Mark Clemens Help for Home Sellers and Buyers MN / WI

If I'm a 725 FICO, will the subprime fiasco hurt me?

If you have an excellent credit score you will probably not be too affected by the difficulties in the subprime market. But you should remeber that all banks have been hurt by this and will therefore tend to be more cautions. Thus you should allow a little extra time for your approval and not take it too personally if you are turned down Another bank will probably not have any trouble with your application in the least.

What will cause the market to turn around so that I can really buy a house?

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Two things will need to happen before "EveryPerson" can again buy a house. One is that the prices must come down and the second is that the lending parameters must become more flexible. It is tempting to say that the rates must drop lower, but stated income programs have actually made this less crucial. The difficulty is that it is much harder to do stated programs than it was just 90 days ago. These allowed people to stretch for a mortgage payment, knowing that there was unreported income to cover whatever their "real jobs" could not. When these programs come back as in deed they will, there will be more activity in the market place.

I've heard "let your money work for you, but can my credit work for me instead?

You have heard "Why work for your money when your money can work for you". Now I am suggesting that  "Why work for your credit when your credit can work for you" is just as powerful. It may even be moreso. If you have an investor mentality, you need to call today. This is not about flips, but the OK way to do what sounds very much like them.

If the purchase agreement is for under apprasied value can I use the appraised value to determine the loan amount?

No. Banks use the lesser of the apprasied value or the aggreed upon purchase price. Thus if the appraisal were for 400K and the price was 350K, they would use the 350K.

The queestion is born out of a creative way to circumvent having to have a downpayment. In the recent past this was taken care of by the 20% second from the same bank offering to do the first. Sadly, these are allegedly the cheif cause of the high foreclosure rate today.

Is there no 100% financing for anyone?

I will not tell you that I am the only one that can get it for you. But it is harder to get than it has been for the last two years. It is better to tell you that it might make some sense to stay with mom and dad for a while before you start looking. That's because even 5% can be alot of money nowadays, 10K on a 200K house. Nevertheless those with excellent credit can still qualify for 100% financing. Those with scores under 620 probably not, especially if your income is not W-2.

What is the best way to find the home that I am looking for?

The best way to find the home that you are looking for is to start with what you are able to afford. That may be a lot less than you had been expecting if you feel safest with a 30yr fixed requiring 20% down. Or it may be a lot more if you are able to qualify for 100% financing, stating your income. While these programs are more rare today than they were 6 months ago, they do exist. But your credit score must be especially high. If you know what you can afford it is then a realatively simply task to sift through the options within your desired area.

Is it true that banks are no longer doing 100% financing for subprime borrowers?

There has been an increasing number of foreclosures and credit card delinquencies lately. This has caused many national lenders to tighten up their income and credit requirements and some cases actually stop lending to people with below 640 credit scores.

But, there are still are banks that will lend up to 100% to applicants below 600. Call 651-216-5931 to discuss your options.

How do I get a 500,000 mortgage for 1786.00 per month?

The best way for you to get a 500,000 mortgage for next to nothing is to call me. But you need to know a few things before you do.

1.)You will need a credit score of 680 or higher.

2.)You cannot have had a bankruptcy or a foreclosure.

3.)You will need around 55,000 down.

4.)You will need at least 3 credit cards with perfect pay history

5.)You will probably need to pay for your closing costs out of pocket

6.)Here is the big one : you will need to be OK with your equity getting reduced every time that you choose to pay the 1786.00/mo vs the real amount of 2997.00/mo

Can I get 100% financing with a pay option ARM?

It would be great if you could, but the answer is technically NO. The bank needs to know that its investment is secure. If you were paying only on the teaser rate with the remainder of the owed interest being subtracted for your equity you would be severely in the negative for at least the first two years. Therefore if the bank had to foreclose, the market value would be less than the amount owed to cover the original mortgage, legal fees, missed payments and selling expense.

But there have been some instances in which an 80% pay option arm is combined with a fixed high interest 20% second. These instances are rare and demand extraordinary credit along with a very tight appraisal, which is generally subject to review or eeven another to substantiate value.

Will rates get any lower than they are today?

People always ask this question when they would like to refinance but do not need to refinance. Those who have to refinnace to cover a large doctor bill or to avoid a lien or other type of judgment do not.

Perhaps I am avoiding the question. But I am doing so because I really do not know. I remember when an 8% mortgage for people with exceptional credit and 20% equity was considered extraordinary. As 02/16/07, 6% is more line line.

Can it go lower? Sure. Will it? Probably not. If you are asking this type of question you should really ask what difference .125% makes on a 30 year mortgage. At 6.5% ammortized over 30 years the PI is 1896/mo. At 6.375% it is1871/mo. That is approximately 25/mo or 300.00/yr of tax deductible interest. Is this amount really worth losing sleep over?