 Seven Things Your Agent Should Know About Your MortgageTuesday, August 3, 2010 - Article by: Richard Woodward -
Seven Things Your Agent Should Know About Your Mortgage Approval While many experienced real estate agents have a general understanding of the mortgage approval process, there are a few important details that frequently get overlooked which may cause a purchase to be delayed or denied. New regulation, updated disclosures, appraisal guidelines, mortgage rate pricing premiums, credit score, secondary approval layering, rescission deadlines, property type, HOA insurance requirements, title and property flip rules are just a few of the daily changes that can have a serious impact on a borrower's home loan financing. With today's volatile lending environment, it's obviously important for home buyers to get a full loan approval which clearly defines all contingencies that pertain to each unique home buyer's scenario prior to spending any time looking at new homes with an agent. Either way, we've listed a few of the top things your agent should keep in mind while showing you new properties: Caution - Agents Beware: High-Rise, Condo, Town House, Single Family Residence, Dome Home... all have specific lending guidelines that can influence down payment, credit score and mortgage insurance requirements. Residence Type - Need to sell one home before moving into another? Is a property considered a second home if it's in the same city? What if I'm buying a home for my children to live in, it is still considered an investment property? These are just a few of several possible residence related questions that should be addressed by your agent and loan officer at the initial loan application. Rates / Locks - Mortgage Rates are typically locked for a 30 day period, and one of the only ways to get a new rate is to switch mortgage lenders. Rates also have certain adjustments for property / residence type, credit score and down payment which could have a big impact on monthly payments and therefore approvals. A 1% increase in rate could literally mean the difference between an approval or denial. Headline News / Employment - Underwriters watch the news as well. Borrowers who work in a volatile industry during hard economic times may have to jump through a few extra hoops to prove that their employment and income is secure. Job changes, periods of unemployment or property location in relation to the subject property are other things to consider that may cause a speed bump in the approval process. |
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