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It seems like Denver mortgages are changing every day. There are two, new important changes any potential buyer should know about before starting the home loan process. First, if you have heard that getting a home loan takes tons of documentation and patience, that’s right. Only now it will become harder and more intrusive. It’s already like a “financial strip search”.Our favorite lender, Jimmy Kinley, puts it this way:
“Fannie Mae and Freddie Mac have recently announced that they are reviewing all loans that they back and that they will be asking lenders to buy back loans that don’t meet the guidelines to absolute perfection. Although this may not sound odd, it is happening.
In the past only “non-performing” loans where reviewed for this strict criteria. This places all lenders at a sizable risk if they have to purchase back any loans. The fact that they are adding performing loans to the equation creates a need for lenders to be extra careful. When a lender has to “portfolio” or “shelf” a loan, it means they have less money to lend. If that happens too much, lenders can become like the old Countrywide and go bankrupt….
Don’t be surprised if lenders start tightening up. Also, don’t be surprised if you hear a little grumbling from … buyers working with other lenders that don’t set the right expectation up front. You know the lenders, ‘Tell them what they want to hear and deal with it later’.
No matter how well qualified buyers are, they should never assume they are above the documentation to prove it.”
Also, there is a new change in the VA Funding Fee veterans must pay when getting a government backed home loan. The bottom line is that the full fee is now going to be charged pending government legislation. If the legislation is not passed, part of the fee can be rebated. But, check with your lender for the exact details.
Jimmy explained this:
“There is a new VA circular published yesterday regarding the VA Funding Fee.
This time around the wording is a lot different than the last time. At the beginning of October the VA stated that they had authority to accept the reduced VA funding fee while waiting for Obama to sign the extension into law. So a few folks benefited from a temporary drop in the fee.
There is a new VA circular published yesterday regarding the VA Funding Fee.
This time around the wording is a lot different than the last time. At the beginning of October the VA stated that they had authority to accept the reduced VA funding fee while waiting for Obama to sign the extension into law. So a few folks benefited from a temporary drop in the fee.
This time they are telling lenders to collect the higher fee, and only refund IF HR674 doesn’t pass. And they want the higher fee regardless of when the loan closes. HR674 has passed the house and senate and is waiting for differences to be resolved and then signed by the President.”
If you have any questions on these changes, please contact me and I will get you answers you need:
One Comment
It sounds like all of these changes are going to do nothing but make it harder for people to purchase property. There certainly shouldn’t be a return to the freewheeling days of liar loans but a happy medium should be found.