Ingrid B. Quinn

NMLS ID #211652 Arizona, Loan Consultant


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Buying Without Selling

4412037-handling-multiple-homesMany homeowners would like to buy a new home and not have to manage the timing of a simultaneous close or would like to do some work on the new home without having to live there. The buyers are not sure they would even be able meet lender’s qualification guidelines carrying both properties.

With a strengthening housing market and housing inventory low, why should a seller accept an offer from a buyer that has a house to sell? Who knows if the buyers are realistic and price their current home to sell, or will do all the right things to market and sell it quickly? Sellers wait to get a cash or non-contingent offer, because they know one will come along soon enough.

There are rules to qualifying for a new home without selling your current home. You must be able to make the required down payment from savings or secured borrowing. The easiest way to qualify is to you have the income to carry both homes without the benefit of rental income to offset the payment of the current home. If the current home is owned free & clear, the lender will count the tax, insurance and HOA fees as monthly liabilities. We must receive a Desktop underwriting approval for the income to debt obligation ratios. Then we are good to go. There are asset reserve requirements.

For a Fannie Mae or Freddie Mac conforming loan up to $417,000 or $625,500 in high cost areas of the country, and a buyer is converting their current home to an investment or 2nd home the reserve requirements for assets after close are if there is 30% equity in the converted residence, then 2 months of the new home payment and 2 months of the converted home payments are required. If there is not 30% equity, then 6 months payments for each is required to be in reserves. There are additional reserve requirements if the homebuyer will own more than 2 properties.
Please feel free to contact me for additional information at ingrid.quinn@cobaltmortgage.com or visit me at scottsdalemortgageexpert.com or cobaltmortgage.com/ingridquinn


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Rumor: Loans Are Hard to Get

rumors

I receive phone calls on a daily basis from people looking for a mortgage. They want to get prequalified to purchase a home and most want to have the rumor “It’s hard to get a loan nowadays” dispelled. There are a lot of mortgage options available:

1. Conventional conforming loans- up to 97% loan to values to $417,000 or higher depending on area of the country loan is placed
2. FHA loans- 96.5% loan to values
3. VA loans- 100% loan to values for veterans & military personnel
4. Jumbo loans- loan amounts over conventional conforming loan limits
5. UDSA- 100% loan to value rural area loans
6. Private/hard money loans
7. Home Equity loans

So where is this bad information coming from? Media, banks, mom & dad, professionals in your life? Getting a loan is not that hard. You need decent credit (not super excellent), a job, and cash for a down payment and closing costs potentially, depending on the type of financing you are eligible for.

Many times the clients I talk to are referred from agents that were supposed to take the client out to look at a rental. If they can afford an $800-$3500 rent payment for example, they may be able to buy a home.

It is important for the consumer to get re-educated on the market today when they are looking to make any kind of move, renting or purchasing, so they know their options and have a plan in place. Many people are surprised when I tell them you can qualify to purchase now. With the market improving and interest rates at historic lows still, now is a great time to buy a home! If you have any questions or comments, I would love to hear from you. I can be reached at Ingrid.quinn@cobaltmortgage.com or http://www.scottsdalemortgageexpert.com or http://www.cobaltmortgage.com/ingridquinn.


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Closing Costs, What Are you Paying For?!

  Buyer-Seller-Rd-SignWhen you purchase a home, there are many things to keep in mind, especially pertaining to financing. As a buyer, you need to be prepared for not only your down payment on the home but also closing costs. These are the fees affiliated with the loan and the purchase transaction being processed and closed.

   You pay closing costs to the Title Company, state/county/city, lender, and you also pay tax and insurance escrows, and per diem interest. The closing costs that you pay the lender are usually far less expensive than you pay to the other parties. All costs and down payment funds are paid at the closing table to the Title Company and they are then dispersed to the various entities/vendors that the fees are owed to.

   The following are the seller concessions that the seller can pay on top of splitting the transfer & recordation taxes (if applicable, splitting these taxes is customary in many areas) In Arizona, it is standard in the resale contract for the seller to pay the Owner’s Title Insurance. Sellers may pay up to 3% of the sale price towards a buyer’s closing costs, escrows, and per diem interest, on a conventional loan with a 5% down payment.

   Sellers can pay up to 6% of the sale price to the borrower’s closing costs, escrows, and per diem interest on a loan with a 10% or 20% down payment. On FHA loans a seller is allowed to pay up to 6%. On VA loans, the seller may pay all closing costs for the veteran.

   On an investment property the maximum seller credit for closing costs is 2% of the sales price.

 

   Here is a list of some fees that are included in closing costs:

-Application Fee (if any)

-Loan Origination Charges

-Points

-Appraisal Fee

-Prepaid Interest

-Private Mortgage Insurance

-FHA, VA and Rural Housing Fees

-Home Owners Insurance

-Flood Determination Fee

-Property Survey Costs

-Title/Escrow Fees/Title Insurance

 

   Your lender will give you an estimate of closing costs on the purchase of a particular house you’ve selected. This is called a “Good Faith Estimate” (“GFE”) and it is required by law to be given to a buyer. Then, the day or before closing, the Title Company will give you an actual “Settlement Statement” (aka “the HUD” or “the HUD-1”), which is the final and complete form with all the numbers for the sale, including the actual closing costs.

   There are many different ways of handling the cost to close, including “buyer assist”. The best idea you can do is sit down with either your realtor, financial adviser or a loan officer and simply ask. They will be more than willing to answer any questions and make sure you are truly ready to buy! If you have any questions please feel free to email me at Ingrid.quinn@cobalmortgage.com


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No Down Payment Home Loans

Open House sign if front of house for sale

Are you in the market to buy a home? There are a few options to purchase a home with no money down. Here are some of the options out there today and remember each option has its own particular guidelines and terms that will vary form loan to loan.

• VA loans: This is offered to active, honorably discharged, retired and widowed military personnel. You do still need a 620 credit score to qualify and there is a funding fee that varies depending on military status type.

• The Office of Housing & Development (HUD): HUD REOs (Real Estate Owned) Homes owned by HUD can be purchased for as little as $100.

• HUD programs: There are federal programs for public service healthcare professionals, firefighters, police force and teachers.

• USDA Rural Housing loan: This loan is designed for people who live in rural areas.

• Lease-Purchase: The seller agrees to sell the home to the person leasing it at a specific date in the future. When this is done the person leasing the home will usually pay an amount
in excess of what rent would normally be. This extra money is set aside with an escrow company as a “down payment savings plan”. When the selling date arrives the extra money will
be used as a down payment on purchasing the home.

These are some of the no money down options when purchasing a home and please keep in mind that terms of each agreement do slightly vary form situation to situation. If you have any questions or comment please feel free to email me at Ingrid.quinn@cobaltmotgage.com