mortgage Loan Officer can give you the names of counseling agencies in your area.

A reverse mortgage can be the best thing since sliced bread if you understand and limited income. It gives you the opportunity to use your home’s equity while you need it. It can help supplement an income, help with medical expenses or long term care. You can make repairs on your home or purchase a vehicle and not worry about adding high debt to your monthly budget. The money is yours to spend as you wish but wisdom is important.

If you are interested in a HECM Reverse Mortgage in Alabama, call Valerie Springer .  205-995-7283 x 305

Reverse Mortgage Benefits

Filed under: ASK VAL,Elder Law,Estate Planning,FHA Loan,HECM,Reverse Mortgage — Valerie Springer @ 6:46 pm

Until the HECM Reverse Mortgage was introduced the only 2 ways you could use the equity in your home was to sell the home and move out or take out a loan which required monthly payments. If you own your home (or have lots of equity) and the youngest person living in the home is 62 years of age you are most likely eligible.

With the “Reverse” mortgage you do not have to do either of the above. A reverse mortgage is a loan which allows you to take the equity out of your home while continuing to live in it. You most likely never have to make a payment back until you die, sell the home or permanently move out.

You may receive the money in a lump sum, regular monthly cash advance or a creditline that allows withdrawals when needed. Your income levels do not matter because you do not have to make a payment back. If you had no income and owned your home you could still qualify.

Even though you receive a “Reverse” mortgage, you still own your home, so the homeowner will still be responsible for property taxes, homeowner’s insurance and routine upkeep of the home. Once neither of the homeowners live in the house as their primary residence the heirs may then sell the home and repay the lien. If there is money left it is given to the estate.

More to come on Reverse Mortgages. If you have any specific questions you would like Valerie Springer to discuss please contact me at valerie.springer@nflp.com

Reverse Mortgage & HECM

Filed under: ASK VAL,Elder Law,Estate Planning,FHA Loan,HECM,Reverse Mortgage — Valerie Springer @ 6:45 pm

REVERSE MORTGAGES (HECM) and What This Means THE HOME EQUITY CONVERSION MORTGAGE (HECM) is the ONLY reverse mortgage that is insured by the federal government. HECM loans are insured by the Federal Housing Administration (FHA). FHA is governed by US Department of Housing and Urban Development (HUD). FHA tells HECM lenders how much to lend based on age and the value of home. The HECM program limits loan costs and FHA insures the lender will meet their responsibilities.

HECM usually give the largest payout of any reverse mortgage as well as more choices on how the money is paid and most importantly you can use the money for any purpose. Reverse Mortgages can be costly but HECM’s are generally less expensive than those that are privately insured. Privately insured reverse mortgages may have lower fees but are usually higher in interest rate. Overall, HECM’s are likely to be less expensive in the long run.

The state and local government sometimes offer reverse mortgages which cost the least but they are most always used for one specific purpose such as to pay your taxes or make a certain repair. Also mostly available to low to medium income.

HECM’s are available all over the United States. A few key factors:

* Youngest owner must be 62 or older, live in home as primary residence and not be delinquent on federal debt.

* Home must be a single-family residence in a 1-4 unit dwelling or part of a planned unit development (PUD) or a HUD approved condo. Some manufactured homes are eligible but most mobile homes are not.

* Home must meet HUD’s property standards but you have the option of using the HECM to pay for repairs that could be required.

* All homeowner’s wishing to seek a HECM must attend counseling from a HUD-approved counseling agency. Loan officer can provide a list of counselors and borrower’s must present an original certificate before loan can be approved.

For answers to your questions, contact your Reverse Mortgage Expert in Alabama, Valerie Springer.

Yours to Count On,

Valerie Springer

Veterans, Spouses and Widow(er)s

My parents are in the process of completing Estate Planning and Asset Protection.  I have learned so much over the past few years with my Grandfather in the nursing home and the loss of another family.

Both wills had to be probated and while my family members thought they had planned well, we realized there was so much available we missed out on.

For instance. My Grandfather was a Veteran of World War II and would have qualified for Veterans Benefits.  He survived the great depression, worked hard all of his life and made wise financial decisions only to find out his money and assets would cause him to be a “private pay” patient at the nursing home. Lots of money going out monthly, nothing coming in.

He was told he did not qualify for VA benefits due to his income. This is not true. He and my Grandmother could have possibly received $1949 per month from the time they were in their mid to late 60’s. My Grandmother died at age 87 and my Grandfather died at age 93.

This money would have helped defer the costs of private sitters so they could remain in their home as long as possible. It would have also been a great help for assisted living and then nursing home expenses. I want to share this with you in hopes your Veteran or Veteran’s Spouse does not miss out on one of the few benefits available for their unselfish sacrifice to our freedom.

A Veteran or Veteran’s Surviving Spouse may be eligible for the VA Aid and Attendance Benefit to help pay for Home Health Care, Assisted Living Facility Care or Nursing Home Care.

Even if you have been told that you are not eligible due to income or asset limitations, there may be strategies to assist you in qualifying for this benefit.

Who is Eligible?

* The Veteran and The Veteran’s Surviving Spouse

An Eligible Veteran:

*Served 90 days or more active duty, with at least 1 day during a time of war

*Discharged from service, with no less than an honorable discharge

Periods of War:

*World War II December 7, 1941 – December 31, 1946

*Vietname Era August 5, 1964 – May 7, 1975/February 28, 1961 – August 4, 1964 (in Republic of Vietnam)

*Korea June 27, 1950 – January 31, 1955

*Persian Gulf August 2, 1990 through date to be prescribed by Presidential proclamation or law

This little known benefit may pay as much as:

Married Veteran (Veteran + Spouse): $1949 per month tax free

Single Veteran $1644 per month tax free

Surviving Spouse $1,056 per month tax free

If you, a relative or friend needs more information about this valuable benefit, contact Valerie Springer. I will be happy to provide you more information. Hoping to spread the word.

Don’t trust a friend, CPA or general attorney for this information. You need to see an attorney who practices Elder Law. I will be happy to refer you, I work with some of the best in the business.

Also, I am an expert in  HECM Reverse Mortgage. It is not for everyone but for some, it is absolutely a life saver.

If you are searching for more information on the above topics please contact Valerie Springer .

www.vshomeloans.com

Yours to Count On,

Valerie Springer

September 10, 2010

Inducements to Purchase

In the real estate world today there are many inducements to purchase a home.  Recently I read where a builder in Downtown Birmingham, AL  will give you free tuition if you purchase a loft condominium. 

Sounds like a great reason to purchase one of these properties if you are young and working toward your education.  BUT…

Guidelines on personal property inducements state the following:

IF  the personal property is a car, boat, riding lawn mower, furniture, television etc…THEN the value of the item(s) must be deducted from the sales price of the property value before applying the loan to value factor.

HOWEVER a range, refrigerator, dishwasher, washer, dryer, carpeting, window treatment or other items determined appropriate by the Homeownership Center (HOC) may be considered customary and affect the value of the property before applying the loan to value factor.

The exception is replacement of existing equipment or other realty items by the seller before closing, such as “flooring”, air conditioners, appliances does not require a value adjustment provided a cash allowance is NOT given to the borrower.

Depending on local custom or law, certain items may be considered part of the real estate transaction with no adjustment to the sales price or appraised value. 

A seller can offer anything to close the deal but whether the lender will allow is may all together be a different story! 

Yours to Count On,

Valerie Springer

August 17, 2010

Appraisals and Housing Valuation Code of Conduct (HVCC)

Housing Valuation Code of Conduct

 

Sometimes I wonder what our government was thinking when a group of lawmakers, (NY) decided it was in the best interest of consumers to have a third party requesting the most important piece of the puzzle in a refinance or purchase.   

An appraisal is an opinion of a property’s value.  Just like in any profession there are good and bad.  To utilize the best opinions it needs to be an appraiser who is familiar with the area and transactions taking place.   

In today’s market, we order an appraisal with a company who then gets in touch with the  appraiser.    

As a loan officer we do not have knowledge of the appraiser until we receive the finished product.  If there are any questions they are filtered back through the appraisal management company.   

For purchases, not so much negative, but for refinances it is a toss up as to the amount of work appraiser puts in to get the true value of the home.  I have been told sometimes can vary as much as $30k depending on comparables used.   

Thankfully, I have only had one appraisal that was disasterous and that appraiser has been removed from the the appraisal management company’s list.   While most appraisers take great pride in their work there are always those bad apples floating around in the barrel.   

I hope this trial will be one that is deemed unreasonable for all parties involved.  Ask the appraiser how they would rather work???   

If you have a comment or opinion, please share.   

Yours to Count On,   

Valerie Springer

August 12, 2010

Closing a Residential Mortgage, What do I Need to Bring?

By now most everything has been completed and if everyone did their jobs correctly the closing should be smooth and easy!    I will give a checklist for the purchaser and seller to make sure you arrive with everything you will need.

The borrower will need to bring the following:

Certified Funds–By law the closing attorney can accept a maximum of $5k in certified funds but check with the law firm, some may accept less.  The certified funds can be made payable to the firm or borrower and endorsed to the closing attorney firm.  Borrowers should also bring checkbook in the event additional funds are needed.  There could be last minute changes to the HUD Settlement Statement.

Picture ID–Closing attorney will need a picture identification from each borrower at closing.  Driver’s license and passport are acceptable but must not be expired.

Funding Conditions–Any closing conditions required by the lender such as an additional pay stub or proof of gift funds etc…Your lender would let you know this in advance.

The Seller needs to bring the following:

Picture ID–Once again driver’s license or passport are acceptable.

Power of Attorney–Usually a power of attorney for the seller does not require a lender approval.

House keys and garage door openers or any other gadget devices.

Other documents–Original termite letter, septic inspections, repair receipts, and make sure you or realtor have provided the closing attorney with payoff a few days in advance.

In attendance will be the borrower’s, seller’s, realtor for purchaser and seller, mortgage loan originator (not always, but I will be there) and the settlement agent or attorney.

During closing the lender’s conditions will be cleared first and then the closing statement of HUD 1 Settlement Statement is explained and discussed.  Next would be warranty deed and other conveyance documents signed by the seller, financing documents signed by the borrower.  Once everything is completed the signed documents are sent to the lender and after review they will wire funds and they will be disbursed.  This could take about 45 minutes.  This is a good time for realtor documents to be signed or updated if anything was missing.  Keys to the house are handed from the seller to buyer and phone numbers are exchanged, especially if purchaser is not taking possession immediately.

Purchaser needs to go to the tax assessor’s office and file homestead exemption immediately while it is fresh.  Taxes could double if deadline is not met.

I look forward to seeing you at the closing table!  If you need financing advice Valerie Springer is here to help with all of your needs! 

Yours to Count On,

Valerie Springer  nmls 198479

July 30, 2010

Qualifications for Reverse Mortgage

All reverse mortgage share several common characteristics. 

*All borrowers must be 62 or older

*Must occupy the home as primary residence (residence is defined as at least one person living in the home for at least 6 months of the year)

*One owner must be living in home at time of closing

*If there is existing lien, it must be paid off by the new HECM mortgage or assume a subordinate position.

HECM must always be in first-lien position.

A homeowner can finance any primary residence that is considered owner-occupied, single family residence, condominium, manufactured homes, two to four units, or a planned unit development.  Mobile Homes are not eligible for this type of loan.    As a government insured program the senior’s home must meet FHA guidelines in terms of minimum property standards to qualify.

There is no income or credit requirements and any senior who owns a home with sufficient equity and age requirement can qualify.  Even if there is a mortgage balance you can qualify.

If you have questions or would like to see how much is available to you, please visit my website to fill out an application www.vshomeloans.com or contact me at 205-995-7283.

Yours to Count On,

Valerie Springer  nmls 198749

July 9, 2010

Reverse Mortgage Alabama

HECM Reverse Mortgage  is a loan against your home that does not have to be repaid as long as you live there.   Using a “Reverse” mortgage, you can turn the value of your home into cash without having to move or repay a loan each month.

To qualify for a “Reverse” Mortgage you do not need income or assets.  You do however need equity in your home.   The money you receive is based on the age of the youngest co-owner.  All owner’s must be at least 62 years of age.  The older a borrower, the more money available.

The homeowner is still responsible for homeowner’s insurance and taxes unless exempt.

If you have questions about a “Reverse” Mortgage please contact Valerie Springer, Sr. Residential Loan Officer  NMLS 198479, Network Funding LP NMLS 2297, 205-995-7283 x 305

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