Mylendingplace.com

I agree with Perry. In my 5 years in the business, I've never closed a hard money deal. At first people love the "idea" of asset-based lending, but when they look at the 5-7 points and the 15%+ interest rate, suddenly the idea isn't so hot afterall. http://www.mylendingplace.com

Your best bet is to approach your bank, or possibly SBA lending. Sure it's a pain but so is 15% interest. - Fri Jul 4 2008, 21:14

As a local Austin mortgage broker, I work with all types of banks. From strictly "A paper" banks to banks who have more liberal guidelines. Once upon a time you could have a 500 credit score--but if you were putting 30-40-50% down you were okay. There were banks willing to lend.

Not anymore.

Now, the most liberal banks want to see at least a 620. And if you are self-employed or have harder to document income you may have to have a 660-680.

Today's banks want three things:
1) Good/great credit scores.
2) Good/great assets (liquid money in the bank)
3) Full Income documentation

Just having a good credit score isn't enough these days. I mean, a teenager can have an 800 credit score, right? This is why most mortgage professionals will ask for a complete application before issuing a GFE (Good faith estimate). If your mortgage professional issues you a good faith estimate without truly looking at a credit and assets—Run! Because there’s nothing more stressful than to be a week from closing and then realizing there’s a problem with your loan and you’re not going to close.

Work with a professional. If you have bad credit, take the time to sit down with your mortgage guy and put in place a plan to improve your scores. There are no silver bullets in credit repair. But sometimes people do have mistakes on their credit reports that bring their scores down unnecessarily.

Good luck!
Jon Spears - Fri Jul 4 2008, 21:09

From a bank perspective:

Banks or mortgage companies won't lend more than the appraised value. So the only option is to renegotiate the price based on the new appraisal. Or order a new appraisal if you feel the first appraisal isn't valid for some reason.

Ordering an appraisal and inspection should often be done before making an offer. After all, if you are serious about buying the home why not remove the issue of the value from the beginning by simply having the mortgage company orders the appraisal upfront?

As a seller, especially if you're going the For Sale by owner route (http://www.austinhouse.net), go ahead and order an appraisal on your own home. It helps you establish and defend your asking price. This makes it much easier to get full asking price when you have a third party appraisal supporting your sales price.

Things you should do before selling:
Order title
Order appraisal
Order inspection...THEN write the sales contract.

Don't know how to order title, apprisals--don't worry these are done by the mortgage company. Just find a good mortgage company to work with (Austin has a bunch of good ones) and go from there.

Jon Spears
Austin Mortgage Broker - Wed Jul 2 2008, 07:52

The economy is experiencing a weird dynamic.
1) High gas prices—which you’d think would help mortgage rates because bad economic news helps mortgage rates.
2) Mixed economic news. For example the recent unemployment report did NOT improve rates which normally, negative economic news causes rates to go down. Rather, rates went UP.
3) Inflation concerns: The Fed is concerned about inflation and is even thinking of raising the FED rate to offset this. This is causing rates to stay high, even in the face of negative economic news. For example, Today’s 20 year rate is slightly higher than the 30 year rate. This is unusual.

My guess is rates will stay in the 6.625% range. Naturally, in this market the best thing to do is get the best loan—which is one without high closing costs and/or PMI. Of course, I’d like to help with this.

Jon Spears
http:// www.mylendingplace.com - Tue Jun 17 2008, 08:47

Hey Dena, one option you may want to consider is attracting a buyer without a realtor. This way if you're thinking of lowering your price you can safely lower your price, say 3%, without losing additional money. I'm a local mortgage company and I runhttp:// www.Austinhouse.net which is a For Sale by Owner website.

If you put your home on the Austinhouse site (it's a free site) and your buyer isn't represented by an agent you'll only have to pay 3% to your listing agent. In your case, 3% is almost $6K. Perhaps use this 6K for upgrades or to pay your buyer's closing costs.

Austinhouse.net is used by realtors and FSBOs.

Option #2) might be to keep the home and lease it out until the market rebounds or you get the price you truly want.

Fewer people qualify for mortgages now so this may be a blessing in disguise. If you're concerned if you won't qualify for the new home if you leased out Texas Oaks...call me. - Sun Jun 15 2008, 12:28