San Francisco Ca, As you have heard, basically…EVERYWHERE IN THE MEDIA, lenders require A LOT of documentation to close a loan when purchasing or refinancing a home in this day and age. Loans are definitely fully documented and without question YOUR BEST DEFENSE IS A GREAT OFFENSE!

That being said here is what you must have prepared with your lender and agent when prepared to write offers:

• A Cover Letter – Tell your story and make sure your lender know your story. Don’t forget to include any skeletons dangling in your closet, collections, alimony, child support or unpaid IRS liens. Paint a pretty picture but explain any skeletons.
• A completed loan application – review for accuracy.
• If you own property already tie all mortgages from your credit report to your properties.
• If you own property already submit mortgage statements and proof of insurance and property taxes.
• Tri Merge Credit report – your lender will pull this. Get a copy, don’t pull your own. Especially if you are writing on bank owned properties. Most bank owned properties want you pre approved with their institution. That means if you go out and look at offers on 5 houses owned by 5 different banks you may have 6 credit checks! Keep them to a minimum.
• Photo ID.
• Income documentation – 1 month paystubs, 2 years w2’s, 2 years complete tax returns, and business returns if the borrower owns more than 25% of a company.
• Earnest money deposit receipt, copy of check and proof cleared borrower’s account.
• Most recent months bank statements or (Per AUS findings).
• Provide letter of explanation for all large deposits (Anything Greater than 10% of gross monthly earnings must also be documented) including paper trail- cancelled checks, corresponding bank statements, etc.
• Gift Letter and Paper trail: Gift Letter, Donors ability to gift and transfer from donor to borrower with final balance in account.
• Contract fully executed.
• Short Sale approval.
• Copy of any inspections and clearances (Per contract or appraisal).
• Preliminary Title Report (Usually received 2 days after escrow is opened).
• HOA certification form and copy of Master Liability Policy and Insurance Policy for a condominium.

While this may sound a little overboard this is exactly what is needed upfront to close FAST in today’s market. For more information on getting pre approved for your California home loan text or call 510.282.5456, or email us at info@garrick.biz

San Francisco Bay Area Home Affordable Refinance Guidelines include:

- Removing the 125 percent loan-to-value.

- Waiving risk-based fees on borrowers who take shorter term mortgages and reducing those fees for others.

- Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the GSEs

- Eliminating certain representations and warranties required of lenders to obtain the GSE guarantee. This will protect lenders from many of the buy-back requirements they face under current guidelines

- Extending availability of the program through the end of 2013

For more information on getting pre approved for your California HARP 2.0 Refinance home loan text or call 510.282.5456, or email us at info@garrick.biz

Alameda, CA: On March 13^th and 14^th we saw huge rate increases.  Our beloved 3.875% “Best Execution” went to 4.125% with most lenders.  In fact over the past two days we have seen a dramatic increase in rates –

For those that want to know WHY rates moved higher so quickly:

I Refer to Matthew Graham of Mortgage News Daily -

“(NOTE:  For most of this discussion, we’ll actually reference 10yr Treasury yields, even though it is Mortgage-Backed-Securities (MBS), that most directly influence lender’s rate sheets.  When markets are undergoing bigger shifts than they’ve recently seen, 10yr Treasuries are a better indicator to measure the progress and severity of those shifts.  We’ll ALWAYS make note of any major discrepancies between MBS and Treasuries on the occasions where we talk about both.)

There are several layers of causality.  We discussed the “perfect storm” of events that drove rates higher yesterday.  That discussion included Greece’s recently fully-approved 2nd bailout, a slightly more upbeat FOMC Announcement, slightly stronger Retail Sales, and the general trading dynamics that left bond markets “susceptible” to the weakness. 

Yesterday, we talked about that susceptibility as leaving room to run up to about 2.13% in terms of 10yr yields.  Today’s rout was the next destination in that technical framework. What begins as a test of higher-than-recent interest rates can quickly turn into a brutal disintegration if certain dominoes fall.  Without attempting to explain every esoteric concept of the underlying markets, suffice it to say that between yesterday and today, some very big dominoes started falling, and we’re not sure if they’re done yet.”

WHAT NOW?

Rates are still phenomenal so if you haven’t locked in on your refinance I don’t think you missed out on anything…you were just waiting for the bottom, and when you wait for the bottom it is very easy to miss the bottom.  That being said, it is of course very possible to see rates go even lower, we are still near historic lows!

For more information please feel free to comment, call 510.282.5456 or email info@garrick.biz.

I wanted to share this article with you…Let me know if you have any questions!

From Mortgage News Daily…

“While housing is more affordable than ever for most U.S. families, the lack of financing available to them continues to constrain prospective homebuyers according to the most recent National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI) released on Thursday. The Index indicates that 75.9 percent of all new and existing homes sold in the fourth quarter were within the financial reach of families earning the national median income of $64,200. This is the highest number for the affordability index in its 20 year history.

HOI measures the percentage of homes sold in a given area that could be purchased by households earning that area’s median income at current mortgage interest rates and assuming a 20 percent down payment.

“While today’s report indicates that homeownership is within reach of more households than it has been for more than two decades, overly restrictive lending conditions confronting home buyers and builders remain significant obstacles to many potential homes sales, even with interest rates at historically low levels,” said Barry Rutenberg, chairman of NAHB.

The metropolitan area encompassing Youngstown Ohio and Boardman, Pennsylvania was the most affordable major housing market in the country with 95.1 percent of all homes sold during the quarter affordable under the NAHB definition. The area’s median income is $54,900. Other major MSAs ranking at the top in affordability are Lakeland-Winter Haven, Florida; Modesto, California; Harrisburg-Carlisle, Pennsylvania; and Toledo, Ohio.

The most affordable small housing market was Kokomo, Indiana where 99.2 percent of homes were affordable to families earning the median income of $59,100. Other smaller housing markets at the top of the index included Fairbanks, Alaska; Cumberland, Maryland; Lima, Ohio; and Rockford, Illinois.

Only 29.0 percent of homes in the New York-White Plain area were affordable to those with the area’s median income of $67,400. This was the 15th consecutive quarter that this MSA ranked last in affordability. Other major metro area at the bottom of the affordability index included Honolulu and three California MSAs, San Francisco-San Mateo-Redwood City; Santa Ana-Anaheim-Irvine; and Los Angeles-Long Beach-Glendale.

The least affordable small market was Ocean City, New Jersey where, with a median income of $70,100 only 47.5 percent of homes were deemed affordable. It was followed by Laredo, Texas, San Luis Obispo-Paso Robles, and Santa Cruz-Watsonville, California; and Brownsville-Harlingen, Texas.”

Original Article
http://www.mortgagenewsdaily.com/02162012_home_prices.asp

Direct Link
http://www.youtube.com/watch?v=gTY1UVPRk8g

A lot of people ask this question and it’s a great question.

And the answer is- That depends. You see, guidelines are always changing and will continue to change over the next few years.

In fact they JUST changed!

So here is how it stands today…

CONVENTIONAL

Bankruptcy – You may apply for a Conventional, Fannie Mae loan after your bankruptcy has been discharged for FOUR (4) years.

Foreclosure – Home was given back to the bank – no owner participation.

- 7 years from the date the foreclosure was completed and transferred back to the bank if the borrower had NO extenuating circumstances. Minimum FICO of 680 required.

- 3 years from the date the foreclosure was completed and transferred back to bank with acceptable extenuating circumstances, AND 10% down payment. Primary home purchase and rate/term refinance only. Non‐owner and second homes not allowed

Short Sale / Deed in Lieu of Foreclosure -

Short Sale- Home sold, but sales price didn’t cover amount owed.

Deed‐in‐Lieu- Home returned to lender in exchange for canceling the loan.

- 7 years from date sale closed and transferred to new owner or transferred back to the bank for less than 10% down payment and minimum FICO 680.

- 4 years from date sale closed and transferred to new owner or transferred back to the bank with 10% down payment and minimum FICO 680.

- 2 years from date sale closed and transferred to new owner or transferred back to the bank may be possible with acceptable extenuating circumstances and 10% down payment.

Bankruptcy Chapter 7- Debts are discharged through BK, client does not pay any debts owing.

- 4 years from date of discharge

- 2 years from discharge date may be possible with acceptable extenuating circumstances

Bankruptcy Chapter 13- Debts are paid back on a monthly scheduled payment plan by client.

- 2 years from date of discharge or

- 4 years from dismissal date

FHA (DETERMINED BY DATE OF CREDIT APPROVAL)

Foreclosure, Deed‐in‐Lieu of Foreclosure

Foreclosure: Home was given back to the bank – no owner participation.

Deed in Lieu: Home returned to lender in exchange for canceling loan.

- 3 years from date foreclosure was completed and transferred back to bank.

- Less than 3 years, but not less than 12 months from date foreclosure was completed and transferred back to bank may be acceptable depending on the results of acceptable extenuating circumstances.

Short Sale- Home sold, but sales price didn’t cover amount owed.

- 3 years from date sale closed and transferred to new owner.

- No waiting period if borrower had no late payments on any mortgages and consumer debts within the 12 month period preceding the short sale, AND borrower is not taking advantage of declining market conditions. Subject property may not be in the same geographic region.

Bankruptcy Chapter 7- Debts are discharged through BK, client does not pay any debts owing.

- 2 years from date of discharge with re‐established credit paid as agreed or no new credit obligations incurred.

- Less than 2 years, but not less than 12 months from date of discharge may be acceptable if the bankruptcy was caused by acceptable extenuating circumstances, and the borrower has since exhibited a documented ability to manage financial affairs in a responsible manner.

Bankruptcy Chapter 13- Debts are paid back on a monthly scheduled payment plan by client.

- 1 year payout period under bankruptcy has elapsed and the borrower’s payment performance has been satisfactory; and all required payments made on time.

VA (DETERMINED BY DATE OF CREDIT APPROVAL)

Foreclosure, Deed‐in‐Lieu of Foreclosure

Foreclosure: Home was given back to the bank – no owner participation.

Deed in Lieu: Home returned to lender in exchange for canceling loan.

- 2 years from date foreclosure was completed and transferred back to the bank.

- 12‐23 months from date foreclosure was completed and transferred back to bank; if credit re-established and paid as agreed, and was caused by acceptable extenuating circumstances.

Short Sale: Home sold but sales price didn’t cover amount owed.

- 2 years from date sale closed and transferred to new owner.

- No waiting period if borrower has no late payments on any mortgages and consumer debts within the last 12 month period preceding the short sale, AND the borrower is not taking advantage of a declining market.

Bankruptcy Chapter 7- Debts are discharged through BK, client does not pay any debts owing.

- 2 years from date of discharge.

- 12‐ 23 months from date of discharge if credit is re‐established and paid as agreed; and was caused by acceptable extenuating circumstances.

Bankruptcy Chapter 13- Debts are paid back on a monthly scheduled payment plan by client.

- 1 year payout period under bankruptcy has elapsed and the borrower’s payment performance has been satisfactory and all required payments made on time.

When you are ready to get back into the housing market or for more information please contact me at 510-282-5456 or info@garrick.biz.

Related Articles:

Feds Announce Bay Area Real Estate Mortgage Interest Rates to Stay Low Until 2014

Home Affordable Refinance Program Update HARP 2

Restoring FHA Loan Limits