Kris Mathews asked:




When it comes to applying for a home mortgage you have many different options that are available. Traditionally, most people get full documentation loans which require you to prove your income, your assets, and provide a list of all your creditors to the lender. This is to ensure that they have a detailed idea of how eligible you are for a mortgage loan. Some non-traditional loans actually offered people a chance to own a home without have to prove their income. These loans are called no doc mortgage loans.

Just like the name suggest, no documentation loans meant that the borrower didn’t have to prove his or her income in the application. These loans were used quite often by people who were self-employed or contractors because they usually found it difficult to gather all the necessary documents for the loans. These loans use the borrower’s credit rating first and foremost when it comes to determine their eligibility for the loan. This flexibility meant that a lot of people who were self-employed were able to get approval for low doc loans.

As mentioned before, the borrower’s credit rating is the most important factors that lenders look at when approving these loans. No doc mortgage loan lenders will ensure that the borrower has no previous default on their record. They will also ensure that the borrower has been making their previous loan payments on time. Another factor that many lenders consider when looking at these loans is the borrower’s debt to income ratio. This ratio helps lenders determine the borrower’s ability to repay the loan.

Dawn

Michael A. Goldstein asked:




If you are behind on your mortgage payments or are struggling to stay current on your loan payments, you may have considered refinancing your loan. However, if you have been turned down for a refinancing, and your home is worth less then you owe on it, you may be able to modify your loan. Below are several tips to successfully modify your existing loan, even if you do not have good credit.

Prepare a detailed document listing all of your income, assets and debts both secured and unsecured. More specifically, you should list out any income from wages, investments, social security, etc. You should also list any assets you have, such as investments, stocks, bonds, money in any checking or savings account, 401K, and fair market value of any additional real estate. You should list out all secured debts, such as 1st and 2nd mortgages, car loans, and any credit cards that use property as collateral, such as jewelry. Finally, you should list your home expenses, such as utilities, credit card bills, educational expenses and any other monthly expense that you incur. Draft a short hardship letter. Every loan modification has a story behind it. You need to tell the most compelling story as to why you can not stay current with your mortgage, or why you need to modify the loan to enable you to conduct some other life necessity. Prepare all of your financial documents such as: two years of tax returns, six months of bank statements, three months of pay stubs, Proof of home insurance. Form your negotiation strategy You want the bank to believe it is in their interest to modify the loan. As such, you want to remind the bank that you do want to remain in the home, but should no modification be entered into, you may have to file bankruptcy and force the lender to foreclose on your home, thereby incurring all of the legal fees and financial losses of selling your home in a depressed market. Always ask for more then you expect or want (It never hurts to ask) You want to leave room to negotiate to your eventual goal Typically start at 70% of your goal. When forming your offer, make sure you have thrown in a few items, you do not need, but can use a bargaining chips by taking them off the table. When the bank makes their first offer, you want to counter without emotion. For example you can say “let me see if that number will work for me, I need to run my numbers and get back to you with in 48 hours. I will need to speak to my attorney or broker first.” As discussed earlier, when negotiating with a bank, you may want to imply that should the loan modification or short sale not work out at the walk away price, the bank will end up taking the property and incur all the foreclosure sale fees involved. This is especially important in a depressed market, where it is unlikely the bank will recoup their return on investment. Banks do not want to owe properties in this market.


If after talking with your lender you have not received the results that you need, please feel free to contact our law office.

Willie

Kelly Liyakasa asked:




If you’re like many homeowners, you dream of better days when your property is paid in full and you don’t have to make those dreaded mortgage payments anymore. But, getting back to reality, many are turning to mortgage refinance services in order to cut their monthly loan payments or to extend their loan periods. Keep these hints in mind before choosing a refinance plan:
When to Refinance: When you already have a mortgage and wish to apply for a second, be sure the amount you save on interest rates balances fees paid during refinancing. Lending Tree is a great resource when debating the ‘apply/not to apply’ question, as they offer certified lending and allow you to compare multiple offers online. Loan Options: Determine whether a fixed rate mortgage or adjustable rate mortgage is in your best interest. Fixed rate mortgage monthly payments tend to remain steady despite market conditions. E-LOAN allows you to compare both loan options and to outweigh the pros vs. cons before you make your decision. Cash-out refinances: These allow you to refinance with a loan amount larger than your current mortgage…while you keep the cash difference. The catch? Your home equity must qualify before you can go through with it. No Closing Cost Refinances: If you wish to save on up-front fees, this is probably your best choice. Depending on whether or not the prevailing market rate is lower than your existing rate by at least 1.5%, you are sure to reap the benefits.

Websites such as E-LOAN provide mortgage refinance loans, as well as useful information on home equity, home and auto purchasing, and personal loans. Utilizing features such as ‘The Loan Advisor’ allow you to enter information such as credit ratings, how much you intend on borrowing, estimated property values, and current mortgage balances. They, in turn, will recommend which loan route to take. Remember, saving money is key in your refinance loan search.

Caroline