What is a Supplemental tax bill?

Posted on January 26, 2011 by Colleen Craig

What is a Supplemental tax bill?

In Los Angeles county taxes are paid on a fiscal year starting from July to June of the following  year.

Taxes are assessed on the values as of January 1st of every year.

So when you purchase a home, although your taxes will be calculated based on a certain percentage of the sale price (currently 1.25%) the new bills won’t be adjusted until your property is reassessed.  Reassessments are only done when the tax office receives the transfer information  after closing.  It could take several months for this to take place.

If your seller was paying taxes on a lower assessed amount, you will be getting a separate supplemental bill for the difference between what you owe for the higher amount from the day you closed until the date the new tax bill is generated with the new assessed amount.

You may get two supplemental tax bills depending on when you purchased your home.  For example, If you close on your home in March and the fiscal year is from July to June, you will owe taxes for the bill from March to June of the year you closed and then possibly from July to June of the following year if the reassessment wasn’t done until after the second bill was generated.

What if your taxes are included in your mortgage payment through an impound account?

This is where things get a little tricky.  If your mortgage company has an impound account calculated on the higher amount (which they should), then yes, they should have extra in the account.   However, Supplemental tax bills do not go to the mortgage companies, only to the owners.  Mortgage companies are only allowed to keep a certain amount in excess in the impound account for a certain period of time.  So you may get a refund for the extra amount before you even get the supplemental tax bill and not know what it is for.  Sometimes the mortgage company will adjust your payment DOWN when they get the tax bill before it’s assessed and then there wouldn’t be any extra in the account.  Then when they reanalyze your account on the yearly anniversary, they would have to adjust your payment back up to meet the correct amount to cover the taxes and insurance.

So if you get a notice from your mortgage company that your payment is lower than what your lender estimated, don’t get too excited!  And if you get a refund check, don’t run out shopping!  You will have to pay the bill when it comes in.  But the good news is, it’s only the first year when you purchase a home that you will get the supplemental tax bill.

Now if you purchased a home for LESS than what the house was assessed for which would make the tax amount the seller was paying higher than what you will owe, the opposite would be true, and you would get a refund! Now you can resume shopping.

What if your value decreased after you purchased your home?  You may qualify for an automatic reassessment, or you can request a Decline-in-Value review.  Claim forms are available online and can be filed between June 1 and November 30.   You can find out how to go about the process at http://lacountypropertytax.com or www.assessor.lacounty.gov

By Colleen Craig, SocalMtgPro, The Mortgage Ninja

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Corona virus Mortgage at zero percent?

Posted on March 17, 2020 by Colleen Craig

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5 Tips for Buying a House with Student Loans

Posted on January 9, 2020 by Colleen Craig

5 Tips for Buying a House with Student Loans

January 8, 2020 – By Lexi Klinkenberg

 

The thought of buying a house with student loans can be daunting, but that doesn’t mean it’s impossible. With a proper strategy in place, and the willingness to do whatever it takes to save for a home, you could be well on your way to pursuing the purchase of your first home.

Do Student Loans Affect Buying a Home?

Sadly yes, student loan debt can possibly affect your journey to homeownership. Saving up for a down payment can be challenging while keeping up with your student loan payments, not to mention budgeting for future monthly mortgage payments. Other potential challenges include your debt-to-income ratio and your credit score. Rest assured, there are solutions. If you are looking to buy a home but still have student loan debt follow these useful tips.

1) Improve Your Credit Score

Your credit score is one of the most frequently used scores to determine whether you should be given a loan. Loan companies will use your credit score to evaluate how risky you are with your borrowing. The higher your credit score the more likely you will be accepted for a loan. You have the ability to view your credit report once a year. This allows you to check for any errors that could be decreasing it. If you have a low credit score there are a few things you can do to build it back up.

 

Regularly making your student loan and credit card payments on time is a great place to start. On-time payments signal to financial lenders that you are a responsible borrower. Providing evidence that you are accountable with your money. Making the borrowing process much simpler and allowing you to obtain loans more easily.

 

Additionally, you should attempt to completely pay off any credit card debt you currently have. If that is not possible then start by keeping your credit card balances low. Professionals advise you to only spend around thirty percent of your credit limit each month. Doing this will keep your credit score intact and will eventually lead to an increase in your credit score. Another recommendation is to keep any unused credit lines open. Even if you haven’t used them or have them already paid off, closing them could result in an increase to your credit utilization ratio. If you practice these strategies and avoid opening new credit cards you will see your credit increase in no time.

2) Manage your Debt to Income Ratio

Your debt to income ratio, also known as your DTI is considered to be all of your monthly debt payments divided by your gross monthly income. Financial lenders use this number to determine how well you can manage monthly payments, and if you can afford to repay the money you want to borrow. The DTI ratio is one of the most important numbers lenders look at, and it’s important to try to lower your number before applying for a loan.  You will want to keep your DTI ratio below 43% to be accepted for a mortgage loan.

Your DTI has two components: debt and income. So there are two things you can do to reduce your DTI—pay down your debt or increase your income or both. Pay a little more on your loan payments each month and try to pay off any credit card debt you may have. Any reduction in the amount of debt you have will be greatly beneficial. If you have the ability to ask for a raise at your current job, do it. If not, you can try to increase your income by picking up a second job, a side hustle, or asking to work some overtime. Increasing your salary and reducing your debt will not only prove beneficial for buying a house but also with other aspects of your life like refinancing your student loan.

 

Sometimes paying off debt can be too difficult to manage, that’s why there are two payoff plans that can help you manage your debt. The debt avalanche and debt snowball methods. Both of these methods require you to list out all lines of debt and make payments towards all but one debt. The debt avalanche method lets you use any remaining money left over from other debt payments to put towards your debt that has the highest interest rate. This method will allow you to save the most money on interest.

 

The debt snowball method allows you to pay off your smallest debts first before tackling your larger ones. Helping you build motivation for repaying all your debt. Teaming up with a financial professional to map out your finances is recommended. They can assist you in creating a plan for budgeting, repaying debt and planning future purchases. Which may be beneficial before buying a house with student loans.

3) Refinance Your Student Loans

When mortgage lenders are assessing your debt to income ratio they will look at the amount of student loan debt you have, your interest rate, and the time it will take you to pay them off. A great way to show lenders you are on track to pay off your student loans faster is through refinancing. If you have high student loan debt, refinancing would be a useful step to take. Generally, the sooner you can refinance your student loans, the better.

 

When you refinance your student loans your new lender will pay off your original loans and replace them with a new one at a lower interest rate. Having this lower interest rate will save you money immediately as well as in the long run. It will also prove helpful in saving money for a downpayment on a home. Although this sounds like an obvious step to take, not everyone has the ability to refinance. In order to be approved you typically have to have a good credit score, and an acceptable DTI. Clearly, you can see why a high credit score and low DTI are very important. If you qualify for refinancing, it is highly advised to take advantage of it as quickly as possible.

4) Apply for pre-approval on a mortgage

One of the smartest things you can do to ensure you have the best chance of buying the home you want is applying for pre-approval on a mortgage. Often times, homebuyers make an offer on a home and then apply for a mortgage. Doing it the other way around is actually much wiser. Pre-approval will tell you how much of a loan you qualify for, and what your monthly payment might be. It also gives you an idea of what you can afford in your area, or where the best place to live on your budget might be.

 

Having access to this information can help you determine if you can afford to buy a home in New York, or somewhere like Dallas. To get a better idea of what you qualify for, mortgage lenders will look at your employment history, your DTI, credit history, and assets. It is imperative that those numbers are in good shape before you apply for a mortgage loan. Giving you the best chance of receiving a larger loan, with a lower interest rate.

5) Consider Down Payment Assistance Programs

Many people struggle with the cash down payment that they must make in order to buy a home. This is especially prevalent if you have a significant amount of student loans to pay back. If you find yourself in this situation, there are various types of payment assistance programs. Including federal loan programs, and first-time homebuyer programs. These programs can help ease the burden of down payments, interest rates, and closing costs. With a little research, you can find the perfect one for you and begin the hunt for your first home.

 

Buying a house with student loan debt can be a stressful time, fortunately, there are options to help put your mind and financial situation at ease. By making a concerted effort to work on lowering your DTI, raising your credit score, taking advantage of refinancing your student loans, and teaming up with the right professionals can enhance your chances of getting the home you deserve.

 

Originally Published on Redfin

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What is a 1031 exchange?

Posted on September 14, 2017 by Colleen Craig

What is a 1031 exchange?

Section 1031 of the Internal Revenue Code allows a taxpayer who owns a property held for investment or used in a business to exchange a relinquished property and defer paying federal, state capital gain taxes and depreciation recapture taxes if the taxpayer acquires a “like-kind” replacement property to be held for investment.  This allows taxpayers to potentially use all of the proceeds from the sale of the relinquishes property to leverage into more valuable property, increase cash flow, diversity into other properties, expand business operations, reduce management or consolidate into one large replacement property.

How long do I have for a 1031 exchange between sales?

You have 180 days between the sale of the relinquished property and the closing of the replacement property.  You must identify the replacement property within 45 days from closing on the sale of the relinquished property.

This is for informational purposes only and not legal advice.  To find a 1031 exchange expert in your are click here.

Click here to apply

By Colleen Craig, SocalMtgPro, TheMortgageNinja

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Solar panels and refinancing

Posted on August 29, 2017 by Colleen Craig

Solar panels and refinancing.

It is a problem if you have solar panels if you want to refinance or sell your house?

The answer is that it depends on which type of program you participated in and if you financed them.  When you finance them, there is a lien put on the property.  It can be subordinated to the new first mortgage and most of the solar companies have no problem subordinating.

If you participated in one of the HERO or PACE programs, which means that you are paying it back through the property taxes, you will not be eligible for a conventional loan unless it is paid off through the refinance.  The reason being, that property taxes take precedence over a first mortgage and Fannie Mae and Freddie Mac won’t take second lien position, in the case of a a default.  Currently as of the writing of this, FHA and VA is the only options.

Contact me today if you have any questions about refinancing!

661-310-8536

By Colleen Craig, Socalmtgpro, The Mortgage Ninja

 

 

 

 

 

Posted in Uncategorized | 2 Comments

Mortgage Loan Application checklist

Posted on April 23, 2014 by Colleen Craig

Mortgage Loan Application checklist

LOAN APPLICATION

When applying for a home loan, you will need to supply your lender with…

YOUR PLACE OF RESIDENCE:

•·  If you rent: Name, address and phone # of your current landlord.

  • If you own your home and if your mortgage is not reported to the credit bureau: 12 months canceled checks will be needed (i.e private loans)

YOUR EMPLOYMENT:

•·         Name and addresses of your employers for the last two years.

•·         Copies of your last two years W-2’s and federal tax returns

•·         A copy of your last 2 paystubs.

IF YOU ARE SELF EMPLOYED:

•·         Complete copies of the last two years business and personal tax returns.

    

If you receive child support or alimony and are relying on this income to support your request for credit:

  • Evidence of income receipt (ie canceled checks or a payment history from probation for the last 12 months)

If you receive social security or pension Income:

•·         Copy of the award letter

•·         Copy of the most recent checks received or bank statements showing automatic deposit.

YOUR ASSETS:

(Including checking accounts, savings accounts, money market fund accounts, stocks, bonds and investments)

•·         Copies of all pages of the last two monthly statements or the last quarterly statements for 401k or IRA

CREDIT INFORMATION:

•·  A detailed credit explanation letter for any derogatory credit on your credit report may be required.

  • Proof that any collection accounts, charge offs, judgments and tax liens have been satisfied may be required.
  • Copy of all bankruptcy papers including the discharge of debtor and list of creditors.
  • INFORMATION ON THE HOME YOU ARE SELLING/RENTING.

A copy of the executed sales contract or lease contract.

IF YOU ARE APPLYING FOR A VA MORTGAGE:

•·         Copy of your discharge papers showing an honorable discharge (DD214)

•·         Original Certificate of Eligibility

PERSONAL INFORMATION:

•·         A Copy of your divorce decree and/or property settlement agreement documenting any financial obligation to your previous marriage.

IF YOU ARE REFINANCING:

Copy of your most recent mortgage statements

Copy of your homeowners insurance policy

Copy of your property tax bill

If you are properly prepared with your documentation as early in the process as possible,  You will have a much smoother transaction therefore alleviating any stress that comes with the process.

By Colleen Craig, SocalMtgPro, The Mortgage Ninja

For a downloadable checklist click here

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What is a 203k Loan

Posted on April 19, 2014 by Colleen Craig

What is a 203k Loan

203k MADE SIMPLE

 

In Southern California, FHA loans were just not utilized over the past 10 or so years because of the FHA Maximum Mortgage limits But now that the limits have been increased and the prices have decreased, FHA loans have become the most utilized loans especially for first time buyers.  HOWEVER, because it was not a popluar loan, you would be amazed at how many lenders/brokers and realtors do not know much about them.

So what is a 203k loan and why use one?

 

When a buyer wants to buy a home that needs repairs utilizing FHA financing, normally the repairs would have to be completed prior to the close of escrow.   The repairs would normally fall on the responsibility of the seller.  With so many foreclosures in today’s market, the bank is the seller.  And many times the home in need of repair is listed “as is”.  Which in the past would require a cash buyer or conventional financing.  This is another reason that people in the business decided to shy away from FHA loans.  I believe it was pure ignorance of the programs that were available by the brokers and the realtors couldn’t properly prepare their seller for what to expect that gave FHA loans a bitter taste.

 

 

Here we go….203k loans for dummies

 

*  203k loans allow you to FINANCE the cost of the repairs in the new loan amount. (Not to exceed 110% of the after improved value determined by the appraiser and 203k consultant) What does this mean?  I buy a house for 200,000 that needs 50,000 in repairs and I can borrow the extra 50,000?  Too good to be true?  NOPE.  That’s it in a nutshell….

ok details please………

 

*  Down payment is based on the sale price PLUS the final cost of the repairs x 3.5% so for example:

 

Sale price is 200,000 (DO not calculate 3.5% on this)  PLUS 50,000 in repairs/costs (which includes certain costs and reserves the lender will require) 250,000 x 3.5%.  Down payment is $8750.00 (closing costs are separate as usual)

 

* Buyer will hire (lender can recommend) a HUD approved FHA 203k Consultant to go to the property with the buyer to determine the required repairs and wish list repairs.

 

The fee charged by the consultant can be included in the mortgage.  The fee can range anywhere between $ 400 to $1200 depending on the repairs required.  Please check with the consultant prior to scheduling your appointment.

 

*Buyer will obtain estimates from several licensed contractors for the work to be completed depending on how extensive the repairs.

Three estimates are recommended for each contractor but not necessary.  FHA says that buyer can act as their own general contractor only if experienced and licensed. However most investors do not allow this anymore.

 

The consultant will determine the “required” repairs versus the “wish list repairs”. You must start with the required repairs and then move on from there for you wish list. This is an important step for the consultant and appraiser so that you don’t over improve the home and exceed the comparable properties in the area.

 

Eligible Repairs

 

  1. Structural alterations and additions
  2. Garage (attached /detached/new)
  3. Remodel kitchen or bathroom
  4. Install appliances
  5. Changes to eliminate deterioration and reduce maintenance
  6. Repair swimming pool (up to $1500)
  7. Modernize plumbing/heating/air conditioning/electrical systems
  8. Install or repair roofing /gutters/downspout
  9. Install flooring /title /carpet
  10. Energy conversation improvements
  11. Major landscaping /decks/fencing
  12. Improvements for accessibility ( e.g. handicapped ramp)
  13. Interior and exterior painting
  14. Improvements that are a permanent part of the real estate

 

Ineligible Repairs

 

  1. New Tennis court
  2. Gazebo or bathhouse
  3. Additions or alterations to provide for commercial use
  4. Photo mural
  5. Television antenna or satellite dish
  6. New Swimming pool
  7. Outdoor fireplace/hearth/barbecue pit  (Sorry to those of you in California! Sob)

 

* Once the consultant completes his report of required and wish list repairs, the lender will forward it to the appraiser for an “After Improved Value”.  This is where you may run into problems with OVER improving the property based on current values.  Between the consultant, appraiser and buyer – the FINAL FINAL report will be tweaked to come up with a final report that the contractors will be hired to do.

 

* So now the file is submitted to underwriting and approved ( you need to qualify at the full amount you are borrowing of course, which may include your current mortgage payment for the home you will live in during the rehab period) and the normal steps for closing will occur.

(BIG PLUS – you can include 6 months of mortgage payments in the new loan amount since it’s assumed that you will have TWO housing payments duringthe rehabilitation of the new home.  This money will be deducted each month during the rehab process) This is optional.

* Closing occurs, and the work begins within 30 days of closing/funding. (This is when your mortgage payments start since this is when you started borrowing the money – however, if you included the 6 mths mtg payments, they will be deducted from escrow starting when your first payment is due)

* Disbursements are made throughout the following 6 months from the escrow account (normally 4 draws with one final inspection, but  this can be increased for higher repair amounts) as the work is completed.

Remember you paid the seller for the price of the home, and then you borrowed an additional amount of X which is sitting in an escrow account to pay the contractors (your total loan is the total amount you borrowed)

Once the last disbursement is made and the final inspection showing COMPLETED AS PER THE CONTRACT……..you are done! Simple As 1 2 3  – okay maybe not, but that’s why having an experienced lender on your side is crucial!

There are specific properties and repair requirements for this type of loan, so please contact Colleen Craig FHA 203k Specialist for more details if this program sounds like it might be a fit for your new home

See full size image

Happy Rehabbing

By Colleen Craig, SocalMtgPro, The Mortgage Ninja

 

 

 

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Why committing mortgage fraud should scare you

Posted on October 20, 2011 by Colleen Craig

 

Why committing mortgage fraud should scare you

Be Scared! Be very very Scared!

 

On the theme of Halloween, I feel that it’s a perfect time to talk about being scared in the real estate industry on a daily basis.  Scared of what?  Scared of NOT going to jail of course!

I’m bringing this up because today, I may have lost a realtor partner, but I gained my freedom!

This conversation is becoming more and more prevalent and I’m only trying to EDUCATE those that don’t realize that you can GO TO JAIL for things that you may have done in the past few years without blinking an eye.

 

 

 

 

EXAMPLE # 1 – REALTOR, BUYER AND MORTGAGE REP CAN GO TO JAIL

I was asked from one of my realtors to qualify a buyer a few months ago.  Unfortunately he is in the process of losing his home and would not qualify for a new mortgage at this time.  Today I received a call from the same agent who apparently had continued to show him properties over the following weeks (unbeknownst to me) and was ready to put an offer in and needed a pre-qualification letter from me.  And I was told not to worry because his daughter was going to buy it in her name.

WHAT?  Hold the phone mable!

So I request the information from the daughter only to find out that she herself lost her home to foreclosure a few years ago.  Now, she WAS able to obtain a new mortgage under FHA financing because of the time period that passed from her foreclosure, however……….obtaining an FHA loan would mean an OWNER OCCUPIED mortgage and she currently lived and worked 40+ miles away from the home her father wanted to buy (Los Angeles traffic which could be a 2.5-3 hour commute each way).

Dear Mr. Realtor….regardless of the fact that I KNOW she is not going to occupy the residence, even if i WANTED to pretend i didn’t know, (which I won’t do)  there is NO WAY an underwriter would BELIEVE that she was going to move and turn her 10 minute commute to work to a possible 6 hour daily commute.  And by the way, this is considered MORTGAGE FRAUD and YOU could go to jail along with me.  Mr. Realtor said, no I can’t, I would just say that she TOLD me she was going to live there, so i didn’t know anything.   You are defrauding the bank. This is OCCUPANCY fraud.

THIS IS WHERE MOST REALTORS ARE WRONG…….did you know that the FBI is sending agents to doc signings to investigate fraud on the spot?  Yes, you heard me right.  Did you know that if you play dumb, not only would the judge say “It’s your JOB to know!”, the FBI would go through all your emails and files to prove that you did know?  And that you would be prosecuted for conspiracy of mortgage fraud?  Do you look good in orange?  I sure don’t.!

If you don’t believe that the FBI is investigating in your backyard, here are just a few more examples.

EXAMPLE # 2  – PARALEGAL GOES TO  JAIL

Paralegal sentenced to 3 years in prison for her part in mortgage fraud:  her part? Preparing loan documents and doing doc signings for files that turned out to be fraudelent.  Full story HERE

EXAMPLE # 3. – BUYERS FACE 3 YEARS IN JAIL

Mesa police officer and wife arrested on mortgage fraud for pretending to separate in order to obtain a loan modification on their home in order to purchase a bigger home together.  They were facing 3 years in prison. He was forced to resign and she accepted a plea and they are both on probation.  .. Full story HERE

 

And this…..have you seen America’s most wanted …..how’s this one look for your HEADSHOT?

 

Yes there are more sophisticated fraud schemes, but the next time you think that things just don’t seem right, it’s your job to LOOK deeper and find the red flags…because IT’S YOUR JOB TO KNOW.

So I say, LOSE a DEAL and SAVE your FREEDOM!

I will be keeping my realtors up to date with future arrests only to EDUCATE and PROTECT them with their careers, and both of our FREEDOM.

Just remember, no matter how bad you need the money…..it’s not worth losing your freedom, your license, career, family, reputation and going to jail.  Think twice…..and save  your career hence your life!  So this why committing mortgage fraud should scare you!

 

Posted in 203k Loans, FHA LOans, Uncategorized | Tagged , , , , | 1 Comment

I can pick my own interest rate?

Posted on August 31, 2011 by Colleen Craig

I can pick my own interest rate?

How come other lenders haven’t told me that I can pick my own rate?

Before I get into the rates and fees, make sure you check to see that the loan professional you are working with is actually LICENSED with the NMLS which I explain why here and you can check by clicking here

Ok here’s the skinny on how interest rates work:

Interest rates can change daily and even hourly and are priced based on several things called RISK factors.  Remember, the bank/ investor makes their decisions and pricing based on the likeliness of getting paid back.

  1. Loan Amount
  2. Loan to value (sale price divided by Loan Amount)
  3. Credit Score (middle of all three)
  4. Purchase or Refinance (cash out or not for refinance)
  5. State and County of home (collateral)
  6. Qualifying Ratios (Debt to income ratios)
  7. Condo,Single Family, Duplex or Multi Family
  8. Length of time for lock period (25, 30, 45 days – longer time needed, the higher the price)
  9. Owner Occupied or Investment property

Now, once all this information is provided, we PRICE IT OUT and get our quotes.  (Banks only have ONE option, while mortgage Bankers have Many banks and investors to pull quotes from – therefore getting you the best possible rate at that time)

This is where it gets tricky.  We get a spread of rates to choose from.  I call this above, at or below the line.

Each rate offered either pays back money (points) above the line, or costs money to get – below the line

(Rates below are just an example to make it easy to understand and is not a current rate quote)


If the rate is PAR, this means the company must charge you the company minimum (otherwise they would be doing the loan for free, which wouldn’t be worth your business) Most likely, no less than 1 point.  (Average could be about 1.5%)

If the rate you choose is giving Back money, then you must use it towards your closing costs.  If the bank/seller is paying your closing costs, then you would need to choose one of the other rate options.  Some loan officers won’t even give you an option only because they know how the loan should be structured the best for you but won’t take the time to explain it to you.

The other thing to look at when comparing rates is the FEES. There are NORMAL operating fees and what some people call JUNK fees.  I honestly haven’t seen many junk fees lately due to regulations, but these are the most common operating fees:

  1. Processing Fee
  2. Underwriting Fee
  3. Document prep Fee
  4. Application Fees
  5. Credit Report Fee
  6. Tax Service Fee

Be sure to see what the Mortgage company fees are and break them out of the ENTIRE list of fees.  We are required to estimate all third-party fees when doing our estimate, so it can get a little confusing as to which fees belong to which party.

Be sure to compare rates on the same day and preferably at the same time if the market is moving quickly in either direction.

Some banks or credit unions will only change their rates once a week which might not give you the best rate if the market has since moved in a favorable direction.

So to recap, the questions you should be asking when comparing the company’s once they have your details.

  1. Is the loan officer personally Licensed with the NMLS
  2. What are the rate options with and without points
  3. What are the mortgage company specific fees
  4. How long is the rate good for (if the rate expires before you close, you may incur an extension fee)

So don’t always ASSUME that the rate on your approval letter is the rate you are getting.  I personally qualify my clients at the Highest rate with the highest fees to leave room for the market to move, so that you don’t find a home and not qualify because the rates have moved during your search.

As always, make sure you are working with a professional that you can TRUST to be there with you throughout the entire process.

Happy  Hunting!

Serving all of Sunny California!

By Colleen Craig Socalmtgpro, The Mortgage Ninja

(661) 310-8536

Posted in Closing Costs, Interest Rates | Leave a comment

There is a fire sale on real estate!

Posted on February 20, 2011 by Colleen Craig

There is a fire sale on real estate!

Bloomingdales is having a sale!  90% off everything in the store!  But I think I’m going to wait?

Wait….for what?

I think they might have a 95% off sale……okay…you wait for that, I’ll be back!

==

Now if that were true of Bloomingdales or ANY store, would you wait?

I just had this conversation with my client that I’ve been working with for over a year.  They were in escrow but canceled the escrow because of termite repairs.  I followed up with them a little while after they canceled the escrow and this is what they told me.  We think we are going to wait because we think things will go lower.

Alrighty then.

Now my next call was from a client who is a real estate investor that lives in Beverly Hills.  We were working out how he could finance the 9th property he was about to buy this year.   He was like a kid in a candy store.

 

real estate investors

I wished I could have let the first client listen to the conversation with the second client.

So how do we educate people without sounding like we are just self serving sales people trying to make a buck?

The FACTS ….the facts……and nothing but the facts……

real estate facts1.      My burberry rain boots were normally 226.00 and now they are 22.50! (not true But if it were,) Good deal? DUH!

2.       Rates haven’t been this low for anyone in this lifetime.  Good deal?  DUH     (This is FACT!)

There is a FIRE SALE on real estate……….DUH!  (THIS IS FACT)

Santa Clarita Real Estate FIRE sales………

Now I ask again……there is a fire sale on real estate….interest rates are at their lowest……..are you still going to wait?

If so…..good luck and I’m sorry you couldn’t make it to the party!

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Is your Loan officer a Big talker but couldn’t pass the mortgage exams?

Posted on February 1, 2011 by Colleen Craig

Is your  loan officer a big talker but couldn’t pass the mortgage exams!

Lawyers pass the BAR exams in order to practice law.   

CPA’s, Accountants and tax attorney’s all pass different tests in order to obtain their designations.

Doctors , Surgeons and dentists pass a multitude of exams in order to practice medicine.

And NOW loan officers must pass extensive exams in order to originate loans!

IS YOUR LOAN OFFICER LICENSED OR JUST REGISTERED?

What is the Difference?

There’s a lot of alphabet soup out there when it comes to registration and licensing.  DRE, DOC, NMLS etc.  What does it all mean? If a loan officer has their real estate license, does that mean they are LICENSED?  Nope! Not under the NMLS !

Effective July 1, 2010 all Mortgage Bankers and Mortgage Brokers Across the country will require their loan originators to be licensed through the NMLS (Nationwide Mortgage Licensing System)

However! Based on an exemption in the laws, the big Interstate Chartered Banks do not require their loan originator working for a big bank such as Chase, Wells Fargo and Bank of America to be licensed. Currently they only require them to be REGISTERED with the registry.

The S.A.F.E. Act states:  The Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (the S.A.F.E. Act) requires the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Office of Thrift Supervision, the National Credit Union Administration, and the Farm Credit Administration (collectively, the Agencies) to jointly develop and maintain a Federal registration system for individual employees of Agency-regulated institutions who engage in the business of residential mortgage loan origination. The statute requires these individual mortgage loan originators to be registered with the Nationwide Mortgage Licensing System and Registry (Registry), a database established previously by the Conference of State Bank Supervisors (CSBS) and the American Association of Residential Mortgage Regulators to support the licensing of mortgage loan originators by the States.

Is your loan officer licensed?  You can find out here:

http://www.nmlsconsumeraccess.org/

In order to get LICENSED, loan officers (not working for a Chartered Bank)  must go through extensive testing, background and credit report checks etc.

Here is a chart to show the differences between what is involved in getting licensed. Please note, that some Chartered banks require internal background or credit checks as they would ALL employees.  This only applies to the NMLS requirements for loan officers.

SAFE ACT CA LO’s Chartered Bank LO’s
Licensed Yes No
FBI Background Yes No
Fingerprinted Yes No
Assurity Bonded Yes No
20 hours upfront education Yes No
8 hours continuing education Yes No
Credit checked Yes No
Fed and state testing Yes No
Complaint mechanism Yes No
Licensing  fees and renewals Yes No

.I’ve come across many loan officers that talk a big game.  They bad mouth other loan officers, they rip their articles apart, they make it sound as though they are the only game in town.  Yet, I’ve recently looked up these bully’s only to find that they were unlicensed and unable to pass the National and state exams.

If you fail, you must wait 30 days to test again, if you fail a second time, you must wait another 30 days, and a third time?  You guessed it, you must wait another 30 days.  If you fail the 4th time, you must wait to retest and  are unable to originate loans for 6 months!

I’ve heard of loan officers that have failed and are somehow still originating loans!  How Is this possible?  Well it all comes down to enforcement.  These loan officers are most likely putting the loan applications in another loan officers name (someone who is licensed) and they are probably working out a commission deal illegally under the table.

So if you have applied for a loan, and the last page of the application is not signed, or is signed by a name you have never heard of?   Most likely that loan officer you applied with is not licenced and was unable to pass the tests or background checks.

DO you want to know of your loan officer is licensed?

 

So, the next time you speak with a loan officer that is talking a big game.

Check to see if they have their NMLS license and make your own decision!

NMLS# 254430

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