Having chosen South Carolina as your home, you’re now ready to find the cheapest first, second, or refinance mortgage rates available. The process of finding and comparing low-cost mortgages can be summarized into the following steps:

• Learn the options.
• Know the rates of interest.
• Determine your budget.
• Collect quotes.
• Compare your offers.

Horizon Financial is here to help. Our content is informative, and our information is accurate. You can request free quotes online, crunch numbers on the mortgage calculators, or calling Horizon Financial directly.  Take advantage by using our thorough South Carolina broker/lender mortgage loan programs knowledge to get the mortgage loan that is right for your situation.  Whether you are just starting to research or have a written offer on your dream home, we have Conventional, FHA, VA & USDA Rural Housing expects ready to assist with your hassle free options.

Posted by Bob Dangelo, a senior Loan Officer with over 20 years mortgage lending experience.  You can reach Bob toll free at Horizon Financial (877) 627-9211 ext 110 in Greenville, SC 864-527-8900 ext 1100 or email at bdangelo@horizonfinancial.org

The reason Fannie Mae has started its Loan Quality Initiative is to improve its loan pool’s performance.    

Better loan quality should help keep conforming mortgage rates down, while reducing the taxpayer’s burden for foreclosures. Unfortunately, it’s also going to lead to more mortgage denials and a lot of busted purchase closings. Therefore, be extra careful with your credit between the date of application and the date of closing. If you must buy something “big”, consider paying cash.  Anything that goes on a card can be used against you as grounds for revoking your approval. Even if your loan is underwritten and ready to close.   

What the bank will do: Look at the Credit Inquiry section of your credit report to look for “non-disclosed liabilities”. If items are found, the bank will ask for supporting documentation on the inquiry, and will use the information to re-underwrite your mortgage.

What you should do about it: Don’t go looking for new credit until after your loan is funded.  Period.  Now re-read the prior sentence, please, to help it sink it.

 For help with your mortgage approval, or questions about the Loan Quality Initiative, let us explain your options in easy terms.

Posted by Bob Dangelo, a senior Loan Officer with over 20 years mortgage lending experience.  You can reach Bob at Horizon Financial (877) 627-9211 ext 110 or email at bdangelo@horizonfinancial.org.

http://forecasts.org/fha.htm

-Gary Schoenholz (864)979-1111.  15+ Years of mortgage experience. Website:  www.GarytheMortgageExpert.com

Low Mortgage Rates

Many residents of South Carolina and North Carolina and of the Southeast are refinancing or purchasing right now to take advantage of very low mortgage rates. Often people see low rates advertised, but when they call, the rates are higher, sometimes they are even lower than advertised. Why? Really there are several factors that can affect your new mortgage rate.

Most of the mortgage rates for Fannie Mae or Freddie Mac bank loans are under 5%, but FHA loans (best for purchasing) are generally a little over 5%. Why is FHA rates higher? This is simply due to the type of loan and the pricing that generates directly from the FHA that is higher due to the higher risk for FHA loans for default or foreclosure (this is also why there is higher mortgage insurance costs for FHA).

Mortgage term can affect rate. Shorter terms are generally lower rates. 21 to 30 year loans are priced similar. 16 to 20 year is slightly better than 30 year (maybe 1/8% better). 15 year mortgage or shorter term can be much lower than 30 year. As much as 3/8% to ½% lower, but of course, the shorter the mortgage term, the higher the payment. On the positive side, the lower rate and term means you can save many, many $1,000’s of dollars over the life of the loan in interest (sometimes as much as $50,000., $100,000., or more). In some cases there is even a 1/8% less rate for a 10 year mortgage versus the already low 15 year fixed mortgage.

Closing costs can also affect rates. If you want very low closing costs, that is great, but you will pay more for your mortgage rate. This makes sense if you think about it. The banks have to make money on a mortgage somehow, so if there is little or no closing costs, banks can make up money by having a higher rate. At higher rates, Fannie Mae, Freddie Mac, FHA, and VA all pay banks and lenders more money at a higher rate. Of course the lower closing costs are nice, but the higher rate will mean a higher mortgage payment. Many customer select a very low rate so they can have a greatly reduced mortgage payment. This is good, but this can come with 1% or higher origination or discount fees. For many people, this makes sense, especially if you plan on living in this home a long time. The longer you keep the mortgage, the more beneficial it is to have paid higher closing costs for a lower rate. The best thing is to analyze the numbers with a skilled and experienced loan officer to see which is most beneficial for you.

Lastly, there are some underwriting factors that can affect your mortgage rate. Factors such as your credit score, the amount of equity in your home, loan size, if you are refinancing a mortgage only or getting cash out for bills or other purpose. Generally the higher your credit score, the better your rate. You are best to have a middle credit score of 740 or higher. When scores get below 740 and especially 700, your rate can go up greatly, or even cause your mortgage application to be denied. The amount of equity in your home is very important. If the total of all mortgages (including HELOC’s) are less than 60% of your appraised home value (or 60% LTV, Loan To Value), this gives you the best chance at a lower rate and improves you chances of mortgage underwriting approval. If you get over 80% LTV, rates can be higher and you will be required to pay for mortgage insurance. Sometimes, a customer rate can increase during the loan process because the appraised value comes in lower than expected. This is why it is important to estimate your home value as accurately as possible (consider that in some areas, home values are dropping, especially higher priced homes). Loan size can definitely affect your mortgage rate. Smaller loan amounts under $100,000., means a higher rate. Rates under $60,000. can be significantly higher. Loan amount between $250,000 to $417,000. generally have the lowest rate. Over $417,000 is a jumbo loan, and rates generally are higher like the very small amounts are higher. Lastly, cash out loans have a higher risk than straight refinance loans, so they are priced with a higher rate with higher LTV’s. The higher the LTV, the higher the rates on cash out mortgages, especially the higher you go over 60% LTV.

If you are looking for a mortgage right now or have a mortgage rate over 5%, than call or email me right now. Now is the time to take advantage of historically low mortgage rates.

www.GarytheMortgageExpert.com

-Gary Schoenholz – Loan Officer Manager – 15 years experience, 1000 loans closed.

Call my cell phone today- 864-979-1111. 

Lower Mortgage Rates

As recently as a month ago a borrower was approved at a debt-to-income ratio of 61%.  But Fannie Mae is about to lower that ratio to 50%.  And some lenders have already reduced the acceptable limit to 45%.

 So what is this ratio anyhow?  It is simply the ratio of the monthly payments (debt) on your credit report divided by your gross monthly income.   

For example: If the total of your mortgage payment (including taxes and hazard insurance), credit card payments and car payments is $3,000 and your gross monthly income is $5,882, then your debt-to-income ratio is 51%.  A month ago you would be approved for a loan.  A month from now you will not be approved.

 The debt-to-income ratio does not figure in any debt that does not appear on your credit report.  However, the ratio does take into account credit cards that show a zero payment.  If a card shows a balance owed but a zero payment, a payment is factored into the ratio.

 The reduced debt-to-income ratios are just another twist in a series of tightening regulations by lenders and agencies that will make it impossible for another sector of borrowers to purchase a home or refinance.  Long gone are the days when all you had to do to get a mortgage was fog a mirror.

Posted by Terry Brunner.  Terry is a Senior Loan Officer with Horizon Financial.  Terry can be reached toll free @ (877) 627-9211 x150 or email TBrunner@HorizonFinancial.org.  Visit Horizon’s website at www.horizonfinancial.org

Other property issues are more bizarre.  You might be trying to refinance your home but also happen to maintain a working goat farm in the backyard. 

Most lenders will fail to approve you for a mortgage.  Maybe you pay your property taxes to the Department of Motor Vehicles.  Fail.  Maybe you live in a geodesic dome.  Fail.

Maybe you own a log home and the nearest other log home is 50 miles away.  Fail.  Maybe built a bungalow in a neighborhood comprised of million dollar homes.  Fail.  Maybe you built a million dollar home in an area comprised primarily of bungalows.  Fail.  Maybe you turned your double-wide on it’s side so you would have a double-high.  Fail.  Maybe you converted the first floor of your home into a combination tax service and bait store.  Fail.

There are some new government programs available to homeowners who have either a Freddie Mac or Fannie Mae loan.  They can refinance up to 125% loan-to-value.  That is, the amount owed on their mortgage could be 25% more than the value of their home.  These homeowners could refinance at close to conventional rates as long as they have only one mortgage (no 2^nd mortgage or Home Equity Line Of Credit) and meet the normal qualifying criteria of income, assets, etc.  If you fall in this category, it is definitely time to refinance.

Posted by Terry Brunner.  Terry is a Senior Loan Officer with Horizon Financial.  Terry can be reached toll free @ (877) 627-9211 x150 or email TBrunner@HorizonFinancial.org.  Visit Horizon’s website at www.horizonfinancial.org

With mortgage rates are hovering near all-time lows, lots of Americans are taking advantage of refinance and home buying opportunities. 

The downside of today’s unexpectedly-low rates, though, is mortgage lenders are ill-equipped for the rush of new business. 

As a result, the process of underwriting and approving new mortgage applications is taking some conforming lenders as long as 2 months to complete. 

This is double the time needed as recently as six months ago.

Because there may be 60 days between the application date and the closing date, it’s important for applicants to remember that mortgage approvals can be revoked at any time prior to funding. 

As mortgage applicants, there are many events that are out of our control — job security and health matters, for example.  But there are also events that are within our control. 

Knowing that mortgage approvals can be fragile, here are 8 things you should absolutely not do while your home loan is in process.  It may be the difference between being approved by the bank, and being turned down.

1. Don’t buy a new car or trade-up to a bigger lease.
2. Don’t quit your job to change industries
3. Don’t switch from a salaried job to a heavily-commissioned job
4. Don’t transfer large sums of money between bank accounts
5. Don’t forget to pay your bills — even the ones in dispute
6. Don’t open new credit cards — even if you’re getting 20% off
7. Don’t accept a cash gift without filing the proper “gift” paperwork
8. Don’t make random, undocumented deposits into your bank account

Now, avoiding these items may not be practical for everyone.  For example, if your car lease is expiring and you need a larger vehicle, it doesn’t mean you can’t buy the car — just check with your loan officer first to be sure the new payments won’t “break” your approval. 

The same goes for accepting cash gifts from parents.  There’s a right way and a wrong way to accept gifts and doing it the wrong way may prevent you from using the gift as a source of downpayment.

Mortgage lending is full of “gotchas” and with underwriting times stretching to 60 days, it’s a lot more likely that a mortgage applicant will trip into one.  Following these 8 rules, though, is a good start.

Posted by Scott Fowler.  Scott is a Partner / Sr. Loan Officer for Horizon Financial.  Scott can be reached toll free @ 877-627-9211 x 104 or email SFowler@HorizonFinancial.org .  Visit Scott’s website @ www.ScottFowlerTeam.com .