Let's Talk MORTGAGES

[Anonymous]

So what happened if your mortgage company goes bust? What happens to your payments and title from a non bank finance company?

[Anonymous]

My husband and I got ourselves in a very bad credit situation about 3 years ago - we are pulling ourselves out of it now - in Jan 2006 our scores were me 488 him 514 - now we are at me 556 him 560.  We currently have our house for sale because the owners of the house we want are willing to do a lease to purchase with us - the price of that house is $440,000 - what is the liklihood that in 18 months if we pay all of our debt off and have a 10% downpayment for the purchase that our scores will be what they need to be in order to buy that house?

Our combined income is $110,000 - like I said, effective the date we sell our house we will only have 1 car payment as "debt" the rest will be paid off and we will have a 10% downpayment.

If we lease this house for 18 months we will have a 3 year history with no lates because our last late shows in Jan 2006.

?? 

[Anonymous]

1 Time close construction/permanent can save closing costs fees & provide peace of mind by pre-approving you for the permanent mortgage.  There are requirements about using general contractors, having budgets & blue prints.  Please see my blog on construction to permanent for more information.

Greg Z.

[Anonymous]

What is causing the a problem with your ARM? Is a prime or subprime loan.  Subprime tend to have larger increases when you reach the recast date for the mortgage rate.  Here is some more information about an ARM loan that may help you decide whether yours is a problem.

Greg Z

[Anonymous]

Ok time to put your thinking caps on all you mortgage gurus out there!
Here is my situation, catastrophic ankle injury on the job, 7 months no work, no lates on mort or car payment, workers comp settlement of 45k due in about 3 weeks, bankruptcy 2 years ago, Nov 2005 fico 498 , 666 as of yesterday, ( iwish i could raise it or lower it just one point, that # creeps me out!)
I want to buy a bed and break fast in small kansas town, relocating from Atl GA and will also be parterning in a small restaurant and bar with my brother in law. The B&B has been totaly redone by owner, invested over 100k in upgrades, thanks to a deployment to Iraq and a nasty divorce wants to dump it, currently not listed with an agent, FSBO was asking 175k no bites in over a year now at 157k. My sis in law knows the family selling and says they want to dump it asap, says an offer of 125-130 would probably fly. This a property that can make its own mortgage payment! You could start collecting money on the day of closing for rentals for the pheasant hunting season, the house is booked @ 100% for three months in advance(PAID) starting sept 15. Would have 20k-25k to put down.Also expect about 30k from sale of current house
Whew!
My question?
How does a guy with out a job but lots of cash go to a bank and get financing on a deal like this?
The restaurant bar is 90k for the building and every thing in it. Current sales avg for 3 years is 192k, expenses run about 75k a year. I would have an income from the bar and rest of around 35k plus half of all net profit(20k-25k) I know sounds too good to be true but the guy has health issues and no family to pass it along to.
So tell me how crazy I am to do this or even if it is possible! Look forward to your replies.

[Anonymous]

I am looking for a mortgage but have some time before we close (probably December).  I contacted a direct lender at a big bank and they said they could give me a commitment on a floating rate loan or I could lock for 60 days.  I don't see the point in lock given that rates keep dropping and closing date is undetermined.  Can I get the floating rate commitment and just walk away if I find a better rate somewhere else?  It seems too good to be true to be a free option.  They said they would holdoff all costs including appraisal until I am ready to pull the trigger.   Should I get the commitment on a floating rate loan?  What are benefits/costs? 

[Anonymous]

Thanks for you feedback.  I plan to see what the lending situation will be like in about 18 months and then perhaps look into a lease-option.  I would just hate to fork over all the money I've saved into a lump sum downpayment.  Any thoughts?

This is the smartest thing you could possibly do in this real estate market. I have been a real estate investor and landlord for the past 10 years, and a realtor for the past 4. I also have a degree in economics, so this insane real estate run up we have had is something I have followed closely. It has amazed me the herd mentality of the American homebuyer as they followed thier neighbor to the slaughter house. The price to income ratio for housing is the worst it has ever been in the history of our nation. At current pricing I could not afford to live in the house I bought 10 years ago, and my income has more than doubled in this time period. Usually when real estate takes a appreciation run up it is due to the fundamentals of strong job growth and wage increases. In this, the greatest run in American RE it was not due to strong fundamentals. It was due to free and easy credit. This caused a huge demand for housing, and prices went nuts. Rental properties in my area stopped having positive cash flow around 2003, yet people with no clue what it took to be a landlord were buying like crazy, and even worse people decided they could make money flipping houses. Then along came the toxic option ARM loans with teaser rates of 1.25%, and now everyone is a real estate investor  The 3rd shift manager of Mc Donalds with a 750 FICO score could get a 100% LTV, no doc, option arm on a $600,000 house(I am not making this up, this was an actual client of mine, who I talked out of this house and into the 200k home she could actually afford)  We are in for a very serious correction in housing over the next 24 months, and lease options are the best way to hedge your bets. If in 18 months you do a 1 year lease option for 100k and prices fall to 85k you don't need to exercise the option. If they rise to 110k you just made free equity. Try to give up the smallest option consideration deposit you can like 2% of the purchase price or less, and negotiate that 25% or more of the monthly lease rate be applied toward the down payment. A screwed seller who just needs to get out from under their mortgage will sign just about anything, so negotiate the best deal possible. This will be a great strategy to gain control of Real Estate, it's cash flow, tax advantages, and hopefully someday some appreciation(houses will not appreciate for at least the next 7 years) without much cash. I hope to purchase around 3 to 5 million dollars worth  of rental properties using this strategy around 2010 to 2011. I think this is around the time prices will begin to bottom out. If inflation takes off, so will rental rates, and the days of no money down, positive cash flow properties will return. Those who have the guts to buy when no one else is,  are willing to hold their properties for 10 years,and play the cash flow landlord game will end up very wealthy when they sell off to the sheep going to slaughter at the top of the next real estate bubble.

[Anonymous]

Has anyone had this experience, and can recommend how to go about fixing it.

We are very prompt on paying our mortgage ever month.  We do so online on the mortgage company's site.  We have this  5 year mortgage history so far with no lates.  Recently, we were notified that an online payment had not been processed because of technical issues; they had the incorrect routing number on the account.  We immediately took care of that payment, but not before the mortgage company slapped us with a 30-day late on the account. We pay from the same checking account every month.  We argued with them about this, that if they had stored this account information the payment would have been processed correctly.  We mentioned that their systems did not have the ability to store the account number, and hence it needs to be entered each and every time with the possibility of error.  Coincidentally, 2 months after this situation, their systems have been upgraded and now allow you to store your account number.  Maybe we should require a fee for the user-experience enhancement to their systems.  We are not certain were exactly the account issue occurred (their end or ours), but this is our first and only 30-day on an otherwise perfect payment record.  We'd like to request removal of that 30-day late given the circumstances.  Has anyone any experience on the best way to go about doing this or even if we'll get any kind of consideration?

[ShanetheMortgageMan]

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BOBINSKY wrote:

Has anyone had this experience, and can recommend how to go about fixing it.

We are very prompt on paying our mortgage ever month.  We do so online on the mortgage company's site.  We have this  5 year mortgage history so far with no lates.  Recently, we were notified that an online payment had not been processed because of technical issues; they had the incorrect routing number on the account.  We immediately took care of that payment, but not before the mortgage company slapped us with a 30-day late on the account. We pay from the same checking account every month.  We argued with them about this, that if they had stored this account information the payment would have been processed correctly.  We mentioned that their systems did not have the ability to store the account number, and hence it needs to be entered each and every time with the possibility of error.  Coincidentally, 2 months after this situation, their systems have been upgraded and now allow you to store your account number.  Maybe we should require a fee for the user-experience enhancement to their systems.  We are not certain were exactly the account issue occurred (their end or ours), but this is our first and only 30-day on an otherwise perfect payment record.  We'd like to request removal of that 30-day late given the circumstances.  Has anyone any experience on the best way to go about doing this or even if we'll get any kind of consideration?

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I'd write them a "Goodwill" letter stating that the only reason the payment was late is that an incorrect routing number was entered, I wouldn't mention anything about "if your system stored the account info" because that could be looked at as complaining.  Basically state that you always make your payments on time and obviously made an effort to pay it on time, and once you noticed it was an error you quickly rectified it by providing the correct routing number.  Some people think it's best to wait a few months after it happens to, to have additional on time payments made after the late payment (further evidences that you pay your payments on time).

[Anonymous]

Hi mortgage guy !

Another newbbie on this site asking you a question.

After rewiewing my last Equifax report 15 min. ago, I'm surprised to see that two of my "in process of foreclosure" properties show  60 days late and then for the past two months it says "paid ok".

Any idea of what is going on ? I haven't been notified of any court dates and haven't been at summary judgement court date either ?

Was the loan sold to bomebody else ? 

Property # 1 I am talking to the lender to accept a lower purchase contract from a buyer, Short Sale.

Property # 2 is my home and I've been talking to the lender also, see if I qualify for a Loam Modification.

Asper the credit report, what is going on ?

Thanks for any advice and comments !

P37