Mortgage Finance Blog

Happy New Year!!!

Alright...so 2009 is here. It is very exciting in the real estate and mortgage industry. After a dismal 2007 and 2008, those who remain in the industry take a collective sigh of relief and believe that things are going to stabilize and turn for the better. As we are gearing-up for an increased work load, we are keeping a close watch on the market conditions. While we hope for a steady improvement on Wall Street, we are also hoping that rates stay relatively low, as well.

I have a few friends who are employed at large investment firms, like Schwab, Smith Barney, etc. and even the large banks like Bank of America/Countrywide. I have been getting calls from them as they have clients who need to refinance or seek 'purchase' money. We like to compare rates and costs. Their rates are ok but I think that they are trying to reel in clientele with low closing costs. Don't be mistaken!!! Pay close attention to detail.

These large firms are getting service release premiums or large yields from the rates that they provide in order to make-up for some of the costs. Costs are always there, somewhere! If you are presented with a quote, make sure to call your local mortgage broker and find out, just how competitive it actually is. Why pay for a rate over 30 years when you can pay it up-front and save more money over the term of the loan.

Give us a call and we can help you understand APR's and the mystery behind these "low-closing cost" loans...

Until then...Have a happy new year!!!

Your Mortgage Professional,

Diego L. Quintero

In the mortgage industry we have Jumbo loans and Conforming loans. Anything below $417,000 is considered conforming, anything above is a Jumbo. Conforming loans are those that Fannie Mae can insure and/or buy for for servicing purposes. Jumbo products are a risky product for a bank to lend on because they are non-insurable and there's a limited amount of buyers who want to service them, hence the higher rates and costs that are associated with them. The good news is, however, that this kind of market makes it affordable since all interest rates are low.

I have been asked by several agents, past clients, and fellow blog readers to write-up an estimate of rates and a brief scenario to get a better idea. Please note that not all applicants qualify. Restrictions are based upon income, credit, market conditions, and acceptable collateral. Rates are subject to change without notice.

A home valued at $750K needs to get refinanced. John Consumer, who has a 720 Fico score & 1 year at the same job wants to cash-out $100K for whatever he wants. The  loan amount can be 75% of the value of the home. So, a loan amount of $562,500 would be appropriate for this scenario.

Let's suppose that Mr. Consumer only wants to stay in the property for another 8 years. We can save a little on interest if we do a 10-yr fixed program instead of a 30-year fixed. John's rate would be 6.25%, with an APR of 6.345%- based on today's rates. His payments would be at $3463.41/month, plus taxes and insurance. There are minor adjustments to the rates as you increase the risk for the bank. For example, a 30-yr fixed-rate, an interest-only program, or a loan amount greater than $600K would add a slight bump to the rate. They add a risk to the loan program based on longer repayment or a larger, uninsurable loan.

Its simple to get an idea of which rate would apply to your scenario, whether Jumbo or Conforming. Your information is private and confidential and its FREE to find out. If you would like to know just send me an email or apply online.

Thanks for reading!

Your Mortgage Professional,

Diego L. Quintero

QUICK FACTS : You may choose to include or exclude tax & insurance payments in this Jumbo program with no additional rate increases. Loans can be closed being 1 day off-market, but cash-out will not be allowed. Maximum allowed cash-in-hand at close is $300,000!

Our nations economy has been experiencing what  is characterized as a perfect storm. Wall Street tumbling, banks filing bankruptcy, unemployment rates increasing, and homeowners losing homes. Risky investments and an obvious sense of greed & irresponsible behavior have all combined to create this unprecented position that we are fighting against.

Our long term goal is, obviously, to turn this around but our short term goal is simply to stabilize our markets. The world is watching as it, too, has a vested interest in our economic recovery and success. The Housing Economic Recovery Act of 2008, has been established do just that - and congress has agreed to extend the timeframe for first time homebuyers to receive a tax benefit of up to $7500. This is great stuff! Obviously, some restrictions apply, like income levels cannot exceed a specific threshold, etc...If you need more info, shoot me an email or consult with your CPA for your particular scenario.

In the mortgage and real estate industry we are excited to see that congress is allowing this portion of the program to continue as it will bring more buyers to the table who are seeking finance. This will hopefully increase our velocity of money and in-turn help us stabilize at a quicker rate.

If you are a first time homebuyer or have not owned a primary residence in the last three years, your first step is to call your trusted mortgage broker. Your data and information will be processed to find out if you qualify and for how much. Always run your own budget spreadsheets to make sure that you are comfortable with the broker's findings and estimated payments. As always, feel free to call or email with inquiries or if you would like for me to take you through the process. I appreciate your business and your time. Thank you! 

Your mortgage professional,

Diego L. Quintero -

Diego@fsrei.net - 602.614.5794

QUICK FACTS: For FHA buyers the minimum downpayment is 3.5%, but closing costs are still allowed to be covered by the seller (not to exceed 3% of the purchase price). For conventional buyers, you are looking at 5% down but if your market is characterized as a deteriorating market then banks will require 10% down. It is a great time to buy!