Frisco Texas Mortgages, Real Estate, Events, and more

Do you have clients that are not quite 'Credit Ready' to buy a home?

Michelle Gibson - Realtor in Wellington Florida, shares a GREAT idea to help your 'future clients' into a rental.

Do you have some other great ideas to share?

Recent changes to FHA.  This was well written and provides some great examples. Figured I would share it with you.

Have you attended one of these classes yet? Its well worth it. Many use Facebook, but are still not sure hot to do it for business. This one hour class will be filled with great information.

Hey... if you are going to be on Facebook already, you should learn how to use it effectively for business and pleasure.

This was a photo taken last last year while we were on a Disney Cruise. We were all standing in the front of the ship checking out the open sea. As you will see , its quite breezy up there. Luckily for me, I keep my hair short. My son had a little movement because he keeps his hair slightly longer than mine... but my daughter... poor thing kept trying to keep it together.. and as you can tell from her posture, she had just given up trying.

Enjoy!

A short while ago, Mr. Jason Crouch wrote a post about his diet. If you have kept up with his posts or twitter updates, you may know that he has already lost 30+ pounds. Well, we were talking about 2 weeks ago about what he was doing and the different iPhone Applications that helped him acheive this goal (and he is not done yet).

Well, after talking with him about it and talking with my friend about an infomercial I was watching (P90X), I decided I needed to do something about my weight as well. As it turns out, my friend has this system in his house and only lasted the first week. He claimed it was a tough program and his schedule just became too busy.

I did a little research and asked if I could borrower it for at least 30 days (its a 90 day workout program for those of you that are not familiar). If after 30 days, I have stuck with it (which I COMPLETELY intend on doing) then I will purchase my own.

To keep me honest, I am stealing Jason's idea about going PUBLIC with my weight loss goal. This will keep me focused and accountable for my goal. My goal is to be around 205 pounds. As I get closer to this goal I may adjust it accordingly, which will depend on my muscle mass compared to fat percentage.

So, on Sunday morning I jumped on the scale. Although I was not happy with the initial reading, I was not surprised by it either... in other words, the scale was not kind to me...

Sunday evening I started the first day of my P90X program. As I mentioned, its a 90 day program, which for me will run from August 1st to October 30th. In addition to the workout program, you have to watch your diet. They have a recommendation, but I am currently watching what I eat, how much I eat, and ultimately counting my calories like a modified Weight Watches program.

Today is Day #4 ... YOGA. :-)  I  have not completed this exercise yet, but can imagine it will be tough. Its 92 minutes long. In previous years I have teased my wife about how easy Yoga is... although I had never taken a class. So, I imagine she will get a good laugh at me after this evenings workout.

The program is designed to have a 'Weight Lifting' day, then a 'Cardio' day. What do you think about Yoga? Is it tougher than it looks? I'll know for myself in about 4 hours, but wondered what you thought and how many AR members are Yoga fans.

To date, I have lost 3 pounds... and Im sore ALL over. Seems like a small number, but its only been 3 days. I dont expect to lost a pound a day, but a few pounds per week would be great.

If you have ever thought about P90X, I would certainly consider it. The only time I would not suggest investing your money is if you have back or knee problems. Some exercises may irritate an existing injury you have in those areas. It can be tough, but feels well worth it so far. I'm sure I'll keep you posted with the results as I go.

p.s. Did I mention that some how I got Jason Crouch to do it as well? It works out really well because we compare notes on the exercises and push each other. Besides going public with my weigh loss goal, one of the biggest motivators is that I have an accountabiity partner that checks in on me to keeps me honest.

See you later in the Rain!

You may have seen this post due to the 'FEATURE', but I wanted to share with those readers that do not follow features each day. Great information for keeping in contact with your customers.

Do you read a post and spread the word by either creating your owner post or reblogging the post? Or do you read a post, do your homework to confirm the accuracy, and then create your own post?

In today's AR Newsletter, a post was shared written by Lenn Harley called "Are Mortgage Loan Origination Fees Deductible....." 

Within the post, Lenn points out that Loan Origination Fees ARE deductible. The fact of the matter is that not ALL situations are the same. To her credit, Lenn does provide the IRS website and instructs her readers to check it out for more details. She even states to not listen to your Realtor or Loan Originator, but to contact a CPA or Tax Expert for clarification.

I too suggest contacting a CPA, but I wanted to share some helpful tips for when a Loan Origination is Tax Deductible and when it is not.

In today's market, the Loan Origination is more often the fee paid to the lender/loan originator for doing business with that company. The "Discount Point" is typically the fee that is applied towards getting a "below PAR" interest rate. In essence, paying a fee specifically to lower the rate from XXX to XXX. This is typically called a Discount Point or Discount Fee.

According to the IRS Site, a 'POINT' is defined as:

The term "points" is used to describe certain charges paid, or treated as paid, by a borrower to obtain a home mortgage. Points may also be called loan origination fees, maximum loan charges, loan discount, or discount points.

As you can see, a POINT could be called many things. The first thing you ask your Loan Originator is 'Does this CHARGE (no matter what the name) Lower The Interest Rate?'. If the answer is YES, then this is step one to writing off this charge on your taxes. Why? Because the fee is a direct result of a Lower Interest Rate. If the charge is just a charge paid to the Originator, then the fee is NOT deductible. You can not always tell by just looking at the Fees Breakdown.

In some cases the buyer (or homeowner that is refinancing) will pay a Loan Origination Fee AND a Discount Fee. In this scenario, it is very clear that you are paying a fee to drop the rate... although its not always obvious which is which. Ask your Loan Originator, make a note of it, and then discuss it with your CPA when the time is right.

What is extremely helpful for buyers today is that the new GFE (Good Faith Estimate) clearly states "Borrower Pays a Charge Of XXXXX.XXX For This Interest Rate Of XX.XX%". This was placed on the new GFE to make it very clear and helpful to buyers. As long as the buyer has received the GFE (which they always should) then it should also be clear that the paid a FEE to get the lower rate (Discount Fee).

My overall point to this post is to be sure to do your own homework before Reblogging a post OR before you spread the word to your buyers. Sometimes a post has all the information you need and other times the post is stating facts (or what they consider to be facts). Check it out for yourself!

My question for today... Why is it Common Sense for me, but not Common Sense to you?

A recently loan I closed was delayed last week when the Underwriter noticed that the 'Lead Based Paint Addendum' was checked on the sales contract (page 7). This would make a ton of sense, except the home was built in 2004.

It is required by Law to disclose to a buyer/renter when a home uses Lead Based Paint, but only for those homes built on or before 1978. This is what HUD states about the law:

Congress passed the Residential Lead-Based Paint Hazard Reduction Act of 1992, also known as Title X, to protect families from exposure to lead from paint, dust, and soil. Section 1018 of this law directed HUD and EPA to require the disclosure of known information on lead-based paint and lead-based paint hazards before the sale or lease of most housing built before 1978.

Basically, its required by law that the seller or landlord must disclose how to identify and control lead based paint hazards. In addition, the seller/landlord must tell the buyers/renters how to treat the area, provide any historical records, and also allow the sellers a 10 day period to do some thorough research about Lead Based Paint.

Two questions are asked when I receive this type of 'condition' for the loan.

1 - Why didn't we catch this before sending it to the underwriter? In this case, we had reviewed the document completely, but because it was a 'docusign' contract the lender asked for a new 'wet signature' contract. The sellers and buyers signed a docusign version, which we assumed (and you know what they say about assuming) was the same contract. Turns out that when it was reprinted, the agent accidentally clicked the addendum.

2 - Why is the underwriter making this a condition 'Prior To Docs' instead of 'prior to funding'? I understand wanting to have an updated version, but you KNOW the home does not need the addendum. Why delay the documents from being generated when it is much easier to make this a Funding Condition.

I asked the Underwriter to make this a 'Funding Condition' rather than 'prior to docs'. Since they will both be at the closing table, its much easier to have them sign it on closing day. When asked this to the underwriter, they replied that they would need 'MANAGEMENT OVERRIDE'....  WHAT?!?!

Management Override took 2 days. Why can an Underwriter not make that 'judgement call' instead of holding up the closing of the loan?

Perhaps that just makes sense to me. Does it make sense to you?

Over the past two weeks, I spoke to three new clients with similar situations... their Loan Officer was not returning their calls all of a sudden.

When I receive these calls, it is music to my ears. I'll be happy to pick up the where someone else dropped the ball. Not because these loans are easy - In most cases they are quite opposite. Actually, 75%-85% of the time the client has some real credit or financial issues that need to be addressed. They were just unfortunately to find someone that didn't want to take the time to explain it.

My biggest question to those previous Loan Officers is 'why not just tell the client what the issue is and how they can resolve it?'

Trying to jumping right in, I know that these clients may need a few months of hand holding (perhaps even for up to a year). The key is to explain to them what the main concerns are, point them in the right direction, and set them up with local professional that will help them further.

A local professional could be a Credit Counselor, Real Estate Attorney, Financial Planner, etc. Depending on their current situation, have them contact a professional. Sure, I can direct them on their credit to a certain point, but credit correction is not my expertise. If its something we can work on together, GREAT! Otherwise, they need to speak with someone who can really focus on the improvements needed, who have the time, and supporting staff to see it through correctly.

I'll give you an example... two weeks ago I received a call from a client that received a Pre-Approval Letter. Not just a Pre-Qualification Letter (which is still ridiculous) but an actual Pre-Approval Letter. She then placed an offer on the home and was planning her relocation from Virginia to Frisco Texas. Well, after making arrangements, and getting things packed, she found she was having a hard time reaching the Loan Originator and the Realtor. When she finally did reach the Loan Originator, he told her that she would need some work on her credit.

Keep in mind, this was almost a month later. The 'soon to be' Homeowner's credit scores were low 500s to high 400s. In a panic, she contacted me (Thanks to Activerain and Google.... ranked #1). Unfortunately, I was unable to help with financing today and explained to her why. A few years back she had some issues that were never resolved. None of her credit history was due to recent activity, which tells me that the Loan Originator should have explained this during the very first call and not waited for the customer to TRACK THEM DOWN.

I immediately called Loreena Yeo of 3:16 Team Realty. Explained the situation and that the buyers were coming into town within the next 2 days. She called and spoke to Mr. and Mrs. Buyer to gather some information on location, size, etc. She found some great Lease Options for these buyerss. As a matter of fact, they are working on a Buyer Financing deal while the buyers continue to work on their credit. Actually, while they were all in my office, the buyers called the Credit Repair company I suggested right then to get things started.

So, they will not be able to move into their home as quickly as they would have liked, but at least they have found a home in our wonderful city of Frisco. And although this scenario was not 'financially' beneficial for me, it was well worth it. She is moving pased a bad experience and into something very positive. Besides, in a a few months to a year from now they will be ready to refinance the home to a much lower rate. On top of that, who will they think of the next time someone asks mentions Real Estate or Mortgages? It's all about the relationships you build!

I do not typically have this many 'ReBlogs' but have you read Deb's post for why a Homeowner should not sell a property on their own?

These are some fantastic reasons that a homeowner should hire a Real Estate Professional. Homeowners usually only consider the money they are saving, but there is much more to it than just the 3% commission.