Mortgage News

Home Buyer Q & A

April 30th, 2012

  • I have an investment property worth about $1.1 million, I am trying to sell it and would love to refinance it. What are my options? Couple of questions...How is the property titled? For conventional mortgages, the property must be titled to the individual. So, this is a pretty important question. Is the house currently listed? If the house is currently listed for sale, it does need to come off market in order to refinance. How long? Some programs only require 1 day others require 6 months off market before application. Next, on an investment property, the maximum loan is 75% of the appraised value. Unless, the loan is a conforming balance ($417,000 or less) and is serviced by Fannie or Freddie. The the relief refi and refi plus programs kick in.
  • I am in the process of purchasing a new home. I have seller paid closing costs. What happens if I do not use them all? How can we use them all? If you do not use all of your seller paid closing costs, you lose them. In a 100% financing transaction like VA, you may only walk away with as much money as you have in the transaction (earnest money, cost of appraisal and credit report). In a situation where you have a down payment, your down payment would be adjusted by what you have in the transaction. How do we use all of the money? It is difficult to use seller concessions to the penny. We usually under estimate slightly or over estimate slightly, depending upon your cash position. We may look to buy the rate down or pay up-front mortgage insurance, depending upon your situation.
  • We would like to buy a new home. We filed bankruptcy (Chapter 7), it was discharged 2 years ago, and we did have a foreclosure as part of our bankruptcy. Do we have to wait to buy? FHA and VA both allow for exceptions to their routine rule of "3 yrs after a foreclosure before you can buy a property again" rule. I usually have my client my client provide a letter of explanation and a copy of the bankruptcy. I then have my underwriter review everything to assist in determining extenuating circumstances.
  • I am a veteran. I am in the process of buying a new home, but the purchase price is 600,000. How much do I have to put down? The first thing we should do is make sure you have full entitlement. Then, we compute our magic worksheet. General rule of thumb is 90% of purchase price. However when you use the jumbo worksheet, our numbers come up to roughly 93%.

- Jennifer Keenan, Senior Mortgage Consultant, NMLS# 101837, Tidewater Home Funding 757-366-8690