Texas Home Loan Blog: July 2009

  This is a very CRITICAL UPDATE and anyone using the USDA loan, or if you KNOW of someone using USDA loans, please pass this blog link along, or RE-BLOG it to your sphere!!

I have included at the bottom of the BLOG, the entire list of loan coordinators within the United States of America!  Email first if you can! 

 

   Also, check out the music video at the end as well!

 

The reason for this update is because the USDA is experiencing it's highest volume since the inception of the program! 

************************** 

 

BEFORE I SUMMARIZE the changes, we need to first cover LENDER OVERLAYS!

What is a Lender overlay you ask?  Well, Im glad you asked!  Thanks!

A Lender overlay is a requirement that a specific LENDER has, that maybe another Lender does not have!  For example, if you speak directly with a USDA office about a specific requirement on a loan application, offer to purchase, or confront them about a situation, and you get a FAVORABLE RESPONSE, it may not mean anything at all!  WHY?  Because the LENDER that is UNDERWRITING and approving the loan PRIOR to the loan going to the USDA, may have a sticter rule, or may not approve a loan under those circumstances!  Hence, enter the LENDER OVERLAY! 

Another example, JP Morgan Chase & Taylor Bean & Whittaker, are the only two companies I AM AWARE of that allow a USDA loan product to be processed as a "Subject to" appraisal, or as a "fixer upper" loan!

Wells Fargo, and other companies do not!  Why?  Because they have LENDER OVERLAYS! What this is REALLY telling you is that they dont understand them, dont want to have anything to do with them, and aren't we all afraid of the unknown?  They do not want to take the risk!  Who does today?

NOW TWO VERY QUICK THINGS TO WATCH FOR IN THE COMING DAYS! 

 Realtors-  If you are not getting them already, start watching for a CHANGE in loan committments!  Loan committments are going to start coming through with stipulations on them!  This isn't a bad thing necessarily, but you will start seeing approvals come through that say..."this loan approval is SUBJECT TO an acceptable appraisal, and any other further sitpulations put forth by the Rural Development office!

Lenders-  Start looking over your appraisals WAY more closely!  DO NOT RELY on your internal underwriter,manager, or processor!  LOOK AT THE DARN THING YOURSELF!  A friend of mine recently had her USDA loan suspended, due to the site value being 30.10% of the appraised value!  Limit in USDA loans is 30%.  Yes, it is only 1/10th of 1 percent, but look at the grief we are getting!

 

Okay, now on to the summary!

  

 Let's first talk about rate locks!

 Rural Development has experienced a HUGE increase in volume.  Directly from the USDA, they are asking both Lenders & Realtors alike to allow ample time for a review of the file and a response.  "Plan accordingly with your rate locks and loan closings. Contacting Rural Development multiple times as a Lender,Broker,Realtor, or borrower, will only delay your important request. "  In other words folks, be patient!  Lenders, make sure your Realtors understand time frames and turn times!  Realtors, take your heart medication and drink lots of fluids!   In other words, plan for an extended delay in high volume processing areas!

 

This is a quote from the USDA alert regarding CONTACTING the RD office!

"While many parties are anxious for their request to be acted upon, commication concerning guaranteed loan applications will occure between the Rural Devlopment and the approved Lender.  Brokers, correspondent lenders,Realtors,or potential borrowers,etc..should communicate with the approved lender, NOT Rural Development."

 

 Lenders

The Guaranteed Underwriting System (GUS), will reduce proceesing times and allow approved lenders to verity loan data for accuracy in a timely manner!  Here's the rub tho:  There are MANY new GUS rules that may REQUIRE ADDITIONAL DOCUMENTATION to be submitted on "ACCEPT" loan files when a "final" underwriting submission is executed. 

Read all  your findings!  What does this mean to Realtors?  Well, sadly, they can add things at the end!  I know we don't like hearing that...but they can!  Tough!  However, communication is VERY important on this!

   

 

 Okay, now here are Bucky's Tips & Best Practices straight from the USDA!

Any of these changes may adversely affect your Conditional Loan Committment!

 

1.  if the loan amount increases

2.  if the loan interest rate increases

3.  if there is an increase in mortgage or personal liabilities

4.  if there is a decrease of assets, and/or the income decreases 

 

 

 How about an example?  Let's say, your customer is buying a home.  They get their Conditional Loan Committment and everybody is happy!  House is inspected and/or appraised, and it is determined that the house needs a new roof.  Seller refuses to pay for it!  Well, the USDA plan allows for a new roof to be financed!  Hurrah!  However, that spells DELAY!  Hence, the loan amount increases,the mortgage liability increases, and more than likely the debt ratio goes up!  This means that it will need to go BACK to underwriting!  Sometimes this is 1 day, or 1 week!  Depends on volume!  PLAN AHEAD!

 

LASTLY

USDA LOANS DO NOT REQUIRE HOME INSPECTIONS!  Hello??  Bueller??

Click HERE for the income limits link

 Click HERE for the income income eligibility link

Click HERE for the property eligibility link

 

 THE FOLLOWING STATEMENT BELOW IS DIRECTLY FROM THE USDA!

         Sign up for our email distribution list to receive timely updated information regarding program origination, GUS underwriting or servicing.  Sign up at:  http://www.rdlist.sc.egov.usda.gov/listserv/mainservlet.

  

STATE	CONTACT	PHONE #	EXT.	FAX #	E-MAIL ADDRESS
AK	Karen LaMouria	(907)761-7732		(907)761-7794	klamouri@ak.usda.gov
AL	Al Butler	(256)532-1677		(256)532-1931	al.butler@al.usda.gov
AL	Lou Rambo	(334)279-3442		(334)279-3448	lou.rambo@al.usda.gov
AR	Linda McCaslin	(501)301-3235		(501)301-3290	linda.mccaslin@ar.usda.gov
AS	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
AZ	Earl Tatlow	(602)280-8709		(602)280-8879	earl.tatlow@az.usda.gov
CA	Annete Joyer	(916)714-1104	107	(916)714-1118	annette.joyer@ca.usda.gov
CA	Ed Amen	(530)226-2589		(530)226-2567	ed.amen@ca.usda.gov
CA	Nellie Nunez	(559)734-8732	110	(559)732-3481	nellie.nunez@ca.usda.gov
CA	Viloet Gomes	(831)757-5294	106	(831)424-7289	violet.gomes@ca.usda.gov
CO	Jamie A Spakow	(720)544-2918		(720)544-2970	jamie.spakow@co.usda.gov
CT	Arlene Nunes	(413)253-4300	4333	(413)253-4347	arlene.nunes@ma.usda.gov
DE	Stacey Slacum	(302)857-3603		(302)857-3611	stacey.slacum@de.usda.gov
FL	Bob Coordsen	(352)338-3435		(352)338-3437	bob.coordsen@fl.usda.gov
FL	Roger Taylor	(352)338-3435		(352)338-3437	roger.taylor@fl.usda.gov
FM	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
GA	Ashley Carlan	(706)546-2169		(706)613-3046	ashley.carlan@ga.usda.gov
GU	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
HI	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
IA	LindaKay Rhoades	(515)284-4723		(515)284-6668	linda.rhoades@ia.usda.gov
ID	Pamela S. Cook	(208)378-5628	1	(208)378-5643	pamela.cook@id.usda.gov
IL	Lindsey Rademacher	(217)403-6216		(217)403-6231	lindsey.rademacher@il.usda.gov
IN	Vince Maloney	(317)290-3100	414	(317)290-3096	Vincent.Maloney@in.usda.gov
KS	Kevin Culley	(785)271-2722		(785)271-2784	kevin.culley@ks.usda.gov
KS	Tim Rogers	(785)271-2718		(785)271-2784	tim.rogers@ks.usda.gov
KY	Don Johnson	(859)224-7361		(859)224-7450	don.johnson@ky.usda.gov
LA	Scott Pousson	(318)473-7630		(318)473-7829	scott.pousson@la.usda.gov
MA	Arlene Nunes	(413)253-4300	4333	(413)253-4347	arlene.nunes@ma.usda.gov
MD	Stacey Slacum	(302)857-3603		(302)857-3611	stacey.slacum@de.usda.gov
ME	Dale D. Holmes	(207)990-9110		(207)990-9119	dale.holmes@me.usda.gov
ME	Lorrie Hamlin	(207)990-9110	113	(207)990-9119	lorrie.hamlin@me.usda.gov
MH	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
MI	Kevin Smith	(888)771-6993	113	(517)676-1909	kevin.smith@mi.usda.gov
MN	Linda Behrendt	(651)602-7797		(651)602-7825	linda.behrendt@mn.usda.gov
MO	Nathan Tutt	(573)876-0990		(573)876-9348	nathan.tutt@mo.usda.gov
MO	Randall L. Griffith	(573)876-0976		(573)876-9348	randy.griffith@mo.usda.gov
MP	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
MS	Ivan Kiani	(601)965-4325	133	(601)965-4561	ivan.kiani@ms.usda.gov
MS	Robert (Don) Thames	(800)548-0071	146	(601)965-5384	Robert.Thames@ms.usda.gov
MT	Laura Horn	(406)585-2559		(406)585-2565	laura.horn@mt.usda.gov
NC	Dale Darroch	(919)873-2036		(919)873-2075	dale.darroch@nc.usda.gov
NC	Mel Ellis	(919)873-2041		(919)873-2075	mel.ellis@nc.usda.gov
NC	Neal Sherrod	(919)873-2059		(919)873-2075	neal.sherrod@nc.usda.gov
ND	Barry Borstad	(701)530-2046		(701)530-2111	barry.borstad@nd.usda.gov
NE	Krista K. Stevens	(402)437-5518		(402)437-5408	krista.stevens@ne.usda.gov
NE	Michael Buethe	(402)437-5574		(402)437-5408	mike.buethe@ne.usda.gov
NH	Colleen Ladew	(603)223-6035		(603)223-6061	colleen.ladew@nh.usda.gov
NJ	Neal Hayes	(856)787-7732		(856)787-7737	neal.hayes@nj.usda.gov
NM	Art Garcia	(505)761-4973		(505)761-4977	arthur.garcia@nm.usda.gov
NV	William L. Brewer	(775)887-1222	13	(775)885-0738	william.brewer@nv.usda.gov
NY	Janette Smith	(607)753-0851	4	(607)753-3190	janette.smith@ny.usda.gov
OH	Jerry Greenbaum	(614)255-2405		(614)255-2561	Jerry.Greenbaum@oh.usda.gov
OK	Jackie Walther	(405)742-1070		(405)742-1084	jackie.walther@ok.usda.gov
OK	Richard Himbury	(405)742-1079		(405)742-1084	richard.himbury@ok.usda.gov
OR	Rachel Shultz	(503)414-3337		(503)414-3394	rachel.shultz@or.usda.gov
PA	Jeremy Wilson	(717)237-2277		(717)237-2193	jeremy.wilson@pa.usda.gov
PA	Rob Lane	(717)237-2275		(717)237-2193	robin.lane@pa.usda.gov
PR	Arlene Zambrana	(787)766-5095	222	(787)281-4993	arlene.zambrana@pr.usda.gov
PW	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
RI	Arlene Nunes	(413)253-4300	4333	(413)253-4347	arlene.nunes@ma.usda.gov
SC	George Randolph	(803)253-3094		(803)253-3827	george.randolph@sc.usda.gov
SD	Kathy Chase	(605)352-1132		(605)352-1154	kathy.chase@sd.usda.gov
TN	Tom Favreau	(615)783-1364		(615)783-1391	tom.favreau@tn.usda.gov
TX	Joyce McGlothlin	(254)742-9763		(254)742-9735	joyce.mcglothlin@tx.usda.gov
TX	Leon Carey	(254)742-9772		(254)742-9735	leon.carey@tx.usda.gov
UM	Stephanie Taketa	(808)933-8308		(808)933-8327	stephanie.taketa@hi.usda.gov
UT	Kristine Dahlberg	(801)524-4329		(801)524-4406	kristine.dahlberg@ut.usda.gov
VA	Agnes Rollins	(540)433-9126		(540)432-1707	Agnes.rollins@va.usda.gov
VA	Byron Waters	(804)287-1547		(804)287-1784	Byron.Waters@va.usda.gov
VA	Gwen Fender	(804)287-1598		(804)287-1784	Gwen.Fender@va.usda.gov
VI	Bob Coordsen	(352)338-3474		(352)338-3437	bob.coordsen@fl.usda.gov
VI	Roger Taylor	(352)338-3495		(352)338-3437	roger.taylor@fl.usda.gov
VT	Bob McDonald	(802)828-6013		(802)828-6018	bob.mcdonald@vt.usda.gov
VT	Michael Bard	(802)828-6013		(802)828-6090	michael.bard@vt.usda.gov
VT	Rita Weisburgh	(802)828-6003		(802)828-6067	rita.weisburgh@vt.usda.gov
WA	Benjamin (Ed) Reynolds	(360)704-7765		(360)704-7718	WA-grh@wa.usda.gov
WI	Julie Czappa	(715)345-7620	119	(715)345-7699	Julie.Czappa@wi.usda.gov
WV	Scott Mullin	(304)263-6461	110	(304)267-9172	scott.mullin@wv.usda.gov
WY	Shauna Gibbs	(307)233-6722		(307)233-6739	shauna.gibbs@wy.usda.gov

 

 Some more good music for ya! Click on the You-TUBE logo!

 

 Thanks for reading & Keep selling!

 

-Darin-

 

As always, I welcome your concerns,comments,issues and suggestions!  Darin@Osmwi.com

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Metroplex Appraisal Services is a proud sponsor of the DFW Amp Event at Blackfinn in Addison, Wed July 15th. Door Prizes, $2 Draft Miller Lite & Coors Light Beer, $3 Well Drinks & House Wines, $3.95 Appetizers, Cold Drinks - Good Food Great Networking!!!

 

AMP Networking Realtor and Mortgage Industry Event

Wednesday, July 15th
5:30 PM to 8 PM

$2 Draft Miller Lite & Coors Light Beer
$3 Well Drinks & House Wines
$3.95 Appetizers
Cold Drinks - Good Food
Great Networking!!!

Join us at our new venue - Blackfinn in Addison Texas

Usually 150+ people attend the Dallas AMP Networking Event - see the Photos Below!

4440 Belt Line Rd.
Addison, Texas 75001
469.374.7667

BlackFinnDallas.com/ADDISON

Click Here For Map

 

 

 

 

 

Join our Door Sponsor

This Month's Sponsor

Kristen Hagberg
TriNet Total HR Services

(214) 288-7416 Mobile
kristen.hagberg@trinet.com

AMP Networking promotes & provides FUN events, education and travel opportunity to deepen business and social relationships, improve networking, and further career opportunities for mortgage industry professionals. Our member invitation list is over 10,000, and 900 people attend our Mortgage Industry Networking events every month in Dallas & Tarrant County, Houston & Austin.

 

FHA loans seem to be one of the main choice of mortgages in the last 6 months or so. There are several reasons for this, which should be spelled out below in my comparison. What I hate hearing is that FHA mortgages have taken the spot of the subprime loans. This is not true by any part of the imagination. This statement is from those that are inexperienced in both the mortgage and the real estate industries. The realization has been that 30% of the subprime mortgages in the last 5 years previous to the last 2 years should have been FHA mortgages, not subprime.

 

To compound this, so many said just because you had a conventional loan, you had the better loan. This was not always true when putting 3% or even 5% down. In most cases, you were told this, because that particular lender was not FHA approved. Now?  Even with 10% down and credit scores less than 680, FHA loans in many cases, will be the best mortgage for you. You want to see a shocking example?  Here is an example of 20% down and it shows that the FHA loan was still better. Please read : FHA Loans vs Conventional Loans - 20% down - A Rude Reality Check

 

 

 

So you could argue the fact that this is my opinion, that FHA loans in many cases would be better for you. True, even though I have over 16 years of experience as a loan officer in the mortgage industry. But numbers don't lie. Let me show you.....

 

The example below is based on a $280,000 purchase price with 5% down. One reason why conventional rates are a little higher in this scenario as in FHA rates is because Fannie Mae and Freddie Mac have added penalties per se. If you are putting down less than 30% and your credit score is less than 720, certain fee penalties would apply to you, which would increase your rate.  The FICO (credit score) that I am going to use is 679, which is above the average credit score and I will still show in this example that FHA loans are cheaper, even with 5% down.  

 

***And keep in mind, some lenders have penalties on FHA mortgages with credit scores under 660. And many lenders can't do FHA loans under 620. Just beware of those that promise you a mortgage with scores under 620. It can happen, but they aren't as easy as advertised.***

 

 

 

 

 

 

 

 

 

Disclaimer :  These rates are examples, but the spread shown in the example is real. To compare this scenario apples to apples, the fees are the same and with zero points. In this scenario, there is a $475 commitment fee and points. The conventional rate also includes the penalty for the 679 credit score.

 

 

Some of you might be saying that you will be adding $4,655.00 onto your principal balance if you did the FHA mortgage because of the FHA one-time mortgage insurance premium. This is correct and I don't want to confuse you with more numbers and charts. But here is a quick breakdown. If you kept your house for 5 years, you would have saved $11,916 in payments in 5 years. Subtract the Upfront Mortgage Insurance premium from the monies saved in 5 years and you have saved a difference of $7,261.00!!!   And one other thing that is very small, but still makes a difference. You will be subtracting a few more dollars per month from your principal because your interest rate is lower, which would offset the interest that you would write off on the 6.25% rate. Just something else to remember, but consult your tax consultant or CPA.

 

 

Lastly, keep in mind that depending on the area that you are buying or refinancing in, that you might not be able to get a conventional loan unless you have 10% down or a 90% LTV. The reason being is the mortgage insurance companies and how they view certain geographical areas and declining market areas.

 

 

 

For more FHA loans vs conventional loans comparisons :

• FHA loans vs Conventional loans - A true numbers comparison with 5% down - Using a 710 credit score
  

• FHA loans vs Conventional loans - A real comparison with 5% down - Using a 659 credit score
  

• FHA Loans vs Conventional Loans - 20% down - A Rude Reality Check - Would you believe that FHA loans could be cheaper even with 20% down?  Come see why and how.

• FHA Loans vs Conventional Loans - 5% - 4 comparisons that you need to know - Comparing a FHA loan against 3 types of conventional loans with different types of monthly mortgage insurance. Guess who won while still using a 679 credit score.....

• FHA loans vs Conventional loans - Knowing the true comparisons - A great comparison with a 679 credit score and 5% down.  This example will still show that even with a better than average credit score, that FHA loans are still better in many cases.
  

 

 

 

                    

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Experience & Knowledge at its BEST !!!

 

_________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For more information about the 2009 Tax Credit for First Time Homebuyers : 2009 Tax Credit

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!

Copyright © 2009 by Jeff Belonger of Infinity Home Mortgage Company, Inc

I'm going to be in Dallas on July 17, 2009 and will be teaching two of my fabulous classes:

Creating an Internet Presence & Converting Cyberleads and Painless Prospecting

Creating an Internet Presence & Converting Cyberleads- 9am-11:00am

Learn the basics of how to create an internet presence in order to help capture more buyers and sellers doing their research online.  Learn how to convert these "cyberleads" into Clo$ed $ales, putting more money into your pockets!

Painless Prospecting- 11:30am- 1:30pm

Get back to the Basics with prospecting the painless way.  Learn some easy ways to prospect that won't hurt your pocket book or make you feel like putting prospecting off another day, week, month...

Each class is 2 hours of MCE credit and you can take either just one or both.  It's $20 for one class or it's $37 for both classes.  Also, if you take both classes, you'll receive a FREE lunch provided by The Dallas Loan Guy, Tom Burris.

Yes, classes are soon coming to Austin and San Antonio, but if you can't wait, you might want to make the drive to Dallas (Plano).

Seating is limited, so please RSVP to me, Donna Harris, at 972-407-3908 or donna@donnahomes.com.

Location is:
Republic Title Corporate Headquarters
2701 W Plano Parkway #100
Plano, TX 75075

Cash or Check accepted on the day of the class.

Please reblog as you see fit and pass along to all the agents in your offices, and if mortgage people could pass this along to their databases as well, that would be swell!!

**Are You Packed Yet?**

Donna Harris, REALTOR®
RE/MAX Austin Skyline
www.DonnaHomes.com
Donna@DonnaHomes.com

Austin, TX real estate and the surrounding areas of Lakeway, Bee Cave, Westlake Hills, Cedar Park, Round Rock, Spicewood, Circle-C, Steiner Ranch, and everywhere in between... Whether you're buying or selling, I'll be with you through the entire process. 

 

     Have you been listening to the media lately?

 

Many are saying that the housing market has hit bottom and the economy is on the way to a recovery. To these people I say nonsense! As a mortgage banker who fields calls for refinancing and purchases every day I can tell you this is a false statement which is harboring false hope. I have my finger on the pulse and it is not good. Here is a snapshot of how I see it -- like it or not.

 

 

 

The stock market is still 40% off where it was just a year or so ago. And in my opinion will continue to head the wrong way. Unemployment is up. Way up! In fact it will likely go over 10% next month. That means if you put 50 Americans in a room, 5 of them will be unemployed. 1 in 5 American home owners are under water! Foreclosures continue to rise. A recent report shows that 1 out of every 4 homes are delinquent on their mortgage. If you live in a neighborhood of 50 houses, 12 of your neighbors could be facing foreclosure. Staggering!!!!

 

Here is my finger that is on the pulse and this is what it is telling me.

I am approving fewer loans than I did last month and the month before that.

Housing prices continue to sink at an unthinkable pace.

Credit scores continue to drop.

Income continues to drop.

Personal debt continues to increase.

 

 

So what can I do about this you ask? First of all, hunker down. Change your spending habits. Stop using credit to purchase things. Cut up your credit cards. Call your creditors and ask if they have any programs to help eliminate your debt faster and less costly. Pay your mortgage, autos, electric and feed your family first! Do not let unscrupulous creditors and collection departments bully you. And finally this may come as a shock to you hearing this from a mortgage banker, do not open a line of credit or a second mortgage. If at all possible, do not consolidate your bills into a new mortgage and eat up the remaining equity in your house. These may be moves you never recover from.

 

In my opinion, this country is in for a more serious economic crisis than most so called experts have ever predicted. I see this stuff every single day and I am living this nightmare right along with you. My mission is to provide you with honest answers to your questions. Possibly selling your home and moving “down” makes the most financial sense. Maybe, walking away from your house or negotiating a short sale makes the most sense.

 

 

Seek high quality advice and a get a complete credit check up from someone who has a heartbeat and NOT a dollar sign in mind. It may be the most important move you ever make.

 

Mortgage rates this week should be --  HIGHLY  VOLATILE