Michigan Mortgage Blog by Mortgage Matt of Icon Mortgage

I understand the skepticism of the Realtors I talk to. It seems too good to be true with everything going on. With the masses of lenders that let their imaginations run wild with all of the money they could make on unqualified buyers. So to hear that someone is still helping the very average buyer-the same as they have been for two decades- seems kind of…too good to be true. But while FHA was running wild with 500 FICO scores and Non-Occupying Co-Borrowers, there was a mortgage insurer that never waivered from their original guidelines. Now that the bottom fell out from under the others and Steve Preston scrambles to wrangle FHA in yet continue to lend…there is the stolid conservationist guidelines that have served median income borrowers for a while now. Oh, it’s still a United States Government backed program. It’s called the USDA and it is here to stay. They have never swayed to lower scores, client base, or lower standards. The only thing lower is the rates. They had lower income b

I find that the first hurdle a First Time Buyer faces is getting their paperwork together. I am not sure why, but honestly this simple task dissuades many people when they start to apply. Perhaps following this list and having it ready at the outset will help the process seem smoother. Last two years of W-2s or Tax Returns. If you can’t find them, you can always contact your employer, your tax preparer, or the IRS for a copy. Most recent month of pay stubs. 1 month worth…the most recent available. Most recent 2 Months of bank statements. If you don’t get paper statements, you can print your online statements, but you will need to take them to your bank to get verified and stamped. Most recent 401k statement. (If you have one.) Copy of your driver’s license and social security card. The Patriot Act requires us to check these. Have these items ready to go before you look for a loan officer and DO NOT trust anyone that will try to quote you a payment or interest rate before they even see

For a first time buyer, there is so much to worry about and so many levels of details to address, that I just want to provide a good general guide to how to start the process. You can refer to my other blogs for more detail, but I think this is a great overview. Purchasing anything, will cost you money. A home is the biggest purchase you will ever make, but most people expect to spend less than when getting an apartment. Any decent complex will want first, last, and possibly a security deposit. That’s at the very least $1000. Have this much before you consider buying a home. Now, Before you do anything else, find a loan officer. Before you contact a Realtor, before you look at homes, you have to qualify. In today’s market there are so many intricacies to qualifying that the first thing you need is to get approved. Approved, not pre-approved like so many tell you. Finding a good loan officer is finding someone that doesn’t talk about pre-approval. Find one that runs Underwriting and a

“BORROWERS BILL OF RIGHTS” 1. You have the RIGHT to shop for the best loan for you and compare the charges of different mortgage brokers and lenders. 2. You have the RIGHT to be informed about the total cost of your loan including the interest rate, points, and other fees. 3. You have the RIGHT to obtain a “Good Faith Estimate” of all loan and settlement charges before you agree to the loan or pay any fees. 4. You have the RIGHT to know what fees are nonrefundable if you decide to withdraw your loan application. 5. You have the RIGHT to ask your mortgage broker to explain exactly what the mortgage broker will do for you. 6. You have the RIGHT to know how much the mortgage broker is getting paid by you and the lender for your loan. 7. You have the RIGHT to ask questions about charges and loan terms that you do not understand. 8. You have the RIGHT to a credit decision that is not based on your race, color, religion, national origin, sex, marital status, age, or whether any income is der

You’ve probably met me face to face and don’t even realize it. If not, you’ve certainly seen my cards pass through your office in the last six years. I’m the guy that was in your office with a smile, a free pen, and a Rural Development (RD) loan flyer. I’m here again to tell you why you need to find yourself a great RD loan officer to refer client to. RD eliminates the most common deal killer. “Cash to close” kills more deals than anything, I am certain of that. Whether it kills deals in process or stops potential buyers from proceeding, the money a buyer has to bring to the closing table is the biggest obstacle in Michigan. RD eliminates this by allowing your borrowers to finance closing costs even above normal LTV guidelines. We don’t need concessions to achieve stress-free financing for buyers. RD has no down payment requirements. RD sees other ways to protect their own investment, but for most Michigan borrowers these requirements are not an issue. The last 100% financing availa

Proceed with Caution: The weirdest part of talking to people about their loan experiences is that people usually are more particular about their Realtor than their Loan Officer. In reality, your Loan Officer is responsible for ten times more than your Realtor, especially in a foreclosure transaction. They will be digging through every aspect of your life; they are exposed to some of your most sensitive information. They are responsible for organizing the entire transaction from open until close. Most importantly, this is the person that represents you, and your application to the powers that be, so you need to believe in them to portray your strengths and represent you well. This is also a good time to realize that cheaper rarely means better. A good bit of advice I would give anyone…choose wisely, make sure your Loan Officer is making as much as your Realtor, and demand excellence. Interview with a Vampire. No, it’s not that bad. Actually the vast majority of bad loan officers and b

What is it? An escrow account is basically a mandatory savings account to pay your taxes and insurance from. Every month you will pay your mortgage payment and a portion of that payment will go to the mortgage and a portion will go to the escrow account. When your tax and insurance bills come due, they will be paid from your escrow account company automatically. You will never see a tax or insurance bill, yet they will get paid. Why do you need it? With almost all loans an escrow account is required by the lender you are getting your loan from. The same as with your mortgage payment, if you do not pay your taxes, you will face foreclosure. Instead of being foreclosed on by your lender, you will be foreclosed on by Uncle Same. The possibility of tax foreclosure threatens your lender’s ability to ensure you repay them. Hence, they require that you have an escrow account so that you can’t simply stop paying your taxes. How will this affect your closing? You will need to fund the escrow

Pro-Rated Taxes: Oh, the agony! Nothing causes headaches the way pro-rated taxes do. What exactly are they? It’s your tax bill…and yes…it is YOUR tax bill. In most places in Michigan you get two bills for Property Taxes. One for winter and one for summer. In the vast majority of places, you pay these taxes in advance meaning you are paying in July for the tax bill between July of that year and July of next year; same for the winter bill Dec.-Dec. If you buy a house, let’s say in August, the seller has already paid for the taxes through July of next year. Even though they have paid through July, they will only own the home for one month covered under that bill and you will own it for the remainder of time covered by that bill. You will be required to reimburse them for the time that you will own the home- August through July for the summer bill and August through December for the winter bill. How to calculate what you will have to pay . It’s no secret; you can calculate this yourself t