Blog


By: Denise Grab

If you are planning on purchasing a home, I would start asking people you know and trust for referrals, especially for a Realtor ®. I am sure no matter what, you will hear either how awesome the experience was, or how horrific the selling and buying process was. 

By asking people you trust, it will help you to decide who is going to provide you with the best options and service for your scenario specifically. You want to make sure that you are going to get as much equity from your home as you can, while covering their fees, to use as a down payment on your next home. Just a reminder, if this is your first home purchase, having an agent represent you in the buying process is COMPLETELY FREE and STRONGLY RECOMMENDED!

I know I started off the article about selecting a realtor first, and that was just to get your attention, but the real person that you should contact first, is your loan officer here at First Integrity Mortgage Services.  We, at First Integrity Mortgage Services in St. Louis, always provide our customers with options for buying their first or forever home. It is imperative that we are all on the same page concerning a monthly budget and payment. Most of the time, you will be able to qualify for a monthly payment that is higher than what you think you can afford. It is our job to make sure that you are fully prepared, financially, so that when you are house hunting, you are fully prepared for what is ahead in the loan process and know what to expect on closing day. After all, even if you are borrowing 100% of the purchase price or putting 20% down on your first home, your money matters and we want to make sure that you are familiar with every step of the process. 

Step one in the qualifying process will be to complete a loan application on our secure website. You will be asked to provide the basic information, such as your Name, Birthday, SSN, 2 Years Employment history and some simple yes or no questions. Nothing too complicated. From this, your First Integrity loan officer will run your credit and ask you for documentation to verify the information that you submitted on your application. This documentation includes 30 days most recent pay stubs, two years most recent tax returns and W2’s and 2 months most recent bank statements. Is this all the information we are going to need? I wish, but it will be a great start and will put us on track to a solid pre-approval. 

At First Integrity Mortgage Services in St. Louis, we issue a true pre-approval letter, not a pre-qualification letter. The difference between the two is simple. Approval means that your documents have actually been reviewed vs. qualification is that your lender provides a letter to you based on the information that you inputted on the application. Not that we don’t trust what you submitted, investors have several overlays on employment and income that we want to make sure we have all squared away before you list your home or put that offer in on your first home. The last thing you want to hear is that your loan is declined after you have sold your home and have spent several hundreds of dollars on inspections. A solid pre-approval will also make the loan process faster! 

Generally, we can close a loan in as little as 3 weeks but can vary depending on the loan scenario. 
Buying a home is stressful, but if you have the right team to guide you through as we do at First Integrity Mortgage, it will be a little more bearable!  Call us today FIRST to get PRE-APPROVED for your home search and we will be sure to set you down the right path. Check out our Google reviews! They are a true testament to our 5-STAR customer service!

For questions, comments, or concerns, please contact, me, Denise Grab at 314-220-9620 or dgrab@firstintegity.com, NMLS# 738524. I look forward to hearing from you!


By: Dave Puzniak

The Home Equity Conversion Mortgage, commonly known as a Reverse Mortgage, is an excellent solution to the senior care challenge.  For clients who are age 62 and older, a Reverse Mortgage can be used to create a senior care funding strategy.  This smart retirement funding tool leverages the power of an important financial asset – home equity – to help older clients receive the care they need while continuing to live in their own home.


Let’s dispel some old myths about the Home Equity Conversion Mortgage:

Myth #1 – The lender owns the home.

Reality – Borrower retains title to the home, no one is added.  The borrower must live in the home and continue to pay real estate taxes and homeowner’s insurance.


Myth #2 – The home must be free and clear of existing liens.

Reality – HECM is designed to pay off existing liens.  There must be sufficient equity to pay off the existing liens.
 

Myth #3 – Loan proceeds are taxed.
Reality - HECM proceeds are not income, therefore not taxed.

 

Myth #4 – There are restrictions on how to use proceeds.
Reality – Any proceeds remaining after paying off liens can be used; however, the borrower desires with no restrictions.

 

Myth #5 – Only poor people need HECMs
Reality – HECMs provide an opportunity to diversify a portfolio and help ensure against overdrawing existing retirement assets.
The HECM is not for everyone.  An analysis of your situation is necessary to determine if your needs and wants make a HECM the right decision for you.  

 

Let the professionals at First Integrity Mortgage Services walk you through the process to see if it is right for you and your family. Contact David Puzniak, NMLS# 559106, at 314-878-7900 or 314-486-2652 or dpuzniak@firstintegrity.com for more information and a personal meeting with you.


Sources of Down Payments  - Important Factors to Consider When Purchasing a Home!       
 
By: Chris Reh



When purchasing a home, there are many important factors to consider.  One big challenge facing today’s homebuyers is the down payment. It is not just what amount makes sense, or required per whichever loan program you choose, but it is also understanding the acceptable sources you are allowed to use towards your down payment.  

WHAT IS A DOWN PAYMENT? 
A down payment is a cash payment required at closing. In addition to the amount you borrow, this will be used towards the total purchase price of your new home.  Many states and counties offer additional down payment assistance programs to home buyers as well; contact me if your lender hasn’t explained this.   I am going to show you some creative ways you can source the funds needed for your down payment.



1. GIFT FUNDS

Maybe you have some generous family members that are willing to gift you cash to use towards your down payment.  This is great and completely acceptable under most loan programs out there. However, who qualifies as an acceptable donor and the amount allowed to give varies.  The donor must complete a gift letter stating that the money is indeed a “gift” and does not need to be repaid. The donor’s bank statement is required to verify.



2. TAX REFUND

Using your tax refund can add a sizeable contribution towards your down payment.   The estimated average tax refund is expected to be $2,200 for most Americans this year.  Some tax pros might recommend to pay debts, invest, donate, and or save. But with the younger generation working hard to overcome debt, a lack of savings and rising home prices; I think this is an effective, easy, and painless way to increase your down payment.

3. PROCEEDS FROM HOME SALE

Homeowners who choose to sell their home may simply use the existing equity proceeds towards their down payment on their new/next home.  Something important to consider is that one of the difficulties of selling your existing home while simultaneous buying a new home, is to get both the sale and purchase contracts to close in coordination.  Another great option is if you are buying a parent’s home, the equity in that home can be ‘gifted’ to the buyer as part of or the full down payment requirement.

4. YOUR BUDGET

Maybe a source one might easily overlook, however, by simply taking a fine tooth comb through your current budget, you can make some simple cuts to your monthly expenses and free up some additional cash to save for your down payment.  For example – cut costly cable services and start streaming what you watch on TV, or prep meals at home instead of eating out every day for lunch.  This may be easier than you think; definitely worth the try.  TIP: If able, refinance your auto loan at no cost.  In many cases, the result reduces your monthly car payment by a third or more; freeing up some nice cash while also lowering your Debt To Income Ratio.



5. RETIREMENT ASSETS

Your financial advisor may not be too excited about this option, but in some instances, borrowing from your retirement assets can have tremendous value to your down payment.  Retirement plans sometimes allow employees to borrower up to 50% of the vested balance to be applied towards a down payment when buying a home.  Using this approach, you may be able to reach 20% down payment on a conventional loan thus avoiding private mortgage insurance AND lowering monthly payment.  Use those savings to simply repay your retirement account through monthly payroll deductions.  If you go this route, please consult your financial advisor due to the potential tax implications involved.



6. ASSISTANCE PROGRAMS
You might not find an abundance of federal programs that help you, but many city, county, and state governments offer excellent programs to help homebuyers realize their dream of homeownership.  Most are positioned for first time home buyers, have income limitations, and will have specific requirements to qualify for, including but not limited to, purchasing homes that meet certain criteria and homeowner education courses.  It’s key to remember that these programs usually come with other stipulations, such as length of time you must occupy the home as your primary residence, that when broken, levy potential recapture fees.  TIP: Tap into these programs as soon as possible, because the annual funding diminishes as the year goes on.  If you don’t need the assistance for your down payment, then you can actually use those funds to pay your closing costs.

7. POWER PLUS 

Only available from your friendly mortgage banker at First Integrity Mortgage Services.  Ask your mortgage banker today how you can take advantage of the enormous benefits of our Power Plus options.  These also offer an amazing way to avoid private mortgage insurance with less than 20% down. 

As one of the largest cash purchases you’ll likely make, I believe it to be most crucial to work with an experienced lender you can trust, so you can begin planning and documenting the source of your down payment early.  At First Integrity Mortgage Services, we focus on educating and informing, walking you through different custom scenarios that match your needs, for all of the different loan programs that you qualify for.  Stop thinking you need a 20% down payment to buy a house.  You DON’T.   If you are a current homeowner or thinking of buying a home and have any questions about how much you will qualify for, interest rates, fees, credit repair plans, program guidelines, or have been told you currently don’t qualify by another lender, call me. Chris Reh. 314-420-3122. creh@firstintegrity.com NMLS# 1773185. 


By: Kiara Johnson

Home ownership is a core component in establishing and living the American Dream. Whether you are a first-time homebuyer, moving up/down, renovating, or become an investor, you need to have a game plan in place to ensure the most stress-free process as possible.
Many people forget the most critical step of the home buying process. They surf sites like Zillow, Realtor.com, and Red Fin browsing homes but have NO real idea of which route to go. 

The #1 step for purchasing ANY real estate is to talk with your lender. Your lender will be one of the most valuable people in the process. Your lender can give you insight on what price range you should be looking in, estimated payment to make sure you’re comfortable, or even what to expect during the process. The lender will also give you direction based on your desired goal. 

If you are a first-time homebuyer, your lender will discuss low down payment options along with any assistance that may be available. If you are looking for a renovation loan, your lender may advise you to set a general contractor in place to oversee the project. If you are looking to move up, your lender may inform you of the infamous Power Plus loan that allows you a 5% down payment with NO PMI. This is a step that is often overlooked but most necessary.  Your lender is your friend ☺ If you need help finding a lender, call me, I know the perfect one!

If you would like more information or have any questions, comments, or concerns, please reach out to Kiara Johnson, NMLS# 869292 directly at kjohnson@firstintegrity.com or 314-568-6389. 


By Jeremy Durham 

Have you ever found yourself in the market for a particular sized home in a certain school district, but everything you’re seeing appears to have last been updated by the Brady Bunch? Have you loved the location of a home, but found yourself walking away from making an offer due to avocado green appliances? Or peach and country blue wallpaper? Did you think to yourself “I wish I had extra funds to buy this home AND be able to remodel it?” What if you could buy a dated home, in the part of town you wish to live and renovate it to your tastes…all before you ever move in? Perhaps you should consider a Renovation Loan as an option. 

When you purchase or refinance a home, your appraised value is based on the value as the home sits right now. In the condition, it’s in, right now. With a Renovation Loan, your home’s value will be based on the projected After Improved value once your renovation work is complete. Adding square footage, an extra bedroom, bathroom, additional living space, all with more modern fixtures/appliances, means instead of the value of a 3 bedroom/2 bathroom home that you are buying/or currently own, your value will be based on comparable homes with 4 bedrooms and 3 bathrooms that closer meet what your home’s square footage WILL be after the work is completed. Also, all of this can be completed in one transaction with between a 3.5% and 5% down payment, or if you already own the home you wish to renovate this can be accomplished with all costs incorporated into your new loan.  

The Renovation option can also be successfully used by progressive listing agents who perhaps have a dated listing with linoleum floors, wallpaper in every room, a 1950’s pink bathtub, and tile etc. Market the home and provide potential buyers looking at that home with the great backyard in just the right school district, as what the house CAN be, not what it is right now! 

As a local mortgage banker, we specifically offer five variations of the renovation program. There are two types of FHA’s 203k which require a down payment of 3.5%. For our nation's Veterans, there is a VA Renovation option that requires no down payment. Fannie Mae’s HomeStyle option allows for much higher loan amounts than FHA and enables luxury features to be incorporated in your remodel, but still requires only a modest 5% down payment. First Integrity Mortgage has even taken this last product one step further and created a renovation program we refer to as Design Plus.

Design Plus starts with the foundation set forth by our very well-known Power Plus program that combines 1st and 2nd position liens to 1) either avoid costly mortgage insurance without having to make a 20% down payment, or 2) purchase a much more expensive home than conventional lending guidelines allow, all while still producing only a 5% down payment. The Design Plus incorporates Fannie Mae’s HomeStyle Renovation program that provides for a loan amount up to $484,350 (increased for 2019) and a 2nd position lien up to an additional $250,000. In essence, this program can allow a homebuyer (or a current homeowner) to renovate a home with combined loan amounts up to $734,350….all with a 5% down payment (or 5% equity in your current home), no presence of mortgage insurance, AND the rate of both loans are based on the current market 30 year fixed rate. 

Please give First Integrity Mortgage a call today, and we’d be happy to go over these options with you in detail, lay out a timeframe for lending and renovation completion, and get you on your way to having a home in that perfect neighborhood, that’s designed and decorated just the way you want it. 

If you have questions about improving or updating your home or know someone who is and would like more information on any of the renovation loan program, please contact Jeremy Durham at JDurham@firstintegrity.com or 314-856-5626, NMLS# 989777.


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