Hispanic Borrowers

As a Hispanic mortgage broker, I have seen countless Hispanic borrowers getting ripped off. I am glad with new guidelines in place to protect them. The issue I see now is that a lot of them do not qualify because they were so used to using Stated or No Doc programs to qualify. I think there are programs that will allow them to get loans, but they need education on the process, the guidelines and the new laws in place. They need to understand advantages like, the FHA non-occupant co-borrower program. They also need clarification on streamlines. I believe with strong education and communication we can help a lot of them save their homes or get into a new home. Education on strengthen their credit or fixing it is also necessary. I think there a lot of the people who do not hesitate to take advantage of these borrowers and that have created a lot of fear in them. Hopefully they understand that there are honest people who can help them and put them on the right road to better financial security.

MD licensed mortgage broker
Rockville condos

If you are divorced, get your name off the mortgage.

I'm sure everyone knows that if you are late on your mortgage, it will hurt your credit. Nothing new there. This blog is about how much damage they can do if your name is on another mortgage and that person is late. As you can assume, it hurts your credit, which in some cases, could disqualify you from receiving a loan. This blog is about specifically divorce couples. A lot of times, when a couple gets divorced, they had both of their names on mortgage. After the divorce, they don’t make any changes to the loan, so both names remain, even though one person has clearly moved out and is probably looking for his or her own home. If the person who remained in the original home is late, it will hurt that persons credit and also the other spouse who has already moved out. It also puts other limitation on future loans. With FHA, which allows 1 late payment of 30 days in the past 12 months, it will disqualify from you doing a cash out. You will only be allowed to refi as a rate and term. If the spouse who moved out is looking to buy a new home, he may need to qualify carrying the debt on the original home. Also, with a current late, especially in this market, any borrower may need to wait for a year before they can complete a refi. If you need access to equity, and to lower your payment, this could cause financial problems, while you wait for the year to expire. I mention 1 year, because on the conventional side of things, banks do not want to see any mortgage lates in the last 12 months. Some banks will go as long as 24 months. I believe the best option, is to refi the house for the person who will be leaving there. I know that sometimes that spouse might not qualify, but if you are not living there and they are late, it could have very serious ramifications for the spouse who has moved out.

DC Sr. Mortgage Broker
Montgomery County, MD Homes

Commission Employees

Most commission employees are making less now than they were a few years back. For those who are looking to buy, they may think this will create a big issue. What these borrowers must do, is average out their income for the last 2 years and use that number to try and qualify. Here is an ex., if you are a financial advisor, take the income from 2007, 2008 and the YTD for 2009. You can use the gross income from the W2. The gross income is the one that includes 401k contributions. You will add all of the income, and divide by the corresponding months. In the example above, if you use 2009 YTD to cover up to the end of August, you will be dividing by, 32 months. 32, because you will add 12 months from 07 and 08 and the 8 months you counted in 09. If you use income from a partial month, divide the days you are using by the total days in the month. Ex., if you are counting up to the 15th day of August, you would divide 15/31 = 48.39. The total for 2009 would be, 7.48. The reason is, 7 months from Jan-July because you used the income for the full month, and then .48 for the partial August income. If we go back to the first example and you are going back to 2007, it would be; 12 + 12 + 7.48 = 31.48. You would divide the total income for 07, 08 and 09 by 31.48. You would then use that average to qualify the borrower.

DC Metro area Sr. Mortgage Broker
Rockville Townhomes