Charlotte Home Mortgage: Time Running Out!

The leaves are turning and fall will soon be over.  Another thing that will be over soon is the first time homebuyers $8,000.00 tax credit.  If you are looking for a Charlotte home mortgage and still haven’t found the house of your dreams, you better HURRY!  As of today, there are only 35 days left to close on your new home. 

This weekend I was driving around the many communities around Charlotte and noticed all the many “open house” signs.  I don’t think I have ever seen this many open house signs.  Many home buyers and their Realtors are prepping their listings for the final push.  Buyers, getting a Charlotte home mortgage, are looking for bargain and sellers are looking for eager buyers to close on their home before the tax credit expires.  And although there may be some excitement in the air, heading into these last days, buyers and seller must be aware how soon the deadline is coming (Nov. 30th).  I have received 2 new contracts just this weekend for first time homebuyers looking to close on their Charlotte home mortgage, and I have 35 days to do it!  This can still be accomplished, but you need to be prepped and ready to execute. 

Many of the Big Banks have even already stopped accepting mortgage applications, because they are unable to hit the Nov. 30th deadline.  It is important you have a plan and execute that plan quickly with the support of mortgage and real estate professionals that have the ability and experience to guide you through the process.

Here is a short list of things you need to do:

1)  Get Income Together:  Get your most recent pay stub and last years W-2 or tax return.  It is also helpful to have you most recent bank statement, if you have one.  If not, be familiar with your balance.

2) Get Pre-Qualified:  Call me or a trusted mortgage professional as soon as possible and request a pre-qualification.  To save time, you should be able to do this over the phone.  The focus is on… Income, Credit and Down Payment.  If you clear these basic hurdles over the phone, then make an appointment to get pre-approved.  If there is some concern about the any of these, your mortgage professional will guide you on the next step.

3)  Get Pre-Approved:  In a pre-qualification, you just verbally offer the qualification information over the phone.  A pre-approval is actually meeting with a mortgage professional and verifying everything.  At that time they will go over terms and the mortgage process.  (If they require an upfront “application fee”… leave!)

4)  Call and make appointment with Realtor:  Make sure you put the horse in front of the cart, so get pre-approved first and then connect with a Realtor.  The Realtor wants to make sure you are a bonafide buyer and ready to look at properties.  If you are pre-approved, they will be able to do their job quicker and more effective.

5)  “Get Game Face On”:  You are pre-approved and your Realtor has narrowed down your search to your top 6 houses.  Schedule appointments to see all these house in 1 day.   

6)  Make Offer:  Once you seen the 6 houses, be prepared to make an offer on one.  (You don’t typically want to rush this process, but this article is about meeting the fast approaching deadline, so time is crucial).  Your Realtor will guide you through the offer process.

7)  “Accepted Contract!”:  You have an accepted contract on a house!  At this point your mortgage professional and Realtor take over moving forward.  I encourage you to hire an inspector to do a home inspection.  Do this ASAP.

These sound like obvious simple steps, but each one is important.   You shouldn’t have any problem closing on a mortgage transaction in 35 days, even a FHA mortgage, if you quickly follow these steps.  The longer you wait, the more pressure will result and may jeopardize being able to make the deadline!

I love to work with first time homebuyers and I take a lot of pride ”holding the hands” of my clients all the way to the closing table.  If you are looking for a Charlotte home mortgage or a mortgage for your property in the surrounding Charlotte area, and I can be of any assistance as we approach these final crucial days, please feel free to call me and my team.  I have over 11 successful years experience helping homeowners achieve their dream of homeownership!  Call John”The Mortgage Smith” at 704-299-5507 or email me at john@mortgagesmithteam.com

A client of mine sent this video to me and I thought it was pretty funny!   While watching it, I kept thinking… aw come on kid, don’t do it… don’t do it…you know your going to get bit!  AAaahh!

Even though he knew he was going to get bit, he did it anyhow.  This video makes me think of all the big bank customers that use thier mortgage services, or most any of their services for that matter.  They know it’s going to be a long wait, they know there are going to get sub-standard service, ultimately they know they are going to get bit, but they put their fingers in thier big bank mouths anyhow…  OUCH!!  When you go to get your mortgage, make sure you don’t get BIT!  When your looking for your next Charlotte home mortgage or anywhere in the extended greater Charlotte area, insist on working with an experienced, trusted professional that will always goes the extra mile.  I am proud of my 11 year track record of unparalled service and I would be honored to earn your business.  Please call me, John “The Mortgage Smith” at 704-299-5507 for your Charlotte home mortgage needs!

The very popular first time homebuyers’ tax credit sure went a long way in stabilizing the housing market. The proof of this is certainly consistent with the many Charlotte home loans that are closing in our Charlotte, NC office.  But as the economy improves, the Federal Reserve will begin to slow down its purchase of mortgage securities. The Federal Open Market Committee said after meeting in Washington: “The Committee will gradually slow the pace of these purchases in order to promote a smooth transition in markets and anticipates that they will be executed by the end of the first quarter of 2010.”  Federal officials can still buy up to $1.25 trillion in mortgage-backed securities with continued support for the housing markets. At this time, they have bought about $860 billion in the mortgage-backed securities program, and $129 billion (out of $200 billion program) in U.S agency bonds. And instead of shocking the market by shutting down all government assistance programs at once, the Fed will ease out their purchases and are hoping that other buyers will start increasing their activity to avoid a potential increase in mortgage rates. When the Fed’s stop purchasing mortgage-backed securities, it’s possible that we could see a .5 to 1% increase in interest rates.

According to the National Association of Realtors, existing home sales rose 7.2% in July from June, which is the highest level increase in about two years. The Federal Housing Finance Agency index indicates that home prices rose for the third month in a row, with a .3% in July from June. 

Although the market is still tough, there are signs of definite improvement for the Carolinas and the greater Charlotte area. For the first time since August of 2008, policy makers announced that the economy is in fact improving, but they are still committed to keeping interest rates low for an extended period – perhaps into the early spring 2010 season. These comments by the Fed, current interest rate position and housing statistics all combine for an ideal buying and selling season. This may be that moment we have all waited for, with the housing prices hitting their low and positioning to move back up, and interest rates at historic lows.  If you’re also able to take advantage of the $8,000 tax credit, for first time homebuyers, then you have a dynamic buying combination! 

If you are in the greater Charlotte area, including South Carolina, and considering buying a home and would like to get more information or pre-approved, please feel free to call me, John “The Mortgage Smith” on my direct line at 704-299-5507  

  If you currently have a FHA home mortgage in North Carolina and have been thinking about doing an FHA Streamline Refinance, you should be aware of the changes that are heading your way.  These changes will not effect borrowers looking to purchase a home, but only affect borrowers that already have an FHA mortgage and looking to refinance to take advantage of a lower interest rate and or payment.  I haven’t confirmed the exact deadline date of when these changes go into effect, but it will be as early as November 17^th, 2009 and possibly as late as December 31^st, 2009.  Either way, this doesn’t give much time, if you are looking to take advantage of the “Streamline” before it’s gone.

After the deadline, these items listed below, will be a new part of the qualifying equation.

1) Borrower must have made no less than 6 months of payments on the loan being refinanced.

2) Loans that have been in effect for 6 to 12 must have NO 30 day late payments in the preceeding 12 months.

3) If existing loan has been in place over 12 months, there is a maximum of only ONE 30 day late payment in the last 12 months.

4) Net Tangible Benefit:Streamline Refinance must reduce PITI ( Principal, Interest,Taxes,and Insurance by 5% or be refinancing from an FHA ARM to a FHA Fixed where the interest rate cannot go up more than 2%…..OR can be from a Fixed to an ARM but the ARM must be at least 2% less than the current rate…..OR reducing the term of the mortgage.

5) Investment properties and second homes are not eligible!

6) Employment, Income , and necessary Assets MUST all be verified!

I have been originating mortgages for 11 years and these are BIG changes folks!  If you are in the Charlotte area and currently have an FHA home mortgage and think you may benefit from a FHA Streamline refinance, then speak up now or forever hold your peace!  If your interested in seeing if you would benefit from a FHA Streamline loan, please feel free to Call John “The Mortgage Smith” at 704-299-5507

First time home buyers… They’re GREAT!  I love working with first time home buyers, and one of the most common questions I’m asked when speaking with them is, “How much can we get pre-approved for?”  Getting pre-approved for a home loan depends on a variety of factors like, your credit rating, current monthly expenses, down payment, time on the job, etc…  But the real question should be “How much of a mortgage payment can we afford?”  Then the homebuyer needs to answer their own question.

I work with many home buyers in the Charlotte, NC area and I typically always ask them, “What house payment do you think would be a comfortable payment for you?”  I ask them this, because, it is one thing to get pre-approved for a particular amount, but it is another thing, month in and month out, to have to make the payment for the next 30 years or until they sell the house.

Now, just because you get pre-approved for a particular size mortgage, doesn’t necessarily mean you should spend that full amount on a home.  Remember, we are in a decent buyer’s market right now and you should hopefully be able to negotiate a deal that makes sense to you.  The pre-approval amount is a good ceiling to know what your limits may be from the eyes of a lender, but I am a big believer is sitting down with your significant other and penciling out your own budget.  Just because your lender says you can afford a $1,500 payment doesn’t mean you should stretch beyond your personal means.  Every homebuyer is different, and you should put some thought into your payment threshold prior to meeting with a loan officer.

If you are looking for an FHA or USDA (Rural Housing) mortgage to buy a home in Charlotte, NC then here is a basic idea on how much you may be able to afford.  FHA/USDA prefers the total debt-to-income ratio at 41% or less.  To calculate your debt-to-income ratio you simply take your total future house payments, plus any other consumer debt (like car loans, student loans, credit cards, child support, etc…) and divide it into your GROSS monthly income.  A borrower may still get approved at debt to income ratios higher than 41%, and up to 55%, but a buyer should realize the higher the ratio the higher the risk can look to an underwriter.  Once the debt to income ratio exceeds 41%, the need for “compensating factors” increases.  Compensating factors may be a very strong credit score, larger down payment, past “on time” mortgage history, length of time on job, large amount of reserves, etc…  Every borrower has a different payment threshold and there may be circumstances that may justify pushing your qualifying ratios.

You should of course discuss your own unique home financing scenario with a quality loan officer to obtain specific advice.

If you have any questions about how much you may qualify for, feel free to contact me.  Call John “The Mortgage Smith” directly at 704-299-5507

If you are a first time homebuyer and seeking a Charlotte, NC mortgage, then there is no reason not to get one now while they are HOTT!  The market for first time homebuyers has HEATED up.  With interest rates hitting a 3 month low this week and the HUGE benefit of the $8,000 tax credit set to expire November 30th, this may well be the perfect time to get off the fence and into a home. Two of the HOTTEST loan programs on the market are USDA Rural Housing and, of course, FHA.  I thought it might be worth a quick look to see how these powerful first time buyer programs are different from one another.

The USDA Rural Housing loan allows you to obtain 100% financing, but you must purchase a home in a designated rural area and USDA also has household income limits.  Although don’t let the “designated rural areas” fool you.  Many areas that are Rural Housing eligible are far from the tractor and corn field image you may be thinking.  If you are considering buying a house and need a mortgage in the greater Charlotte, NC area, you may be surprised to find out that you would only have to travel as little as 5 - 7 miles outside the Charlotte area, and some closer than that. Also, the income limits are very reasonable and many borrowers fit perfectly into these limits.  One of the things many buyers find attractive about this mortgage program is that it does not require monthly private mortgage insurance (PMI). Mortgage insurance is a monthly fee a borrower must pay to protect the lender from losses in the event that the borrower defaults on the mortgage. When comparing the two programs, often times USDA will have the lower of the two mortgage payments.

FHA has been a popular program for many years. With its flexible underwriting criteria, low 3.5% down payment requirement and attractive interest rates, it has been a first time buyer favorite for as long as I can remember. One thing to consider when analyzing USDA vs. FHA, is that FHA does have monthly mortgage insurance, which may be around $60 – $100 for a typical buyer in the greater Charlotte, North Carolina area (higher loan = higher insurance). The other factor that makes FHA attractive, is that FHA does not have geographical restrictions or income limits like USDA Rural Housing.  So if you want to buy a home in Charlotte, Matthews, Mint Hill, Indian Trail, Ballantyne, Pineville, Monroe and many, many other areas… either of these mortgage programs can be a fantastic option for your mortgage needs!

If you have questions about purchasing or refinancing using the USDA or FHA loans, feel free to contact me anytime.  Call John “The Mortgage Smith” on my direct line at 704-299-5507

     Many people I talk to, looking for a home mortgage in the Charlotte area, want to know if the $8000 first time home buyer tax credit that expires on December 1st, 2009 will be extended. That is a good question. But I wouldn’t dwell on the answer for too long, because as of today, there is under 90 days left to…
• find a house…
• put in an offer on…
• negotiate and have the offer accepted on…
• qualify for a loan for…
• make sure you have enough money for down payment and closing costs for…
• get an inspection on…
• appraise the value of…
• process, underwrite and produce loan documents for…
• sign documents at title (attorney’s office) for…
• make sure the loan funds…
• and have the note and deed recorded properly for…

…YOUR HOUSE!

The process, listed above, can easily take 60 days or more, depending on how much looking your doing.

As it stands, if this does not happen by November 30th, you will not get the tax credit. If you are in the greater Charlotte area and looking to get a mortgage and take advantage of the $8000 tax credit, the time to act and get your home mortgage rolling, is now!

Here is some good news! There are a five bills that have been introduced to Congress to extend the first time home buyer tax credit.  S.1230: Home Buyer Tax Credit Act of 2009,  H.R. 2801: Home Ownership Moves the Economy (HOME) Act of 2009,  H.R. 2006: Home Buying Credit Expansion Act,  H.R. 2619 and H.R. 2619.  All these bills offer various ways for homebuyers to benefit from buying a house; from increased tax credits, inclusion of all homebuyers (not just first time homebuyers), extending limitations of recapture requirements and adjusted gross income limits.  

Once Congress reconvenes, we will see if any of these or version of them will pass. Here is the bad news! There is less than 90 days for Congress to extend the first time home buyer tax credit and there are major issues (i.e. healthcare) that may take priority and push the tax credit to the side.

For now, we can either wait and see if the lobbying groups in DC can sway our lawmakers to believe that this is a priority or you can immediately contact a licensed mortgage professional to take advantage of the current $8000. As you may have heard your Grandfather say once or twice, “One in the hand, is better than two in the bush”.

If you are a first time home buyer in North Carolina and want to ensure that you take advantage of the current $8000 first time home buyer tax credit, you should act now. As a reminder, the available FHA financing options are tailor-made for first time homebuyers.

If you are in the Greater Charlotte, North Carolina area and are thinking of buying a home and have more questions, please feel free to contact me personally. Call John “The Mortgage Smith” on my direct line at 704-299-5507

If you currently have a FHA loan and think you can’t refinance because you are “under water” or owe more than your house is worth, then think again.  The Federal Housing Administration’s (FHA) goal of making home owning a possibility does not end with just purchase transactions on FHA loans. Another great service provided by FHA is Streamline Refinancing! Streamline Refinances are great ways to reduce interest rates and lower monthly payments on existing FHA mortgages. They are termed “streamlined” because of the reduced paperwork, ease and speed to get approved for such refinancing.

Other benefits of choosing a Streamline Refinance is that appraisals, income verification, or employment verification are usually NOT required. A timely mortgage payment history in the last 6 months and preferably a 620 credit score may be the only credit requirments needed to do this type of financing. Also, out-of-pocket costs are minimal, and possibly zero.  The requirements for a FHA Streamline Refinance must be fulfilled before obtaining a refinance. Most importantly, the existing loan must be FHA insured, current, and in good standing. Six months must have passed since the original loan was taken out before a Streamline Refinance can occur. The Streamline Refinance must lower the borrower’s interest rate, thus lowering monthly payments. There is no cash back option for this type of refinance. 

I have closed quite a few FHA Streamlines, and with the elimination of appraisals and income docuementation, my borrowers can’t believe the ease and speed we are able to refinance and lower their rate and payment!  This loan is not completely without paperwork, but what is needed is very, very, basic.  Please email or call me for the list of basic needed information.  Call John “The Mortgage Smith” 704-299-5507