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Archive for January, 2011

Question of the day: Can I purchase a home that is in need of repairs?


Q:  Can I purchase a home that is in need of repairs?

Well, Yes and No.

The No… The loan will require a property appraisal which determines the property condition and value for the lender.  The appraiser will confirm for the lender that the home is in LIVABLE condition.  The appraiser will ensure that if you were to default, the lender would not have to instantly put money into the home to re-sell it.   Typically, I tell my clients to wear their critical hat while previewing properties.  IF they are not sure if an item is an issue to the appraisal, it probably is. 

Here is a general guide.  The home needs to have flooring, A/C and heating, no health and safety issues (exposed wires, broken windows) and an acceptable roof.   All the plumbing and electrical need to be operational (which will include the pool if the properties has one)  

The appliances do NOT have to be installed as long as they are items that can be pushed into place and plugged in.  If they are installed items (stove top, built in refrigerator, etc) they need to be in place at the time of inspection.

The Yes… There is a government FHA loan called a 203K which does allow for some repairs to be built into the loan.  There are very specific guidelines as to what is allowed to be included and there are only certain lenders who offer the product.  Ask your loan officer about the details to determine if it is an option for you.

Having a dream is good, owning one is better!

Leslie Pelletiere, Owner

First Class Financial Services, proudly mortgage lending since 1999!

602.294.9288(O)

602.294.9830(F)

http://www.fcfs.net

MB#0902810

NMLS #162494

AZDFI Loan Officer # LO-0911453

Oh by the way, I am never too busy for your mortgage referral!

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Inside an Arizona Trustee Sale… NOT what I thought…


So, I went to a trustee sale. You know the ones. Borrower gets their notice of default that their home is going into foreclosure. A date is set for their “trustee sale” on the court house steps.

Here’s what I have always thought about trustee sales:

1. They are not for just Joe Customer. Only savvy real estate investors, banks, big wigs, etc.

2. It isn’t really done on the court house steps.

3. The trustee has a complicated system that I could never follow.

4. I would be lost in the bidding process and never be able to win a bid.

I WAS SO WRONG! First, my heart is beating as I approach the security at the courthouse building. I’m thinking that when I walk into the “trustee room” that everyone in the room is going to turn and stare at me like the 6 men in the Galway bar I walked into in Ireland wondering WHY a blond American girl was in their sacred place. I asked the security guard where the “trustee sale” meetings are held. He points, OUTSIDE. What? Outside? What do you mean OUTSIDE? Where? Right there, he points. Ok. Im still not clear, the only thing I see is the patio cafe shared by the courthouse buildings. Yep. Thats the place he tells me.

Ok so I assume he doesn’t know what I’m referring to and I’ll be re-directed by the cafe. Sure enough the cafe clerk points to the outdoor seating for the cafe and says “It’s right there.”

Literally it is two Maricopa county employees, with laptops on a folding table in the middle of the cafe seating! IF the employee #1 was legal age to drink I’d be surprised but she is ensuring that IF you signed in, that you have your $10K cashiers check to be able to bid. That’s it! Literally that’s it. Now, I can bid. After she checks everyone in, she goes back to reading off the property numbers and address of the THOUSANDS of properties that were postponed for sale.

Employee #2 is reading through the properties set to bid for the day. There is only 9. He starts with “Property Number 1”. Address 123 Main St. “Any interest?” 2 bidders “HousesRUs” and “WeBid.com” or something equally silly, step up to the table. One bids $71k, 72K, 73K back and forth until they reach their max. Employee #2 says “SOLD!! $73K to “HousesRUs”. He takes his $10K cashiers check. Stamps the paperwork and says “On to Property Number 2.”

THAT’S IT? Really? ANYONE can do this! You have to pay CASH within 24 hours of acceptance. You bring your remaining balance back. present it to Employee #2 and he hands you your finalized paperwork.

Any interest in this process or questions about Hard Money lenders who can facilitate the funds on these properties within 24 hours, feel free to contact me!

Thanks Maricopa County Superior Court for FINALLY making something in this real estate /lending business EASY!

Having a dream is good, owning one is better!

Leslie Pelletiere, Owner

First Class Financial Services, proudly mortgage lending since 1999! 602.294.9288(O) 602.294.9830(F)

www.fcfs.net

MB#0902810 NMLS #162494 AZDFI Loan Officer # LO-0911453

Oh by the way, I am never too busy for your mortgage referral!

And so it begins… the exploration of the insides of credit scores


This will begin a long journey down a path regarding credit scores.  Via blogging AND future webinars,  I hope to provide some insight as to the why’s, how’s, what if’s, etc. behind scoring.  Because it is so critically to lending these days, I will keep my personal feelings of it’s bogus”ness” out of it.

Posted today, 1/11/11, is an article from Yahoo Finance regarding the ability to get your credit score disclosure if you are not offered prime rates.   We already are required to disclose credit scores through lending however now we are required to advise what impact those scores had in determining your mortgage interest rates. 

For example:

Less than 720 score? Could impact your interest rate.

Less than 680 score? Impacts your interest rate.

Less than 660 score? Impacts your interest rate even more.

Less than a 640 score? Impacts your interest rate even more.

Less than a 620 score? No longer eligible for conventional financing. 

Now, what is your score and how do you improve it?

IF you have not applied for credit and been provided your scores through your application you can get a copy of your own credit report.  You are eligible for one FREE report per year.  Go to: http://www.annualcreditreport.com or call 1.877.322.8228 however, be advised that the FREE report will NOT include your score.   There is a small fee to obtain the report with your credit score included.  It’s worth the fee at least initially so you know where you start.

Now that you have your credit report, how do you read the darn thing? What is reported on it? How do you dispute what is reported? What do you need to do BEFORE you begin to tackle anything that is not correct?  What steps can you take to improve your score? What should you be careful of?

Stay tuned. We will cover all of these questions and more!

Categories: Uncategorized

Who should I get my mortgage loan with? Broker or Banker?


 I’m confused.  This seems like a simple question with a simple answer. 

There seems to be a misnomer regarding bankers and brokers.   Which is better? How do you  know?

1. First, who were you referred to?  Who did your “happy new homeowner” friend or co-worker get their loan through?

2. What kind of reputation does that banker/broker have? How long have they been in business?  Are they a local business or a behemoth guy?

3. Is the loan officer you are considering meerly an employee of the company or required to be licensed by the state they work in?   Do you want your loan officer to have to meet education requirements, have had a full background check and required to carry an individual lending license? Probably.

Loan officers of mortgage brokers are the only individuals required to maintain all of those items.

4. Do you want:

  • the access to many different types of loans?
  •  from many lenders?
  • at the best interest rate ?
  • and with the lowest fees?
  • Ok. Sorry. Silly question.

Bottom line? Referrals are always best.  You wouldn’t pick your doctor out of the phone book.  You probably shouldn’t do that with your loan officer either. 

Still not sure? Who is going to get the job done?   Start with-  which one returns your phone calls. (I know. Another silly one but my biggest client comment… “thank you for returning my call” ) How do they handle your application process?  If its sketchy here, it will only go downhill during the loan process.   Do they have the best interest rate WITH the lowest closing costs.  Compare the whole scenario. 

Of course, you know what MY answer would be…

Categories: Uncategorized