Blog Category: Home Buying Process

stack of cash

2021 Mortgage Loan Limits

Every year, the Federal Housing Finance Agency (FHFA) sets a dollar cap on conventional mortgages that Freddie Mac or Fannie Mae are allowed to back, commonly referred to as a conforming loan limit. In 2020, the conforming loan limit for a single-family home was $510,400. This year, the conforming loan limit for a single-family home increased to $548,250, nearly 7.6% higher! Read More

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2023 Much Higher Conforming Loan Limits Announced

2023 conforming loan limits have been announced! The Federal Housing Finance Agency (FHFA) sets the loan size limits each year on conventional mortgages that Freddie Mac or Fannie Mae will buy from mortgage lenders. In 2022 the conforming loan limit for a single-family home was $647,800. This year, the conforming loan limit for a single-family home has increased to $726,200. A little over a 12% increase! Read More

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2024 Conforming Loan Limits Announced

2024 conforming loan limits have been announced! New loan size limits are set each year on conventional mortgages that Freddie Mac or Fannie Mae will buy from mortgage lenders. You can see the 2023 loan limits in the chart below. For 2024, the conforming loan limit for a single-family home has increased from $726,200 to $766,550. That is about a 5.5% increase! Loan limits go even higher for 2-4 unit homes.

In most areas, the maximum conforming loan limits for 2024 are as follows: Read More

bad versus good

6 Tips on Choosing a Mortgage Lender or Broker

Is choosing a mortgage lender important? People spend a  lot of time looking for the perfect home. There are the countless hours spent poring over real estate listings, the weekend trips to open houses, and the days of driving with your realtor from showing to showing. However, choosing a mortgage lender or broker is often treated as an afterthought. Many buyers simply go with their own bank or a broker/lender recommended by their realtor. They do so without researching competitive rates and looking for lenders who will also educate them.

This is a critical mistake. Read More

Traffic Sign Slippery Road

7 Warning Signs You’re Not Ready To Buy A Home

Buying a home is the most important and expensive decision that most of us will undertake.  It is surprising to me how many people are not prepared to buy a home. A potential homebuyer should do extensive amounts of research and give a lot of thought to what they want to buy. When they feel they are ready then they can get pre-approved for a mortgage. Below are some of the warning signs that you might not yet be ready to buy a home and you may need to do some more research. Read More

ten percent off sale

Are Housing Values Dropping Now?

Are housing values dropping now? Potential homebuyers who contact me for a mortgage are now frequently asking if they should wait to buy a home.  The implication is that people are now worried that housing values are going to fall. So why buy now? Isn’t it smarter to wait? Maybe, maybe not. It is understandable why everybody is asking the question, “are housing values dropping now?” Read More

septic truck

Are Well And Septic Inspections Needed To Get A Mortgage?

Well and septic inspections may indeed be required to get mortgage approval. But it depends on the type of mortgage you are seeking.

Conventional mortgages

A conventional mortgage through Fannie Mae or Freddie Mac typically do not require  well and septic inspections. I say “typically” not required because there may be an instance where they are required.

Fannie Mae requires the lender to disclose any information regarding environmental hazards. A lender is required to get the necessary inspections if the appraiser, real estate broker, property seller, property purchaser, or any other party to the mortgage transaction informs the lender that an environmental hazard exists in or on the property, or in the vicinity of the property. Fannie Mae also requires the lender to disclose such information to the borrower and comply with any state or local environmental laws regarding disclosure.

So if you’re buying a home that is on a well and/or septic systems and  it comes to the attention of the lender through the appraiser or any other party, inspections will be needed on those systems to get the loan approved. If there is no visible issue and nobody reports a problem, which is typical, then no well and/or septic inspection would be required.

For more details on this issue as it relates to Conventional loans, click here B4-1.4-08, Environmental Hazards Appraisal Requirements.

FHA mortgages

However, with FHA and VA loans, a well and septic inspection is always required, regardless of the visible condition of these systems. If an inspection doesn’t pass the local guidelines and requirements, remediation will be needed until the systems pass. And an FHA or VA mortgage loan will not be able to close until the inspections pass.

With an FHA loan, the FHA Appraiser must check for issues or malfunction if the property has a septic system. If there are visible deficiencies, the FHA appraiser must require repair or further inspection. And the FHA guidelines also require the lender to get a septic system inspection. Hence, it is important to note regardless of what the FHA appraiser finds, the lender is going to require an inspection of the septic system. The same holds if the home has a well water system.

For further FHA guidelines click on this link, and start reading at the bottom of page 170 from “Requirements for Well Water Testing” for all the details. You will see other interesting details such as:

  • The septic tank must be 50 feet from the water supply on existing construction.
  • The septic tank must be preferably 100 feet from the water supply on new construction.
  • Existing wells must deliver water flow of three to five gallons per minute for existing construction.
  • Wells must deliver water flow of five gallons per minute over at least a four-hour period for new construction.

VA mortgages

For further VA guidelines click on this link and look for page 12–20 and start reading from “15. Water Supply and Sanitary Facilities”.

You will see information on things such as:

  • All testing must be performed by a disinterested third party.
  • Water quality for an individual water supply must meet the requirements of the health authority having jurisdiction. If the local authority does not have specific requirements, the guidelines established by the Environmental Protection Agency (EPA) will apply.
  • The appraiser must be familiar with the minimum distance requirements between private wells and sources of pollution.
  • Water quality test results are valid for 90 days from the date certified by the local health authority unless the local authority indicates otherwise.

Feel free to contact me for any further questions on well and septic systems as it pertains to getting a mortgage, or any other questions in general related to conventional loans, FHA loans, and VA loans.

approve or reject

Automated Underwriting Versus Human Underwriting

When you’re ready to buy a new home, one of the first things you have to do is take steps to get your financing in place. Mortgage approval is based in part on an automated underwriting process. It is beneficial to get a pre-approval letter from a mortgage lender before you even make an offer. Having your loan pre-approved can show a seller you are a serious buyer with adequate funds. You can also reduce the risk of the contract falling through.

Lenders typically use one of two underwriting processes for mortgage loans: automated and manual. Understanding the basics of how these types of loan approval work can give you confidence when applying for your mortgage.  Read More

To do stickies mortgage checklist

Buyer’s Guide to Closing on a House

This blog assumes you’re at the final steps of the mortgage process. You’ve completed your loan documentation, received your appraisal and title insurance, your loan is approved, and you have scheduled your movers. Now you’re ready for it to be over. But there is more to consider. Settlement day, a.k.a. closing day, can bring surprises and unexpected stress. Spend some time on these final closing details with a couple of tips that I give my clients on how to be prepared for the big day. Read More

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Buying A Home Non-Contingent On The Sale of My Current Home

Buying a home Non-Contingent on the sale of your current home is hard. I often get asked to get a potential buyer pre-approved to buy a new home, without the mortgage being contingent on the sale of the current home that they own. While this is possible, it is difficult.

GETTING THE CASH FOR THE DOWN PAYMENT ON YOUR NEXT HOUSE

First, you have to have the cash for the down payment and closing costs for the new home without the benefit of the sale of the current home. Then you would have to be able to qualify to carry the debt of both mortgages at the same time. Read More

debt paydown

Can paying off a debt help qualify you for a mortgage?

Can paying off a debt help qualify you for a mortgage? When you qualify for a mortgage loan it may not be for the amount you want. Outstanding debts can affect how much you are able to borrow. In some instances you may be able to pay off the debt in order to qualify for a larger loan.

If you reduce the number of installment payments to 10 or fewer, the loan may not be included in your debt-to-income ratios. What if the debt has a large monthly payment? Then an underwriter may consider it a risk in your debt-to-income ratio. Read More

law books judge gavel

Condominium Litigation When Getting A Mortgage

Condominium litigation can be a problem when getting a mortgage. What if a condominium has litigation against it and you want to buy it? To get a loan approved there are certain things a mortgage lender has to document or the loan may be denied.

A mortgage lender has to prove that the litigation has no impact on the safety and structural soundness of the condo.

And the insurance carrier that insures the condominium building is involved. They have to have agreed to provide the defense, and the amount of the litigation must be covered by the HOA’s insurance.

There are other reasons why litigation against a condominium may not be an issue. These may be:

  • It is non-monetary litigation including, but not limited to neighbor disputes or rights of quiet enjoyment;
  •  the HOA is the plaintiff in the litigation and not the defendant;
  •  the reasonably anticipated or known damages and legal expenses are not expected to exceed 10% of the project’s funded reserves.

Financing a condominium can be tricky for other reasons. Mortgage guidelines have the ability to change at any time. Always talk to a well-reviewed mortgage loan officer. Make sure you understand the current guidelines and how they might apply to you.

interest rates are up

Did The Coronavirus Make Mortgage Rates Go Down? Did the Federal Reserve Just Cut Mortgage Rates To 0%?

Mortgage rates did indeed go down after the Coronavirus spread and financial markets started to panic. But the Coronavirus and mortgage rates aren’t directly connected.

People considering a refinance continue to contact me for low rates, but now that rates have spiked it may no longer makes sense.

The recent mortgage rate reductions we saw may be gone for a period of time, but the rate changes are not as drastic as the media made it sound. Read More

condo building

Do Condo Fees And HOA Fees Affect How Much I Qualify For?

Condo HOA fee impact a mortgage pre-qualification. When pre-qualifying someone for a condo mortgage a loan officer will have to make some assumptions if there is no ratified contract on a particular condominium. In those assumptions would be an estimate of what the monthly condominium fees would be. I personally use $1.00 per thousand of the sales price when I am working up my numbers when prequalifying someone. Read More

What Who Where When How Why

Does It Really Matter Where Your Loan Officer Is Located?

It is very common for realtors to ask a homebuyer who their mortgage loan officer is and where they are located. There is a belief that a lender, and for that matter all the service providers to a real estate transaction, needs to be very local.

Realtors assign some magical powers to a mortgage loan officer who is Read More

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e-closings The Reality

There has been a lot of talk about e-closings recently. E-closings allow someone to close on a mortgage remotely from the comfort of their own home or office, without physically going to a title company office. However, knowing the details is important. You need to determine if this is an option that is available to you, and if it is a good idea for you.

As of the writing of this blog, e-closings are not available in all 50 states. You need to determine if your state has passed legislation to allow them. Then you need to find a mortgage lender and a title company that have the knowledge and technology needed to participate in e-closings.

You may also hear an e-closing referred to as a digital closing, electronic closing, remote closing, and other variations.

There are also different types of e-closings such as: Read More

divorced couple

Getting A Mortgage In Community Property States

What is a community property state?

Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin are community property states. Community property laws require divorcing couples to split assets acquired during a marriage equally. Marital property includes earnings, all property bought with those earnings, and all debts accrued during the marriage. Read More

income taxes

Grossing Up NonTaxable Income

Fannie Mae, Freddie Mac, FHA, and VA all qualify mortgage borrowers by using their gross income. When getting a mortgage your mortgage lender can gross up nontaxable income to a higher figure to help in qualifying you.

You would think they would use net income, which is after tax income. Especially since a mortgage payment is paid out of after tax income. But they do use gross income. I am sure if they suddenly shifted the guidelines to solely using net income to qualify mortgage borrowers, the allowable debt ratios would go up to compensate for using the lower after tax income. Read More

house and house key

Help Entering The Home Buying Market

Many homebuyers need help entering the home buying market. They cite obstacles and problems that create fear in moving forward with buying a home. This is especially true of first time homebuyers. But with some research and patience, there are answers for a lot of these questions. And there are many ways to overcome fears of home buying.

See the list below of some of the most common fears, and answers to those fears. Read More

money and housing

Historical Real Estate Values

Do you know Historical Real Estate Values? I often have conversations with potential homebuyers in speaking with them about their mortgage financing. And they ask me about whether I think Real Estate is due for a correction. Let’s face it, Real Estate has been going up in value at a striking pace in the last few years. It’s a realistic question to ask if some of that increase is due for a correction to some degree.

Of course, I don’t have the answers. But we can have a discussion to give homebuyers a frame of reference. Read More

interest rates going up

Home Price Reduction and Rates

How do home price reduction and rates affect one another? I have clients who have reported seeing price reductions in the asking prices of homes for sale. This is the first time I have heard of this in years and years. So, are real estate values about to correct? It probably depends on where you live. And of course, as with many of life’s answers, the answer is a matter of degree. Some markets may be in for a large correction, some a small correction, and some markets may still experience price gains.

Are housing values dropping?

Should they adjust the price of their home due to interest rates rising?

I have heard of some home shoppers say they feel home sellers owe it to homebuyers to drop prices just because of the interest rates increase. Read More

Homeowners Insurance in a Nutshell

Why is it important to have homeowners insurance?

Owning a home is one of the most valuable assets and investments you can have in a lifetime. Protecting your investment should be commonplace. There are still those who feel that paying for insurance is a waste of money. Homeowners who have purchased their home with cash can decide against homeowners insurance but that is unwise. Otherwise, if you have a mortgage loan the lender will require you to have homeowners insurance. Read More

Debts Paid By Others

How Are Debts Paid By Others Handled On A Mortgage Application?

How are debts paid by others handled on a mortgage application? Sometimes when someone applies for a mortgage with me, they mention they have a debt paid by a parent. They may have a school loan that a parent pays. Or people may tell me they co-signed for someone else’s mortgage, but they do not make the payments. Read More

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How are property taxes calculated?

Property taxes are a part of the cost of owning a home. When you buy a home you not only have the cost of the monthly mortgage payment. You also need to consider property taxes, homeowners insurance, any HOA dues, maintenance, and utilities.

What amount will I owe?

Many people wrongly assume property taxes are a fixed cost. They believe whatever amount is billed when you first buy the house, is what the amount will be for the life of owning the home. However, property taxes can change quickly after buying a home. Most counties assess property value annually, and adjust the amount due annually. Read More

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How Can a Buyer Pay for Their Own Realtor Representation?

How can a buyer pay for their own realtor representation? I wrote an article discussing the lawsuits against the National Association of Realtors (NAR) and some of the largest real estate firms. By now everyone has likely heard about all these lawsuits. The litigation accused brokerages of inflating sales commissions and of monopolistic practices.

Homeowners could see a reduction in the cost of selling their homes now that the NAR agreed to resolve the case.

But could this mean an increase in cost for buyers instead?

Read More

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How Much Mortgage Can I Afford?

When you buy a new home, you need a mortgage to purchase it. And before you get a mortgage, you need to determine how much mortgage you qualify for. Different sources may qualify you for different mortgage amounts. And how much you qualify for does not necessarily equate to how much you can afford.

How much you can afford is based on your personal budget. When a mortgage lender tells you how much you can qualify for, that is the highest mortgage amount they’ll approve you for. But this may not be the mortgage size you end up closing on.  Read More

car loan

How Much Mortgage Does My Car Loan Cost Me?

Car loans and mortgages, do they affect one another? When a mortgage lender analyzes your finances to qualify you for a mortgage, they’re looking at all of your debt along with the new proposed mortgage payment. The other debts that they consider outside of your new mortgage payment are debts like minimum credit card payments, car loans, student loans, and any losses from other rental property. They do not look at debts like utility bill payments, car insurance or cell phone bills. Read More

online search

How To Find The Best Mortgage Lender

When comparing mortgage lenders there are many things to consider. If you want to save time follow the below steps on how to compare mortgage lenders. Time is valuable and these six steps should help you find a good mortgage lender: Read More

special sale only this week

How to Get the Lowest Mortgage Rate

Clients always ask me how to get the lowest mortgage rate. Especially given the fact that interest rates have increased since 2022 after having been at record lows for so many years prior to that. Many people think mortgage rates are high currently. However, interest rates today are historically quite average. We were just spoiled with cheap money for a very long time from just after the economic debacle of 2008 through most of 2021. What I see now is an almost carnival like atmosphere of people hawking quick fixes to get “special” mortgage deals. Read More

Contract Agreement Signature

How to Make an Offer on a House: 5 Important Topics

Do you know how to make an offer on a house? It’s simple, right? There are many things to consider when you are making an offer on a house. When it comes to making an offer there are some key things that can make a difference!  Below are some important topics related specifically to the mortgage when you’re getting ready to write up an offer on a home. Read More

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Is It Cheaper to Rent or Own a House? Pros & Cons of Renting vs. Buying

Is It Cheaper to Rent or Own a House? If you are planning on moving and are financially stable enough to potentially qualify for a mortgage, there is a lot for you to consider. Buying a home usually requires a down payment plus closing costs. Renting also comes with its own fees, but those are generally less than you will need to buy a home. Here, we will explore whether it is cheaper to rent or own a house. And the pros and cons of both.

Read More

house for sale

Losing Fees Paid For Services When A Loan Does Not Close

Fees paid during a home buying process are at risk? Every now and again a loan does not make it to closing. Common reasons for this are home inspection issues that cannot be resolved or a condo that cannot be approved. Unfortunately, some of these issues arise and cause a deal to cancel after some services have already been performed and therefore have to be paid for. And this is where debate will sometimes arise. The debate is related to fees paid during the home buying process. Read More

monopoly houses

Maximum number of financed properties

There are rules related to the maximum number of financed properties you can have. These are for investment property buyers. There are some mortgage agencies, like Fannie Mae, that will not do a loan for an investment property buyer that already has what they consider to be excessive financed properties.

What if you are buying a new primary residence? Then there is no limit to the number of financed properties that you already have.

However, if you are buying a second home/vacation home or rental property there are rules. You cannot have more than 10 financed properties already. Read More

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Maximum Seller Credits

When a buyer is getting a mortgage to buy a home, there may be repairs or issues that the seller needs to remedy. Frequently, the remedy is to offer closing cost credits to the buyer. Clients ask me if there is a maximum amount of seller credits that a seller cannot exceed? In the mortgage industry we have another name for seller credits. We  also call them interested party contributions. Whether a credit is given to a buyer from a seller, a realtor, or a lender, they’re all considered interested parties. And regardless of who the credit is coming from, there are limits as to how much it can be. Read More

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Mortgage forbearance

Forbearance – you should only do it if you absolutely have to. Some people are taking a forbearance on their mortgage as a way to take a break on their mortgage payment when they really do not need to.

Forbearance does not mean you can skip mortgage payments and never pay them back. You have to repay any missed or reduced payments in the future. So, if you’re able to keep up with your payments, keep making them.

It will also impede your ability to refinance. Having a forbearance on your credit report means you cannot get a new mortgage. You have to bring the loan current to do so. Read More

no money

Mortgage Forbearance in 2020

Forbearance, only do it if you absolutely have to. Some people are taking a Forbearance on their mortgage as a way to take a break on their mortgage payment when they really do not need to.

But forbearance does not mean you can skip mortgage payments and never pay them back. You have to repay any missed or reduced payments in the future. So, if you’re able to keep up with your payments, keep making them.

Taking a forbearance will also impede your ability to refinance. Having a forbearance on your credit report means you cannot get a new mortgage. You would have to bring the loan current. Read More

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Moving Tools When Moving Into A New Home

When you move into a new home there are numerous tasks to track. It is almost impossible to keep everything organized, unless you keep track through a task list or use some sort of technology tool.

Although the closing will seem like a long time off once you get under contract for a new home, it will all happen quickly. And a lot of tasks related to moving into your new home require a lot of advance notice! It is time to start planning things ASAP, do not procrastinate. The below will help. Read More

multifamily home

Multifamily Property Mortgages Got Cheaper

Multifamily mortgage financing just got cheaper.

What Is A Multifamily Home?

Multifamily residential homes are two, three, and four unit homes. These are also called duplex, triplex, and four-plex homes. I have also heard them called two-family, three-family, and four-family homes.

Fannie Mae defines multifamily property as, “A property that consists of a structure that provides living space (dwelling units) for two to four families. Although ownership of the structure is evidenced by a single deed.”

Any home with more than 4 units is considered a commercial property. These don’t qualify for a residential loan. I don’t do commercial loans. I do have some knowledge of commercial loans. They typically require large down payments, like 25% down or more. I doubt that will ever change.

Multifamily residential property has historically also required significant down payments. These down payments ranged from a minimum of 15% down to as much as 25% down.

How Did Things Get Cheaper?

Fannie Mae recently announced a 5% down payment option for multifamily homes. This is a significant policy change. Interestingly, Freddie Mac has not made the same change. Not as of yet, anyway. Read More

Online Reviews – Check Before You Select

Online reviews are playing an increasing role in the mortgage industry and here’s why:

TEXT: Hello. I’m doing a video blog today while on my treadmill, that’s why I’m bouncing up and down a bit, on online reviews. Online reviews were thought only to be for restaurants and bars. And you would go to a website like Yelp to see if you wanted to go to a certain restaurant in your neighborhood. Read More

Title insurance

Owner’s vs. Lender’s Title Insurance: What You Need To Know

Shopping for a home means coming to understand Owner’s Title Insurance vs. Lender’s Title Insurance. It also means learning about home inspections, appraisals, title searches, and other steps inform buyers and sellers of possible complications with the sale. Homeowners need to understand mechanisms built to protect them, such as owner’s title insurance. Read More

qualification

Pre-Approval Letter Versus Pre-Qualification Letter: What Is the Difference?

When you’re beginning the home-buying process, figuring out what you need to get your mortgage loan can seem complicated. You may even be tempted to find your dream home first before you apply for a mortgage. However, going through the pre-qualification and pre-approval processes at the start of your search can make the entire experience go more smoothly.

Before you meet with a lender or mortgage broker, you should have a good understanding of how the loan process works. This guide covers the basics of loan application, qualification, and approval. Read More

house sitting on pennies

Reduced Government Transfer Taxes for First Time Homebuyers

Government transfer taxes can consist of some or all the following: transfer tax, recordation tax, and tax stamps. These are one time taxes charged by a state or jurisdiction upon the transfer of real estate. They are based on the sales price of the real estate being transferred to the new owner. These taxes are simply a tax on the transfer of property.

If there is a mortgage on the new property, then there is also tax stamps or a recordation tax to record the mortgage. It may be customary in most areas for the buyer and seller to split these taxes. But it’s always good to check and see what is customary in your area, or if a seller expects those to be negotiated. Read More

COVID

SELF EMPLOYED LOANS DURING COVID

Are you self-employed during Covid? Need a mortgage? There are newly revised mortgage guidelines for self-employed people due to the Covid-19 pandemic.  There are temporary requirements for assessing income derived from self-employment.  The additional due diligence is due to the disruption from the pandemic.  Mortgage lenders now need to consider if and how a business has been impacted and the likelihood of income continuance.

There is additional income documentation required. You may need an audited Profit & Loss statement with supporting documentation for the Profit & Loss statement.  The continuity and stability of income is what will be considered. Read More

termites

Solutions for Termite Damage when Buying a Home

Sometimes when you buy a new home you find termite damage, termite infestation, or both. When applying for a home loan termite damage is of course unwelcome news. And the lender will want to see the issue resolved before allowing the loan to go to settlement. However, there are solutions to avoid disrupting the mortgage process. Read More

question mark pile

Top 15 Questions to Ask a Lender or Broker Before You Apply for a Mortgage Loan

It may seem odd that someone in the mortgage business wants to discuss how to help consumers find the best mortgage lenders. People search for mortgage providers every day without the benefit of professional help. So, I figured why not help people whether they find their way to me or someone else? Below I’ve listed the most important mortgage questions that you need to ask before you apply for a mortgage loan. Read More

older couple in retirement

Using Retirement Account As Income For A Mortgage

There are times that I have used a mortgage borrower’s retirement account balance/s as income. I have done this even if the borrower is not currently taking required withdrawals from the account/s! But how can an asset be used as income? It can, and the guidelines allow it. However, there are rules.

There are many rules to consider.

  • The mortgage must be for a 1-unit or 2-unit Primary Residence or a second home. No investment properties are allowed. And no 3-4 unit properties are allowed.
  • The mortgage must be a purchase loan or a no cash-out refinance, not a cash out refinance.
  • The maximum loan-to-value is 80%.
  • At least one borrower on the account must be 62 years old.
  • We take the account balance and divide by 240 to get the monthly income. For example: $800,000 401(k) account balance / 240 = $3,333.33/month in income to help qualify for a mortgage

All the Freddie Mac rules related to this can be seen by clicking here.

What if someone is already taking distributions from retirement accounts?

For retirement accounts that are already being used to take distributions as income, the Fannie Mae rules to document that as acceptable income are found here. Look under the area marked “Retirement, Government Annuity, and Pension Income.” The main points are:

  • If retirement income is paid in the form of a distribution from a 401(k), IRA, or Keogh retirement account, determine whether the income is expected to continue for at least three years after the date of the mortgage application.
  • Eligible retirement account balances (from a 401(k), IRA, or Keogh) may be combined for the purpose of determining whether the three-year continuance requirement is met.
  • The borrower must have unrestricted access to the accounts without penalty.

Conclusion

If you are getting near retirement age or you are already retirement age, consider using your retirement accounts as income to help you qualify for a mortgage, even if you are not currently taking withdrawals from the account.

To contact me to discuss any income qualifying or other mortgage questions, click here to schedule a call or you can email me directly.

house and calculator

VA $0 Down Payment Loans To Infinity?!

Prior to 2020, veterans could borrow more than the Veteran’s Administration (VA) Loan Limits capped amount, but had to have a down payment of 25% of the difference between the maximum loan limit and the sales price. As of January 1, 2020, the VA has started to allow $0 down loans that exceed the county loan limits.

So now, if a veteran wants to buy a home for $1,000,000 with no money down, they can. $2,000,000? Sure thing. $3,000,000? No problem! However, there are rules and guidelines that come with this new change. Read More

condo building

Waiving Contract Contingencies On A Condo

When buying a condo, you may find yourself in a competitive bidding situation. And your realtor may ask you about waiving some or all the contingencies in your contract. These contingencies are usually things like a home inspection contingency, appraisal contingency, and financing contingency. But waiving contract contingencies on a condo can be risky. Read More

Police and frog thief

Watch Out For Wire Fraud In Mortgage Transactions!

New home purchasers can get caught up in a wire fraud scam in a mortgage transaction by cyber criminals if they aren’t careful!  This type of fraud is happening more often.  Some borrowers are fortunate enough to have a bank that recognizes that money is being sent to a suspicious account and the wire gets stopped. Otherwise, the mortgage borrower can lose their entire down payment on the house. Read More

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What are Discount Points and Origination Fees on a Loan Estimate?

What is a Loan Estimate?

The new Loan Estimate (LE) was introduced in October 2015 as a federal standard form. It includes the interest rate, monthly payments, and total closing costs for a mortgage loan application. The lender is required to send you a Loan Estimate within 3 business days after applying for a mortgage. Even though this form attempts to help the consumer understand the loan payment breakdown and the costs, it can still be very confusing. The language on the form is murky and some of its terminology needs to be explained. Read More

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When Is A Mortgage Really Approved?

When is an approval really an approval? When is an approval only a conditional approval? Below are the different levels of “loan approval” you can get for a mortgage:

Pre-Qualification:

Pre-qualification is done before you make an offer on a home. It is only a loan officer analysis, and supporting financial documents are not required. Only a review of the applicant’s income and debts are done. Standard methods of determining housing and debt ratios are used. This can help indicate the maximum loan amount for which an applicant would qualify. But it is subject to the satisfactory appraisal, further verifications of income, employment and credit history.  This is the lowest form of analysis you can have done.

Read More

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Where Are Real Estate Prices Going Next?

Most everyone knows low inventory is keeping real estate prices high. But why is inventory low? Because 90% of US homeowners have a 6% or lower mortgage rate. 62% have a rate below 4%! No one wants to give up their great rate for a much higher rate. They won’t move! But how does this end? When does it end? It can’t stay this way forever. Eventually people must move. People will move due to retirement. Or families will need larger homes. Or sometimes they are ready to downsize.

My theory is inventory will increase over a long period of time, and that may bring prices drops. But when? Interest rates going up has not stopped housing demand nor price increases. Rates going down won’t cause real estate prices to spike. And rates going up even more than they are now won’t cause prices to tumble. Historically low inventory will see to that. Read More

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Why Do Sellers and Realtors Want Me To Be Pre-Approved?

Always get your mortgage pre-approved! Homeownership is a major component of the American dream. It provides you with your own piece of property to put down roots and live your life. You might think the process starts when you first go out hunting for houses or condominiums. But it often begins long before the initial meeting with a realtor when you contact a lender for pre-approval. Here are a few reasons why the seller and listing agent might want you to get pre-approved. Read More

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Why get a home inspection and who pays for it?

A home inspection protects the buyer. It’s meant to uncover potentially serious issues with the home so that you understand what you’re buying.

In a competitive market, some buyers walk through the home with an inspector before making an offer on the home. This gives them the confidence to formally waive the inspection contingency when they make their offer. And this possibly putting their offer in a stronger position to be accepted.  However, a home inspection may identify the need for major repairs or builder oversights and minimize unpleasant surprises or unexpected difficulties. Read More

Work with individual or a team

Work With An Individual Loan Officer or A Loan Officer Team?

Should you work with an individual Loan Officer or a Loan Officer team? This discussion will stir up some controversy. I will likely get some angry comments as well as some supportive comments. Keep it classy, and let’s discuss! Read More

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Working With One Realtor or With a Team

Real Estate Teams vs. Real Estate Agent

The real estate business is one of the most highly competitive job markets. And all real estate agents are in fact small business owners. They have an ever-growing client list, new leads, open houses, scheduling, marketing, budgeting, mailers, and websites. It is a never-ending list of responsibilities that seems to demand more and more time. It’s a fast-paced competitive housing world out there. Without the best tools and resources it’s possible to lose your clients to a more established realtor or realty team machine. Read More

House For Sale

Your homeowner’s insurance coverage is too low!

Your homeowner’s insurance coverage is probably too low!

Check your home value annually

You should annually check your house value by having a local realtor pull comparable sales. Or use resources like this home valuation tool from Redfin. Or this one from Zillow. These tools will help you to adjust your home insurance as needed. Or you can ask a local realtor you trust to send you comparable sales. After a certain period you may find your existing insurance coverage is insufficient.

And let’s face it, who checks their house value annually? Who makes increase and adjustments as needed? Not many of us. Read More