650 is still a good credit score. I would not wait to try and purchase a home in this situation. Right now it is still a buyers market, and you can pick up some great deals for home ownership. You can also, in most cases, have the seller pay your closing cost for you, which saves you a lot of money. For more information, please go to www.stacy-bennett.com.
You can get a wealth of additional information there.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

To report to the credit bureaus, it cost money. Some banks and credit unions are not willing to pay that fee, as they are not required too. It is not mandatory that they report to the credit bureau. A lot of small town banks and credit unions don't report to the credit bureau. It is the cost of doing business.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

If you have more than 10 real estate mortgages, you will have to get an ALT-A mortgage. The rate is slightly higher than your conforming mortgage rates. The reason for this is that there is more risk associated with this mortgage. However, it can get done, and your cash flow will still be there. You can get this kind of mortgage with Wells Fargo Home Mortgage.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

Most lands loans can be done at your local bank. If you own the land and you want to do a construction to permanent loan, Wells Fargo Home Mortgage can help you with that. As far as the size of the loan, we can go up to 6 million dollars on your home loan.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

For Buchanan County building codes, visit the county website at: http://buchcomo.phpwebhosting.com/.

If the home will be constructed within city limits, contact the city directly. http://www.stjoemo.info/

 

The appraised value can exceed 97% LTV, however that is the max LTV FHA will do is 97%. Therefore the customer has to put down 3% of the purchase price, not the appraised value.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

You probably received this information as a courtesy. If you have an Adjustable Rate Mortgage, it will adjust at a specific time. Your lender has to notify you of this. It was good for them to send this to you, because your rate has the possibility of going up with an ARM. With a conventional fixed rate loan, they will modify it, so it will never go up again. I recommend looking into this for anyone that has an ARM, in which it is going to adjust.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

FHA loans are insured by the Federal Housing Administration. FHA has what is called an Mortgage Insurance Premium that is charged to the borrower. This insures the lender in case of default by the borrower.

This is not to be confused with your Homeowners insurance, that will cover you as the borrower.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

If you send in your mortgage payment for March, in say April, it will just be like making any other payment. What you need to do, is to send the payment in and in the memo section of the check write "APPLY TOWARDS PRINCIPAL". This way you are paying down principal early. If you want to reduce the principal balance on your mortgage, always send in your regular payment and an additional payment that will be applied towards principal.

Stacy Bennett
Wells Fargo Home Mortgage
"Dreaming Is the First Stage. Wells Fargo. The Next Stage."

 

The answer is yes; there are even loans where you don't have to verify employment. There are so many variables to address, here are just a few to think about and to talk over with your mortgage planner. First, will debt or credit scores of either borrower bring down the approval, it may be possible to receive a better loan option with just one borrower being on the loan, in your case it sounds like you know your credit and should be fine but are you bringing any debt to the table that hinders the approval? Second, the relationship between the borrowers, Missouri is a "Right of Ownership State", meaning; if you are married you have ownership of the house whether you are on the loan or not. If you are not married you must be on the loan or be added to title after closing. Keep in mind that if you are not married but both of you are on the title; the down payment on the house is considered equity. If your relationship was to dissolve and the house was sold, in-short, you would give up half your down payment to the other person. Depending on your relationship you may want to look at putting the down payment towards something else; emergency fund, debt or savings. Your planner should help you design a plan that is woven into your long and short term financial goals.

T.N.T. Mortgage Inc - "Today Not Tomorrow"

 

Yes it does and yes you want to make sure that you specify that the additional payment goes to principal (most payment statements have an additional box to check for extra principal payments). Here is an example; a $150,000 loan at 7% on a 30 year fixed mortgage would have a principal and interest payment of $997.95. If you were to pay just the minimum payment, the loan would be paid off and you would have paid $209,266.34 in interest over the 30 years. If you would have paid an additional payment each year (starting at the end of the first year) of $997.95, the loan would be paid off in 24 years and saving $49,273.58 in interest. Now there are other factors that are involved that you must take into consideration. First, tax savings; the interest on the house is tax deductible (keep in mind that you must be able to itemize on your tax returns to receive this). The faster you pay your mortgage off, the smaller your interest deduction is. In this scenario; if you were in a 22% tax bracket (15% federal and 7% state, this would be a family filing jointly with an income between $15,100 and $61,300 in 2006) you would have given up $10,840.19 of tax savings. Second, liquidity, the extra money that goes into the house does build up your equity, but it also puts you in a less liquid position. Here’s what I mean; let’s say that you were laid off from your job or because of an injury you were on short term disability. You may want to access some of your equity to get by until you get back on your feet. With the money tied up in your house you must now go the bank and ask for a loan, the problem is that now you have to qualify in order to access your own money. [It is sometimes hard to qualify when you don’t have the income coming in]. Here is an alternative to think about; what if you were to take the $997.95 a year and put it into a liquid side-fund that would earn a rate-of-return and could be easily accessed if you needed it. If you were to put the $997.95/yr or $83.16/mo into a side-fund that earned 7% and then added the tax savings of the $10,840.19 (37.64/mo) that would have been recognized if you hadn’t paid down the mortgage, making the total monthly contribution to a fund at $120.80/mo for 24 years, it would grow to $89,863, a gain of $40,589.42.

 This is why I suggest that a person should always consult with their mortgage and financial planner before making any decisions when it comes to prepaying a mortgage, it could cost you thousands of dollars.

T.N.T. Mortgage Inc - "Today Not Tomorrow"

 

Pre-qualification is an informal way to see how much you maybe able to borrow. You can be 'pre-qualified' over the phone with no paperwork by telling a lender your income, your long-term debts, and how large a down payment you can afford. Without any obligation, this helps you arrive at a ballpark figure of the amount you may have available to spend on a house.

Pre-approval is a lender's actual commitment to lend to you. It involves assembling the financial records. (Without the property description and sales contract) and going through a preliminary approval process. Pre-approval gives you a definite idea of what you can afford and shows sellers that you are serious about buying.

T.N.T. Mortgage Inc - "Today Not Tomorrow"

 

Private Mortgage Insurance (PMI) is required by lenders when a loan is originated and closed without a 20 percent down payment. This insurance protects the lender from default losses in the event a loan becomes delinquent. There are 2 situations under which you can have PMI canceled. First, Automatic, when the equity in the home reaches 22 percent of the original value of the property, the lender will automatically cancel the PMI. Second, By Request, the homeowner can request cancellation of the PMI when their equity reaches 20 percent of the original value of the property, if certain criteria are met. There is a third option and that is the homeowner could refinance after 5 percent equity is built up. This would require splitting the loan into an 80/15 (1^st and 2^nd trustee).

 There are 5 ways to avoid PMI when purchasing a home (keep in mind that all have certain criteria that must be met).

1.      The homeowner could put 20% down on the purchase of the new home.

2.      Lender Paid Mortgage Insurance (LPMI), under LPMI plans; the lender purchases the mortgage insurance and pays the premiums to the insurer. The lender will increase your interest rate to pay for the premiums -- but LPMI may reduce your settlement costs and lower your payment (tax savings may also be more favorable if you can itemize). You cannot cancel LPMI or government mortgage insurance during the life of your loan.

3.      Single Premium MI or Upfront Mortgage Insurance Premium (UFMIP); the lender will charge a single premium upfront which can be paid out of pocket or financed into the loan, assuming that the final loan amount does not go over the appraised value of the home. Once again, depending on your tax situation (being able to itemize) this may create a lower net payment, but like LPMI it can not be canceled.

4.      1^st and 2^nd Trustees (80/20, 80/10/10 or 80/15/5); by doing a 1^st and 2^nd trustee you have in essence put 20 percent down on the purchase, even though you have financed the 20 percent you have avoided PMI. A 2^nd trustee will typically have a higher rate but the payment will usually be lower then a single loan with PMI and it will have a better tax savings (if you can itemize).

5.      Non-Traditional Loans; a non-traditional will usually carry a higher interest rate and typically will be an ARM product with a prepayment penalty.

I suggest that you have your mortgage professional put a total cost analysis together so you can compare each program side-by-side and make sure that the product you choose fits your short and long term financial goals.

T.N.T. Mortgage Inc - "Today Not Tomorrow"

 

It is possible to qualify with no credit; there are two types of no credit. First being; no credit because of derogatory reasons; collections, bankruptcy, repossessions and late pays, for these reasons there is no financing for 0 scores. You will need to build traditional trade lines to increase your scores. Second, no scores because of lack of trade lines; due to maybe the following reasons; age (a young person who just hasn’t been in the system long enough) or pays cash for everything and has never had traditional trade lines or has borrowed money from banks or credit unions who don’t report to the bureaus. It is still possible to get financing under these circumstances, but you would have to have typically four soft trade lines. Examples of soft trade lines would be; rent history (usually need canceled checks or verification through a management company), utilities (water, electric or phone), cell phone or even car insurance, anything that has been paid on a monthly basis that wouldn’t show up on a credit report. Keep in mind that you will need a 12 month history of timely payments.

T.N.T. Mortgage Inc - "Today Not Tomorrow"

 

The top ratio is your mortgage payment divided by your gross monthly income.  The 2nd ratio is the bottom ratio and this ratio includes all of your monthly liabilities divided by your gross monthly income.  They are either revolving or installment debt. These liabilities are added to the top ratio (the new mortgage payment) to come up with the bottom ratio.  In the past lenders had very rigid debt ratios.  The top ratio maximum was 28% and the bottom was 32%. Today lenders have become more lenient and the loan approvals are done on the computer.  It is called desktop origination and sometimes debt ratios are allowed to be in the 60% range.  It is important to keep in mind that just because you qualify doesn't mean its a good financial decision.   With most non conforming lenders the maximum debt to income ratio is between 50-55%.  Debt ratios are used to limit lender risk and also to assist home buyers with a rule of thumb so they don't get into financial problems.  A budget is a must when looking at purchasing a home and maintaining a good credit profile.

 HomeSmartz - "Your Mortgage Solution"

 

The Federal Housing Administration, generally known as "FHA", provides mortgage insurance on loans made by FHA-approved lenders. FHA insures mortgages on single family and multifamily homes. FHA loans typically underwrite with less scrutiny when it comes to credit, they don’t have a minimum score, and instead they require clean credit for the last 12 months. FHA requires a 3% down payment and charges 1.5% MI up front and another .50% monthly. Conventional loans are loans that are secured by government sponsored entities such as Fannie Mae and Freddie Mac. Conventional loans can be made to purchase homes with one mortgage or first and second mortgages (in order to drop the MI) on single family to four family homes. Conventional loans typically have a minimum credit score requirement but also allow for no scores with nontraditional trade lines.

T.N.T. Mortgage Inc - "Today Not Tomorrow"

 

Purchasing a car before a home will increase your debt ratios.  I always recommend that the home purchase be the top priority before cars and other large ticket items.  It is also very important not to make any purchases after you have been pre approved for a home loan because it could affect the debt to income ratios and the rates and terms of the financing.

HomeSmartz - "Your Mortgage Solution"