Origination: Lending outside qualified mortgage rule may help lenders replace lost home refinances
Home purchase volume is expected to increase slightly but this trend will likely be prominent in 2018, as originators may continue to struggle to replace lost refinance volume and their compliance and risk management processes become more robust.
Cost Competition: Fannie Mae and Freddie Mac tech help lenders expand credit box
What this means to lenders and borrowers? Lenders will be able to improve the borrowing experience for home buyers and make full use of the credit box.
Mortgage Loan Service: Market Consolidation
Mortgage debt is expected to grow 4% in 2018, following the 3.2% growth in 2017. The largest residential mortgage services will get even larger, benefiting from consolidation and the outsourcing of service rights acquired by companies without their own platforms.
Always Room for Improvement: Technology and Automation will drive the digital mortgage advances
Digital mortgage technology as we all know is the current 'buzz word." It helps consumers take a more hands-on-approach to the mortgage process, lenders are stepping up their adoption of automation and learning through artificial intelligence abilities. Which means a fully end-to-end digital solution which is still in the infant stages.
What Valley West Mortgage strives to better the way we operate our mortgage business from start to finish, from origination to funding to servicing and keeping our clients happy.
Compliance and Regulation: Fannie Mae and Freddie Mac
Shifting policy stances and renewing focus on housing finance reform could make 2018 a breakout year for Congress to finally resolve the conservatorship which began on September 6, 2008. This conservatorship in response to the substantial deterioration in the housing market that severely damaged Fannie Mae and Freddie Macs' financial condition.
Shopping for a Mortgage Loan
How Do You Shop for Rates?
The top tools for mortgage shopping
Over the years, shopping for a mortgage has become better than ever. Purchasing a home is more accessible online and mobile, which makes the process more fitting for those of us looking for our dream home. Valley West Mortgage is here to make that happen, with our online pre-approval form, loan application, and secure loan docs upload capabilities to ease the stress of buying a home.
Buyers have been using a combination of resources when looking for mortgage information that include, real estate agents, online, family, friends, and lenders. Out of which, most buyers found that the industry professionals, family, and friends were more trustworthy over online resources.
Lenderswere the top preference for recent buyers, with 77 percent saying they used a lender for information when shopping for a mortgage. Two-thirds also said they looked for information directly from an agent, while 69 percent said they used online resources, including Realtor.com, credit management sites and social media.Valley West Mortgage is your Mortgage Banker offering the lowest mortgage rates in the Las Vegas Valley.
Online mortgage resource users are buyers between 18 to 34 and 45 to 64. Nearly half of all buyers said they used online resources out of convenience. 22 percent said because of their “practicality,” and another 12 percent said they were “easy to understand.”
If you’re wondering, it’s not going away anytime soon. Mobile usage during the mortgage shopping process has jumped to 65 percent and 73 percent hope to do so in the future.
Tools That Help Your Mortgage Buying Needs
Specifically, online tools and mobile resources are available to you 24/7 which is why it makes it more convenient to start your search there. You can compare mortgage quotes, obtain a mortgage quote, fill out a mortgage application,submit documents to your lender and look for advice about getting mortgage via your mobile device without the hassle of leaving your home.
When it comes to getting a home loan, you have a few options available to you in order to come up with the money to purchase the home. This article will focus on two of the most common ways you can borrow money for your home loan. More importantly, it’ll will focus on the differences between these two options.
What is the difference between financing a home loan through a mortgage broker and financing a home loan through a commercial bank?
Well for starters, a mortgage broker acts as a middleman between the borrower and the big banks. Brokers have knowledge and experience with market trends and they analyze the possibility of your loan with several different banks. Commercial banks on the other hand will only show you what their bank offers; a comparison with other banks is not part of the process. Brokers are able to accommodate borrowers who may have an unusual financial situation by doing the footwork for you. Instead of you going from bank to bank finding out who will qualify you, you can give your information to a broker and he searches through his database of banks to find what bank will suit you best.
It’s easy to turn to a commercial bank when you think of applying for a home loan because most of us do our everyday banking with commercial institutions anyway. Commercial banks often offer discounts on home loans because of your loyalty through everyday banking. Borrowers are comfortable with who they are familiar with. Truthfully though, familiarity with your bank doesn’t guarantee them as the best option.
Loan officers also differ depending on weather you decide to go with a bank versus a broker. Mortgage brokers often hold small operations, making the process of your home loan quicker because your file doesn’t have to go through as many hands. A loan officer that works for a broker is likely to be able to give your loan more attention than that of a loan officer at a commercial bank. Broker institutions are more intimate and offer the borrower a more involved experience.
Also, it may be safe to say that loan officers who work for brokers are more knowledgeable about the business. Why? At commercial banks loan officers are required to do the general hours of study necessary to be licensed with the Nationwide Mortgage Licensing System (NMLS). With brokers, loan officers are required to do the same as well as required to be licensed in every state that they will do business in. In other words, LO’s at commercial banks get a general education of the market. LO’s who work for a broker obtain a more in depth knowledge of the market. Their knowledge is not just based on the national standard, but also on the specific standard of each state that they operate in.
When doing your research always be sure to consult great sources. Check out the sources for this article below!
An appraisal is a document provided by an appraiser (the person who conducts the appraisal report) that provides a professional estimate of the value of your home.
Appraisals are conducted by a third-party appraiser who is completely objective in their process. Appraisers do not work in favor of the lender nor the borrower. They simply conduct the appraisal and produce their findings.
Appraisals are most often conducted two ways. The first way an appraiser can conduct an appraisal is by noting comparables. Comparables, or comps for short, are properties within the neighborhood of the home you’re buying that are similar to yours. The appraiser will use the values of the similar properties nearby to determine the value of your home. The second way is by estimating how much it would cost to replace your home should it burn down or be otherwise destroyed. The appraisal will compile all of the findings of the appraiser including:
Comparisons with homes near the subject property
Notes about the real estate market in the area as a whole, including the ages of the homes and the average selling prices of the homes nearby
Notes about the appearance of the inside, outside, and surrounding area of your home
Notes about any visibly unfavorable characteristics about the home like cracked concrete or damaged windows
Pictures of everything that adds value to the home including, bedrooms, appliances, and fixtures
Why Lenders Need Appraisals
Lenders do not want to dish out more than the actual market value of the subject property. An appraiser’s goal is to determine that value. With this figure, the lender knows how much the property will sell for if you default on your loan. They also know how much they can lend to you without taking a loss if you default.
For example: If the subject property is appraised at $150,000 – that’s how much it will sell for on the open market. If your lender gives you a loan of $175,000 and you default on your loan, they now have to try to sell the home at a higher amount than what its appraised for, which can be difficult. If they end up selling the home for the actual market value, they’ve just lost $25,000. It is for this reason that lenders usually give a loan amount that is at or under the appraised value.
Why Borrower’s Need Appraisals
Appraisals are usually buyer paid and can be paid for at closing or during the application process. If you’ve signed a contract to buy a new home for $200,000 and the appraisal comes back valuing the home at $150,000, you should negotiate with your lender to lower the loan amount because you’re paying more for the home than it’s actually worth.
Overall, appraisals are a measure of protection. They ensure that neither party is lending or spending too much during the purchase process of a home.
When doing your research, always be sure to cite great sources! Check out the sources for this article below!
Our last few articles have been on the impact that the oncoming rise in interest rates from the Federal Reserve will have on the general public, and more specifically how it will impact those who are in the market for purchasing and refinancing. Janet Yellen has openly stated that a change from the Fed is coming soon due to the growth in our economy. We’ve mentioned both the pros and the cons of an interest rate hike, but lately we’ve been noticing more pros for our borrowers than cons.
One positive impact that this rise in interest rates can have on our current and potential borrowers is the opportunity to free themselves from Mortgage Insurance Premiums. Your Mortgage Insurance Premium is the price that you pay monthly as a part of your mortgage payment that goes into an account to protect your lender if you fall on hard times and happen to default on your loan. A Mortgage Insurance Premium or MIP for short, is usually only required for borrowers who can’t afford to put down 20% of their loan amount when applying for their mortgage loan. Up until January 2013, borrowers were able to cancel their MIP coverage once they had made enough payments and had 20% equity in their home. Now that policies have changed, borrowers no longer have the option of cancelling the MIP on their loan when they reach 20% equity.
However, being the mortgage monsters that we are here at Valley West Mortgage, we’ve recognized a way that borrowers can still break away from the bondage of MIP. With a refinance into a Conventional loan where the requirements are somewhat different than an FHA loan, borrowers can drop their MIP payment (provided they meet the aforementioned requirements).
Borrowers who used the FHA program to purchase their home who have been making regular mortgage payments have been building up equity since the day they made the first payment. Couple that with the fact that the average prices of homes around the United States has gone up in the last 2-3 years and just like that, we’ve found another reason for you to refinance into a Conventional loan. Having equity or monetary value in your home means that you can apply for a Cash-Out refinance. Thinking of going on a vacation? Have a kid going to college? Or maybe you just want to do some home improvement? A Cash Out Refinance would give you the opportunity to refinance your old loan into a new one and get cash back for some of the value that your home holds.
In 2016 about 8% of all the refinances processed were for borrowers who were switching from an FHA loan program to a Conventional loan program. That calculates to about 20,000 of those refinances per month in 2016. With the growth of our economy, it is estimated that the prices of homes will go up by about 5% (according to data found by CoreLogic). Considering the fact that over 2 million borrowers purchased homes using the FHA program in recent years, there is no doubt going to be a large wave of refinances coming from borrowers who wish to refinance in 2017.
When doing your research, always use great sources! Check out the sources for this article below.
Choosing the right lender is one of the most important parts of applying for a home loan. Loan officers are the men and women who work for the lenders and banks that will be in charge of your loan. They are in a sense, the face of the company. Good loan officers work in your favor to get you the best type of loan for your home. But if you’re like me, you don’t just want a good LO (Loan Officer), you want a great one. You want an LO that is going to go above and beyond to meet your needs, not an LO that just talks a good game.
You, as a potential borrower, have to do your homework. You want a Loan Officer who works for a credible mortgage company. Valley West Mortgage for example, does hundreds of loans, as a lender, every year and has been around as a business for ten years. You can find all of the Valley West Mortgage Zillow reviews here.
Next it’s time to speak with a Loan Officer. Are they friendly? Have they taken the time to answer all of your questions? Think on these things. If you can positively answer these questions about your LO, and your lender, then it’s a safe bet you are the hands of an LO and a Lender who will work in your favor.
More about your lender
So where can these superb Loan Officers be found? If you’re in the Las Vegas area, Valley West Mortgage is your answer. Even if you’re not in the Las Vegas area, it’s possible that you may be in one of the many surrounding states that we offer services to. Our LO’s do a critical analysis of your finances and determine what type of loan is most advantageous for you, while they hunt for the best rates in the country. They are here to help you get your monthly payments to the lowest amount that the banks will allow. Valley West it isn’t just about building a business, it’s also about establishing relationships with our clients.
We want to retain our clients so that when rates get even better we can offer them the chance to refinance. Our borrowers benefit because a refinance allows for a new payment schedule to be created with better pricing. We benefit by getting another chance to prove to our clients, and prospective clients, just how skilled our LO’s are and that we are the best mortgage lender in the business.
You wouldn’t just go to anyone for a haircut. You would go to a stylist whose work you have seen or heard about, someone credible. Likewise for your first home purchase, you should go to someone who not only specializes in first time purchases, but also has improved the process of purchasing a home. There are lots of lenders in existence, but at Valley West Mortgage we pride ourselves in having the best of the best. We won’t just work for you, we will work with you to ensure that your financial needs are met. We appreciate you for your business and we show that appreciation by giving you the best service around.