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Arizona Mortgage Question of the Day: Can I qualify for an Arizona mortgage if I have co-signed on a loan for another person?
Arizona Mortgage Question of the Day: Can I qualify for an Arizona mortgage if I have co-signed on a loan for another person?
Well, kind of.
There is a NEW Arizona mortgage underwriting rule for this. IF you are qualifying for an Arizona mortgage and you have co-signed (for example for your son to buy a car) BOTH you and your son need to be on the NOTE to repay. Your son makes the payments on time each month (out of his OWN individual account) then he can provide cancelled checks to show HE makes the car payment. By doing so, you can qualify for your Arizona mortgage without having that payment included in your debt.
IF, instead, you initiate the loan FOR HIM, you are on the ONLY borrower on the NOTE, then you have to qualify for your new Arizona mortgage WITH the car payment regardless of who makes the payment.
It always angered me that my father would never co-sign on my behalf, to establish credit. After what I have seen on individuals mortgage credit reports, I now understand his concern. Although we all know, I would have made all of my payments diligently 🙂 …… the alternative possibilities are scary.
I would always discourage anyone from co-signing on behalf of another person, however, in certain circumstances it can not be avoided. IF this is the case- just ensure you are BOTH on the NOTE.
Having a dream is good, owning one is better!
Leslie Nilsen
Owner/ Broker
First Class Financial Services
602.294.9288 (p)
mortgagedr@fcfs.net www.fcfs.net
AZ Mortgage Question of the Day: IF my ex-husband signs a quit claim deed, does that remove him from the mortgage liability?
AZ Mortgage Question of the Day: IF my ex-husband signs a quit claim deed, does that remove him from the mortgage liability?
No. The quit claim deed ONLY deeds the ASSET of the property to the remaining party. It does not remove responsibility from the mortgage. The mortgage would need to be refinanced with the remaining borrower qualifying to carry the mortgage alone. Once the new mortgage is closed, the escrow company would take care of recording the new deed in the remaining party’s name.
IF the one borrower signs a Quit Claim deed but does not have the remaining borrower refinance, BOTH borrowers are still liable on the mortgage and it’s repayment requirements. It also will remain on BOTH borrower’s credit reports.
Many borrower’s make this mistake during a divorce. Especially if they are trying to handle their divorce without an attorney. It makes sense that if a borrower deeds the ASSET to the other party, that also transfers the mortgage liability, however this is not the case. It is very important to handle this correctly during the proceedings as it can affect the leaving party in their ability to mortgage qualify down the road. Providing the divorce decree and the quit claim deed will not suffice in removing the mortgage liability when qualifying.
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)
MB#0902810
NMLS #162494
AZDFI Loan Officer # LO-0911453
AZ Mortgage Rental Property Home Insurance Tips!
Arizona mortgage rental property home insurance tips:
First, THANK YOU to Loel Weatherly! My favorite American Family Insurance Agent! He has provided me some important pointers when it comes to home insurance for those of us that call ourselves landlords.
From Loel Weatherly, American Family Insurance Agency: “… A couple of points come to mind immediately…
•1) The proper policy form should be obtained once the property is rented out…typically called a “landlords” policy, “rental dwelling protection” policy, or a BOP (Business Owners Policy). The standard homeowner policy is not written or rated to provide coverage other than to the owner/occupant of the property.
•2) As part of these types of policies there is generally coverage provided for “loss of rents” or “loss of income” in the event that the property would be uninhabitable due to a covered loss.
•3) Another crucial part of these types of policy forms is the Liability coverage to protect the property owner….typically a minimum of $300,000 per occurrence and in many cases can be increased to $1 Million in coverage for a slight additional premium charge.
•4) Also, coverage for damage to the structure, walls and flooring as a result of a broken pipe either in the wall/ceiling or floor should be included. ”
Many times clients call me AFTER something has happened to ask how they should handle it. I am new to this landlord gig so I want to make sure to pass on all that I get as I go through the process!
Again, thanks Loel! You can reach Loel at American Family Insurance at 480.926.2766.
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)
MB#0902810
NMLS #162494
AZDFI Loan Officer # LO-0911453
AZ Mortgage Question of the Day: Can an investor buy a property from Fannie Mae and then sell it to a new buyer using HomePath financing?
AZ Mortgage Question of the Day: Can an investor buy a property from Fannie Mae and then sell it to a new buyer using HomePath financing?
Sorry. The answer is No.
Fannie Mae properties are offered with special financing called HomePath financing. This allows for a buyer to purchase the home directly from Fannie Mae and take advantage of the perks of the HomePath financing.
In this case the client was purchasing an investment property. On investment properties, HomePath allows for a minimum 10% down payment and NO monthly mortgage insurance requirement!
Most HomePath properties are designated that way due to condition issues. The HomePath financing does not require a property appraisal so any condition issues are not relevant to qualifying.
Fannie Mae also have a special incentive running now offering 3.5% closing costs assistance through 6/30/2011.
You can find out more about HomePath properties at www.homepath.com and about the special incentive at www.homepath.com/incentive/index.html
Having a dream is good, owning one is better!
Leslie Pelletiere, Owner/Broker
First Class Financial Services, proudly mortgage lending since 1999.
MB#0902810 NMLS#162494
FREE credit report!
Remember, the law states you can get a FREE copy of your credit report annually!
Through the Fair and Accurate Credit Transactions Act (FACT Act) consumers are entitled to receive a copy of all three credit reports, annually, for free.
You need only go online to:
Enter your state of residence and follow the instructions to request a copy. IF the copy is requested online, you will have access to print it immediately from the site.
You can request a copy by phone at 1-877-322-8228 or in writing. If you request a credit report by mail, download the “request form” by going to www.annualcreditreport.com, print and complete the form and mail to:
Annual Credit Report Request Services
P O BOX 105281
Atlanta, GA 30348-5281
If you order by phone or mail it will take up to 15 days to process.
IF you find any errors or corrections, you can dispute any item found on your report by going to:
Equifax – www.investigate.equifax.com
Experian – www.experian.com
TransUnion – www.transunion.com
It is important to monitor your credit report annually and this is an easy way to do it for FREE! (as always, if it’s FREE, it’s for me!)
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)
MB#0902810
NMLS #162494
AZDFI Loan Officer # LO-0911453
YAY! Lender LOWERS FHA credit score requirement to 580!
I ask you… IF you can get a mortgage with:
1. A 580 credit score
2. Your grandmother can gift you the 3.5% down payment
3. The seller can pay ALL your closing costs
4. (You can have ZERO contribution of your own money)
5. You do not need reserves to qualify.
6. You can get an interest rate below 5%
7. You have more inventory to choose from than eggs at an easter egg hunt.
8. You can have a new mortgage payment less than you are paying in rent.
9. You LOVE your realtor.
10. You LOVE your loan officer.
11. You HATE your roommate.
What is everyone waiting for?
Spread the word. Life is good. We need to take advantage of it!
Having a dream is good, owning one is better!
Leslie Pelletiere, Owner/Broker
First Class Financial Services, proudly mortgage lending since 1999.
602.294.9288(p) mortgagedr@fcfs.net www.fcfs.net
MB#0902810/ NMLS#162494
Kids and Money…It doesn’t grow on trees!
The money may not grow on trees but it does come from gifts! I encourage my son’s family members to gift in the form of CASH. I know. I know. Most gift givers do not want to give cash but it feeds to the rest of my story. #1 He loves the cash. Most family members now give him the gift in the form of individual dollar bills. Admit it, it just seems like more. #2 We practice control. How much to keep? How much to deposit? #3 We make another trip in the “dream car” to the bank. With “whats my balance?” being the next thing out of his mouth. Music to my ears! #4 Once the whole journey is over, he is reminded just how important it is to think first, deposit second, spend third.
My parents have also started contributing directly into his 529 college fund. They will send him something small and a note that they have contributed towards his college.
This morning we had the “How can I make more money?” conversation. He is seeing his goal looming on the horizon. He turns 16 in 310 days, 8 hours and 23 minutes. Not that either of us are counting.
Having a dream is good, owning one is better!
Leslie Pelletiere, Owner
First Class Financial Services 602.294.9288 (p) www.fcfs.net mortgagedr@fcfs.net
MB#0902810/ NMLS# 162476
Kids and Money… Goals. New Account. Compounding Interest!
What is more exciting to talk to your kids about than the magic of Compounding Interest? Ok so maybe thats just me!
My son and I started by talking about what he wanted to spend his money on. Initially it was small things he could buy immediately. The more we talked about it, the bigger his “dreams” got. He ultimately decided he wanted to save for his first car. On that note, we drove his “new dream car” to the bank and opened an account. Ask your local bank about accounts specfically designed for kids.
Over icecream, to celebrate, we talked about compounding interest. The conversation is radically different over ice cream and with his own money. Once he figured out that the bank would GIVE him money, his sense of urgency to get money into the account compounded as well.
Now every time he makes or is gifted money, he holds out a portion for himself and the remainder is deposited into his account. He has a picture of his Jeep posted above his desk, right next to his bank statements.
Might be a good time to think about your own goals (home ownership or upgrading, of course), open an account and master the power of compounding interest! You can thank me later!
Over a glass of wine tonight, I’ll decide my new goal for all the money I saved not having to buy my kids first car!
Having a dream is good, owning one is better!
Leslie Pelletiere, Owner
First Class Financial Services
602.294.9288 (p)
www.fcfs.net mortgagedr@fcfs.net
MB#0902810 / NMLS# 162494
First Class Financial 