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Lance Mohr & Team

Tampa2Enjoy.com

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Mortgages

#1 Concern With Mortgage Lenders – In Today’s Real Estate Market

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A lot of loan officers in the Tampa area are very complacent with the real estate market so good. Learn what to do and what questions you need to ask. With the real estate market being so hot in Tampa Bay many loan officers (lenders) are becoming more and more complacent. So I have been doing their job for them and explaining the different loan programs and closing costs to my buyer for them. Thank goodness I was a loan officer and I know a lot about mortgage loans, closing costs and programs.

What you need to do when you talk to a loan officer is get a Loan Estimate (LE). This will give you a breakdown of all your reoccurring and non-reoccurring closing costs. Then ask the loan officer to go over the different costs with you so you have a good understanding.

It’s also a great idea to ask the loan officer if there are other loan programs that you are qualified for and to go over the pros and cons of each loan program.

Transcription

Hi everyone. This is your Realtor Tampa Bay Lance Mohr. In this video, I want to talk about why loan officers in Tampa and probably everywhere in the United States right now are very complacent and what you need to do about this.

I wanted to do this video because this week I had several buyers. A couple that was local first time home buyers and then some that we’re relocating to Tampa and one thing I noticed just how complacent loan officers have gotten now. I talked about this a weeks ago but I want to bring up a little bit different twist and what you need to do about this.

In Tampa right now our market is really busy. So I think again everybody is getting complacent. Realtors, loan officers, builders, inspectors, everybody and I’ve just noticed a lot of time when first time home buyers are going in and getting a loan. The loan officers are not taking the time to really explain the different loan programs to them. They’re not taking the time to explain the lender's estimates called the LE and going over different closing cost and when someone’s coming in from out of state they’re used to different closing cost or different procedures in the state they are coming from and the loan officers. What they are doing is they’re basically directing everybody to their website. They’re saying fill out an application. They’re filling out an application. They may send them a lenders estimate, they may not. They’re supposed to but even if buyers are calling and getting pre-qualified. They’re not really going over everything with them. They are not explaining things to them like different types of state taxes and how things work here.

What I would say is this. When you talk to a loan officer and you get a quote. Whether it’s on the interest rate of closing costs. Get everything in writing from him. Ask him to send you a lenders estimate and go over all the different cost with them and have him explain it to you. I know when I was in lending years ago. I always did this to people and when I was working with them whether they’re a first time home buyer or a second time home buyer. I always went over the different options with them on loan programs and told them the advantages, disadvantages and let them pick out what was best for them. And a lot of cases they just simply asked me well what one would you go with and why.

So you need to start asking questions because I see so many buyers out there they are just getting information from these lenders and what’s happening is I’m having to step in as a real estate agent and explain the different loan program, the different closing costs and it’s okay because I understand this. I was a lender for so many years. I was a co-owner of a mortgage company but very few real estate agents understand anything about loans and most of them just say oh we’ll just ask the loan officer. It’s unfortunate and I know a lot of people that are watching this video are not in Florida or certainly not in the Tamp Bay area but just make sure to talk to the lender. I mean the loan officer and ask them.

If you have any questions don’t hesitate to give me a call (813-317-4009). I’d be more than happy to help you or just shoot me an email. If you like my videos subscribe. Hit the bell button and you’ll be notified and give me a thumbs up or leave a comment. Have a great day! I hope this helps you. Here is my YouTube Channel https://youtube.com/tampa2enjoy for more educational real estate videos.

FHA Loans – The Pros and Cons

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This video goes over some of the pros and cons of getting an FHA loan. An FHA loan is one of the most popular loans home buyers get. FHA loans have a lot of advantages over a conventional loan. Their low down payment, lower interest rate, lower credit scores and higher debt to income ratio. The biggest negative is the mortgage insurance (MI) will never be removed as long as you have the loan, So if you plan on living in the home for many years and turn it into a rental property, an FHA loan might not be the best way to go. Of course, you want to sit down with a professional mortgage lender who has all your information.

Transcription

Hi everyone, your Tampa Bay real estate agent expert Lance Mohr and in this video, I want to go over the FHA Loan. What is the FHA Loan? What are the Pros and Cons?

So, FHA stands for Federal Housing Administration and they’re a department in HUD which is the Housing and Urban Development. Now what FHA does is they actually insure loans. So it’s the government ensuring the loan of default for the lender. FHA has a lot of advantages. The main advantage that people liked about FHA is their low down payment. It’s a formula but it’s approximately three and a half percent and like all loans they allow the seller to pay your closing costs. They will also allow your relative or a close family member to give a gift and pay your down payment as well. That’s a real advantage for a lot of people. Most people think FHA loan is just a first-time homebuyer loan, it isn’t. Not necessarily. The one thing is you can’t have an FHA loan and get another FHA loan at the same time.

Some other advantages of FHA are their interest rate is generally better than a conventional loan. Now, when I say conventional most people will think of Fannie Mae or Freddie Mac loans. They are also a little bit more flexible when it comes to the debt to income ratio. You can generally go a little higher on an FHA and they are a little bit more flexible with the credit scores. Your credit score could be a little lower on the FHA.

There’s a lot of advantages but probably the biggest disadvantage if there ever is any is the fact that you have to get mortgage insurance. It’s not private mortgage insurance like Fannie Mae and Freddie Mac with FHA it’s just called mortgage insurance but it’s not that you have to get it. It’s just the mortgages sure stays with you. The life of your FHA Loan. Let’s say you buy a home and you maybe you are a first-time homebuyer. You buy a home and the average price in your market is $200,000. You live in the home for six years and you’re ready to move out and you want to rent it. Well you are going to be paying that mortgage insurance, unlike the conventional loan. It’ not going to go away so generally speaking and the lender is going to know your situation. They will be able to give you some good advice if you could get a good honest lender is generally speaking most people don’t want to go on an FHA loan for the mortgage insurance reason unless you have to.

Most people opt to put if they can put 5% down or if they’re putting more down but there may be some reasons the FHA would be the best for you and again get a good loan officer. They will be able to tell you this. If you have any questions let me know. I’m not a lender, I was in lending for a number of years but I again I would say find a good loan officer, talk to them, take what’s called an application on you. Look at everything, pull your credit scores and give you the advice you need on which loan is best for you and then you can always ask them. If they say conventional say why if they say an FHA loan is better for you to say why. Challenge them a little bit. If you have any questions give me a call. If you like this video give me a thumbs up. Subscribe and I wish you the best of luck. Have a wonderful day.

Visit my channel https://youtube.com/tampa2enjoy
for more educational real estate videos. Please share my videos and don't forget to subscribe.

Importance of Hiring a Good Mortgage Lender – A TRUE Story

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I always talk about the importance of hiring a good lender. Choosing a mortgage lender that is honest and will do the right thing. This is a true story that will make you think.

Transcription

Hi everyone. This is your Tampa Bay realtor Lance Mohr. In this video, I want to talk about hiring a really good loan officer and the importance of doing that. I want to give you a real-life scenario that happened to one of my buyers this week to really drive home the point on how important it is to hire and make sure you get a really good loan officer and honest company.

I had a buyer call me up and what happened, I just got back from vacation and I found out that there was a problem with the loan. The lender that he hired actually screwed up and it was being the delayed 3 days and he wasn't. They are not using the builder’s lender. What happened is the builder was charging him $300 per day for every day they did not close and so he was getting hit with a $900 bill. The good thing is, they had a really good loan officer, a really good company and they basically stepped up to the plate and pay that. Then you might be thinking yourself, well yeah, of course, they should you're absolutely right they should but I've been on the end where I’ve seen these lending companies not. There just like hey we're sorry this stuff happens. It's not our fault will get the loan done as quick as we can and their situations especially in this market right here that were in a seller's market, where if you don’t close on time and as a backup offer that's better than yours on a pre-owned home they might just cancel the contract, let it expire and take the other offer. Or if you're working with the builder or if it’s on a relocation company there's a per diem every day if you don't close in it could wind up into hundreds if not thousands of dollars. You need to make sure the lending company that you hire is good, is reputable, is honest and someone who's going to do the right thing.

Always ask for references. The best place to start a real estate agent. If they’ve been in the business a while they should have a really good relationship with a really good loan officer and mortgage company.

I hope this helps. Please give me a thumbs up if you like these videos and if you have any questions at all don't forget to leave them in the comments below. Have a wonderful day!

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4 Top Benefits Of Private Mortgage Insurance

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Private Mortgage InsuranceThe majority of American homebuyers think they need to have a 20% down payment to be approved for a mortgage. In fact, in a recent National Association of Realtors survey, 34% of those that responded said they think they need over 20%.

Here’s what you may be surprised to learn – low down payment mortgages make up a large quantity of home buying every year. With the help of a private mortgage insurance (PMI), people who have five percent or less for a down payment can still buy a home. PMI has been available since the late 1950s, with more than 25 million families purchasing the home of their dreams.

In just the last year, the PMI had ensured that over 750,000 people were able to buy a home or refinance their mortgage. Many of these folks were first-time homebuyers with over 40% of them with incomes of less than $75,000.

How Does PMI Work?

Believe it or not, the private mortgage insurance process is extremely simple. When going through the mortgage underwriting process, the lender will verify employment and figure out how much a person can afford to pay each month. Lenders typically want homebuyers to put down 20% before the bank offers a loan. 20% shows the financial lender that the homebuyer is serious about the purchase.

PMI reduces the down payment gap, so borrowers who would normally get turned down for a loan will actually be approved for one.

4 Primary Benefits Of PMI

1. You can purchase your home sooner. It can be years before a person can actually save up 20% for a down payment. With the PMI, most buyers can purchase a home with a minimum of 3%.

2. It’s only temporary and will eventually result in lower monthly payments. Once 20% equity has been reached – through your making the payments or the home’s appreciation, the PMI is canceled. However, for FHA loans (the federal government’s PMI), the PMI is there until the loan is paid off.

3. It offers a multitude of flexible payment options. The lender may provide various choices for the PMI payment – the most common is the PMI being lumped into the mortgage payment.

4, You can deduct it on your taxes. There are income limits, but the PMI premiums are tax-deductible like the interest of your mortgage. Four million taxpayers took advantage of this deduction in 2014.

Private mortgage insurance is one of the easiest way to attain a mortgage with little down payment for a home. Plus, it provides an array of benefits to potential homebuyers. Due to its prevalence in the nation’s housing market, it has given millions of people the chance to become a homebuyer even when other financial obstacles stood in their way.

Note: You always want to talk to a tax adviser regarding income tax deductions.

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VA Loans = “Cash Back Rebates”

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If you are going to be getting a VA Loan you owe it to yourself to contract Jell Hoffman (see below) to get a Cash Back Rebate and a low price guarantee. He is able to beat big banks like USAA and Navy Federal Credit Union all day and every day.

 

Contact:

Jeff Hoffman
NMLS 380080
President
Nationwide Residential Capital
A Residential Lending Company
O:  813-865-6040
C:  813-918-7445
Jeff.Hoffman@NationwideRC.com
www.NationwideRC.com

 

Subprime Lending is Back

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Depositphotos - Dell640 - Peter Gabriel 030114Lenders have seen some of the worst economy conditions in the last few years, but new reports are indicating that subprime lending could be making a comeback. Subprime lenders have been around for some time, but during the financial crisis, many of them seemingly disappeared. According to online sources, subprime lenders are making a comeback with new nonprime loan offerings. Bill Dallas from NewLeaf Lending in California said, “There needs to be a solution for people who don’t fit in the box, and rebuilding nonprime lending is it.”

Subprime Mortgages' Modest Comeback
“Bill Dallas ran two subprime lenders that collapsed during the financial crisis. Now he’s back in business and plans to start offering what he calls nonprime loans later this year through his latest venture, NewLeaf Lending, based in Calabasas, Calif. “There needs to be a solution for people who don’t fit in the box, and rebuilding nonprime lending is it,” says Dallas. This time, he says, tougher lending rules will require borrowers to put down as much as 30 percent and document their income, credit, and work history.

Lenders are returning to the subprime market, although so far the lending is a fraction of what it was before the mortgage crisis. About $3 billion of subprime mortgages were made in the first nine months of 2013, matching the year-earlier period, according to Inside Mortgage Finance, a trade publication. In 2005, subprime originations reached $625 billion.”

Subprime lending explained in less than 2 minutes

With tougher lending rules out on the market today, consumers are sometimes required to put down up to 30 percent, including more documentation of your income, credit and work history. According to the numbers reported by Inside Mortgage Finance claimed that $3 billion of subprime mortgages issued in the first 9 months of 2013. A subprime loan is typically given out to a person that has a credit score of 660 or less. When the financial crisis hit, the lending companies that were giving out subprime loans were largely blamed for the crisis. Selling high-risk loans with adjustable interest rates that tripled after the first two years required little documentation from the buyer and that caused a huge wave of mortgage loan defaults.

That is when the federal regulators stepped in to restrict the number of high risk mortgages that ended up on the market. Lenders are now requiring credit scores that are much higher than in the past as well as more documentation. One credit group has started to offer subprime loans to those with a credit score between 550 and 599, but they were given a 9.75% interest rate and were required to come up with 30 percent as a down payment.

It would appear that subprime loans are making a comeback, but they are packed with requirements that many of today’s hardworking individuals simply cannot afford.

If you have any questions about the real estate market in Tampa Bay or foreclosures in Tampa please visit our Tampa2Enjoy real estate website.

Small Mortgage Lenders Hesitant Over Rule Change

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According to the Wall Street Journal, the new small mortgage lender rules which came into effect in the first week of January could hinder the ability of small money lenders to issue loans. The new rule states that lenders should ensure that their borrowers pay back what they owe. This means that the loans must meet the ‘Qualified Mortgage' Standards for small lenders to protect themselves from a lawsuit. Any loan that has been issued out of the standards mentioned before will be subject to legal risks.

What are Qualified Loans?

The Consumer Financial Protection Bureau has defined a ‘Qualified mortgage' as a loan that meets the ability-to-repay rule. The borrowers must spend a maximum of 43 percent of their income on the debt. If this does not happen, fees and charges are applicable. The maximum limit for the fees is three percent of the loan's value. What this new rule has done is make small mortgage lenders even more cautious when dealing with their borrowers as there is a lot of scope for a legal suit against the former. The main concern for the lenders is to make the loans meet the new standards.

What are the repercussions to Small Mortgage Lenders? 

Lenders who do not follow the new rules which have been laid out will not be able to see the loan to an investor such as Freddie Mac and Fannie Mae. However, big money lenders such as Bank of America and Wells Fargo have already created a plan which will allow them to issue loans outside the CFPB's new standards and that they will be able to hold the loan on their books. When small lenders have to make a loan, they will have to think twice as to how they are supposed to go about it. Non-banking lenders will need to be even more cautious as they do not utilize their own portfolio in order to hold the loans in their own books.

Reactions from lenders

These new rules have a long lasting effect on small mortgage lenders which hampers them from making mortgages in the future. In the WSJ article, CEO of Big Valley Federal Credit Union Linda Sweet says that they will stop making mortgages this year after the announcement of the new rules. Her organization managed 30 mortgages in the previous year. The reason why Big Valley is not creating mortgages is because complying with the new rules will add more costs to her financial institution and other small mortgage lenders.

Get expert advice on mortgages and Tampa real estate from Lance Mohr. Let us help you find the perfect Tampa home.

Banks Are Pitching Home Equity Loans – Again

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Banks just love the profits in home equity loans. They got burned in the late 80’s, they got burned in the 2,000’s and here we are again, 8 years later. But a lot of the problems with home equity loans are not because of banks, but consumers and state legislatures. Consumers have to be more responsible and state legislatures need to put in safety nets so consumers don’t get hurt. Texas is a great example of this. They weathered the recession better than any state in the union partially because the Texas Congress wrote laws stating what banks can and cannot do in their state. Unlike Florida.

Great article by Deon Roberts with Charlotte Observer
“Banks, eager to speed up their sluggish revenue growth, are returning to a business that lost appeal during the housing downturn: home equity lending.

Consumers are hearing the pitches in direct mail, in their inboxes, and in their bank branches. Lenders say the competition to capture home equity business is heating up – and they’re looking to sweeten the deals with flexible terms.

Banks see home equity as a growing market, with home prices rising in Charlotte and elsewhere. Some borrowers who once owed more than their homes were worth now find they have equity for the first time in years.”

What is a Home Equity Loan? – Explained

Unlike the vast majority of mortgage documents (Fannie Mae, VA, FHA) that have standard verbiage in them that does not let them take advantage of the consumer, HEL’s can be very tricky. So read everything before your sign anything.

If you have any questions about real estate in Tampa, Florida please visit our website.

 

Mortgage Credit Availability Decreasing Due To More Regulations

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Over the past 5 years the mortgage, appraisal and real estate industry has seen regulations cripple the housing market. Our politicians are over regulating the real estate industry due to their incompetence and deregulation that occurred in 1999.

Mortgage Credit Availability Decreased Slightly in November
“A significant number of loan programs allowing for more than 95 LTV and low-to-mid range minimum FICOs were either discontinued in November, or transitioned into programs with lower LTV maximums and/or higher minimum credit scores. Investor pull-back from programs with greater than 30 year terms and Interest-Only programs continued as the industry prepares for new regulations coming into effect in January 2014.

Some decreases to the index were offset by investors increasing their cash-out offerings to well-qualified borrowers.”

Senator Byron Dorgan warned us about the risks posed by the Gramm-Leach-Bliley Act that deregulation of the banking system.

 

image of Gramm-Leach-Bliley Act

Hopefully we can all put our thinking caps on and vote for our public servants that actually know something and have experience in business and real estate. The politicians can point the finger at everyone else, but if they want to know who is responsible all they need to do is look in the mirror.

If you are looking for real estate in Tampa click here. We have a lot of very educational videos on buying and selling a home.

 

 

 

 

 

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