Jo Garner, Mortgage Officer , Lynn & Troy McDonald, Erin McDonald Insurance Agency Allstate Insurance

http://www.600wrec.com/cc-common/podcast/single_page.html?more_page=1&podcast=jogarner&selected_podcast=Jo_and_Troy_and_Lynn_2-11-12_1329176700_18832.mp3

The podcast link leads you to the Real Estate Mortgage Shoppe program with me, Jo Garner, Mortgage Officer with Evolve Bank and Trust.  We are talking with Lynn and Troy McDonald of Erin McDonald Allstate Insurance Agency.  We cover money-saving tips for you to keep your insurance costs at their lowest without giving up adequate coverage. Also keeping your mortgage rate low with the best terms for your individual situation.  

For those of you who have been patiently waiting for the HARP 2B program to roll out so you can refinance to a lower rate the appraisal value being no issue—well, so far the automated underwriting systems for that program are supposed to be rolled out March 17^th.   Move to the front of the line by getting your loan in early. My assistant Susan Belew and I are getting your loan info now so that you don’t have to wait when the program is rolled out.  call me on my business line right now at (901) 482 0354  That is (901) 482 0354.  Susan and I can crunch some numbers with you.

The President talked about an even newer refinancing program –not the HARP program that  would not require an appraisal at all and would remove some other barriers as well .  Don’t hold your breath waiting on the newest one because, for now, there are just too many barriers to cross.  The HARP 2B program we have been talking about week after week is still slated to roll out on March 17^th but NOT the one the President talked about during his State of the Union Address.

This newer program puts even less restrictions on the borrower and the President says he wants this program available to people who have been making their payments on time whether there loan is backed by Fannie Mae or Freddie Mac or some other program.   If you WANT this newer program to roll out sooner, my suggestion is that you call your Congressman or Senator and tell them that you want this newer program available.

Keep listening to our show and we will keep you updated on any new developments. You can also hear our past shows on my blog  www.mortgageloansblog.com 

Here’s some good news for our military personnel arriving back home. HOPE NOW,  a national mortgage relief program, are focused on assistance to military homeowners and foreclosure mediation. If you know a veteran that needs help, they can call (888) 995-HOPE.

Here is the news on mortgage rates:  With what looked like a possible agreement from Greeceon how to effectively handle their debt, Mortgages Rates started to creep up yesterday.  But today one of the political leaders inGreece said his party would not back the bail out agreement so our mortgage rates begin a slight downward motion.  Are you getting seasick yet?    With the on-again-off again financial battle overseas, it is enough to make one dizzy.

Rates are being quoted a little higher this week– 3.875% to 4.375% on 30 yr mortgages depending on how many points you want to pay, your loan amount, loan type, loan-to-value and credit score. The 15 yr is still in the low 3’s to 3.75%.  Susan and I would like to do a personal analysis on your financing to see how much money on a refinance we can save you per month with a lower rate  or by shortening your loan term. We can do comparisons for you on financing to purchase a home.   Call us on our direct line at (901) 482 0354.

Susan and I are focusing this next week on first-time homebuyers.  If you have heard a friend say they can’t buy a house because they don’t have enough money to put down, please give me chance to talk with them.  Susan and I are trained on many first-time homebuyer special programs, we stay up-to-date on the old stuff AND the new stuff to help first-time homebuyers who need down payment assistance getting into their first home with a loan program tailored to them.  Of course we can help those who are NOT first-time homebuyers too.

Some questions answered byLynnandTroyabout keeping your insurance low and your property covered: The benefits of bundling your coverage with the same insurance company.  Some examples of this benefit.

The importance of having adequate insurance on your car & ways to keep premiums low.  Because of lawsuits over car accidents, it is like you are driving around with all of your assets in the car trunk.

Benefits on having renters insurance preceding your future homeowners insurance policy

Benefits to renters insurance to the landlord.

Weighing how much to make the deductible.

Why you never want to call the insurance company 1-800 number.  And other trouble with 1-800 call centers.

Questions answered by Jo Garner about mortgage financing.

1. Jo, you mentioned that your focus this week is to help first-time homebuyers get into their first home with the Lowest Movein costs with down payment assistance programs.  What are some of the most popular down payment assistance programs you are using?
2. A lot of people want to get the best rate in town on their mortgage.  How do you get the “best rate?”The best rate is not always the lowest rate.  The best rate for you is the one that saves you the most money with the least amount of costs and that best suits your financial plans. 

A.The first thing I will ask you is “How long to plan on staying in this house or how long do you plan on keeping this house?”  If you say you are keeping the house for over 5 years, we can begin by looking at fixed rate loans instead of variable rate loans. If you plan on keeping the house less than 3 to 5 years, then an ultra-low rate that is fixed for only the 5 years you are going to be in the house before  converting to an adjustable rate may be the best deal to allow you to enjoy a below-market rate with a low payment during the years you know you will be in the house.

B. The next question I will ask you is “Is your focus on paying the loan off quickly or just on saving the most money per month?”  If you are 10 years from golden years making a house note, you may want to look at a 15 year loan or 10 year loan instead of a 30 year commitment. Hear the story of the  customer who wanted to travel when she retired and did not want the house note.     Hear the story of someone about to put children through college and wanted a low note even if it was a 30 yr.

1. Or maybe you will be coming into a large amount of money from the sale of a home, an inheritance or cashing in on an investment within a year or two—In that case you may want to look at a very, VERY low rate and payment you get from an adjustable rate and enjoy a below normal payment until your large amount of money comes in.  Use that large amount of cash, when you get it, to pay down over 20% of the balance on your mortgage. Then when the rate becomes adjustable, your payment should not go up and in so many cases come down considerably because the balance has been significantly reduced and on the adjustable rate, each year when it adjusts, your payment will only be calculated on the unpaid balance.  Hear the story of the family member selling their house in town and buying land and a bigger house out in the country  Buying new house first and later having the lump sum from the sale of the old house to put down larger than 25% toward the balance on the new loan within less than 12 mos. Why this family went with a 1 year ARM and came out better than ever, paying off the house in less than 10 yrs.

More about mortgage financing options, little known facts and tips for saving on insurance.

www.MoneyShoppe.NET

http://www.600wrec.com/cc-common/podcast/single_page.html?more_page=1&podcast=jogarner&selected_podcast=Jo_and_Richard_Scarbrough_Kevin_2-4-12_1328549340_3186.mp3

On this podcast we are talking with Richard Scarbrough buyer and broker with First National Realty and Kevin Perk of Kevron Properties and blogger on smarterlandlording.com. Jo Garner, Mortgage Officer with Evolve Bank & Trust discusses financing strategies for buying investment real estate.

What can we talk about in the home financing news today? Well, there’s plenty!

For those of you who have been patiently waiting for the HARP 2B program to roll out so you can refinance to a lower rate with no regard for the appraisal value—well, so far the automated underwriting systems for that program are supposed to be rolled out March 17th. To get your loan in early so you can be ahead of the herd, call me on my business line right now at (901) 482 0354 . Susan Belew and I will be glad to crunch through the numbers for you to see how much you can save by refinancing on this program or others.

The President talked about an even newer refinancing program –not the HARP program that would not require an appraisal at all and would remove some other barriers as well . Don’t hold your breath waiting on the newest one because, for now, there are just too many barriers to cross. We are still slated to roll full steam ahead on the HARP 2 program but not the one the President talked about during his State of the Union Address.
Keep listening to our show and we will keep you updated on any new developments. You can also hear our past shows on my blog www.mortgageloansblog.com

How about that news item on NPR earlier this week declaring that Freddie Mac had discouraged homeowners from refinancing because Freddie wanted to hang on the interest income from those higher interest rate loans? It also quotes critics who charge that the Home Affordable Refinance Program (HARP) could be reaching “millions more people if Fannie (Mae) and Freddie implemented the program more effectively.” (Instead of leaving more stringent regulations in place)
Remember that Fannie and Freddie, after a federal take-over , were placed into conservatorship by the US Treasury in 2008. Now the Federal Housing Finance Agency is overseeing these two agencies.
One the one hand Freddie Mac and Fannie Mae (who back the majority of the mortgage loans in this nation) have been charged to help make it easier for home buyers to purchase homes and for homeowners to obtain financing.
On the other hand the other mission statement by the regulators, orders these two mortgage giants –to make money and limit taxpayer losses. Since the higher interest rate mortgages on the books are making money and keeping the two mortgage giants more solvent—the logic is to try to keep the higher interest rate loans on the books and discourage refinancing. .
Here’s some good news for our military personnel arriving back home. HOPE NOW, a national mortgage relief program, are focused on assistance to military homeowners and foreclosure mediation. If you know a veteran that needs help, they can call (888) 995-HOPE.
Did you see what happened with the job numbers yesterday? (If you are listening to us via blog podcast-our show is live Feb 4th 2012.) The monthly Employment Situation Report was released with much better-than-expected results. Stocks rallied sharply and most every interest rate in fixed-income markets moved higher. Mortgage rates inched up a little but not NEAR as much as expected. Wait until the treasury auctions next week—that may make a bigger impact on the mortgage rates.
Rates are being quoted from 3.75% to 4.25% on 30 yr mortgages depending on how many points you want to pay. The 15 yr is still in the low 3’s to 3.75%. Rates are based on the loan amount, loan type, loan-to-value and your credit score. My very capable assistant Susan Belew and I would like to do a personal analysis on your financing to see how much money we can save you per month or by shortening your loan term.
Susan and I are focusing this next week on people who think banks aren’t lending right now. WE ARE LENDING MONEY. If you have heard a friend say they can’t buy a house because they don’t have enough money to put down or they can’t refinance because the value on their house has dropped, please give me chance to talk with them. Susan and I are trained on credit simulator programs, we stay up-to-date on new programs geared to help creditworthy borrowers who don’t snugly “in a box.” Call us directly at (901) 482 0354.
In our studio today we have Richard Scarbrough, buyer and broker with First National Realty and Kevin Perk of Kevron Properties and blogger on smarterlandlording.com Our topic today? “Choosing Your Real Estate Investment Strategy.”
Richard and Kevin, What are some strategies our listeners could choose to start building a real estate portfolio?
Here are some questions that Richard and Kevin answered on the radio show. Check them out by listening to the podcast.
Real Estate Tip of the Week: (Richard and Kevin )
1. What are some strategies real estate investors can choose to start investing and building wealth?
2. What are some pros and cons for buying and selling to wholesalers?
3. What are some pros and cons for buying and selling to retail buyers?
4. What are the pros and cons for buying, holding and being a landlord?
Answers to the following questions covered by Jo Garner in the podcast
1. what kind of tips do you give investors who come
2. to you for a loan?
A. If you are just getting started, remember your terms for investment property are much less restrictive if you own less than 4 financed properties. If the property is in good enough shape when you purchase it, use traditional conventional financing on the first four properties you plan to hold. The rates are much lower and the down payment less on conventional financing . That is the kind of financing I handle at Evolve Bank.
Note: (You get the best terms on traditional financing with much less restrictions if you own less than 4 FINANCED properties. But I can still help you with traditional financing even up to 10 financed properties. ) if possible, these are the properties you want to hold and keep for wealth building.)
3. Where can real estate investors find money to use to acquire properties?
A. Of course the best financing available for real estate investors is through Fannie Mae and Freddie Mac—these are the loan I do especially for the properties in good shape that you want to buy and hold.
B. Many times we arrange with our bank to lend investors an equity line of credit on their home to free up funds to use to get into investment property
C. Another source we can use at our bank is margin loans on stocks and bonds and other types of assets as long as it is not a qualified retirement fund.
4. What is available for financing for fixer-upper houses?
A 203K for owner occupants. Or a home equity line of credit on a different property that gives the investor funds to buy and fix up a new purchase.
Listen to the podcast if you want to know more about mortgages, real estate financing options and real estate strategies?

Jeremy and Alex, I have heard about your company and what you do for real estate buyers and lenders. Since it IS private money, it IS very intriguing. What got you into this business? Why is there a need for private lenders?
Hear answers to the questions below by clicking the link to the 1-28-12 radio show:
Jo_and_Mphs_Turn_Key_1-28-2012_1327960702_22390 http://www.600wrec.com/player/?station=WREC-AM&program_name=podcast&program_id=jogarner.xml&mid=21774482
1. Why is there a need for private lenders?

2. Why would someone want to become a private lender? What’s in it for them?

3. Can you tell me a little bit more about how the process works and what programs you have available?

Questions covered by Jo Garner :
1. Is owner financing allowed behind FHA and Conventional loans? Not usually The CLTV max would be no more than the maximum LTV on a transaction. No prepayment penalties, fixed rate. Most 2nds on FHA loans are provided by city, county or state government down payment assistance programs. On conventional 2nd position loans are usually provided by HELOCs or bank piggy back loans up to 90% CLTV.
2. What kind of scenarios do you see come across your desk where private financing might be a better option rather than traditional financing?Some are where the house is in such bad shape and the seller owns it free and clear and can finance the property. If the seller is not in a position to finance, then the FHA 203K is usually a great loan that will allow the homebuyer to borrow both the price of the house and some of the repairs.

Real Estate Tip of the Week Don’t fall prey.
Fraudsters are targeting distressed homeowners with “deals” that can sound perfectly legit. Some offer loan modifications for upfront fees while others offer fee-based “help” in navigating government housing assistance programs, sometimes claiming they’re attorneys.
There are also con-artist “investors” compelling desperate owners to sign over their homes with quitclaim deeds in return for a typically empty promise to remain there indefinitely. Others are telling former owners they can get their homes back for a lump sum. Be forewarned: Never sign blank documents or documents with blank lines.
If you’re unsure of an offer, have an attorney or other trusted adviser look it over. Keep in mind that a law barring firms — except attorneys — from charging upfront fees for mortgage relief or mortgage modification took effect in 2011. It’s called the Mortgage Assistance Relief Services Rule.
Also featuring the original song “Bail Me Out” by
Pam and Terry at www.pamandterry.com

Jo Garner, Mortgage Officer Evolve Bank & Trust (901) 482-0354 www.MoneyShoppe.NET and www.MortgageLoansBlog.com

The Real Estate Mortgage Shoppe radio show has a mission to inspire and inform the public about relevant topics concerning real estate and real estate financing. Our purpose is to help homeowners achieve their goals in an economical and satisfactory manner.

Our topic today is “Keep Your Lifestyle: How To Make Your House Pay YOU!”
Here are the industry updates taken from the radio show scripts.
Below is the link to the full podcast of the 1-21-12 radio show:

http://www.600wrec.com/cc-common/podcast/single_page.html?more_page=1&podcast=jogarner&selected_podcast=Jo_and_Ken_Bolie_Aaron_McD

There is so much in real estate and mortgage news this week….what do we talk about? What do we leave out?
Okay, well since we’ve had numerous calls about the mortgage rates, why don’t we start there? We saw a weakening market this week which caused rates to bump up just a hair but they are still at neutral buoyancy around 3.875% to 4.25% for the fixed rate 30 yr and 3.125% to 3.5% fixed for the 15 year. The 5-1 ARM is a great deal for a few folks in the low 3’s .
Word to the Wise: If the rate and terms you are being quoted today give you something to brag about, lock it to today. Better to commit on a low rate today and have some bragging rights and be a little disappointed when the rates go lower, than to NOT lock the rate and be angry & frustrated when the rates jump higher.

The White House just passed a law requiring all Fannie Mae and Freddie Mac backed loans to add a Guarantee fee (or G-Fee) to the cost of each loan closed. That means if you are closing on a $200,000 loan, it will add about $200 to your closing costs. If you are closing on a $100,000 loan, it will add about $100 to your closing costs.
This rule is required to go into effect on April 1st but some lenders are starting to implement it early.
Word to the wise: Get your home purchase or refinance closed now and not later.

The new government HARP 2 refinance program that does not take appraisal values into consideration will help several people who are underwater on their loans and even others who aren’t . This program is expected to be fully released on March 17th.

My very capable assistant, Susan Belew and I are working over-time getting your loan ready so that you do not have to wait as long when the program rolls out. If you want to get ahead of the rush, call Susan and me right now on our business line (901) 482 0354. That’s (901) 482 0354. Susan is standing by the phone to talk off the air with you about your refinance or if you want to purchase a home.

In fact, Susan and I would like to ask you to do something that may help someone you know. And you know how it makes YOU feel if you can help someone you care about:

Here it is: This week, think back and remember when a friend or family member told you that they just keep running short on money each month and feel as though they can’t get ahead. If that friend or family member owns a home, Susan and I would like to do a free analysis on their financing to see if we can free up a few hundred dollars a month for them. Call us at (901) 482 0354.

Ah—here’s some good news…
Jobless Claims fell by 50k to 352k, their lowest level since April 2008, and their largest drop since 9/2005. Woo hoo! Bring on the jobs!!!

More good news from REMAX, one of the largest real estate brokerage firms in the nation– REMAX, real estate brokerage company reported that December sales rose 5.7% on a non-seasonally adjusted basis after falling 5.7% in November. “We’re pleasantly surprised to see the year end with such strong sales, and hope this trend will continue into the traditional spring selling season,” said Margaret Kelly, CEO of RE/MAX LLC. She noted sales were driven by an increased number of investor transactions.
Well, well….we were just talking about that last week when Richard Scarbrough and Kevin Perk were here.

And now to the topic at hand today. We are talking about “Keep Your Lifestyle–How to Make Your House Pay YOU” and we have Troy McDonald and Ken Bowley, our insurance experts, to share some helpful insight into how you can use life insurance, long-term insurance and disability insurance to protect your home and your family’s lifestyle.
Check out our podcast for the information on the full topic.

Mortgage questions:
(1) What is the difference between a homeowner getting a Home Equity Line of Credit and getting a reverse mortgage?
Jo answers : “First of all, before anyone is allowed to apply for a reverse mortgage, they must complete a consultation with an FHA-approved Housing Counselor to make sure the reverse mortgage is right for you—since its not the right choice for everyone.
Jo answers: Secondly, on a Home Equity Line of Credit the homeowner has to make monthly payments to the bank to pay off the loan. If they miss payments, the bank can foreclose on the house. .On a reverse mortgage, since there are not payments due, the bank cannot foreclose on the home while the homeowner is living there.
.
Jo answers Thirdly, on an Equity Line of Credit the homeowner has to get approval based on their credit and their income and must prove they have plenty of liquid assets available
Not so on the reverse mortgage: since the homeowner does not have to make payments, the bank does not check credit (except for bankruptcies), the homeowner does not have to prove income or show a large amount of liquid assets.”

(2) What kind of trends do you see with homeowners wanting to refinance? Do most people want to just lower their house payments or shorten the term?
Jo answers: “We mostly see homeowners wanting to free up cash each month to pay off higher interest rate debt, to pay for school or to reinvest somewhere else (presumable for a bigger return than they are paying on the mortgage rate)
We see another group of homeowners who simply want to get the mortgage paid off quicker and get a low rate in the mid to low 3’s. Those homeowners are refinancing from a 5% or higher interest rate with, say 20 yrs or more left on the loan, to a 3.25% rate with only 180 months to reach pay off. The homeowner, in most cases is saving about 5 to 10 years off the mortgage. This can be very attractive because in some cases the number of years on the loan is reduced but the payment does not go up –or in some cases actually comes down.
(Example: If you have a $200,000 loan balance and you’re paying a principal and interest payment of $1,136/mo—and you have 25 years left on your mortgage that means you have $340,800 in total payments left to pay. But if you refinance the $200,000 to a 3.25% rate for 15 years you now pay a principal and interest payment of $1,405/mo times 15 years which is a total paid out of $252,960. You just saved about $87,800 in total mortgage payments . What a deal!

Some people are getting cash out to reinvest somewhere else but most are just wanting to lower the note or shorten the term or both. “

(3) We are talking today about how to make your house pay for insurance. What other ways can you get your house to pay for things?
Jo answers: “If its feasible for you to get cash out on your house, you can use the cash out to pay off other debt that has a much higher interest rate. Once the high interest rate debt is paid off, you can turn around and start prepaying your mortgage to shorten the term, or you can reinvest the money somewhere else like for education, a car or investment venture.

A more and more popular trend is to rent out the bonus room or guest house to create an extra cash flow. I personally have been doing it for years on my house. For the very first time my mother is renting the efficiency apartment over her detached garage. It creates an extra income for her and provides a nice apartment with lower- than- normal rent for a young graduate just getting started in her career. “

Real Estate Tip of the Week: If you are planning to keep your home for 5 yrs or more, it probably makes sense to refinance your property if you can save enough to recapture your closing costs in 12 months or less than 24 months.
If you are shortening the term on your refinance and you plan on keeping the house for 10 years or more, if you compare the total payments over the number of years on your refinance and the total exceeds the amount of closing costs by triple or more, it probably makes sense to refinance.

The topic for the Real Estate Mortgage Shoppe program on January 7, 2012 is “How To Get Started In Real Estate—Your Real Estate Journey with Jo Garner, Mortgage Officer with Evolve Bank and Trust and co-hosts Richard Scarbrough, buyer and broker for First National Realty and Kevin Perk, investor with Kevron Properties and www.smarterlandlording.com
The Real Estate Mortgage Shoppe radio show airs every Saturday 9A to 10A CST on News Radio AM 600 in Memphis, TN. You can also listen live online at http://tunein.com/radio/WREC-600-s22371/
The Real Estate Mortgage Shoppe radio show covers a variety of topics including the latest mortgage news and rates and how it affects the homeowner or aspiring homeowners. Also covered on the show is helpful information about niche real estate mortgage products like the FHA 203K renovation and repair loan, the 100% VA loan, the 100% Rural Housing loan, Down Payment Assistance programs, Conventional combination loans, the My Community Mortgage and refinancing products.

The Real Estate Mortgage Shoppe radio show is led by Jo Garner with Evolve Bank & Trust, a mortgage officer with over 20 years experience and a passion for listening and helping her customers accomplish what they set out to do with the right mortgage product. Jo Garner, Mortgage Officer Evolve Bank & Trust (901) 482-0354 www.MoneyShoppe.NET and www.MortgageLoansBlog.com

In the real estate news this week, Jo Garner shared the highlights.
There sure is a lot going on for a short first week of 2012. . For starters, the Fed sent Congress a little missive on how to fix the housing and mortgage market. The large inventory of foreclosed properties owned by the bank, is keeping the house prices low and keeping households poor. The rent rates on houses are rising as more people leave homeownership and shift to renting. Here’s some ideas the Fed shared with the White House. They said “Try
#1.Creating a bank-owned property to transition from a home-to-rental program that relies on sales to third-party investors. This could work by(a) structuring competitive auctions; (b) making a more attractive deal to investors, or (c) providing investors with the debt financing.

2. Remove some of the obstacles preventing creditworthy borrowers from accessing mortgage credit.
3. Step up efforts to aggressively pursue loan modifications and work out plans for homeowners in money trouble instead of dumping larger numbers of foreclosures on the market
Other big news that will affect homeowners purchasing a home with a mortgage or refinancing one. Tongues are wagging and speculating about the Fannie & Freddie guarantee fee increase adding 10 basis points for each loan closed. Fannie Mae and Freddie Mac will increase their guarantee fee on all residential loans being pooled by 10basis points on April’s Fool’s Day. Many experts believe that this increase should start to reflect on mortgage applications in February, if not sooner. What that means to you, the homeowner, is that if you close on a mortgage for $200,000, you are going to pay over $200 more for cost at closing. If you were borrowing $100,000, you will be paying over $100 more in costs.
Rates are curiously still at their low mark. The 30 yr mortgage rate is around 3.875% to 4.25%. The 15 yr rates are running in the low 3’s to mid 3’s.
My assistant, Susan Belew, and I have a list of customers who are waiting on the new HARP 2 mortgage refinance program to fully roll out. This is the new government program to help homeowners who are making their house payments on time but who owe more than the value of their house. This program has some restrictions. –one of them is that the loan must be backed by Fannie Mae or Freddie Mac. Lenders are waiting for Fannie Mae and Freddie Mac to update their computerized underwriting systems with the new guidelines. The updates are expected in March.
If you want to take advantage of the extra low mortgage rates available, my very capable assistant, Susan Belew and I would like to review your mortgage terms to see if we can save you some money, call us at 901 482-0354. Susan is standing by our phone right now.

The Real Estate Mortgage Shoppe radio show has a mission to inspire and inform the public about relevant topics concerning real estate and real estate financing. Our purpose is to help homeowners achieve their goals in an economical and satisfactory manner.

This radio show covers answers to the questions on rent vs. buy, when does it make sense to refinance my loan, and more. Every week listeners get tips from the Real Estate Tip Of The Week and tips from the host and co-hosts of the program.

By clicking and listening to the podcast below you can catch some of the profitable ideas Richard Scarbrough and Kevin Perk offer to real estate investors starting out.

If you are planning a mortgage loan refinance and mortgage loan for purchase financing of real estate in the Memphis area and across the country, contact Jo Garner at Evolve Bank and Trust (901) 482 0354.

ON NEWS RADIO AM 600

9A-10A Saturdays

The news for mortgage loans and credit on home loans this first week of 2012 is hot from Jo Garner, Mortgage Loan Officer with Evolve Bank & Trust in the Memphis, TN area.  On the radio show today we discussed the Federal Reserve’s missive to the White House on how to fix the real estate and mortgage market. We talked about the new government imposed Guarantee Fee added to each Fannie and Freddie mortgage loan closing. And we gave updates on the phased roll-out of the government HARP 2.0 refinance program for borrowers underwater.

The main topic of the radio program was “How To Get Started Investing—Your Real Estate Journey.”  The co-hosts were experts Richard Scarbrough, buyer and broker from First National Realty and Kevin Perk, owner of Kevron Properties and www.smarterlandlording.com

The Real Estate Mortgage Shoppe radio show airs every Saturday 9A to 10A CST on News Radio AM 600 in Memphis, TN.  You can also listen live online at  http://tunein.com/radio/WREC-600-s22371/

The Real Estate Mortgage Shoppe radio show covers a variety of topics including the latest mortgage news and rates and how it affects the homeowner or aspiring homeowners.  Also covered on the show is helpful information about niche real estate mortgage products like the FHA 203K renovation and repair loan, the 100% VA loan, the 100% Rural Housing loan, Down Payment Assistance programs, Conventional combination loans, the My Community Mortgage and refinancing products.

This radio show covers answers to the questions on rent vs. buy, when does it make sense to refinance my loan, and more.  Every week listeners get tips from the Real Estate Tip Of  The Week and tips from the host and co-hosts of the program.

The Real Estate Mortgage Shoppe radio show is led by Jo Garner with Evolve Bank & Trust, a mortgage officer with over 20 years experience and a passion for listening and helping her customers accomplish what they set out to do with the right mortgage product. Jo Garner, Mortgage Officer Evolve Bank & Trust (901) 482-0354 www.MoneyShoppe.NET and www.MortgageLoansBlog.com

For starters,  the Fed sent Congress a little missive on how to fix the housing and mortgage market. The large inventory of foreclosed  properties owned by the bank, is keeping the house prices low and keeping households poor. The rent rates on houses are rising as more people leave homeownership and shift to renting.   Here’s some ideas the Fed shared with the White House. They said

 “Try #1.Creating a bank-owned property to transition from a home-to-rental program that relies on sales to third-party investors. This could work by(a) structuring competitive auctions; (b) making a more attractive deal to investors, or (c) providing investors with the debt financing.

1. 2.    Remove some of the obstacles preventing creditworthy borrowers from accessing mortgage credit.
2. 3.    Step up efforts to aggressively pursue loan modifications and work out plans for homeowners in money trouble instead of dumping larger numbers of foreclosures on the market

Other big news that will affect homeowners purchasing a home with a mortgage or refinancing one.  Fannie & Freddie  guarantee fee are adding  10 basis points for each loan closed. Fannie Mae and Freddie Mac will add the guarantee fee on all residential loans being pooled by 10basis points on April’s Fool’s Day. Many experts  believe that this increase should start to reflect on mortgage applications in February, if not sooner. What that means to you, the homeowner, is that if you close on a mortgage for $200,000, you are going to  pay over $200 more for cost at closing. If you were borrowing $100,000, you will be paying over $100 more in costs.

Rates are curiously still at their low mark.   The 30 yr mortgage rate is around 3.875% to 4.25%. The 15 yr rates are running in the low 3’s to mid 3’s.  The 5-1 ARM is still a great deal for homebuyers and homeowners who do not plan to be in the home for more than 5 years.  This plan is also great for people who plan to make a substantial  prepayment to principle within the first 5 years. 

The 5-1 ARM is a fixed rate starting at around 2.75% for the first five years.  After 5 years the rate becomes adjustable with safety caps.  However, one important advantage of the 5-1 ARM is that after the loan becomes adjustable, the payment is recalculated each year only on the unpaid balance.

Jo Garner and her assistant, Susan Belew, have a list of customers who are waiting on the new HARP 2 mortgage refinance program to fully roll out.   This is the new government program to help homeowners who are making their house payments on time but who owe more than the value of their house.  This program has some restrictions. –one of them is that the loan must be backed by Fannie Mae or Freddie Mac.  Lenders are waiting for Fannie Mae and Freddie Mac to update their computerized underwriting systems with the new guidelines.  The updates are expected in March.

For borrowers wanting  to take advantage of the extra low mortgage rates available, Jo Garner and her very capable assistant, Susan Belew would like  to review your mortgage terms to see if they can save you some money, call them at 901 482-0354.

If you know a realtor, homebuyer or seller who has been working on the sale of a home and recently had the loan turned down, please put them in touch with Jo Garner, mortgage officer with Evolve Bank and Trust.  Jo and her team have been able to pull some real estate transactions out of the fire for people who have experienced a late hour turn-down from competing banks.  

The Real Estate Mortgage Shoppe radio show has a mission to inspire and inform the public about relevant topics concerning real estate and real estate financing.  Our purpose is to help homeowners achieve their goals in an economical and satisfactory manner.

Jo Garner can be found at www.mortgageloansblog.com and www.MoneyShoppe.NET or by calling (901) 482-0354 or emailing jogarner@mindspring.com

The link to the January 7^th, 2012 podcast can be found at 

http://www.600wrec.com/cc-common/podcast/single_page.html?podcast=jogarner

Jo Garner, Mortgage Officer at Evolve Bank and Trust hosts the Real Estate Mortgage Shoppe program every Saturday.  She covers mortgage and home loan news and real estate tips to homebuyers and homeowners needing credit and home loan finance products in the Memphis area and in every state in the nation.

FHA 203K Home Repair Refinance

The FHA 203k renovation and rehabilitation mortgage clears the way for numerous homeowners to get the very best buy on purchasing their home.    In my career as a mortgage loan officer for the past 20 years, I have seen my customers seal some of the very best deals buying real estate in Memphis using the FHA 203K Repair and Renovation loan.

My customer, Mr L, called me when they put the last finishes on their repairs on the house they purchased for just cents-on-the-dollar.   Here’s how he snagged the “deal of the century” as we are calling it.

Mr. L knew that his family needed to purchase a home that would more than meet their needs but still remain within their budget. They had been on the hunt for their perfect home for about 2 years.  I could hear the excitement in his voice when  Mr L called me to get the loan application completed and the preapproval letter drafted so that his contract could be accepted by the seller.

“This is the perfect house for us, Jo.  It is so unbelievable that we getting this house in this neighborhood for so little money.  Not only is our payment going to be within our budget, but is going to leave room for other stuff.  What a deal!”

Here is the process we went through to get the perfect house for Mr. L.

(1)   First he looked at the house with his contractor and got an idea of how much it would costs to repair

(2)   I gave him an estimate of what terms would be on the loan

(3)   He and his realtor wrote an offer to purchase the home and it was accepted.

(4)   I set up an appointment for the appraiser, the HUD consultant and the homebuyer to meet at the property.   The HUD consultant reviewed the specifications and cost estimates from the contractor who would do the work.  The appraiser gave us a value for the property.  Later the HUD consultant delivered the “official” reasonable costs estimate that the mortgage office would use to calculate Mr. L’s loan amount.

(5)   Mr. L submitted his income and asset documents and loan disclosures to the mortgage office and we submitted the loan to underwriting for approval.

(6)   Mr. L closed on his loan leaving the money for repairs in escrow to be pulled out little by little as the repair on the house gradually came to completion.   The HUD consultant came out 4 or 5 times to inspect the work as they would get to a certain stage in repairs.  At each inspection, a draw was made on the repair money sitting in the escrow account to pay the contractor until the work was completed.

Here is how the 203k loan structure looked approximately for Mr. L. :

Sales price:  $80,000

Cost of renovations:  $38,000

15% reserve on renovations: $5,700

$123,700

X           96.5 (to subtract 3.5% mandatory down payment)

$119,371 (FHA base loan amount)

X            1.01 (adding 1% upfront FHA mortgage insurance)

=    $120,564 (total loan amount with upfront MIP added)

Mr. L’s money needed to close:

Down payment  3.5%  $4,339

Closing costs including $800 HUD consultant fee & 3 inspections $5,000

Escrowing property taxes and insurance $2,700

Seller agreed on contract to pay $2,400 of closing costs for buyer. (FHA allows the seller to pay up to 6% of the closing costs if it can be negotiated on the contract)

$4,339 dp + $5,000 closing costs + $2,700 tx & ins=$12,039 minus seller pd $2,400=Mr L to pay $9,639 to close.

The house value was assessed at over $200,000.  What a deal for Mr. L!  What a deal for anyone who can buy a house that far below market price, fix it up and walk into an instant 40% equity position!

Jo Garner, Mortgage Office

Evolve Bank & Trust

(901) 482-0354 jogarner@mindspring.com

www.MoneyShoppe.NET

The FHA 203K mortgage loan financing was a great real estate home purchase  for Mr. L living in Memphis.

A good number of people would resign themselves to kissing this sweet deal good-bye.  But Terry had a plan.  He punched in the telephone number for his private lender. It didn’t take long for Terry to give his private lender the details of the deal, the value, the cost to repair and the projected profit once the property was completely rehabbed.

The private lender did a quick check on the value of the property and the estimated repairs to be done. She had already done a credit and background check on Terry from previous transactions.  Her last words to Terry before he left town went something like this, “Go have a great time on your vacation, Terry.  I’ll have the money ready for your closing when you return.” These quick money lenders are sometimes pictured as sinister hoodlums lurking in dark alleys waiting to break borrower’s kneecaps when they can’t repay. However, professional hard money lenders are NOT the Mob, but they are not Mama either. Interest rates can go well into the double digits with upfront points depending on the risk factors.

Generally the hard money loan is a temporary loan until the borrower can secure permanent financing or other method of payoff. The main difference between a professional hard money lender like Terry Kerr’s lender and the unscrupulous predatory lender is the design of the loan terms and the type of borrower. The unscrupulous lender structures the loan so that borrowers inevitably fail and the lender/predator can take the house in foreclosure.

On the other hand, the professional hard money lender structures reasonable terms because he wants his money and fees—not the borrower’s house.

There are probably as many different hard money lending loan terms as there are hard money transactions. Terry Kerr’s private loan structure looked something like this:

Sales price on “AS IS” multi-unit:              under $ 20,000
Cost to repair property:                                              $ 50,000

Value of property “AS IS”                approximately  $108,000
Hard Money Loan 65% LTV:                                           $  70,000

Points paid by Terry to his private lender at time of payoff:   $  7,200 (plus interest paid monthly)

Term of hard money loan:  6 months
Terry’s PROFIT at the end of the deal:  !!!!!$ 60,000 !!!!!

Terry Kerr shares his knowledge and experience regularly at the Memphis Investors Group meetings. He shared in a recent interview, “I have done 35 real estate investment deals this year and plan to do 50 next year.”   (quoted in 2005)

Hard money lenders fill a niche in mortgage lending, helping consumers who have specialized needs.  They can be found all over the United States and the world. .

Memphis Investors Group   www.memphisinvestors.com

HomeVestors (Don & Holly Swogger) www.pleaseclose.com/Holldongroup

J. Garner, Mortgage Officer
Evolve Bank & Trust
www.MoneyShoppe.NET

He was a high echelon real estate broker with a high class office building that was sorely in need of carpet quick. The prospective tenant was almost in the bag. The pressure was mounting to complete the renovation by the drop dead time limit and within budget. He stood in the entrance hall looking at bare concrete floors, as the echo of his cell phone ringing echoed off the empty walls. The call was from his interior decorator. He let it go to voicemail. He could still hear her reminding him about the high quality, well-designed carpet that would look nice and hold up in heavy traffic in the hallway. But the price—the price was sending him tumbling over the budget. Stuffing the cell phone in the pocket of his blazer, his fingers fumbled across a folded advertising flier. Pulling open the folds, he saw an ad that promised expert flooring advice and flooring products at wholesale prices. Little did he know that he was about to meet his flooring champion, Gwen Christensen of Builder’s Floors and Interiors. (more) Gwen Christensen answered his call and offered to come over to the office building that very day. “She sounds like she may be able to find the same quality carpet for less, and she seems to understand what I want. I am feeling better already,” he thought to himself. Gwen listened to Mr. Broker’s wants and the decorator’s suggestions, inspected the area where the carpet would be installed, and begin searching for the same quality carpet for a better price. With her vast knowledge of flooring products she found a Staylock carpet that would not ravel at the seams on high traffic areas. The interior decorator’s flooring company was charging $32.95 per yard. Gwen came in at $23.95 per yard, saving Mr. Broker $9 per yard. Once the decorator was satisfied with the design, everyone was happy and within budget. Do you need carpet, vinyl, or tile? Would you like free expert advice like Mr. Broker that will give you the best quality carpet, made to last for its location at the best price you can find? Visit Gwen Christensen at Builder’s Floors and Interiors 3085 Stage Post Bartlett, TN 38133 (901) 382-2155 or go online www.buildersfloorsandinteriors.com Blog post by Jo Garner, Mortgage Loan Officer Evolve Bank & Trust (901) 482-0354 jogarner@mindspring.com