Tuesday, September 9, 2014

Mortgage Qualifications Are Getting Easier - But Not the Hoops

 

The paperwork requirements are still draconian for mortgages


No matter who you believe regarding the economic recovery, no one is claiming that housing has recovered as of this writing. Home prices are up, interest rates remain low, but overall transactions and new home starts remain very depressed. With fewer mortgages for both purchase and refinance being written, the supply demand curve is forcing financial institutions to modify their rules.

While no one thinks we are going back to the crazy Wild West rules of the mid 2000's, regulators and banks who tightened lending standards in reaction to the busted housing bubble, went much to far. Sanity is returning as the pendulum swings back towards the middle. In just the last few months for instance, credit score requirements have dropped from 640 to 600 at FHA, and some lenders are accepting 620 credit scores on conventional loans.

According to TheMortgageReports.com
23.9% of banks reported an easing of mortgage loan standards during this year's second quarter -- more than twice the percentage from earlier this year. Banks are reducing FICO requirements, lowering qualification hurdles, and bringing more loans to closing.
That's the good news. What has not changed is that your paperwork needs to be perfect! Underwriters for the banks and for the insurance companies are driving mortgage brokers and consumers nuts with their demands for details. However, if you are willing to live through a bit of frustration, now may be the best time in a decade to apply for a mortgage.

We will do our best to limit your frustrations by anticipating the paperwork and helping you to get it done right. Call today and we will help you with any questions you have, and help you make smart decisions with regard to the mortgage that will be best for you at this time.

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

424-354-5325

bill.rayman@guaranteedrate.com
https://GuaranteedRate.com/BillRayman

Saturday, September 6, 2014

When Can I Get a Mortgage After a Chapter 7 Bankruptcy?

 


FHA rules require that you wait two years for a mortgage after Chapter 7


The medical bills piled higher and higher. The credit cards were maxed out, and because we'd missed some payments, they were now charging 24% interest. A consultant explained that we had no chance of paying off our debts within our lifetimes. We decided that circumstances like ours were exactly what bankruptcy was created to solve.

The attorney told us that we would be able to get credit right after the final adjudication, and he was right. Within months we received small credit lines on credit cards. Department store credit cards were also available. By year one, we were able to get a car lease, even though the upfront needed to be higher than average. But what about a mortgage.

The FHA sets the minimum. They have a rule that requires you to wait two years. Most lending institutions and other suppliers of premium mortgage insurance are going to require at least this two year standard.

Your credit report will be the next obstacle. In 2014 the banks and other mortgage lenders are requiring a 620 minimum credit score and FHA loans can go as low as 600. If you have been building up your credit during the years since your bankruptcy is is very likely that your credit score will now be in the mid 600's.

If you are hoping to purchase a new home or refinance your current home, and you've had a bankruptcy, we are ready to guide you through the process. Call Bill Rayman today to get the process started. 

Bill Rayman Home Mortgage

12121 Wilshire Blvd
Suite 350
LA CA 90025

424-354-5325

bill.rayman@guaranteedrate.com
https://GuaranteedRate.com/BillRayman