Are some lenders and loan officers just shooting craps with your mortgages?
I think so..... Experience and knowledge don't always have to be a
prerequisite to help you with a mortgage. Now, don't get me wrong,
knowledge and experience could be the key to your mortgage closing. But
what about common sense? Shouldn't it be on the list also?. Why do I say this?
Just
a week ago, I received a phone call from another lender in Alabama. Her
question was about the down payment assistance programs and if I new
any investors that did these with conventional financing. My first
question to her was, why aren't you pursing this as a FHA mortgage?
Her main response was that the back end ratio to qualify was too high.
I asked, how high. She said 47%. Okay, in reality, depending on the
loan, I can sometimes get this approved on a FHA mortgage anyhow. But I went over this with her with a fine toothed comb. Read on to see what I suggested which saved this client over $150 a month.
This loan officer had a client with a 623 credit score on a conventional mortgage. By going conventional, the interest rate was going to be about 5/8% higher than a FHA mortgage. Just by lowering the rate 1/2%, the payment would be much lower, which would have lowered the debt-to-income ratio to under 45%. By doing this, this particular client would then have no problem qualifying for a FHA mortgage. And one more thing to keep in mind, the mortgage insurance would be lower monthly also. Here is a good example of comparing conventional mortgages to FHA mortgages.
The bottom line is to make sure that you are not only dealing with a
lender/loan officer that can do FHA mortgages, but that individual is
someone that can think outside the box.
And you might want to review these red flags. Consumers need to be aware of these Red Flags !!!!!
In Part 2 : I will explain in more detail and give examples of FHA mortgages compared to conventional mortgages. I will also show you that FHA Jumbo mortgages will be even more cheaper than either a jumbo mortgage or doing a conventional mortgage with a 2nd mortgage to stay under the conventional caps.
Author of this blog : Jeff Belonger
e-mail : jbelonger@ihmci.com
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