BY: KIARA JOHNSON
If you have ever purchased a house in the past, I assure you that today’s home buying process is much different.
In today’s world, lenders ask for so much information that you will probably wonder if you even want to proceed with buying a home. This is a common feeling, but rest assured that someone with a 600 credit score will still need the same documentation as someone with an 850 credit score.
This article is to enlighten you on documents your lender will request, why they are requesting them and other significant milestones throughout the process.
Congratulations! Your contract has been accepted, meaning you have made an offer on a home and the seller has agreed to the terms and conditions that you and your realtor have outlined in the contract. The first important date is your acceptance date. This is a date that the contract is accepted. From that date, you have typically 24 hours to provide your earnest money to your agent. Earnest money is the pre-negotiated amount that you put down in advance to show the seller that you are serious about purchasing this property.
Also, from this date, it is essential that you sign your “Intent to Proceed” with your lender. The Intent to Proceed form says that you have chosen that lender to work with on the purchased of the specified property. Without this form being signed, your lender is limited on what they can do with the file. They cannot order the appraisal or request certain documents in order to get the loan process moving.
Another milestone date that buyers should be aware of is your inspection period. Typically, unless otherwise stated, you need to have your inspections completed within ten days of the acceptance date. This includes, but is not limited to, your building and pest inspections. During this ten-day window, it is also important to call insurance carriers to make sure the property is insurable. Any concerns should be drawn up in an inspection report which your realtor will send over to the seller to see what issue(s) they may or may not be willing to address.
Simultaneously, your loan coordinator is working hard on preparing the file for underwriting. Your loan coordinator will be your primary point of contact outside of your loan officer. As a lender, we want to make sure you will be able to make your payments, so we need to verify sources of income. Whether that may be from a job were you receive paychecks, self-employed income, or even fixed income. We will typically collect a month worth of pay stubs, two years federal tax returns, W2’s and/or 1099’s. You would think that would be enough to prove your income, right? The answer is “No.” Behind the scenes, we are calling your employer to verify the information you provided and contacting the IRS to verify your tax returns were filed identically to what you gave us. This is not done out of choice on the lender’s part but because the guidelines require it.
When we run your credit report, we will ask you to explain or provide documentation on any derogatory information. This includes bankruptcies, judgments, charge-offs, late pays, etc. We will also have you explain any inquiries to your credit within the past 6 months. We want to make sure we have an accurate picture of your debts and liabilities so that we are meeting mortgage lending guidelines. There are times where credit accounts will not report to the credit bureaus. When that is the case, we need to know about those accounts from you.
We also require asset statements. Not only for the accounts that will be used for closing; but for all your asset accounts. Sometimes the difference between your loan being approved or denied can be that little extra money you have in a 401K or investment account that can be used for reserves. We will also ask you to document and support deposits that aren’t payroll. We will request information that may be specific to your financial situation. This may include divorce decree or separation agreement, job gap explanations, and unfortunately much more.
There will be times were you provide everything requested and we still come back and ask for more. How frustrating! Most likely, the information you provided triggered for more questions or documentation for clarity. It can be an emotional roller coaster but keep in mind, we are all on the same team with the same end goal- to get you into the home of your dreams.
After all that has been squared away, we have loan commitment. This may be the most important date for the lender, realtor, and seller. This is the date that you are contractually obligated to provide loan approval. Most loan commitments will have a few conditions on them such as a 24-hour verbal verification of employment, 24-hour credit soft pull, or finalize insurance. These items are nothing to worry about.
The most exciting date for all parties involved is your closing date. This is the day you receive the keys to your new home- which is exciting, and it’s also the day you sign a significant amount of paperwork- which may be less exciting.
Call Kiara Johnson at 314.568.6389 to get pre-approved and learn about all of the mortgage options you qualify for. I can also be reached by email at firstname.lastname@example.org.
By: Tim Whitmire
Yes! Buyers can purchase a home with no cash out of pocket! How much down payment should you make?
Common questions home buyers have are: How much money do I need to buy a home? How much down payment should I make? Is it worth making a 20% down payment?
To many people’s surprise, home buyers can qualify to purchase a home with needing no cash to close. There are two 100% loan programs. These programs are VA mortgages for eligible veterans and USDA mortgages for homes in eligible rural areas. Both of these programs require no down payment. There are still closings costs involved, but closing costs are eligible to be negotiated into the contract for the seller to pay. It isn’t uncommon for Veterans or those purchasing homes in eligible rural areas to need no money to close.
It is still possible to get into a home with no money out of pocket even if you are not a Veteran and are not buying in a rural area. This can be accomplished with both Conforming and FHA mortgages with the use of down payment assistance programs. There are down payment assistance programs in both MO & IL. There are also down payment assistance programs available through certain counties in MO & IL. You do not always have to be a first-time buyer to be eligible for down payment assistance.
Even though it is possible for many buyers to purchase a home with no money out of pocket, which can make the dream of homeownership more obtainable, making a down payment can save you money over the life of the loan. A larger down payment may allow you to reduce the amount of private mortgage insurance (PMI) you must pay or eliminate the need to pay PMI altogether. A larger down payment can also help you obtain a better interest rate on your mortgage. If you are an eligible veteran and choose to take advantage of your VA benefit of obtaining a VA mortgage, a larger down payment can reduce the amount you must pay for VA’s up-front funding fee. There can be a lot of benefits to making a larger down payment. Sources of down payment can include savings, liquidating assets, borrowing against assets such as a 401k or a vehicle, tax refunds, a bonus, inheritance, gifts from family, down payment assistance, etc.
There is a lot to consider when determining the amount of down payment you should make. We at First Integrity encourage you to ask the following questions: How much money is that larger down payment saving you? What is the source of your down payment? What is the opportunity costs incurred for the funds used to make your down payment? Is it worth making a 20% down payment? It’s important to consider all of your mortgage options and all the true costs of the down payment or lack of down payment, you choose to make. First Integrity has exclusive programs we’ve designed to meet the needs of home buyers with all amounts of down payments. Ask how you can make less than a 20% down payment and truly pay no PMI!
- We Care enough to take the extra time necessary to make all of the mortgage programs you qualify for available to you
- We Think through the pros and cons of each mortgage option and help you make the best decisions for you and your family
- We Deliver the best mortgage experience and make buying a home fun
Our Closings are a Celebration! Not a Formality.
Call Tim Whitmire at 314.402.8184 to get pre-approved and learn about all of the mortgage options you qualify for. I can also be reached by email at email@example.com.
Start with a solid plan today!
The vast majority of New Year’s resolutions have to do with health and finances. We can’t help you eat healthier, exercise, or lose weight, but we can help you get on track to be financially fit with a refinance or by helping you prepare to purchase your first home or your next home in 2018.
The key to a smooth real estate transaction, whether it is buying your first home, your next home, or refinancing, is following a well-thought-out solid plan.
A successful purchase transaction starts well before looking at your first home. An informed buyer first prepares by talking with their mortgage banker months ahead of time. So many times home buyers wish they had done this or wish they had not done that. We have a list of Do’s and Don’ts to share with home buyers looking to purchase a home in 2018. Call us for this FREE and simple guide.
We also help buyers understand their options with detailed loan analysis worksheets. These worksheets include a complete breakdown of all costs associated with the transaction, cash needed to close, and a breakdown of what the monthly payments will be. This helps home buyers establish down payment goals, which can be turned into a monthly or weekly savings plan.
Credit is also very important. It is important to know your credit score and how it impacts your mortgage. Even if you already have excellent credit, increasing your score can help you obtain a lower rate and save thousands of dollars over the life of the loan. A First Integrity Mortgage Banker can help you understand how to improve your score. Viewing and having a full understanding of your credit months prior to your purchase while there is still ample time to improve your score can pay off in a big way.
Is it better to save for a larger down payment, or to use that cash to pay down debt and improve your credit score? It’s important to get these answers before you begin shopping for a home.
There are many ways refinancing can help you meet your 2018 financial goals.
With increasing home values, you or a friend or family member may be able to save money by eliminating Private Mortgage Insurance (PMI) from your mortgage.
Or, you may want to make home improvements. Did you know that you do not need equity in your home to finance home improvements? Call today and ask how. (314) 878-7900.
With the Federal Reserve Bank raising short-term rates and Prime rate increasing, you may need help to pay off high rate credit card debt or you may want to pay off an adjustable rate second mortgage.
Refinancing can help you achieve goals of lowering your monthly payment, paying off your mortgage quicker, consolidating debt, lowering your rate, eliminating PMI, adding or removing someone from the mortgage, etc.
It takes very little effort on your end to find out if you could benefit from refinancing. A First Integrity Senior Mortgage Banker will ask the right questions to learn about your existing situation and understand your goals. With this information, we provide a no cost, no obligation analysis to determine if you could benefit from refinancing. Call Today! Tim Whitmire 314-402-8184 or firstname.lastname@example.org.
Now is the right time to find that perfect home, make updates, improvements, or renovations so you enjoy them this summer. Whether purchasing a home or wanting to upgrade your existing home, our Renovation loan programs allow a customer to build the costs of renovating into their mortgage and achieve two goals with one loan. If you have found that home in the perfect location, but it’s not quite what you want: Don’t wait, Renovate. Are you outgrowing your current home or wanting to upgrade dated items, but do not have enough equity built up or enough money saved? Don’t wait, Renovate.
There is a lot of talk in the real estate community about low inventory on homes for sale. That is true in some cases if you are referring to homes in new, pristine, move-in ready condition. However, there is a great inventory of homes that are outdated or in a distressed condition in very desirable areas which are great opportunities to purchase and renovate. These homes are typically being sold below market value so, not only can you get a great deal, but you can also include any and all updates, improvements, or renovations that you would like at the same time. So, don’t wait until you find the perfect home. Turn any home in your desired area into the perfect home with one of our renovation or home improvement products.
Whether you are spending $15,000 for cosmetic repairs and updates, $150,000 for kitchen and bath remodels, or $300,000 to put on an addition and complete major renovations, we have the right renovation program that can help you accomplish all of your goals. All of these programs work off the “after improved” value, not the “as-is” value which gives you credit for all the repairs, updates and improvements upfront. This allows access to the greatest amount of funds available.
These programs are mainly designed to benefit home buyers and homeowners, but they are also a wonderful tool that can be used to help Realtors, Contractors, Investors, Financial Planners, and Insurance agents increase their business and help their clients reach their goals. These programs work well on all owner-occupied properties, but they can also be usedto for second homes and even investment properties.
Choosing the right lender is as important as choosing the right loan program. Both need to work for you today and tomorrow. At First Integrity Mortgage Services, you can expect the best possible service to help you plan effectively, purchase confidently, and own successfully.
If you would like to learn more about our Renovation programs or see if one might be a good fit for your next project, please contact our Renovation Specialist (Ryan Cox) to set up a free consultation 618-581-3015 or email@example.com NMLS# 1547172.
December 2017 Newsletter
By: Kiara Johnson
This is by far one of my favorite times of the year! It’s the time of year where most people come together and realize how important it is to be thankful for the many blessings we have. We know everyone’s story is different, and no one is dealt the same hand. This is why it is so important for us to give back while we can.
Here at First Integrity Mortgage Services, we don’t wait until this time of the year to show support to our community. This is something close to all of our hearts & an ongoing trend year round. Once a quarter, First Integrity Mortgage picks an organization to give back. Money is raised among the employees and donated at the end of the quarter. The organizations chosen are usually near and dear to the employees here.
1st Quarter 2017 – Team Activities for Special Kids (T.A.S.K.) & Gateway to Hope
2nd Quarter 2017- Leukemia & Lymphoma Society (LLS)
3rd Quarter 2017- American Foundation for Suicide Prevention
4th Quarter 2017- Amy’s Wish
Although the majority of our donations come from our employees, everyone is welcomed to participate. If you want to know FIMS current organization of choice, feel free to contact our office at 314-878-7900.
Backstoppers is another organization FIMS holds close to heart. Police officers, firefighters, and EMS workers continue to face great challenges and make sacrifices for our safety every day. Supporting Backstoppers is one of our ways of saying “Thank You”. We give $750 for every Backstopper loan we originate. The borrower receives $500 off closing cost AND we donate $250 to the organization.
We don’t stop there! Every year, in April, we host a Trivia Night in support of Backstoppers. Our first year in 2016, we raised approximately $8,000.
Our second year, we took it to a new level and raised over $16,000! 2018 we are looking to go above and beyond. Everyone is welcomed to attend our trivia night. More details to come early 2018.
Another group that we like to show our appreciation and support to is our veterans. The individuals that have fought for our country and our freedom definitely deserve a break and some recognition. Every VA loan that is originated, we waive our origination fee. Just a simple way of saying “Thank You” and we appreciate everything you have done. So as we go into the holiday season, let’s show what the season is all about…Love, Peace, & Happiness!
If you would like more information or have any questions, comments, or concerns, please reach out to Kiara Johnson, NMLS# 869292, directly at firstname.lastname@example.org or 314-568-6389.