Ingrid B. Quinn

NMLS ID #211652 Arizona, Loan Consultant


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Mortgage Loan Term: Which One Is Best?

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You will need to make some decisions when applying for a home mortgage. The mortgage, whether it is to purchase a home or to refinance your existing loan, will be for a certain period of time. Your loan term is just another way of saying the length of the repayment period, expressed in years. A 30 year fixed mortgage has a 30 year term, so it will be paid off in 30 years if you make the regular scheduled monthly payments.

If you choose a longer loan term, but make payments for a shorter term, the loan will behave exactly as if you had chosen the shorter term in the first place. You can choose your loan as a 30 year fixed mortgage and make 15 year payments and it will pay off in 15 years. One reason someone may do this is because the shorter term payments are higher and if they run into a financial challenge for a month or more, may choose to pay the lower scheduled amount until they are back on their feet.

The pros and cons will remain the same no matter which term you choose. The benefits of a shorter term loan are:

• Shorter term loans typically have more favorable rates/fees than longer term options
• Shorter term loans force people to put more money towards principal
• Shorter term loans typically have more favorable mortgage insurance premiums in the case of a loan exceeding an 80% loan to value
• The interest paid benefit is huge over a longer term loan

The benefits of a longer term loan are:

• Lower payments than shorter term loans
• There is more flexibility than shorter term loans as far as payment options
• Easier to qualify for as far as the income debt to income requirements for a loan
For most borrowers, the decision comes down to getting more favorable terms for a shorter term mortgage versus lower payments for longer term loans.

Other than the typical 30 or 15 year options, there are also 10, 20 and 25 year options to explore. Contact your mortgage professional to discuss all the options. You may also use my mortgage calculator app from your mobile device to determine your monthly payments.
See
http://ingridquinn.mortgagemapp.com/mobile
For questions or comments please email Ingrid.quinn@cobaltmortgage.com or visit http://www.scottsdalemortgageexpert.com or http://www.cobaltmortgage.com/ingridquinn.


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Fannie Mae Closing Cost Assistance

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FNMA has announced that homebuyers may receive up to 3.5% of the sales price in closing cost assistance on purchase offers submitted on HomePath properties between 2/14/14 and 3/31/14 when purchasing during the First Look period. During the First Look period, owner-occupied buyers are able to submit offers, giving them the opportunity to purchase homes without competition from investors. The First Look period has recently been extended from 15 days to 20 days. Purchases must close on or before 5/31/14.

The incentive will offer qualified buyers up to 3.5% of the final sales price to pay closing costs. If closing costs do not total the 3.5%, the buyer is not able to take the left over amount as a credit back. The incentive is not available on second homes or investment properties.

Prospective buyers can search for properties and easily identify how many days remain on a property’s First Look period by visiting http://www.HomePath.com. “For more information regarding this incentive, please visit the Fannie Mae website for complete details:

http://www.fanniemae.com/portal/about-us/media/corporate-news/2014/6079.htm

Consult your local Realtor for additional information on how to submit an offer to HomePath.

For questions about the Fannie Mae HomePath mortgage financing, please contact me at Ingrid.quinn@cobaltmortgage.com or visit my website at http://www.cobaltmortgage.com/ingridquinn or http://www.scottsdalemortgageexpert.com.


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Flood Insurance Changes and How They Effect Your Home Purchase

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A few months ago F.E.M.A. made some significant changes to the National Flood Insurance Program (NFIP) that was originally established in 1968. For details on this subject refer to the F.E.M.A website, http://www.FEMA.gov , but I felt that there are a few key points that people need to know about. Typically, a homeowner’s insurance policy is shopped for towards the closing date of a purchase transaction. At that time, a purchaser finds out they will need to purchase flood insurance if their new home is located in a flood zone. An issue that clients have been running into is the lack of an elevation certificate on the home they are purchasing and effective October 1, 2013 an insurance agent must quote worst case premiums which can reach into the thousands of dollars if an elevation certificate is not available on the home they are buying.

The elevation certificate is an important administrative tool of the NFIP. It is to be used to provide the elevation information necessary to ensure compliance with community floodplain management ordinances, to determine the proper insurance premium rate. The surveyed elevation data, typically the elevation of the lowest adjacent grade of the structure in question, is provided by a Licensed Land Surveyor. If you are looking to buy a home that is in a flood zone and requires flood insurance to be purchased, this should not be left to the end of the loan process because it may take a week, two or three to obtain the certificate and closing may be delayed.

The cost of obtaining an elevation certificate is usually the responsibility of the buyer. Maximum coverage through the NFIP is for $250,000. For full details and changes made to the National Flood Insurance Program please visit: http://www.fema.gov/media-library-data/7c1b0352fe3987c36569fccc492ab2ca/change_package_508_oct2013.pdf. For questions, please contact me by email at Ingrid.quinn@cobaltmortgage.com or visit my website http://www.scottsdalemortgageexpert.com or http://www.cobaltmortgage.com/ingridquinn.


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The Mortgage Business-Not How It Was

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It’s been a 30 year ride for me in this business. I thought it was time to reflect where the industry has been and where it may go. It certainly is not a boring job. I find it an exciting challenge to daily talk to people and work with them towards their goal of buying a home.

The industry has been in the news a lot in the last 7-8 years and there has not been a dull moment. There have been a lot of changes in the rules and just keeping up with those has been a huge undertaking, but it just takes me back to when I first started out. We verify everything. It’s the way it should be.

I have been through real estate booms and busts, trends come and go and so do people I have worked with. The industry has done some weeding out and hopefully most of the bad apples are gone and hopefully industry standards are where they should be.

What remains the same is that Americans still want to own their homes. I find that people place an enormous amount of trust in my hands and I do everything I can to make their homeownership goal a reality. What has changed, though, is the difference about how a mortgage is originated. The online channel has grown and the mortgage industry has finally automated the process to an almost paperless process. Yea!! Gone are the file folders of 3-8 inch thick loan files and pdf versions of documents loaded into our processing system has make copying and faxing a near thing of the past.

What I still feel is important is the relationship of the quality referral to an experienced and trusted lender. Though online access is readily available, the referral to your mortgage lender is important because they are handling all of your personal information and the trust factor is imperative as to who has your information.

A home purchase is close to if not the largest personal purchase you will make. Take the time to find your trusted advisor in this process. It will make the experience a smoother one. For questions or suggestions please feel free to contact me at Ingrid.quinn@cobaltmortgage.com or visit my websites http://www.scottsdalemortgageexpert.com or http://www.cobaltmortgage.com/ingridquinn.


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Condo Project Eligibility

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When looking to purchase a home in a condominium project, there are a few things to consider. Condominiums are treated a little differently than a single family detached or even an attached home in a homeowner’s association subdivision. The overall financial health of the condominium association is scrutinized. As a result, the project must be acceptable by guidelines put in place by Fannie Mae, Freddie Mac, FHA or VA. The scope of the guidelines and the specific eligibility criteria are dependent upon whether the condo project reviewed is an established community or new construction. I am going to focus on established projects and conventional guidelines. Below are guidelines for such condo projects:
• at least 90% of the total units in the project have been conveyed to the unit purchasers;
• the project is 100% complete, including all units and common elements;
• the project is not subject to additional phasing or annexation; and
• Control of the homeowners’ association has been turned over to the unit owners.
Some General Questions to ask about the Condominium Association
• Is there current litigation involving the association?
• How many units are investor units out of total count?
• Are there more than 15% homeowners 30 days or more delinquent in association fees?
• Does any single entity own more than 10% of the units?
By getting answers to these few questions, you may find out sooner than later whether you will have difficulty obtaining financing for the home you want to purchase.
Condo Insurance Requirements
The condo project insurance policy must ensure the homeowners’ association maintains a master or blanket type of insurance policy, with premiums being paid as a common expense. The insurance requirements vary based on the type of homeowners’ association master or blanket insurance policy. Also, be aware there must be a fidelity bond coverage or employee dishonesty coverage which covers against theft by those entities handling community funds. As for unit coverage, there are a couple of types available and you must check with your lender for what is required:
“All-In/Single Entity” (sometimes known as an “all-inclusive”): The policy must cover all of the general and limited common elements that are normally included in coverage. These include fixtures, building service equipment, and common personal property and supplies belonging to the homeowners’ association. The policy also must cover fixtures, equipment, and replacement of improvements and betterments that have been made inside the individual unit being financed. If the unit interior improvements are not included under the terms of this policy type, the borrower is required to have an HO-6 policy with coverage, as determined by the insurer, which is sufficient to repair the condo unit to its condition prior to a loss claim event.
“Bare Walls”: This policy typically provides no coverage for the unit interior, which includes fixtures, equipment, and replacement of interior improvements and betterments. As a result, the borrower must obtain an individual HO-6 policy that provides coverage sufficient to repair the condo unit to its condition prior to a loss claim event, as determined by the insurer. Depending on the type of loan you choose there can be a requirement for flood insurance.
Buyers need to know this information when looking into purchasing a condo. To determine eligibility for your condominium contact your lender and discuss what information you have and need to obtain for a smooth transaction. This adds an additional step to your mortgage process so make sure you have sufficient time to process your loan application.
For questions or suggestions please feel free to email me at Ingrid.Quinn@CobaltMortgage.com or visit me at either http://www.ScottsdaleMortgageExpert.com or http://www.CobaltMortgage.com/IngridQuinn


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Investment Purchase Options

Purchasing an Investment Property?With recent media attention and television shows that focus on buying and/or flipping (buying distressed properties and remodeling), there has been an increase in property investment purchases. These investors know the benefits of buying an investment property. Whether they rent them out to tenants or they flip a distressed property, buying another home can generate passive income for a homeowner. Because restrictions or tightened guidelines have come to mortgage lending companies, many investors are looking for alternative ways to finance their purchase. By researching all of your available options, you will be able to find a way to finance your potential investment property. Below are some options that may be available to you:

Conventional Conforming Mortgages

The rules will vary depending on whether an investor owns 4 or less financed residential properties or 5-10 financed residential properties. Before applying for a loan, make sure that you have your bank/asset and income paperwork in order. Lenders will require your last 2 years personal Federal tax returns. If you currently own rental property and will need to use rental income as qualifying income, it should be reported on your tax returns. Many investors set up LLCs or partnerships for managing rental property income and expenses. Copies of those returns will be required as well. Also, it is a good idea to obtain a current copy of your credit report as lenders will also have FICO requirements for investment mortgages that may be higher than those scores required for a simple owner occupied transaction.

Private Portfolio & Hard Money Lenders
Investors that flip properties must have short term cash to complete the majority of their purchases. Often, they are attending courthouse auctions to buy foreclosed homes. Many times, they obtain loans from private lenders at high interest rates and costs. With this type of loan, investors are under pressure to sell the house as quickly as possible.
You may choose to finance your investment purchase by using the equity in your primary residence as collateral. You can borrow the money from your primary home to pay cash for your investment property.
If you own additional properties, you can use the equity in multiple homes to finance your next purchase by using cross-collateralization. Some lenders will use your primary residence, as well as second home equity as security when buying an investment property.

How have you financed an investment purchase?
Please comment or email me at Ingrid.Quinn@cobaltmortgage.com or visit my websites at http://www.scottsdalemortgageexpert.com or http://www.cobaltmortgage.com/ingridquinn.


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Moving Up! Some Things You Should Know

moveup-1So, you have been in your current home for a while and you are looking for something a little different. Maybe you are starting a family or you recently married and want to build a home together. There are many reasons why people “move up”. No matter what your reasons are for purchasing your next home, there are some things you need to be prepared for.

I did touch on some of this information in my previous blog “Buying Without Selling”. So if you are looking to purchase a new home while retaining your current home, please feel free to take a peek at that post, but for right now I’m going to write about selling your current home to purchase a new one!

The ideal situation would be for you to simultaneously sell you current home and purchase your new home. This is possible; however the timing is a little tricky. In order to complete this type of transaction smoothly you are going to need a good realtor and loan officer working on your side.

In our current AZ market, selling your home before buying can be easily done. Home values are up and inventory is down, so if a home is priced properly you can sell quickly. Many people have been in their homes for about 7+ years and now have just enough equity, if equity was previously an issue, in their home to move up. However, many people choose to take different routes when looking to move up.

There is an option known as Bridge Financing and what this entails is technically owning two homes for a brief period of time. Bridge Financing is through a financial institution. You will take out an equity loan similar to a home equity loan but the bank will know it is temporary and the repayment structure will be different. It will not carry an early termination fee like home equity loans. There will be a limit on the amount you can borrow on the current home depending on how much equity there is. This loan will give you the funds to make the down payment and pay closing costs for your new home, then repay the loan once the current home is sold. Generally, bridge lenders give you 6 months for the loan with the possibility of extending an additional 6 months. Payments on a Bridge can be deferred but when applying for the new 1st mortgage; the lender will qualify you carrying quite a bit of debt.

I know this sounds a little complicated, but it is actually simpler than you’d think. When it comes down to it there are many ways to “move up” and where there’s a will there’s a way. In the end no matter what you want to do you should always consult a professional. Don’t hesitate to call your loan officer, ask questions and look into what is going to be your best option to get you into that new home. If you have any questions or concerns please feel free to contact me at Ingrid.Quinn@cobaltmortgage.com or visit me at http://www.coblatmortage.com/ingridquinn .