Sure, everyone would like to hear, “Oh, just whenever you’re ready!”

The truth? Whether you are a real estate investor looking for a mortgage for acquisition, rehab or construction or you are a homeowner just looking to purchase a home there are a couple of points you need to be aware of when it comes to closing speed and dates for any mortgage loan.

Closings are not demandable even by your real estate agent – a common fallicy among inexperienced agents. Many moving parts are involved in closing on a purchase or a refinance. Pay special attention to the list of items at the end of this article which can cause delays. Take special note to how many of those are under your control or within the control of the lender/broker. The person who will actually be making the final scheduling of your closing will be the lender who will pass that information to the processor who will pass it to the attorney. Real estate agents do not control or have the ability to affect closing dates and times (although some want to force the issue around their schedule it’s actually up to the lender first and you second – I don’t care when you close so long as you close!)

Here is an average sampling of how this works. You’ve already called us and been prequalified – since you know that’s the correct order of things – and now you’re shopping and you’ve found a house.

1. We know the most often required documents so we gather those from you ahead of time.
2. You make an offer on a house.
3. A couple of days later that offer is accepted.
4. Generally, the offer is going to show a closing date 30 days from the day the offer was made. Not from the day it was accepted.
5. You tell us the offer was accepted so we start “start the ball rolling”.
6. An appraisal must be done and this requires an executed sales contract. Sometimes we get that in our office right away, sometimes – for one reason or another – it is delayed. Appraisals take 2 days to a week as a general rule.
7. While we’re waiting on the appraisal we’ll “update your docs” which means we’ll ask for current pay stubs, bank statements, and any other documentation to prove income and assets. If you get those back to us right away there’s no delay. If you drag your feet – there is a delay!
8. We’ll need insurance documentation – this is entirely dependent on the co-operation of your insurance company. As I am writing this our processing department is “having fits” with an insurance company who has held up a closing for over 5 days while we wait on proper documentation. That’s rare, most insurance companies are prompt and professional.
9. Once we have all the required documentation we send the “package” to the underwriter. Underwriting can take as little as one hour and as much as several days. The deciding factor is underwriter workload.
10. The underwriter may ask for additional documentation. If they do you can (a) argue with the processor about having to provide it and end up sending it anyway or (b) get it back in as quickly as possible.
11. Once the underwriter has issued a “Clear To Close” with no further conditions you’re good to go.

Average closing time from application to close? About 14 days industry wide. It can happen in as little as 48 hours but that is rare [edit: since this article was originally published in 2006 new federal regulations have been passed requiring a minimum of 3 business days for the borrower to contemplate the mortgage offer before the lender can proceed which adds a little time to closing].

Lenders and brokers who advertise 24 hour closings are omitting the first 10 steps from above. NOBODY can close a purchase loan in 24 hours from the time your offer was accepted.

Delays in closing can be caused by many things. More often than not delays are caused by one or more of the following:

1. Fully executed contract delayed. This happens more often on foreclosures where the seller is a bank and it takes them a few days to sign the contract and return it.
2. Appraisal coming back with a value lower than the sales price. Very rare but it has happened.
3. Appraisal coming back with “subject to repair” comments which exceed those allowable by the lender.
4. Lack of co-operation from the insurance company. Loss-Payee Clauses are requested in writing and are generally returned within 24 hours. Anything longer is considered a delay.
5. Lack of co-operation from current mortgage company in returning pay-offs or Verification of Mortgage (VOM).
6. Lack of co-operation from employer in returning Verification of Employment (VOE).
7. Income and/or assets on application used for pre-qualification being overstated and not supportable by documentation.
8. Borrower’s earnest money check not being deposited into the Real Estate Broker’s escrow account.
9. Problems with the title to the property – discovery of liens or multiple title changes in short succession.

These are just a few “hiccups” that are fairly commonplace on my side of the desk. The most important thing to remember is that the staff at your mortgage broker or lender is working for you. They don’t get paid unless and until your loan closes. So guess what? That’s right! They really want your loan to close.

It takes dozens, often hundreds, of man-hours to take a loan from application to closing. There are many people involved in the process that you never know exist. Some of them work on commission and only get paid if your loan closes. Others are on salary and of that group some just don’t care.

Most broker’s are very committed to you. I can speak for my own staff and say they definitely take it personally … the good and the bad.

Ken Cook – Georgia – FHA, USDA, VA and Conventional Home Loans (678) 439-8683 NMLS ID 208452 – Originally published in Active Rain on July 24, 2006.

I asked, “why not? What trouble?”

It seems she had a few misunderstandings about how this powerful purchase loan works. The truth is it doesn’t involve any extra work for her than a regular FHA loan. What it does it take an unsellable home and turn it into a sale. Conventional loans do not allow for some of these types of repairs on an “as is” home sale. Even there it increases the sale amount by the mere virtue of dealing with a homeowner financing the property instead of an investor paying cash for the property.

The FHA 203k Streamline purchase loan is perfect for the large majority of homes in the US. Any home that qualifies for a standard FHA home loan, the 203b, also qualifies for the FHA 203k if it needs less than $35,000 in non-structural upgrades or repairs. So what CAN you do with an FHA 203k loan?

• Repair or replacement of roofs, gutters and downspouts
• Upgrade of plumbing and electrical systems
• New flooring or floor covering
• Exterior decks, patios and porches
• Minor remodeling (no structural such as room additions)
• Paint and wall covering
• Weatherization including storm windows, storm doors, insulation and weather stripping
• Purchase and installation of new appliances
• Disability access improvements interior and exterior
• Basement finishing and remodeling
• Basement and crawl space moisture control and waterproofing
• Window and door replacement
• Exterior residing such as replacing old, defective siding
• Septic system or well repair or replacement

It’s always something that needs to be covered right up front. When the loan officer is taking the application and they know what it requires for down payment and the approximate closing costs they also need to calculate in the speficied amount of reserves. What are reserves? Straightforward it is enough to conver the principal, interest, taxes, and insurance (at a minimum).

Most loans require two months of reserves on the purchase of a primary residence and as much as six months (PITIA) on investment property purchases. But it’s not enough they be available they must also be sourced and seasoned just like the down payment and closing costs.

Here’s a little good news, though: reserves don’t have to be in cash form. In fact 100% of the following can be counted for reserves:

1. Stocks, bonds, mutual funds, U.S. government securities, and other securities that are traded on an exchange or marketplace general available to the public (such as NYSE, NASDAQ, Midwest SE, CBOT, or OTC) whose price can be readily verified through financial publications.
2. Cash-value life insurance (rather than face-value) that is verified. The borrower must be the owner of the policy and not the beneficiary.
3. Personal IRA and SEP-IRA accounts that are owned by the borrower and verified.
4. The borrower’s portion of undistributed trust funds.

Additionally a portion of the value of the following may be counted as reserves:

1. 401(k), KEOGH, 403(b) and other IRS-qualified employer plans may be counted as reserves; however, to account for withdrawal penalties and estimated taxes, 70% of the vested amount of the account should be used to determine the borrower’s available reserves. The borrower will be required to provide documentation that the funds are accessible for withdrawal. If the retirement account only allows for withdrawals in the event of the borrower’s employment termination, retirement, or death, these funds should not be considered as reserves.
2. Savings bonds may be counted at 100% of face value if mature. If the bonds are not mature, the amount counted towards reserves is based on the redeemable value at the time of underwriting.

Ask your Loan Officer about reserves. If you are an agent and want help understanding these please never hesitate to call me or have your client call me. I’m more than happy to help even if I do not have the ability to assist in your area.

Here’s the official story from Congressman Mark Schauer:

WASHINGTON, Oct 8 - Today, Congressman Mark Schauer voted to pass two key measures for our American veterans. The Service Members Home Ownership Tax Act (H.R. 3590), which passed with bipartisan support today, will extend the deadline for taking advantage of the first-time homebuyer tax credit under the American Recovery and Reinvestment Act for qualified service members by one year. Today’s House passage of an amendment to the Veterans Health Care Budget Reform and Transparency Act (H.R. 1016) will help advance the legislation towards a Presidential signature. The bill authorizes Congress to approve investments in Department of Veterans Affairs (VA) medical care one year in advance to provide more predictable health care funding for veterans.

If you have questions or comments about the First Time Home Buyer’s Tax Credit, FHA, VA or any other real estate finance questions I will be happy to answer. Telephone me at 678-439-8683

If you have not yet identified a home and made an offer you are going to be very hard pressed to get closed in time to take advantage of the Federal First Time Home Buyer’s Tax Credit. If you have questions don’t wait any longer – pick up the phone and call me at 678-439-8683 or complete the form below now. Not tomorrow, not after you get back from your break … now!

This rule affects all loans whether it is an FHA loan, a Fannie Mae loan, a Freddie Mac loan, or a Ginnie Mae loan. The MDIA affects loans originated by brokers, lenders and bank employees. The MDIA applies to new homes, previously existing home and home refinance loans.

Here is the catch: If the APR changes more than .125% the Truth-In-Lending (the other 1/2 of the Good Faith Estimate) has to be resent and another waiting period of three (3) business days must expire. Some lender interpret that to include a decrease in the APR of more than .125% and some only consider an increase of more than .125% since the government’s action does not specify.

There are many, many reasons the initial disclosure could be wrong including loan amount which may be affected by the appraisal, payoff which could be higher (and usually is on a refi) than indicated on the current mortgage coupon, or a list of other factors which may even affect a home purchase – not just a refinance.

All homes are not alike but most home buyers need a home loan to purchase the home unless they are successful enough to have the cash!

Many towns and cities today have true “town homes” where the building is mixed use. This particular home in downtown Smyrna, Georgia even has a little tomato garden on the upper deck and a shop on the ground floor. FHA home loans (HUD mortgages) has the solution for these properties up to the county limit. So what’s available outside of the county limit?

The answer really depends on the zoning for the property and what is available by lender in the local area. Currently FHA will approve loans up to 96.5% of the sales price with the loan amount not exceeding the county limit for the county where the property is located. To know for sure if an FHA home loan can be used on your property be sure to contact your FHA home loan expert before making an offer on the property.

Since each property may have a different type of business located on the first floor there “can” be issues affecting the type of loan you get and whether or not an FHA home loan is available on that particular property. Again, always contact your local FHA home loan expert to get the best answers for your individual needs.

I encourage all first time buyers to be very active about finding a new home and getting approved for the loan now because November will be too late. Seriously, if you think you can wait until November to find a home you will be sadly mistaken and, in Georgia at least, miss out on a possible $9,800 tax credit including both the Federal and State home buyer’s tax credit.

If they have been applying for jobs online or have their resume online they may fall for this trick out of desparation. Feel free to repost this entire article with a link back on your website or anywhere else it can be posted:

from	Selina <firework68828@gmail.com>
reply-to		firework68828@gmail.com
to		me
date		Mon, Aug 24, 2009 at 11:38 AM
subject		Notice: Resume Considered For Possible Employment
mailed-by		ey-out-1920.google.com
signed-by		gmail.com

Hello. Good Day.

We came upon a copy of your resume on the Internet. Our corporation oversees various job opportunities in your field. We are fully interested in appointing a qualified person such as yourself for a variety of jobs we offer. The task is pretty easy. You will be in charge of planning meetings and from ?time to time, running company errands. When running errands you will be assigned a company credit card.

Due to damaging events with this in the past, before we can send you an company card application, we require you to get a credit check. We prefer you utilize – http://ID0824CREDIT02.webs.com/Credit-Quiz-27.html – to acquire this data. When you provide your info they will send you your credit check. ?When you send thru email your credit score, we can continue the employment process.

We have part and full time positions available. Send me your schedule and how many hours per week you plan on working. ?Thank you for your attention!

Sincerely,

Jeremy Young
Director of Operations:Human Resources

e-mail message trace ID: qzeddkw-1517664485-uda5ornhn

We constantly keep our eyes on the rates wondering if and when they will move and which direction they will go. As a Georgia FHA home loan expert I am most interested in FHA but we offer VA, Fannie Mae and Freddie Mac loans as well. Of course any move higher invokes one response and any move lower another. It is amazing to me how a slight move higher gets people to call and a slight move lower gets people to hope the rate will go even lower.

Forbes is a great source for stories and news about mortgage interest rates and I can almost tell where my customers get their information when they get it from Forbes. Their article this morning titled “Mortgage Rates Lowest Since May” sparked a few emails and a couple of calls from people saying they saw rates had dropped to 4.57 – sure, on a 5 year adjustable!

It’s easy to skim articles and come up with a number like that so I don’t blame people for doing so. The reality is mortgage rates are lower today than they have been since May but chances of them going any lower or even hovering that low are very slim. Rates have been more volatile this year than they have in many years although the fluctuations, fortunately, have been small. My advice? If you are a first time home buyer and want to take advantage of the first time home buyer’s tax credit or even if you’re just looking to purchase or refinance an existing Georgia FHA home loan this is a great time to do so.

Call me directly at 678-946-0101