Frequently Asked Mortgage Questions



If you questions about your scenario, you have come to the right place.
If you don't see your answer down below, just give me a call or shoot me an email.

Preston Ware - 20 Years Experience

Home Loans Florida

NMLS License # 216170

 My Direct Line (561) 329-0075

Here are some common questions. Every scenario is different so please feel free to use the "Got a Question" form at the bottom of the page.

Do you have any upfront fees?

How long does the mortgage process take?

I am thinking of doing the Home Affordable Loan but I am not sure if I have a Fannie Mae Loan or a Freddie Mac Loan. 

Does being self employed make it harder to get a loan?

 Can I use my overtime to qualify for a mortgage?

 Should I get a home inspection when purchasing a home?

When is my mortgage loan locked?

 If I go directly to the bank, can't they give me a better deal?

 Is it much more difficult to get a loan now then it was three years ago?

Why should I go with you instead of another mortgage broker or bank?

 Can I get a mortgage loan if I have no credit?

 Should I consider getting a co-signer to get a better interest rate?

I am having a problem finding the right home because they are being snatched up so quickly

Do I qualify for a streamline FHA Refinance?

If I had a foreclosure, short sale or deed in lieu and am looking to get an FHA loan, how long do I have to wait?

If I had a bankruptcy and am looking to get an FHA loan how long do I have to wait?

If I had a foreclosure, short sale or deed in lieu and am looking to get a Fannie Mae loan, how long do I have to wait?

If I had a bankruptcy and am looking to get a Fannie Mae loan how long do I have to wait?

 
How do we qualify a conventional Fannie Mae borrower who has a pending sale that will not close before the purchase of the new home?

What about this recent "Back to work initiative" change to FHA guidelines that says we can go buy a house one year after a short sale, foreclosure or deed in lieu?  


Do'sandDon'ts



 

Do you have any up front fees? No. The only up front fee is that you pay for the appraisal when the time comes. There is a form that you fill out in which you provide a credit card number to pay for the appraisal when the work is done. Then the fee is deducted from the final closing statement. We cannot make money on an appraisal or a credit report, it is against Federal Law to do so.

 

 

How long does the process take? My bank can move very fast if need be. Best case scenario I would say three  weeks. A large part of the equation is the borrower. Is the borrower organized and quick to forward the necessary paperwork or not.

 

 

I am thinking of doing the Home Affordable Loan but I am not sure if I have a Fannie Mae Loan or a Freddie Mac Loan.  Here are the two lookup links. For whatever reason they are not 100% accurate. If you feel that there is something wrong, please give me a call. Fannie Mae Lookup Tool    http://loanlookup.fanniemae.com/loanlookup/

Freddie Mac Lookup Tool    https://ww3.freddiemac.com/corporate/  We are all waiting on HARP 3.0 which should be open to everybody.

 

 

Does being self employed make it harder to get a loan? No Just as long as we are able to show the same line of work or a work history of at least two years we are O.K  There is actually a Freddie Mac product that allows us to qualify you with one year history of being self employed.
 

Can I use my part time job to qualify? We can use a part time job as long as you have steadily been working it for at least one year. the guidelines actually state two years is necessary but in my 20 years of doing this, we have always been able to get the exception and use one years time to qualify.

 

 

Can I use my overtime to qualify? Same guideline. We will need to show that overtime is consistent and has taken place for at least one year.

 

 

Why should I use a realtor? If you are buying, the realtor commission comes out of the sellers side, so it doesn't cost you anything. If you are selling, most likely the Realtor will help you get a better price for your home. In each case, the Realtor will explain legal issues and help with the contracts that bind you

 

 

Should I get a home inspection when purchasing? Yes. Even if you have entered into an as-is contract. the inspection is typically done before the appraisal and will reveal hidden secrets about your home. If there are major issues, your Realtor can take the laundry list of problems back to the seller and renegotiate a better price.

 

 

What is the difference between pre-qualified, pre-approved, approved etc ? If you are purchasing you always want to have some sort of a letter from a mortgage professional that shows that your profile has been looked at and you are in a position to buy. This will help your Realtor negotiate a better deal for you. A pre-qualification letter is when I have discussed your file and pulled your credit and it looks good. A pre-approval letter is when I have received your proof of income assets and debts and run your deal on-line through one of the many underwriting engines. e.g Fannie Mae, Freddie Mac or FHA. You are fully approved when I have sent your file to a bank and the source has validated or agreed with me that your loan falls within the parameters of the program.

 

 

When is my loan locked? I will not lock a customer until they actually apply. That means when I receive signatures on compliance forms and proof of income and assets. If I lock when I issue paperwork, sometimes the customer drags their feet and it effects my ability to guarantee the rate.

 

 

I am not buying a home for 90 days, when should I start putting my file together? Now. It is best to get your ducks in a row early so you are an expert by the time the purchase rolls around.

 

 

If I go directly to the bank, can't they give me a better deal? No. I utilize the wholesale channel of a bank and if you go directly to the bank, you are using their retail channel. By definition wholesale prices are better than retail prices. I created a YOUTUBE video about this. http://www.youtube.com/watch?v=WK0z4jzXRTo

 

 

How do I know I am getting a good interest rate and a good estimate? Check the difference between the note rate and the APR. The more fees and closing costs associated with your loan, the larger the spread between these two numbers. Also beware of an estimate that omits certain closing fees or escrows of taxes and insurance. These costs simply don't go away if we do not include them on the good faith estimate. I have written a few articles about getting a Good Faith Estimate.

http://www.huliq.com/1/85393/getting-quote-todays-mortgage-rates 

http://www.huliq.com/1/84951/review-good-faith-estimate-mortgage-rates

 

 

Is it much more difficult to get a loan now? Maybe. I think for homeowners who are trying to refinance it has gotten more difficult because values have dropped which makes the loan tougher. But from a standpoint of purchasing we have several 100% financing programs & FHA which is 96.5% financing at a great rate! I even have a $100 down program for the purchase of a HUD foreclosure.

 

 

Why should I go with you? Besides my stunning good looks, I have 15 years of experience and have been trained by some of the most knowlegable people in the mortgage business. I still do business the old fashion way, where every customer is treated well and considered a referral source for life. There are two types of lenders in this world, hunters and farmers. In stead of hunting and looking for a kill I prefer to plant little seeds of friendship that comes back to me ten times over. Ask any of my previous customers.

 

 How do I know if my credit profile is good enough to get a loan? Really this is my job. As a rule most lenders like to see at least a 640 credit score thesedays. Although i should say that I have options with sources as low as 580 middle credit score. Also, I have a number of tools that I can use that will repair credit in as little as 5 business days.

 

Can I get a loan if I have no credit?  Yes. There are still a few sources that allow us to build a credit profile with alternate forms of credit. e.g Pay your rent with a check so you can prove it later, pay your phone, electric, cable, car insurance on time so we can prove it later. If you ever finance furniture, computers or a car at a buy here, pay here establishment , we can use that too.

 

What if I have a bunch of charge offs and collections? Whenever we do a loan we run the deal on line to an automated underwriting engine. the feedback will tell us if the aprticular source is requiring us to payoff a debt. Sometimes it is up to underwriter discretion. If your collections are medical, we most likely will not need to pay them off. if they are judgments, absolutely yes we will need to get them off the credit report before you can do a loan. In some cases I can help you settle collections at 25 cents on the dollar.

 

Should I consider getting a co-signer? This is something that we always can consider, especially if the co-signer has good credit and savings and little debt and intends to live in the home. If you are doing an FHA loan, and we have a non-occupant co-signer then between the two of you, you will need to put 15% down instead of 3.5%.

 

I am having a problem finding the right home because they are being snatched up so quickly This is becoming a problem again because many believe banks are holding back their supply of foreclosed properties from inventory. Before you go house hunting you need to be properly pre-qualified by me so I can give you a pre-qualification letter. If you are having a hard time finding the property, #1 Always work with a realtor. Their commission is taken out of the seller side of the closing statement. Sometimes a buyers agent loses momentum with you as time goes by. If you feel that happening, switch agents. It may be a case where you are asking the unattainable or maybe the realtor isn't jumping high enough for you.

If I had a foreclosure, short sale or deed in lieu and am looking to get an FHA loan, how long do I have to wait? 3 years from the Certificate of Title date to the application date.

 If I had a Bankruptcy, how long do I have to wait until I can go get an FHA loan? Two years from the date of discharge but you will need to have some good credit history remaining or re-establish at least three trade lines and not a single late since the BK was discharged.

If I had a foreclosure, short sale or deed in lieu and am looking to get a Fannie Mae loan, how long do I have to wait? For an 80% Purchase or Rate/Term Refinance, the seasoning period is 2 years. For a 90% Purchase or Rate/Term Refinance, the seasoning period is 4 years. For an 80% Cash Out Refinance the seasoning period is 7 years.

If I had a bankruptcy and am looking to get a Fannie Mae loan how long do I have to wait? 4 years from the date of Discharge. Chase has a 7 year seasoning requirement.


What about FHA's "Back to work initiative" change to underwriting guidelines that says a borrower can go buy a house one year after a short sale, foreclosure or deed in lieu? Before the change, the FHA guideline was that a borrower with a previous short sale had to wait three years from the certificate of title date before he or she could go buy another home. Now the requirement has been lowered to the one year mark with a few caveats.

 

The three caveats are:

  1. 1.) The borrower needs to demonstrate the “economic event” that shows at least a 20% loss of income whether it was due to illness, loss of employment or just reduced income due to extenuating circumstances.
  2. 2.) Then the borrower needs to show that the event has been sufficiently repaired and he or she has maintained a good residency history and good credit for the last twelve months.
  3. 3.) The borrowers need to complete a HUD approved housing counseling class from a HUD approved counselor.

 
How do we qualify a conventional Fannie Mae borrower who has a pending sale that will not close before the purchase of the new home?

  1. Provide a signed contract for the current residence with evidence that all financing contingencies have been cleared, an appraisal of the current residence confirming a minimum of 30% equity and evidence that the borrower has liquid reserves of 2 months PITIA for both mortgages. OR
  2. Provide a signed contract for the current residence with evidence that all financing contingencies have been cleared and evidence that the borrower has liquid reserves of 6 months PITIA for both mortgages.

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