I am happy to report financing is getting a little easier as we move into spring. One, the banking institutions and title companies said they would be ready for the new rules in late 2015. They have kept their promise. They did tell us that 30 day closings were a thing of the past and to write contracts for 45 days. I am happy to share I had one deal close in 28 days and another in 30 days from two different lenders and two different title companies. They were conventional loans which are a little easier with generally stronger buyers. I think what we are seeing are lenders moving their time table up and still allowing time for the 3 day disclosure period for buyers. The biggest hurdle I have seen is scheduling appraisers soon enough they get their work done. That did not hold us up.
Two, there are some new financing guidelines for Self Employed buyers that will help make it easier for a self employed person to get a home loan. The loan is based on cash flow through your bank account instead of just 2 years of tax returns.
You will still need a little more time for government backed loans and the 40 to 45 days is probably a good time frame. This type of loan has to be approved by a government agency and the lenders do not have control of how quickly loans get approved.
Three, the mortgage broker is soon to be a thing of the past. You need a mortgage banker or bank for your loans today. I experienced this first hand with a mortgage broker that could not sell the loan to an investor for a client due to a one time 9 month old late payment. It was not that it was not paid. It was just late. We were told they would have to wait a year before reapplying. I contacted another lender and they did the loan in 30 days.
Things are looking up,
This is an update on the changes that were scheduled for August. The Government backed off the August date and moved it to October 1st, 2015 to allow more time for lenders and title companies to get ready.
What does this mean for you?
I just attended a training seminar to get up to speed myself. The intent of the changes are to protect you from predator lending. It's purpose is to provide you more information in a time frame that gives you time to ask questions and make sure you are comfortable with what you are committing too with your closing and your loan. The lender and title company will be communicating more and earlier before the closing to provide you this information. You will receive the closing information 3 days before closing and the lender will go over it with you at that time. If there are any changes to be made, the 3 days before closing will start over. The lender is accepting more responsibility and liability through this process. Contract to closing time will increase due to this process.
Ultimately, you will be closing the same as before but it will take more days to close.
This will be a learning process for everyone. Some lenders are going to do this better than others. Lenders will be approving title companies and you will not have as many choices as you had before in most cases.
You are still looking for your dream home, getting a loan and closing on your new home. You should expect 40 to 45 days to close initially until we find out how well this works.
The good news is you will be better informed when purchasing a home with a loan.
August 1st new changes are coming for financing residential property and you need to be aware. Most of our local lenders and the title companies are prepared. All of this is being done to protect you from predator lenders and lazy ones. The Dodd Frank Bill has some very good things included for you as a buyer but when the government is involved it becomes complicated and sometimes silly.
I want you to be aware and talk to your lender before you are ready to purchase a home so you understand the process. It is not making it more difficult for you to quality for a loan. It is adding work for your lender and title companies which always means more time to close.
Be aware! I highly recommend you use local lenders in your area and not depend on someone on the internet or someone's best friend. It will take professionals that are very good to make this work smoothly. They can get the same rates and most likely reduce your lending costs.
You have been warned!
Have an awesome summer,
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Have an awesome day!
Winter weather could come at any time in the Branson area. We have had our first frost. The trees are beautiful this fall and the days have a fall like feel to them. We tend to not worry about winter because it is so nice in the fall but that is how we get caught off guard.
You need to get your home ready and this is your reminder.
1. Clean up the leaves so they do not kill out your grass for next spring.
2. Some bushes and plants should be trimmed back. Check with someone smarter than me on which ones those are and how to do it properly.
3. Clean out your gutters.
4. Drain and put away your garden hoses.
5. Buy a Deicer for your sidewalks and driveways. You should always have a bag around incase of times when you must leave home. DO NOT USE SALT! It will destroy the top of your concrete and it is not good for your plants & grass.
6. Make sure all your windows are sealed and closed properly.
7. Check your exterior door seals and replace if needed.
8. Have your furnace checked and serviced by a HVAC professional so it is operating correctly and efficiently.
9. Check your propane tanks and if you use wood have plenty on hand.
10. No wood piles next to the home. Termites love wood piles.
11. Do you have a good show shovel?
12. Remember if the roads are slick you can often wait a couple of hours and they will be melted off.
Have a great fall and take care of your home.
The dog days of summer will be ending soon. The kids will be going back to school and life will be normal again.
Our market like many others has been a little slower than we would like and that means it is a buyer's market. We have good inventory and most properties priced well. They are looking for a new owner. Sellers are not wanting to hear that but if their property is on the market they want to sell it.
Buyers, this spring our market was changing to a seller's market under $200,000 and it was hard for the buyers to accept. Some were disappointed! Over the last 50 days that has changed somewhat and there is opportunity to get a good deal. August is usually slow as families are on vacation or getting ready for school to start. If you are a buyer it is time to get after it before sellers get optimistic about the fall market.
Words of wisdom!
I hope you are enjoying your summer. They go fast!
I have noticed that we have some buyers and sellers discouraged by the new finance rules we are living by today but wanted to cheer you up a bit.
We have local lenders making some changes in loans and creating new loans to fit specific needs. I will not name them here but if you want some guidance I would be glad to share them with you.
Some local banks have made strategic decisions in their loan lending which will benefit many of us. They have increased their residential in house loan commitments which means they are willing to carry the loan locally and that gives them some flexibility in still meeting the new banking regulations. If you or your loan will not fit the traditional secondary market they may have a solution that will not cost you an arm and a leg. The examples I have seen were competitive on interest rates and most have low loan origination costs.
Condo sales and prices have been dramatically impacted by the new regulations. We have several local banks that will finance these in house and we have another lender that has went to great lengths to know which condo complexes will fit the secondary market. That number is higher than you might think.
All in all we have a lot of choices when it comes to financing and you or your property may very well qualify for them.
Until next time,