What to do with your home during divorce….

Getting out of a marriage is hard and life changing, but getting out of a mortgage (and the marital home) can be even harder. After years of co-signed loans and joint finances, separating yourselves will require a lot of patience.

Rule #1….Keep up with your bills! Seriously.
With everything going on, it’s easy for monthly mortgage payments to fall through the cracks, especially if you don’t plan on staying in the house. But in order to buy again after the divorce, it’s important to keep your credit score good, and missing payments while your name is still on the mortgage isn’t going to help.

Rule #2….Have an agreement in place of who will pay what.
This means more than just paying your mortgage. Any late bills can hurt your credit score. So make sure you have an agreement in place about who pays what.

Rule #3….Have the discussion.
If you and your spouse can have a good discussion about the house, it’s best to decide very early if you will sell or if one of you will stay. You could both stay in the house, at least until it sells and you can split the equity. However, in most cases that is impossible for obvious reasons.

If you jointly decide that one spouse will keep the house the most important factor will be whether or not one of you can afford the house on your own. In order to remove one spouse from the mortgage, you actually need to refinance, or replace your existing loan with a new one.

That means that the spouse keeping the house will need to be able to qualify on his or her own–and then keep up with the payments, with or without alimony.

Call us today with questions about what to do during this difficult time! We are here to help! 770.924.1111

203k/Rehab Loans….

203k-rehab-loans

At Mortgage Solutions of Georgia, we understand that just because a home needs some repairs or remodeling, doesn’t mean it’s not the right home for you. With that in mind, we have worked hard over the years to become well versed in the FHA 203K rehabilitation home loan program. This is a federally insured loan program that allows a client to purchase a home that requires repairs or remodeling or refinancing a home they already own to complete repairs as well.

The 203K loan allows a client the ability to purchase and have escrows funds for repairs in one loan instead of being required to finance them separately. There are certain guidelines and restriction in place that make it advantageous to work with a mortgage company that has the experience to help you avoid mistakes that can cause delays or even a denial on this type of loan.

Basically, a home improvement loan, the 203K program is HUD’s program to help home owners revitalize properties that may be distressed or in need of repair. There are two basic options available through this program, a “full” 203K loan or the streamline version. The “full” 203K loan requires the involvement of not only a licensed general contractor, but also a certified 203K consultant.

These loans are required if repair costs are over $35,000 or if the repairs to the home are considered structural. The streamline version of this loan does not require the consultant, but does normally limit total repair costs to $35,000. Not offered by all lenders, the 203K program has become very popular due to the heavy amount of foreclosed properties available in today’s housing market. Many times these homes are not left in ideal shape or have been sitting vacant for a prolong period of time. Most other loan types will require a property to meet certain standards of condition prior to closing of the loan.

The 203K loan offers clients the ability to close prior to the repairs being completed and have those repair costs set aside in an escrow account to be dispersed to the general contractor completing the repairs once they are finished. 203K loans are restricted to primary residences only.

Benefits of Using a 203K Loan to Purchase a Home
-Purchase a home in need of repairs and close prior to repairs being completed
-Have the repair costs included in loan at low rates
-Have ability to put down 3.5% down payment using FHA insurance
-Seller is able to pay 6% in closing costs
-Up to 90 days allowed to complete repairs
-10% contingency built into escrow amount for unforeseen additional repair costs
-Ability to qualify with less than perfect credit due to FHA insurance backing.

Benefits to refinancing with a 203K loan
-Use the 203K loan for repairs or for updates
-Work with the general contractor you choose
-Structure the loan based on the appraised value after repairs complete
-Refinance up to 97.75% LTV
-Have the repair costs included in the loan at low rates
-Qualify with less than perfect credit

A 203K loan can obviously be a great tool to use when looking to buy a home that may not be in perfect condition. This loan requires a knowledgeable loan officer that can take a client from start to finish in a timely manner.

Contact us today to get started on your rehabilitation loan today. Mortgage Solutions of Georgia, your 203K loan experts! 770.924.1111

4 Things that Slow Down Your Loan Process…..

frustrated-with-sales

1.Incomplete Documentation
In today’s mortgage world, documentation is absolutely critical. Your loan can either be really easy and close in 2 weeks, or really difficult and take much longer to close. Often times the difference is how complete and thorough your documentation is. When your Loan Officer asks for bank statements, sending in all pages is critical as often times bank statement will have numbered pages, if we are missing a page then the underwriter is going to ask for it, even if it’s a completely blank page.

2.Cash Deposits or Transfers
Cash deposits are the arch nemeses to underwriters. Tracking cash is nearly impossible and if the underwriter sees a large cash deposit with no documentation often times we won’t be able to give you credit for this deposit and the money will be backed out of your available assets. Transferring monies from account to account can also present a problem for underwriters. When the underwriter sees a transfer into your account from another account, statements for the other account must be provided in order to track where the transfer came from.

3.Dragging your Feet to Obtain Documents
A sales contract is a legally binding agreement and certain timelines must be met. When documentation is asked for, time is of the essence and as a homebuyer, you must provide this documentation in the fastest possible time frame in order to stay on track for your closing.

4.Sense of Entitlement
Loan officers have this issue with applicants who make $25,000 a year or one million a year. Buyers don’t understand why so much documentation is required for them to be approved for a mortgage loan, but that’s the environment we are in and will be in for the foreseeable future, so get used to it. Here at Mortgage Solutions, we will never ask you for a document that we can either find ourselves, or really don’t need. So if your Loan Officer asks for a document, its best to simply comply rather than having a discussion about why it’s needed.

Bottom line, here at Mortgage Solutions we know how to close mortgage loans, after all, it’s what we do and have been doing for well over a decade now. We have streamlined the mortgage process to get you closed in the most efficient manner possible. We look forward to working with you in the future, if you are seeking a mortgage loan in 2015, get it done right, call the The-Go-To-Guys today!770.924.1111

Words of Encouragement for your Dreams of Buying a Home in 2015!

lying couple on grass and dream house collage

Do you have dreams and aspirations of owning your own home in 2015? Have you previously been turned down for a mortgage loan and want so desperately to have a home to call your own? Then it’s time to make 2015 a year to remember!

We have all been there, heck, I have been there myself. Well over a decade ago after graduating college I had the worst credit in America! No one had ever taught me the importance of credit, how to manage it, and how having good credit would positively impact me for the rest of my life. I am not proud of the pathetic credit score I had back then, but I am proud of where I am at today rocking a credit score in the high 700’s!

The reality of it all is that any credit can be fixed. You just have to know what to do and what not to do. There are tons of valuable resources listed on our website that can help you become an educated consumer. And because we have been there ourselves, we welcome the opportunity to speak to you regarding your personal situation and work up a custom action plan to improve your credit. We can teach you not only what to do, but educate you on why you need to do it. And most importantly of all, we are a no judgment zone! We are here to help you accomplish your goal of home ownership in 2015.

Every day in our office we turn potential home buyers who were previously denied for their mortgage loan into happy home buyers. Sometimes the process is fast and easy, and other times it can take the better part of a year, but you have to start somewhere, and today is the day, now is the time. No more excuses, if you are a serious potential homebuyer and want a home of your own by the end of 2015, calling us today or applying online is the first step in your success!

770.924.1111

How give and receive a gifted down payment for your home…

85

Receiving a down payment gift for the purchase of your next home? You’re not alone. Many U.S. home buyers do it.
Mortgage lenders allow cash gifts for down payment on a huge array of loan programs including FHA loans, VA loans, USDA loans, and conventional loans.

However, if you’re getting a cash gift for down payment, you’ll want to make sure that you “receive” your cash gift properly.
There’s a specific way to receive money for a down payment. Should you receive your gift improperly, your loan could be denied.

Step 1: What the Giver of the Gift Needs To Do
With your mortgage down payment gift letter written, you’ll want to make sure you don’t violate the rules of “taking a gift”. In order to do that, make sure to keep an extra-strong paper trail for the money being gifted.

If you are the person who is gifting funds to the buyer, for example, and you sell your personal stock holding as part of the down payment gift process, you will want to make sure that you document the sale of your stock as well as the transfer of funds from your brokerage account into the account from which you’re making the gift. Do not make the transfer without a proper paper trail.

Next, you’ll want to write a check to the home buyer for the exact dollar amount specified in the gift letter you’ve written. Photocopy the check. Keep one copy for your records and give one copy to the buyer — the lender will want to see it as part of the process.
Note that writing a check is will require more steps and will require more effort than simply wiring funds to the buyer. Be okay with these extra steps. It’s simpler for a lender to document and track a personal check than it is to track a wire; and it’s good to make things simple for the bank.

Step 2: What the Receiver of the Gift Needs To Do
Now that the gifter has handed, in the form of a check, a down payment gift to the buyer, the following steps are required.
First, with the gift check in hand, the buyer should physically walk into your to make the deposit in-person. Do not deposit the check online using an iPhone or Android app; or at an ATM machine.

In addition, into whichever bank account you deposit your gift money, make sure it’s the same bank account from which all of your money at closing will be drawn. You do not want to bring money to closing from multiple savings accounts. This, too, can make things difficult on a bank and the goal is to keep things simple.

When you get to your branch, do the following:
1.Deposit the gift funds into a bank account
2.End your transaction
3.Collect a receipt for your deposit

Under no circumstances whatsoever should you “co-mingle” your gift deposit with other monies, nor with other gifts. The amount specified on your teller receipt should match exactly the dollar amount on the certified down payment gift letter. If the amount is off by even a penny, the lender will likely reject your letter and the funds that came with it.

Note that if you are receiving multiple cash gifts for down payment, you should follow this process for each gift independently. Again, do not co-mingle your gifts. Be guided by your gift letter.

Step 3: Complete the Gift Letter
When you accept a down payment gift, remember that there’s a right way and a wrong way to do it. For example, you cannot randomly deposit your cash gift into a bank account. Doing so will get your loan denied.
The Gift Letter can be obtained by your Mortgage Lender.

Call The Go To Guys for questions regarding any of the above information. We are here to help! 770.924.1111

Just apply for a mortgage? Avoid these 8 deadly sins….

Denial-of-home-loan-application

Here are 8 things you should absolutely not do between your date of application and your closing date. Any one of them could force your loan to fall apart.

1.Don’t buy a new car or trade-up to a bigger lease

2.Don’t quit your job to change industries or start a new company

3.Don’t switch from a salaried job to a heavily-commissioned job

4.Don’t transfer large sums of money between bank accounts

5.Don’t forget to pay your bills — even the ones in dispute

6.Don’t open new credit cards — even if you’re getting 20% off

7.Don’t accept a cash gift without filing the proper “gift” paperwork

8.Don’t make random, undocumented deposits into your bank account

And that’s it.

For example, if your car lease is expiring, you have to do what you have to do. Renew the lease. Before doing it, though, check with your loan officer — spreading your lease over 60 or 72 months may be better for your debt-to-income (DTI) ratio.
The same goes for accepting cash gifts from parents.

There’s a right way and a wrong way to accept a cash gift for a purchase and if you do it the “wrong way”, your lender may disallow the gift and deny the loan.

These are just 8 things that could sabotage your loan. There are more, of course, and Mortgage Solutions of Georgia will help you identify them.

And that’s it.

Call us if you have any questions about the above “Deadly Sins”! 770.924.1111

VA Loan: Better Than FHA and Conventional?

Va-vs-Conventional

VA loans are designed to help active-duty military personnel, veterans and certain other groups become homeowners at an affordable cost. The VA loan asks for no down payment, requires no mortgage insurance, and allows flexible guidelines for qualification.

Here are the biggest benefits of a VA home loan.

No Down-payment
With a VA loan you can finance up to 100 percent of the purchase price. The VA loan is a true no-money-down opportunity.

Easy To Qualify
Like all mortgage types, VA loans require specific documentation, an acceptable credit history and sufficient income to make your monthly payments. But, as compared to other loan programs, VA loan guidelines tend to be more flexible. This is made possible because of the VA loan guaranty. The Department of Veterans Affairs genuinely wants to make it easier for you to buy a home or refinance.

No Mortgage Insurance
Typically, lenders require you to pay for mortgage insurance if you make a down-payment that’s less than 20 percent (Also referred to as PMI). But a VA loan does not. That makes a VA-backed mortgage very affordable upfront and over time.

Lower Closing Costs
The VA limits the closing costs lenders can charge to VA loan applicants. This is another way that a VA loan can be more affordable than other types of loans. Money saved can be used for furniture, moving costs, home improvements or anything else.

Loan Options
A VA loan can have a fixed rate or an adjustable rate. It can be used to buy a house, condo, new-built home, manufactured home, duplex or other types of properties. Or it can be used to refinance your existing mortgage, make repairs or improvement to your home or even make your home more energy efficient. The choices are yours.
Mortgage Solutions of Georgia is a VA-approved lender and can help you decide.

Funding Fee Flexibility
VA loans require a “funding fee”, an upfront cost based on your loan amount, your type of eligible service, your down payment size plus other factors. Funding fees don’t need to be paid as cash, though. The VA allows it to be financed with the loan, so nothing is due at closing. And not all VA borrowers will pay it. VA funding fees are normally waived for veterans who receive VA disability compensation and for unmarried surviving spouses of veterans who died in service or as a result of a service-connected disability.

No Prepayment Penalty
A VA loan won’t restrict your right to sell your home if you decide you no longer want to own it. There’s no prepayment penalty or early-exit fee no matter within what time frame you decide to sell your home. Furthermore, there are no restrictions regarding a refinance of your VA loan. You can refinance your existing VA loan into another VA loan via the agency’s Interest Rate Reduction Refinance Loan (IRRRL) program or switch into a non-VA loan at any time.

Assumable Financing
Most VA loans are “assumable,” which means you can transfer your VA loan to a future home buyer if that person is also VA-eligible. Assumable loans can be a huge benefit when you sell your home — especially in a rising mortgage rate environment. If your home loan has today’s low rate and market rates rise in the future, the assumption features of your VA become even more valuable.

U.S. Government Guarantee
The federal government guarantees that a portion of the loan will be repaid to the lender even if you’re unable to make monthly payments for whatever reason. This guarantee encourages and enables lenders to offer VA loans with exceptionally attractive terms to borrowers that want them.

Call your VA Loan Experts today! 770.924.1111

Why you should consider a Refinance right now…

refinancing

Today’s mortgage rates have dropped again, reaching new lows. It’s a terrific time to refinance a home — there’s no doubt about that.

Yet, for whatever reasons, U.S. homeowners are ignoring the opportunity.

There are currently more than $800 billion in outstanding U.S. mortgages with notes rates of five percent or higher. If your mortgage is one of them, compare your current mortgage to mortgage rates today. Even if you’ve been turned down in the past, you may be surprised what you discover.

Not only are mortgage guidelines that “loosest” they’ve been in close to 10 years, a recent report showed that the average refinancing household now saves 30% on average with a refinance. 30% savings means that for every $1,000 you pay to your bank today, you could be paying $700 to your bank tomorrow.

That’s a huge monthly savings. Don’t miss your opportunity.

So let’s discuss….
One of the biggest questions that most individuals that have a mortgage ask is “should I refinance my current loan.” The answer to this question can be complicated at times since there are many factors to consider when and if you pursue a refinance. The days when the simple answer was “if you are saving a point on your current rate, you should refinance” are long gone. Today, with the incredible changes that have hit our housing and financing markets, making the decision about a refinance is based as much on the program and loan type you have as it is the current rate you have verses what is available on the market. In general, a refinance is a good idea when a “tangible benefit” is achieved by the home owner that helps them attain a better financial position in the regards to their current mortgage and housing situation.
At Mortgage Solutions of Georgia, we advise our clients when it is best to take advantage of these situations and even when it is best to keep the current mortgage and forego a refinance. There are many factors that can weigh in on one’s ability to perform a refinance, but probably the most notable and worrisome one that most people consider today is the appraisal. With property values at 20 year lows based on the high foreclosure fallout from the recession of 2008, many people have found themselves with a mortgage balance higher than their current appraised value, or “underwater” which is the term commonly used to describe this scenario. Although this can make a refinance challenging, it does not means it is impossible. There are a number of special programs that can be of assistance to help home owners save money monthly, such as the FHA and VA Streamline programs and even the HARP I and II programs.

Most programs like these are based on the type of current mortgage you may have and consulting an experienced mortgage professional is essential to the process to determine eligibility for the program and expedite the closing process. Income, work history, credit history and credit rating are other major factors that can affect the approval of a refinance loan. Although we cannot help with income and employment, at Mortgage Solutions of Georgia we can help you achieve a more favorable credit rating and history. This is done by using our extensive credit knowledge and working with our tried and true credit program, Lending Hand, which is offered by our credit provider. Lending Hand is not credit repair, but instead credit enhancement based on your current credit profile and the desired credit rating necessary to attain credit approval for your desired loan type. This process can often take long periods of time to accomplish and can involve guidance from our team for months on end, which we are prepared to do. Even though the market has changed and limited the types of loans available from what they were years ago, there still are plenty of refinance options available and the input of mortgage professional is critical in making the correct decision for your financial wellbeing.

Whether you are considering refinancing your primary residence to use your equity to pay down other debts, performing a streamline refinance to take advantage of a lower rate and term, or even considering a reverse mortgage to supplement retire income, Mortgage Solutions of Georgia will be there to guide you to financial security. We understand the mortgage on your home is normally the biggest financial asset, tool, and responsibility you will ever have and we want to guide you to help you make the best decisions based on all of the choices available to you. At Mortgage Solutions of Georgia, we don’t just consider you our clients, we consider you our friends.

Call us today 770.924.1111

Conventional or FHA? Which loan is best for you?……

fha-vs-conventional-

Current mortgage rates are the lowest they’ve been in nearly two years. As a result, this often brings up the question of “should I buy or continue renting?”

Since the start of last year, mortgage lenders have lowered minimum credit score requirements for the FHA’s popular 3.5% down payment loan; and, Fannie Mae and Freddie Mac have been pushing a popular 3% down payment program, called the Conventional 97.
In addition to those programs listed above, there is also the 100% VA loan and the no-money-down, “rural housing” loan from USDA.
However, for many buyers, the choice of which loan to choose is typically between the FHA loan and the Conventional 97. This is because VA loans are available to military borrowers only; and USDA loans are restricted to suburban and rural areas, with maximum income limits.

So, how do you choose between FHA loans and the Conventional 97?

Conventional 97 LTV Program….
The Conventional 97 loan is another low down payment option available. Thanks to Fannie Mae and Freddie Mac, the program was recently revamped to be cheaper and easier to use.
For example, compared to the original Conventional 97, the newest version is available to first-time buyers and repeat buyers alike, where “first-time buyer” is defined as a person who has not owned a home in the last three years.
This means that borrowers who lost a home to foreclosure last decade can be Conventional 97-eligible under the program’s new rules.
Another great perk is because Conventional 97 allows for cash gifts for down payments, home buyers are not required to make a down payment from their own funds. Monies may be 100% gifted from parents and relatives. The only requirement is that the gift is actually a gift – down payment “loans” are disallowed.

The Conventional 97 program requires a minimum down payment of 3%, only 30-year fixed rate mortgages are allowed, and the loan must be used for a primary residence.

Borrowers are required to verify income and employment; the program can be used to refinance a home; and, home buyer counseling is not required.
And, like other conventional loans, because Conventional 97 loans feature less than twenty percent home equity, they require borrowers to pay private mortgage insurance (PMI).

With all Conventional 97 loans, though, PMI cancels when the loan reaches 80% LTV. That is, when the homeowner has 20% equity in its home.

FHA 3.5% Down payment Program…
Today’s FHA homeowners get access to loans of up to 30 years; minimum down payment requirements are as low as 3.5%; and, FHA mortgage rates routinely beat the market average — often by a quarter-percentage point or more.
In order to get an FHA loan, you must meet the following requirements:
FHA mortgage guidelines state that eligible home buyers must have documented, verifiable income, for example; and require home buyers to live in the home being purchased.

The FHA also requires home buyers to pay mortgage insurance premiums (MIP) as part of their monthly payments.
FHA MIP varies by loan type and down payment, with the most common scenario being a home buyer using a 30-year fixed-rate FHA loan with a 3.5% down payment; and paying 0.85 percent against the borrowed amount in mortgage insurance premiums annually, or $71 per month per $100,000 borrowed.

The FHA cancels FHA MIP after 11 years for loans which started at 90 percent loan-to-value (LTV) or lower. For everyone else, FHA MIP must be paid until the loan is paid-in-full or refinanced into a non-FHA loan.
The FHA is the largest insurer of mortgages in the world. Last year, it insured nearly 1-in-5 loans closed by U.S. lenders.

SO NOW COMES THE QUESTION….
So, which loan is better? That will depend on your current situation.
For example, in deciding between an FHA loan and the Conventional 97, your individual credit score matters. This is because your credit score determines whether you’re program-eligible; and, it affects your monthly mortgage payment, too.
FHA loans are available with credit scores of 580 or better. The Conventional 97 loan, by contrast, requires a minimum credit score of 620. Therefore, if your credit score is between 580 and 620, the FHA loan is best for you.

To really figure out which loan would be best for you, give us a call at 770.924.1111 and we can walk you through the process and answer any questions you might have!

What is a USDA Loan?

USDALoansInformationandFAQ

Looking to buy a home in Georgia but don’t have a down payment, you may want to look into a USDA loan. A USDA loan, also known as a Rural Development Loan, is a government insured home loan that allows qualified home buyers to purchase a home with NO Money Down. USDA Home Loans offer 100% financing to qualified buyers, and allow for all closing costs to be either paid for by the seller or financed into the loan. USDA offers some the lowest rates of any loan product, and you will always have a fixed interest rate.

Am I Eligible for a USDA Loan?

There are 3 main factors that need to be determined…

Credit Worthiness: When an underwriter reviews your credit history, the major thing they will be looking for is a history of paying your bills in a timely fashion. If you have had blemishes in the past they may be overlooked as long as you have reestablished your credit over the past 12 months. Generally, any open judgments or collections will need to be paid off before you close on your new home but every situation is different so on occasion there can be some flexibility when it comes to smaller collections and medical collections.

USDA Loan Income Restrictions: USDA loans are full doc loans, meaning that you will be required to fully document your income. USDA will generally want to see a two year history of employment or consistent income. Exceptions on the two year requirement can be made for applicants such as students. On a USDA Loan Assets are not required for approval, but can certainly help overcome any possible blemishes on credit.

Where You Want Live: In order to qualify for a USDA Loan your home must be located in a designated USDA rural area. It might surprise you just how many areas of the Georgia do qualify for these 100% financing home loans. In fact most the majority of Counties in Georgia are either 100% eligible for USDA loans, or have areas within them that are eligible.

To learn more about USDA Home Loans and how to take advantage of this great program, call the USDA Loan Experts at Mortgage Solutions of Georgia for a free credit consultation.