Ingrid B. Quinn

NMLS ID #211652 Arizona, Loan Consultant


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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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APR vs. Interest Rate, What’s the Difference?

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Recently one of the Realtors I work closely with asked me what the actual difference between APR (annual percentage rate) and the Interest rate. Well, there is a big difference and when you are shopping for a home mortgage you are going to want to pay attention to a lot more than just the APR that is being offered by a lender. The short answer to this question is that simple interest is only the interest you pay on the loan whereas the APR is an informational number that covers some of costs of obtaining a residential loan, including points, interest, lender administration fees, mortgage insurance and various title fees.
In the case of a mortgage, the annual percentage rate, or APR, is the total yearly cost of financing a home, expressed as a percentage of the amount financed.
The federal Truth in Lending Act requires the lender to disclose both the nominal rate and the APR. Loans are frequently offered on different terms. Loan terms from different lenders can make it hard to figure out which offer is truly the best one.
The APR disclosed can be rounded up or down to the nearest one-eighth of a percentage point. Both the APR & simple interest rate must be advertised in the same font size or APR may be larger in print.
What this all means is that the APR of a loan is essentially a consumer tool designed to assist people when looking to make a major purchase. On the other hand, you have your simple interest rate. This is a very straight forward percentage that will be applied to your loan and determines your monthly payment.
People can use APR to get a general idea of what you will be looking at long term, but when it comes down to it people need to not be hesitant to ask lenders questions. Call them and find out what exactly their APR includes and what other fees are to be expected. You can also talk to your realtor and ask them about different lenders they have worked with. It’s never a bad thing to get a second opinion. Especially from a professional who is there to get you into your new home or assist you your refinance transaction.
For any questions or suggestions please feel free to email me at Ingrid.Quinn@CobaltMortage.com or visit me at http://www.CobaltMortgage.com/IngridQuinn or http://www.ScottsdaleMortgageExpert.com .


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Interest Rates Are Up!

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Interest rates are now up about 1.25% from their rock bottom lows in October 2012 and again in May 2013. The inevitable interest rate increase from all-time lows is continuing. Following the Federal Reserve meeting last week, it seems that if the economy performs as expected, then the Fed plans to taper its bond purchases as early as later this year. Over the past few years, the Federal Reserve bond purchase program has helped mortgage rates drop and stay at historically low levels.

However, even though interest rates are volatile, they do not move in a straight line up or down. They have been moving so fast the last few days, as a reaction to the Fed news of possible pull back that we may see some correction. However, that is conjecture, and anyone contemplating a mortgage these days needs to be aware that the mortgage market is highly volatile right now. It seems the Federal Reserve believes the economy is no longer in recession, and as a result the Fed has indicated that it appears ready to scale back its bond purchases.

The rapid rise in mortgage rates has been shocking, but it had to happen at some point. To boost the economy during the financial crisis, the Federal Reserve undertook an unprecedented program to purchase enormous quantities of mortgage backed securities and U.S. Treasuries in an attempt to push rates down. Before the Fed started this program, rates were about 1.5% to 2% higher, so it looks like that is where we are headed again. We are already a good bit of the way there!

So, what you are witnessing with the rise in rates is the market trying to determine the realistic range of mortgage rates without the intervention of the Federal Reserve. Lots of people try and guess the direction of the market and react in advance for their own benefit.. The market buys on rumor and sells on news.

So clearly the market is signaling that it believes the Fed is done with this part of the stimulus. Now it seems we will see the market reconfigure to the new reality.


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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 .


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Always Get a Home Inspection!

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Finding the perfect house is like love at first sight. You can search and search and when you least expect it, you will fall in love, but when love at first sight strikes, you need to be cautious. Just as you would get to know a person and see if you are compatible before settling down you should get to know the house. A home is where you build your life and this is a commitment not to be taken lightly. I always suggest that my clients need a professional’s eye when looking into the possible issues of a home.
Think of having a home inspection like bringing your newfound love home to meet your parents. Just as your parents will scrutinize this new person in your life, the home inspector will scrutinize the house. Both simply want the best for you and are willing to do what it takes to show what’s really underneath the surface.

Normally, you have 10 days according to the Arizona standard real estate contract, to do all the inspections on a home, structural, mechanical, well and septic, termite, permits with the county, crime reports, etc. The cost of the inspection is outside of your loan transaction. Usually, I wait for the go ahead that the inspection was satisfactory and that there are no deal killing issues with the home before I order the appraisal for my client. Why spend $400-$500 on the appraisal if the inspection is not acceptable?
I highly recommend doing all the necessary inspections and that unless you are a licensed contractor and know a lot about a home and its construction that you have a licensed professional perform the home inspection. Your Realtor should give you the names of a few inspectors to contact.
I would be interested in your comments about any home inspection stories you can share. Please comment on my blog page. I can be contacted at Ingrid.quinn@cobaltmortgage.com or visit my website at http://www.cobaltmortgage.com/ingridquinn.


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Using Alimony and/or Child Support Income to Qualify for a Mortgage

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The number 1 question I get about using alimony and/or child support income to qualify for a home mortgage is what if you have not been receiving alimony for 12 months? Well, good news, many people do not have to wait that long. For these situations, I recommend pre-approval in advance of looking for a home. Our automated underwriting engines (DU or LP) will determine the length of time this type of income needs to be received for the loan approval. It is common for a divorcee to want to use alimony/child support income to purchase a home immediately after a divorce.

Below are the guidelines as to how to document this income:

Document that alimony or child support will continue to be paid for at least three years after the date of the mortgage application, as verified by one of the following:

• A copy of a divorce decree or separation agreement (if the divorce is not final) that indicates payment of alimony or child support and states the amount of the award and the period of time over which it will be received. A copy of the children’s birth certificates may be required. Note: If a borrower who is separated does not have a separation agreement that specifies alimony or child support payments, the lender should not consider any proposed or voluntary payments as income.
• Any other type of written legal agreement or court decree describing the payment terms for the alimony or child support.
• Documentation that verifies any applicable state law that mandates alimony, child support, or separate maintenance payments, which must specify the conditions under which the payments must be made.

Document the borrower’s regular receipt of the full payment, as verified by:

• deposit slips,
• court records,
• copies of signed federal income tax returns that were filed with the IRS, or
• Copies of the borrower’s bank statements showing the regular deposit of these funds.

Review the payment history to determine its suitability as stable qualifying income. Each individual’s situation with the ex-spouse is different so it will be important to check with the lender you choose how to work it out. If you have further questions or comments, please contact me at Ingrid.quinn@cobaltmortgage.com or visit me at http://www.cobaltmortgage.com/ingridquinn.