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VA Cashout Refinance – Use It For Debt Consolidation or More

July 20, 2010 Leave a Comment

Refinancing in 2010 is tough in many parts of the country. Why? It is tough because of the severe “correction” we have had in home values over the past few years. Home values have come down which is causing problems for many folks who want to refinance but cannot meet program guidelines centered around your home’s value relative to the home’s mortgage balance. In general, for a mortgage to get approved the home’s value must exceed the mortgage balance.

If you are fortunate enough to have a VA mortgage you may be able to refinance your current VA mortgage using the VA’s streamline refinance program without having to meet the home value and mortgage balance requirement that I just mentioned. The VA streamline program does not require an appraisal (according to the VA – see below for specific mortgage lender specifics) so if you are in a situation where you home’s value is less than your mortgage balance you may still be able to qualify to refinance your home using this program.

However, if you are not upside down on your mortgage balance and your home’s value and if are looking for some cash out on your home to do some debt consolidation, or minor home repairs, you may want to consider the VA cash out refinance loan program.

The VA cash out mortgage program is good if you already have a VA loan and want to refinance, or if you don’t have a VA loan, but want one and are eligible for one. Some other reasons to consider the VA cash out refinance loan program include:

  • competitive mortgage rates,
  • no PMI (this is a big cash savings when compared to other loan programs like Fannie Mae, Freddie Mac and FHA),
  • you can defer a few mortgage payments,and
  • you can be set up to refinance using the VA streamline refinance program if rates drop in the future.

Unlike the VA streamline refinance, the VA cash out refinance will require you to get an appraisal and qualify for the mortgage with your income, assets, and credit. If you decide to go for this program, the VA will let borrow up to 100% of your home’s value with your new loan. (Lender Caveat) However, many lenders in 2010 are capping the new loan amount to not exceed 90% of the home’s appraised value. Also, some mortgage VA lenders are requiring an appraisal and income/employment documentation even for the VA streamline refinance.

You will need to talk to a VA loan officer who specializes in VA loans to see what options you have for your situation.

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Filed Under: VA loans

Qualify for a home vs. Qualify for a IRA

July 15, 2010 Leave a Comment

As a mortgage guy, from time to time I get asked questions like: “do I qualify for a Roth IRA?” or “what is the difference between a Roth IRA and a traditional IRA?” Of course, my answer is the same – “I’m not qualified to answer this question, as I’m only a mortgage guy.” Typically, I end up referring someone who asks me this question to someone I know who is qualified to handle these questions.

What I will offer though, is that qualifying for a Roth IRA is a lot easier than qualifying for a mortgage. If you think about it, it makes sense. For a Roth IRA, you are giving your money to yourself for a future purpose – so there are no credit requirements. For the Roth IRA you only have to really meet two qualifications: have some source of documentable income and don’t make too much money.

More specifically for the Roth IRA, you are capped in the amount of income you can make annually and you are capped in the amount you can contribute to your IRA annually. These amounts are subject to change on an annual basis, but they do not always change. For more specifics on the program, I encourage you to speak to a qualified financial and/or tax professional.

Now Qualifying for the Mortgage

The mortgage company is giving you money so the responsibility is on you to prove to the lender that you are credit worthy. Your mortgage company will carefully analyze all aspects of your financial situation including: documented income (for most loan programs), money in the bank, and good credit.

Unlike qualifying for the Roth IRA, qualifying for a mortgage goes much better with more income. Mortgage lenders like to see more income coming in on a monthly basis than going out in debt payments.

Unlike Roth IRA questions, if you have mortgage program specifics, ask me a question.

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Prime Lending Loan Officer Moves To Academy Mortgage

July 13, 2010 4 Comments

From time to time, I get great pieces of information that come across my desk.

Wondering why more and more great loan officers are choosing to work at Academy Mortgage?

Here is one great loan officer’s announcement to his clients recently of why he made the switch.

From: Michael McDermott
Sent: Thursday, July 08, 2010
Subject: IMPORTANT ANNOUNCEMENT – Changing The Way Your Clients Experience the Home Buying Process

Good afternoon everyone,

I urge you to read this email in its entirety; I guarantee that it will change the way you look at the lending industry and ultimately help you grow your business! It’s a bit lengthy but well worth the time it will take to read it.

I am very excited to announce that I have moved to another mortgage company. A move that was made with you and your clients in mind.

As many of you know, I have been with PrimeLending (formerly CTX Mortgage) for nearly 8 years now and I can honestly say that I enjoyed my time there. PrimeLending is a stand up mortgage company in an ever-changing market and I wish them the best.

However, just recently PrimeLending has struggled through some growing pains that have adversely affected the turn times that I expect from a company that stands behind my business and ultimately supports you and your client. After missing a few close of escrows over the past couple of months, I felt that a change was necessary.

So the question is, where did I move to and why did I move there? After meeting with several companies, I felt that Academy Mortgage had the most to offer your clients. This is where things get interesting; please read on.

Academy Mortgage is not the largest mortgage company in the valley but they are the third highest producing mortgage company in Maricopa County.

They offer absolutely everything in office…key phrase, in office, not in house!

I have personally met with each processor, underwriter, doc drawer and loan funder within Academy Mortgage and every single one of them is within walking distance from me.

The days of sending an email or waiting for a returned phone call from an underwriter are officially over!

This is absolutely crucial to the unprecedented loan processing system I am about to tell you about…

So here it is…Academy Mortgage offers a Guaranteed 10 Day Close!

Not only do they offer this but they stand behind it by offering the buyer $100 for every day after the 10th day for up to 5 days that their loan doesn’t close.

Year to date, Academy Mortgage has only had to pay two buyers a fee for going past the 10th day. This speaks volumes to me and I’m sure it does to you as well! If a company is willing to fork out some of their own money for the inconvenience of not closing in less than 10 days, I know they take your business seriously and they will do whatever it takes to get the job done on time.

As I mentioned earlier, there are several reasons for making this move but I will share the rest of those reasons over the next several days and weeks but I will tell you that Academy is VERY competitive in regard to interest rates and their processing fees are less than half of what you have been used to seeing.

I hope you are as excited as I am about this news and I look forward to working with you in a more efficient manner than ever before. I appreciate the business you have trusted me to handle over the past several years and I assure you this move is in the best interest of everyone involved; especially the most important one…the buyer.

As always, if you need anything from me, I can be reached at [email protected] or directly at 602-694-5279. Have a great day!

Your Trusted Mortgage Planner,
Michael McDermott
Direct: 602-694-5279

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Jumbo Loan Rates Drop To 2003 Levels

July 10, 2010 Leave a Comment

Since the credit crunch that began a couple of years ago, jumbo loans have been harder to find.  Many of the lenders who used to specialize in jumbo loan financing are no longer around – and many of the larger lenders have tightened their guidelines – or just stopped lending money for jumbo loans all together.

But within the last few months, it seems that there have been a handful of lenders who are now offering jumbo loan financing – and just in time… interest rates on jumbo loans has dropped to levels not seen since 2003.

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Courtesy WSJ

According to the WSJ:

Just a year ago, the average rate on a 30-year jumbo mortgage—a loan of more than $729,750 not backed by government-sponsored agencies Fannie Mae or Freddie Mac—was 6.86%, according to Greg McBride, a senior financial analyst at Bankrate.com. Now it is 5.48%—a rate that rivals those available during the height of the credit bonanza.

“In just the past couple of months, jumbo loans have really started to be competitively priced,” says Keith Gumbinger of HSH Associates, a publisher of consumer-loan information.

The recent low rates on jumbo loans has caused an uptick in refinancing activity – with some jumbo lenders reporting that jumbo refinancing up as much as 50% vs. what it was last year.

Refinancing a Jumbo Loan: Big Savings

Due to the large loan amounts of a jumbo loan, when you lower the interest rate by refinancing your jumbo loan, you can save a great deal of money.  Dropping your interest rate just a single percentage point can add up to over a thousand dollars – on a fairly “regular” jumbo loan product.

A simple example pointed out by the WSJ was where a homeowner with a 30-year fixed-rate $800,000 mortgage at 6.86% pays $5,247 a month. If he were to refinance at 5%, his monthly payments would be reduced by $952.

Jumbo Lenders in Arizona: We Are Here

Working with the right loan officer who knows what lenders are offering what terms on jumbo loan financing here in Arizona is key — there are a handful of different lenders offering jumbo financing and each one has different guidelines.

Contact us today to see if it is in your best financial interest to refinance your jumbo home loan here in Arizona — or anywhere else!

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What is foursquare and Why Should I Use It

July 8, 2010 Leave a Comment

What is foursquare and Why Should I Use It %spacebasenameWhat is foursquare and why should I use it?

If you participate in social media, it is very likely that you have asked this question by now.

It may be that this is the first time that you have heard the actual term, but if you are on facebook or twitter, you have probably noticed someone’s updates that start with “I’m at …” or “I just became the mayor of …”.  That is foursquare.

If that is the case your next line of thinking is probably to ask …

“Why would someone care where I’m at?”

or

“Why do I want everyone to know where I’m at — so they can rob my house and/or stalk me?”

Regardless, it has captured your attention and, maybe, peaked your interest.

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You're not gonna convince me!

So again: What is foursquare and why should I use it?

There are two main aspects to foursquare.

1) It is a game and a competition.

2) It has actual business application.  (In fact, I believe that it is one of the most powerful business-to-consumer social media tools.) Check out these foursquare articles by Justin McHood, SEO Maestro.

Here are a couple of videos that offer an introduction to foursquare.

If you are in Arizona, come to our foursquare swarm party next Friday and learn why and how YOU should use foursquare.  The aforementioned SEO Maestro, Justin McHood, will be leading a discussion on how Arizona real estate professionals can use foursquare for business.

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Come Join The Academy Mortgage foursquare Swarm Party

July 5, 2010 3 Comments

Come Join The Academy Mortgage foursquare Swarm Party %spacebasename

New to Foursquare?  Been on Foursquare for a while?

The swarm badge is one of the crown jewels of Foursquare and one of those things that everyone wants to have.

Don’t have your Swarm badge yet?

Join us for our first-ever Swarm badge party!

We are going to have our first ever Swarm badge party and are handing out free beverages for those people who are on their way to getting their Swarm badge.

And if you already have your Swarm badge?

Join us anyway, and help all of those people who want to get a Swarm badge join the cool kids club.

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