Every now and again I like to share a story where an underwriter has lost their mind, and gone way too far in questioning a loan. I have a doozy I’d like to share. I have seen some idiotic loan approval conditions, but this recent situation was a bit much. Read the rest of this entry »
Fannie Mae now has a policy that pertains to multiple mortgages to the same borrower when that borrower is buying an investment property. Fannie Mae’s current policy limits Read the rest of this entry »
It seems mortgage rules change frequently, below is the latest on down payment requirements.
For a primary residence you need a down payment of: Read the rest of this entry »
It has been established, for as long back as my 25 year mortgage career goes, that if a condo has a high investor level, you were going to have a hard time getting mortgage approval and/or PMI approval if you were putting down less than 20%. The investor level of a condo is how many units of the total investors own. For example, if a condo has 100 units, and 60 are owned by investors to be rented out and 40 units are owned as primary residences, then the condo has a 60% investor level. Read the rest of this entry »
There seems to be a lot of confusion around what an approval letter is, what a pre-approval letter is, and what these documents are worth since some don’t seem to hold up when it comes time for the underwriter to approve the loan and issue a final commitment letter. Read the rest of this entry »
When buying a home the appraisal contingency addendum in a sales contract says the home buyer has a certain number of days (the date is negotiable) to get an appraisal that is equal to or greater than the sales price in the sales contract. If the appraisal is less than the sales price the buyer can Read the rest of this entry »
Many people are not aware of a rule that has altered, made more expensive, or stopped people’s refinance attempts. This rule states that on a Conforming Loan (loans up to $417,000) or Conforming-Jumbo loans (loans from $417,001 to $729,750) if you are refinancing and paying off any 2nd trust (HELOC: Home Equity Line of Credit, or HELOAN: Home Equity Loan) that the transaction must be deemed a ‘cash out refinance’ as opposed to a ‘no cash out refinance’. This is important for several reasons. Read the rest of this entry »
Some people think that getting a cosigner on a mortgage loan is a cure-all, and will automatically make someone qualify for the loan they seek. This is not so. Read the rest of this entry »
If you are looking to buy a new house, and want to keep your current home as a rental property, on a Conventional loan you need to show the lender making the loan on your new home some things that you would not if you were selling your current home instead of renting it. You need to show 6 months “cash reserves” after the down payment and closing costs on the new house, and you need a 70% loan-to-value (LTV) on your current home, as evidenced by an appraisal. Read the rest of this entry »
There are times when a lender might enter a loan application into the automated underwriting system, and the resulting approval may allow for a “PIW”. A PIW is a Property Inspection Waiver, which means that Fannie Mae or Freddie Mac has decided that due to the characteristics of the particular loan entered that they feel comfortable proceeding without an appraisal being done. Read the rest of this entry »