01/24/2012 By: Krista Franks Brock

Capital Economics expects the housing crisis to end this year, according to a report released Tuesday. One of the reasons: loosening credit.

The analytics firm notes the average credit score required to attain a mortgage loan is 700. While this is higher than scores required prior to the crisis, it is constant with requirements one year ago.

Additionally, a Fed Senior Loan Officer Survey found credit requirements in the fourth quarter were consistent with the past three quarters.

However, other market indicators point not just to a stabilization of mortgage lending standards, but also a loosening of credit availability.

Banks are now lending amounts up to 3.5 times borrower earnings. This is up from a low during the crisis of 3.2 times borrower earnings.

Banks are also loosening loan-to-value ratios (LTV), which Capital Economics denotes “the clearest sign yet of an improvement in mortgage credit conditions.”

In contrast to a low of 74 percent reached in mid-2010, banks are now lending at 82 percent LTV.

While credit conditions may have loosened slightly, some potential homebuyers are still struggling with credit requirements. In fact, Capital Economics points out that in November 8 percent of contract cancellations were the result of a potential buyer not qualifying for a loan.

Additionally, Capital Economics says “any improvement in credit conditions won’t be significant enough to generate actual house price gains,” and potential ramifications from the euro-zone pose a threat to future credit availability.

Just a note to remind you that in October, President Obama announced plans to open up refinancing to more homeowners who are underwater. This proposal was a revision to the current Home Affordable Refinance Program (HARP).

So what does this mean to you?

This means that if your mortgage is owned or guaranteed by either Freddie Mac or Fannie Mae, you may be eligible to refinance your mortgage under the enhanced and expanded provisions of HARP.

You can determine whether your mortgage is owned by either Freddie Mac or Fannie Mae by checking the following websites:
•http://www.freddiemac.com/mymortgage
•http://www.fanniemae.com/loanlookup/

Fannie Mae and Freddie Mac have recently released details regarding how these changes will be run. If you have any questions at all about what these changes mean or how they could impact you, call or email me anytime. I’m always happy to help.

Sincerely,

Hope mls #3938 Hall
Hall Lending Group
hope@HallLendingGroup.com

NMLS # 3938

Covey contends that every single day, people have 100 opportunities to be proactive or reactive. Let’s say you’re in your car on the freeway and an overly zealous driver is practically sitting on your tail in the fast lane. You’re driving at the speed limit, actually a couple of miles faster than the law permits. But the motorist behind you thinks he’s at the Indy 500. You can stay where you are, infuriate him and possibly get rear-ended. Or, you can move out of harm’s way, to that opening in the right-hand lane and let him pass. He’s in the wrong, and there’s no question about it. Will you follow his lead? Will you be proactive or reactive? It’s up to you.

It’s very empowering to look at life from Covey’s point-of-view. If you moved to the right lane, the reckless driver didn’t force you. He didn’t win. A vehicle can be a deadly weapon and you made the sensible, mature decision that shows why you deserve a driver’s license and the other driver belongs on roller skates.

At work, you can be proactive if you take the time to learn about the principles of nature – in this case human nature and people interaction.

“If you ignore the principles of human effectiveness, you (can) work very hard, but still not get what you want,” Covey says. Say that you’ve been working with a prospective client for the past three weeks, really putting a lot of effort into the new relationship. Then you learn, through some mutual acquaintance, that this would-be client ended up going to a competitor for the same service. It happens, and you don’t have to necessarily blame yourself. But, you should take time to reflect on the past three weeks. Were you really proactive or were you reactive? How did you interact with the client?

Covey says principles are “natural laws that govern the world.” To attain a proactive mind-set, he emphasizes one must create beneficial relationships, build trust and commit to self-renewal. “To be trusted, you must be trustworthy over time,” Covey asserts. As for self-renewal, he says renewal means “preserving and enhancing your greatest asset – yourself.”

Stay tuned for more Business Boosters coming your way!
Hall Lending Group NMLS # 3833
Hope Hall NMLS # 3938

The following are steps you can take to know exactly what to expect from a legitimate credit repair company and the valuable services they provide:

Get a referral from your mortgage professional. Not only do we work with credit repair specialists on a regular basis, our business depends on your success. It’s in our best interest to make sure you are represented by professionals who are experienced in dealing with creditors, the credit bureaus, and collection agencies.

Interview your candidates. Make sure they understand and can explain to you how credit scores are calculated. Remember the 5 factors that make up a credit score that we discussed in a previous article? Without a detailed knowledge of the specific elements that make up your credit score, how can they possibly create a successful strategy to increase your score?

Don’t believe the hype. Credit repair takes time. Don’t fall for advertisements from companies promising miracles in just a few days or weeks. Remember, it took time for your score to get where it is, and it will take a legitimate credit professional time to fix it, depending on your situation. For the most part, expect 3 to 6 months for the best results, and up to a year or more if you have more serious problems like bankruptcies or identity-theft issues.

Don’t spend more than $1,500. Depending on your situation, expect to spend between $800 and $1,500 for a legitimate credit repair company. Again, if you have serious credit challenges such as charge offs, collections, public records or identity theft issues, expect to be in the higher range and vice versa. In today’s market, where FICO scores one point below 740 could cost you thousands of dollars in interest and monthly payments, you’ll be glad you made this investment in your financial future.

Monitor your progress. Be sure to communicate with both your mortgage professional and your credit repair representative throughout the process. To ensure success, we all need to be on the same page. With the right team of professionals, you can expect your credit score to increase between 10 to 220 points over the course of 6 weeks to 6 months. That’s going to save you a lot of money on your mortgage, credit cards, auto loans, and even student loans.

Credit repair is a valuable, worthwhile service when you’re working with the right company. If you have questions about credit repair and how it affects your chances of securing a mortgage or refinance, don’t hesitate to call. We’ll be glad to review your credit and see what, if anything, needs to be done to help you meet your financial goals and needs.
If you or anyone you know has any questions about credit scores or what can be done to repair them, please don’t hesitate to call.

NMLS # 3938

However, because there are so many options available, it’s important to seek advice from an experienced mortgage professional who has your best interest at heart. The first step in determining which program is right for you is to ask yourself the important questions listed below. These questions can also help you confirm that you’ve chosen the right mortgage professional as well, because he or she should be asking you the same questions before trying to put any mortgage in place:
•How long do you anticipate living in your home?

•Do you expect any changes over the next few years, such as expanding your family or having children go off to college or even move away?

•Do you expect any changes in income due to promotions, relocations, retirement, inheritance, or pensions?

•Are you expecting a change with regard to your investments?

•When it comes to investment strategies, are you conservative, aggressive, or somewhere in between?

The reason these questions are so important is that different loan programs will offer specific benefits that will appeal to borrowers at different stages of life. What one homeowner might find desirable might cause another to reach for the Rolaids®.

In the end, be sure you are given a complete picture of exactly how much your mortgage will cost you over the period of time you anticipate having the loan in place. This is the single most important factor you should consider when shopping for a mortgage. Not only does this data illustrate the bigger picture of your financial goals, it allows for adjustments should things change a little sooner than expected. A good time frame for this projection is anywhere from three, five, or even up to seven years.

When shopping for a mortgage, you should always evaluate your choices carefully and consider how they will fit in with your long-term financial plan. Answer the important questions listed above and call me for a free consultation. Together, we’ll find the program that’s best for you.

NMLS # 3938

So what does this mean to you?

This means that if your mortgage is owned or guaranteed by either Freddie Mac or Fannie Mae, you may be eligible to refinance your mortgage under the enhanced and expanded provisions of HARP.

You can determine whether your mortgage is owned by either Freddie Mac or Fannie Mae by checking the following websites:
•http://www.freddiemac.com/mymortgage
•http://www.fanniemae.com/loanlookup/

Fannie Mae and Freddie Mac have recently released details regarding how these changes will be run. If you have any questions at all about what these changes mean or how they could impact you, call or email me anytime. I’m always happy to help.

Sincerely,

Hope mls #3938 Hall
Hall Lending Group
hope@HallLendingGroup.com

For items that cannot be resolved online or that require copies of official paperwork or other supporting documents, use the sample Credit Report Dispute Letter below as a guide. Be sure to mail your letter and documents via Certified Mail for your records.

Word of Caution: Not all creditors report to all three credit bureaus; so be sure to only dispute a derogatory item to the credit bureau that is reporting that item. Otherwise you risk having that negative item added to the reports that are not currently showing them.

Do not dispute an account that you are not 100% sure you can prove it should be removed. Having an account listed on credit as being “disputed” will cause issues during the loan process. So the dispute process should not be started close to a time when you will be prusuing a home loan.

If you need any help, don’t hesitate to give us a call. We’ll be glad to assist you or to provide a referral to credit repair professionals you can trust.

Sample letter below
——————————————————————————–

Your Name
Your Address
Your City, State Zip Code

Date

Name of Credit Reporting Agency
Dispute Department
Address
City, State Zip Code

Re: (Social Security Number & Date of Birth)

Dear Sir or Madam:

I am writing to dispute the following information in my file: (Identify disputed items by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.) The items I am disputing have also been circled on the attached copy of the credit report I received.

This item is (inaccurate or incomplete) because (explain what is inaccurate or incomplete and why). I am requesting that the item be (deleted, changed, updated, etc.) to correct the information.

(If you are enclosing any documents, send copies only.)

Enclosed are copies of the following documents supporting my position: (List what you are enclosing, if applicable). I have also enclosed proof of my social security number and current address for your review. Please investigate and (delete or correct) the disputed item(s) as soon as possible, and inform me in writing of the outcome.

Thank you for your time and consideration,

Your name

NMLS # 3938

That’s right. The USDA does more than just certify beef. It also sponsors the little-known Rural Housing Loan Programs. If you qualify, you can get a government-insured mortgage on that home you’ve been eying with no down payment, and low mortgage insurance, and sellers can even help you with your closing costs. To find out more about this special program, give us a call today!

A mortgage loan cannot be closed without a locked-in rate, and there are three main elements to take into consideration:
• Interest Rate
• Points or fees
• Length of the lock
Locking in a rate does not obligate the borrower to commit to the loan until the loan is actually closed. The lock is merely a security measure designed to eliminate the risk of market volatility throughout the duration of the purchase or refinance transaction. As long as the loan is approved and funded before the end of the lock period, the borrower will receive the interest rate quoted.

When a lender permits an extended lock-in period, the borrower will likely face a higher interest rate or additional fees that could be quoted as points. In other words, the borrower pays for the lender to take on the extended risk of being exposed to potential changes in the market.

For example, let’s say a 30-day rate lock commitment costs the borrower one-half point, while a 60-day rate lock commitment costs one full point. If the borrower in this scenario needed the extended lock period, but did not want to pay points, then an alternative would be to accept a slightly higher interest rate. In this case, a 60-day lock would typically have a higher interest rate than a 30-day lock.

Our standard procedure is to lock in a rate as quickly as possible. My team and I want our clients to know that while interest rates fluctuate daily, most lenders do not want to lose any business because of it. If a significant rally causes interest rates to drop 0.25% or more, we know that we can most likely renegotiate the rate. In many cases, lenders prefer this option over losing the loan to another lender. On the other hand, if we’d allowed our clients to sit on the fence and not lock in their rate, we would have exposed them to market volatility without a safety net. Then, if rates were to increase, the borrower might no longer qualify for the loan they want – a situation that we want to avoid at all costs.

By knowing our clients’ needs and working intimately with them to make the right decisions early on, my team and I are proud to say that we have helped them to achieve their home ownership dreams.
If you’d like to learn more about the loan programs we have available, please call me!

NMLS # 3938

Do you start each day with a plan for action?

Most people do. Whether they make a to do list or leave emails in their inbox to work on throughout the day, they have some way to manage their tasks and projects. Each day, however, we manage more than just time. We manage conversations, meetings and interruptions.

Have you ever noticed your productivity actually goes up the fewer times you’re interrupted during the day? This is the reason some people block time on their calendar; it is a way to specify the hours (or minutes) of the day that will go toward a specific task or project. For many people, however, they don’t have that much control over their schedule or calendar. If that is the case, here are three habits to practice to have a more productive year:

1. Arrive early. To meetings, airports, appointments, to the office, etc. When you arrive early, you are refreshed and relaxed. Instead of scrambling at the last minute and being stressed out from traffic, delays or other “unscheduled” surprises, you will be able to find a place to sit down and perhaps even review the meeting materials, or read something you have been waiting until you had time to read. This sets you up for success. You have a cushion of time if there is a delay or if you arrive early and can get something done (see tips below).

2. Make fewer agreements. For the next 5 business days, be sure to write down each and every thing you say you are going to do…and what others say they will do for you. Once you have this complete inventory, prioritize the ones that are the most important and start to renegotiate (or eliminate) the rest. One way to manage your agreements most effectively is to use some kind of Promise Guide (http://www.thepromiseguide.com) so you can visually see all you have to do and track your progress over time. The more items you complete, the better able you will be to manage all your actions and tasks. Then, slowly and over time, make fewer agreements, but make sure they are the most important ones!

3. Ask for assistance. Sure, at one time (in university, especially) it was very important to be able to work by ourselves, and demonstrate our capacity for productivity. However, now in an era of uber-connectivity it’s very important that we recognize the experts in the world and reach out to them for assistance. Often, these people are just an email (or even a phone call!) away. Reaching out to ask someone for assistance will save us time, and expand our community and network. As we head into another decade of a considerably flattening world, it’s going to be more and more important that we know WHO we need to know so that we can do WHAT we do better.
For the next few days, consider testing these new habits. They probably won’t form themselves overnight, but practicing with them will give you some ways to improve your productivity, one day at a time.

Jason W. Womack, MEd, MA, is the author of the upcoming, Your Best Just Got Better: Work Smarter, Think Bigger, Make More. Jason is a Talent Development Coach, working with leaders who make significant, positive contributions in life and at work. Visit http://womackcompany.com/ambw for more information.