Gene Mundt - Let's Talk Mortgages & Real Estate!

 

 

The Appraisal Process ...

Chances to Learn More, Share, and

Be Happy When the Stars All Align

 

 

 

     This last week, I attended my local  Three Rivers' Association of Realtors (Serving Will and Grundy Counties, IL) Learning Lunch.  I was very impressed by the great turnout for this particular event.

 

     I believe the topic being highlighted at this luncheon greatly influenced members' decision to attend ... as it was a topic that touches upon all of us within our industry frequently.  The topic in question??

 

    

          Appraisals!

 

    

    Three Rivers had arranged for 3 local, independent Appraisal firms (one of which is on my Chicago Bancorp "approved Appraiser" list) to be on-hand and provide presentations regarding the current market, the challenges presented by the lack of sales, and the "type" of sales occurring and needing to be appraised.

 

     One Appraiser addressed the recent changes to the Appraisal report itself.  He talked of the "exactness" that is required in certain categories where adjustments are made.  He drove home the point that Realtors can help Appraisers greatly by providing detailed information within their listings.

 

     How does that more detailed information help the Appraiser?  It was pointed out that it most certainly assists from an accuracy standpoint ... but it also greatly improves the ability of the Appraiser to provide a more timely turnaround on the completed Appraisal too.

 

     The second Appraiser discussed the need to satisfy mortgage lenders' Underwriters with detailed and accurate reporting ... sometimes with as many as 6, 7, or 8  Comparables  being utilized within an Appraisal report.  All the Appraisers on-hand for the Learning Luncheon agreed that 4 Closed Sales and 2 Active Listings were the starting point for most of their Appraisals. 

     When asked if they avoided using "Short Sales" or foreclosures as Comparables, to a person they said, "no one wants to have to use "distress" sales, but name a housing market that is "free" of them?  This is especially true when needing to use Comparables that SOLD in the last 6 months, were in the same neighborhood or marketplace, and were similar to the Subject Property."

     Many of the Realtors in attendance wanted to know the "magic formula" that Appraisers use to "adjust" for all the above factors?  Unfortunately, the reply was, "There is none". 

     Again, all 3 Appraisers stated that only adjustments for true differences in the properties were being allowed.  Condition of the Comparables, if inferior or superior to the Subject Property, could be considered and adjusted for.  But there should NOT be expectations that a Comparable that was sold as a Short Sale or Foreclosure should ... or would ... get a "bump up" in value because of the terms of that Sale ... ESPECIALLY if there were no "traditional" market sales to be found.

 

     Of much interest to those in attendance, was the discussion of the new Appraisal Requirements recently enacted.  Discussion regarding those ratings of C1 to C6 (Best to Worst), and Quality of Construction Ratings, also from Q1 to Q6 (Highest to Lowest), with specific definitions for these ratings from 1 to 6, raising many questions for clarification.

 

     All of the Appraisers indicated that the time involved in completing an Appraisal had doubled or tripled in the last few years.  They noted that the ability to satisfy a Mortgage Lender or Underwriter has become increasingly difficult in recent times.  Someone wondered aloud, "Why is that"? 

     A variety of answers were provided by the Appraising viewpoint, but I (as a Mortgage Lender) believe the real answer is:   that Appraisals, which are the support for the Value Estimate arrived at, and the "completeness" and "accuracy" of the Appraisal Report, remain the biggest hurdle for a Loan Originator and Underwriter to get past when a loan file gets SOLD in the secondary market.  You simply must have a logical, defensible, and solid Appraisal Report to satisfy Quality Controls of End Lenders ... Fannie Mae, Freddie Mac, and independent loan servicers.

 

     The end result of the Appraisal itself must be that the Buyer pays a fair price for their home.  But the Mortgage Lender must retain the right to know the "true market value" of the property being purchased or lent upon.  And thirdly, the "Agencies" themselves need to know that the value was arrived at without any undue pressures or influences.

 

     These days that happens when the stars are all aligned ... a truly beautiful thing to behold when it occurs.

 

     The Three Rivers Association of Realtors is to be commended for hosting this important and timely topic for discussion and education at this month's Learning Lunch.  The more everyone involved within our industry knows and understands of each other's contributions to the process of buying, selling, and financing homes, the better.  It makes the entire transaction flow much more smoothly and easily toward successful conclusion.  And ultimately that is what we all want ...

 

 

 

 

     *  Looking for an experienced Mortgage Lender within the Will and Grundy County Area?  Or a Referral Partner that has the expertise, knowledge, and wide program of services to satisfy and successfully close the transactions of your clients?  I have over 35 years of mortgage lending, appraising, and financial planning service and expertise that will accomplish that and more. 

 

Contact me today ... I'll love hearing from you and also cherish the opportunity to earn your trust and mortgage business.

     I can be contacted through any of the following means:

Direct:  815.277.4036  Cell/Text:  708.921.6331

Email:  gene@chicagobancorp.com

Website:  www.genemundt.com

Skype:  630.219.1316

Click Here 4 a: NO Cost NO Obligation Mortgage Consultation

Available via Your Mobile Phone/Devices Now!    

 

 

 

 

• Last 2 years W-2's and Tax Returns
• Last 30 Days consecutive Pay stubs
• Name, Address, and Telephone Number(s) of your Employers for the past 2 years
• Last TWO (2) months Bank Statements (ALL pages) or 60-Day printout of accounts from the Bank that is stamped and signed by a representative of the Bank.  (Including 401K, Credit Union, Profit Sharing, etc.)
• Copy of your Social Security Card(s).   (FHA/VA only) and Driver's License (ALL Borrowers to be involved in the mortgage)
• Name, Address, and Telephone Number(s) of your Landlord ... and the amount of the Rent Payment (Renters only) 
  
• Application Fee
• Signed (and legible) Real Estate Sales Contract and ALL Riders on home being purchased
• Names and Phone Number(s) of Real Estate Agent, Real Estate Attorney, and your Insurance Agent
• Copy of Earnest Money Check (as available)

• Recorded Divorce Decree(s) or Separation Agreements  (ALL Pages).
• Recorded Bankruptcy Discharge and Schedule of Creditors
• Most recent Social Security Award Letter or Pension Award Letter
• Filed and Stamped Release of any Judgment and Paid Receipts of all Collections
• 12 Month Court Print-out of Receiving Child Support
• Address and Information on any other Real Estate-Owned

• Year-to-Date Profit and Loss Statement with complete Tax Returns  (Last 2 years Filed)

• Copy of DD-214
• Original Certificate of Eligibility 
  

                                Click Here 4 a: NO Cost NO Obligation Mortgage Consultation

 

 

• Annual Percentage Rate ... Referred to as APR:  - An interest rate reflecting the cost of a mortgage as a yearly rate.  This rate is likely to be higher than the stated note rate or advertised rate on the mortgage, because it takes into account points and other credit costs.

• Gross Monthly Income: - The total amount the borrower earns per month, before any expenses are deducted.   
  

• Loan-to-Value Ratio:  -  The relationship between the amount of the mortgage loan and the appraised value of the property expressed as a percentage.  (A VERY timely and important definition in the current market!)

• Origination Fee: -  The fee charged by a mortgage lender to prepare loan documents, make credit checks, inspect and sometimes appraise a property; usually computed as a percentage of face value of the loan.

• Power of Attorney:  -  A legal document authorizing one person to act on behalf of another.
  

• Private Mortgage Insurance ... Referred to as PMI:  -  In the event that you do not have a 20% down payment, mortgage lenders will allow a smaller down payment.  With the smaller down payment loans, however, borrowers are usually required to carry private mortgage insurance ... insurance that would offset losses by the lender should the borrower not be able to repay the loan.

• REO (Real Estate Owned):  -  Property which is in the possession of a mortgage lender as a result of foreclosure or forfeiture.
  

• Short Sale:  -  A Short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan.  It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower.  Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves heft fees for the bank and poorer credit report ourcomes for the borrowers.  This agreement, however, does not necessarily release the borrower from the obligation to pay the remaining balance of the loan, known as the deficiency.  Each case is decided individually in that regards.

• Truth in Lending Act:  -  A Federal law that requires financial institutions to disclose specific information about the terms and cost of credit, including the financing charge and the annual percentage rate (APR ... see above).

• Underwriting:  -  The decision whether to make a loan to a potential home buyer based on credit, employment, assets, and other factors and the matching of this risk to an appropriate rate and term or loan amount.

                                  Click Here 4 a: NO Cost NO Obligation Mortgage Consultation

Can YOU Spare a Strike??

Bowl for Kids' Sake Through Big Brothers Big Sisters

of Will and Grundy Counties in March

 

     It's a sad fact.  Some kids aren't lucky enough to have strong role models in their lives.  But the  Big Brothers Big Sisters  organization is trying to change that for kids nationwide.

 

    

 

Bowl for Kids' Sake, sponsored each year through Big Brothers Big Sisters is the organizations' largest fundraiser aimed at raising money to help children in need across our country. 

 

 

    

 

     Big Brothers Big Sisters of Will and Grundy Counties in Illinois is part of that overall effort and is once again taking part in this year's annual  Bowl for Kids' Sake  being held on 4 different dates in March, 2012.

 

 

     How can YOU participate and help area children?

   

      1) Start a team

             Teams are formed with five or six members.  Consider creating a team with family, friends, fraternity brothers, sorority sisters, or co-workers.

      2) Start securing sponsorships

             Each bowler is asked to raise a minimum of $100 in sponsorships for a total of $500 - $600 raised per team.

Want to know the best part?  All of the event expenses are completely underwritten by our corporate sponsors.  That means 100% of the money raised by bowlers goes directly towards supporting children served by Big Brothers Big Sisters in your community.

      3) Start bowling

             After you have secured your sponsorships, it's time to have fun!  Receive 2 Free games of bowling (shoe and ball rental included!), a Bowl for Kids' Sake t-shirt, food, drinks, chances to win door prizes!

 

     This year's Bowl for Kids' Sake Event Schedule is:

 

VIP Opening Event!

Crest Hill Lanes, 905 Theodore, Crest Hill

March 3, 2012  

8:00 pm - 10:00 pm

Cops VS Fire Event

(Police & Fire Dept. teams only)

Strike 'N Spare, 811 Northern Avenue, Lockport

March 4, 2012  

12:00 pm - 2:00 pm

Grundy County Event

Echo Bowling Lanes, 220 Bedford Road, Morris

March 10, 2012  

12:00 pm - 2:00 pm

Grundy County Event

Echo Bowling Lanes, 220 Bedford Road, Morris

March 10, 2012  

2:00 pm - 4:00 pm

Will County Event
Strike 'N Spare, 811 Northern Avenue, Lockport

March 24, 2012  

2:00 pm - 4:00 pm

 

     This year participating bowlers will be vying for a FREE iPad.  The more money they raise in donations, the more chances they have to win!  YOU could be that lucky winner, if you too sign-up and partner with Big Brothers Big Sisters of Will and Grundy Counties during this event.  You receive one entry into the iPad Raffle for every $150 of donations you raise.

 

     For additional information regarding the Bowl for Kids' Sake Events being held in March, go to: 

Bowl for Kids' Sake, Will & Grundy Counties

 

     To register for one of the Events, go to:

Register Now: Bowl for Kids' Sake, Will & Grundy Counties

 

     To donate to an existing Bowler at one of the Events, go to:

Donate Now:  Bowl for Kids' Sake, Will & Grundy Counties 

       

      Can YOU Spare a Strike?? 

 

      Bowl for Kids' Sake through Big Brothers Big Sisters of Will and Grundy Counties this March!  Take action to help our area kids now!

 

 

 

 

     *  Thinking of buying a home or refinancing a loan in the Will and Grundy county area? In need of answers to your mortgage and credit questions? 

     My 35 years of mortgage experience and expertise will safely see you through your entire mortgage process, from your 1st questions, to pre-approval, to through successful mortgage closing and beyond.  Contact me today at any of the following, to get started:

Direct:  815.277.4036   Cell/Text:  708.921.6331

Email:  gene@chicagobancorp.com

Website:  www.genemundt.com

Skype:  630.219.1316

                   Click Here 4 a: NO Cost NO Obligation Mortgage Consultation

 

    My wife's entire family is plagued by allergies and asthma issues ... so the title of this post by Inspector David Snell, "Do You Know the Difference Between Allergies and Mold Symptoms?" .. really caught my attention.

    I've seen the misery people suffering from these issues can have ... regardless of the cause.  But what if the symptoms are directly linked to Mold within your home?  What if the symptoms show-up suddenly or are re-occuring? 

    Having the information contained within Inspector David Snell's AR post could save your health and lead to addressing the issues found within your home, as well.

    Should you, or someone within your home, be experiencing any of the symptoms found here ... it's definitely worth investigating the possibility of mold growth somewhere within your home.  If in David Snell's service area (Charlotte, NC), give him a call to have a mold inspection conducted.  If elsewhere in the US, there are many fine inspectors to be found here on ActiveRain ... or locally.

 

Gene

 

 

1. A Seller CLOSED on his sale, and then SIGNED A CONTRACT for another home AND was able to negotiate a possession date/agreement to eliminate a second move?
2. A couple bought a "step-up" home WITHOUT selling their present home ... which they plan on "updating" to make it saleable?  (They will not be renting it out)
3. A First-Time Homebuyer is "borrowing" against her 401k to be capable of putting 20% down on her new home purchase, thus establishing a home environment of her own?
4. A FSBO (For Sale By Owner) went under contract?
5. A "city" couple listed their condominium ... and are now pre-approved for their home purchase in the suburbs?
6. A young, First-Time Homebuyer decided to buy a home at the top-end of his approvability?  While rates hit historic lows?  He's completely over his payment shock and fears!

                       Click Here 4 a: NO Cost NO Obligation Mortgage Consultation

 

Champions Know the "Rules" of the "Game"

 

       I can't tell you how many times, as a mortgage lender, I hear rumors or misconceptions expressed to me regarding the mortgage process.

Cost Of Mortgages to Increase

Anatomy of a Home Staging: from Lived In - to Vacant - to Staged & SOLD

 ~ Portland Oregon home undergoes a staging transformation ~

UPDATE:  this home went under contract in just 8 days!

People sometimes ask if they should stage their home after they move out, wondering if it would look bigger when it's vacant.  We believe the answer lies in the photos that show a home lived in, then vacant after the family moved out, and finally when staged by our Portland OR home staging company.

When we live in our homes, we make the spaces work for us, but when it's time to sell, we have to think like a buyer.  Today's buyers want an open space where they can imagine entertaining their family and friends, a space that feels inviting.

Here's an example of a home that we staged recently, showing all three phases (lived in - vacant - staged)

In the living room: Defining the room's function & adding art to highlight the home's best features adds to its appeal & opens up the space

In the family room: Clearly defining the focal point & highlighting the fireplace gives balance & proper flow

In the office: lightening the paint color and removing excess furniture really opens up this space

In the master bedroom: exposing the hardwood floors, opening blinds & adding light makes the room feel more open

 

If you're selling your home, make it easy on yourself:  Consult with a professional home stager on the best way to present your home to today's buyers for a faster sale!  This home was sold just 8 Days after staging and listing ... in the month of December!!

~ Staging and Photos by Room Solutions Staging ~

***                ***                    ***

Room Solutions Staging offers home staging services to Portland Oregon homeowners, real estate agents, builders, banks,  and investors to prepare homes for the market.  Our home staging clients love our customer service and our home staging statistics!  Our home staging services in the Portland OR metro area include consultations, staging for both vacant and lived-in homes, and interior restyling service.  For a free home staging proposal, please contact us @ 503-246-1800.

 

HARP 2.0 Update ... from Fannie Mae    

 

 

 

      There's a bit more insight and information out on the  HARP 2.0  update, at least from  Fannie Mae's  perspective ...

 

      Beginning Monday, March 19th (2012), Fannie Mae will unveil their new software (more forgiving), and then folks ... stand back!  There's going to be a flood of calls, emails, inquiries to be shared!

 

      Best I can tell, the new guidelines for approval will be relaxed or expanded in comparison to the old, meaning more Borrowers/Homeowners will qualify for Refinances than before. 

 

     But ... a few details still remain to be addressed.  Nothing has been presented to us (mortgage lenders) in concrete and in its' entirety yet.  So before the new items and guidelines are implemented ... I remain optimistic, but cautious at this time. 

 

     It appears that the best change will be related to a greater "disregard" for property values, or in our industry's vocabulary,  LOAN-TO-VALUE,  or LTV. 

 

      In other words, "current market values" may not be the deal-killer that they are presently.  Again, it appears that as long as the Borrowers/Homeowners can qualify on CREDIT, INCOME, EMPLOYMENT, and SATISFACTORY MORTGAGE PAYMENT HISTORY ... they may get the RATE RELIEF and PAYMENT RELIEF that will help them stay in their homes.

     Others will simply enjoy a monthly savings, that may help them better position themselves to save and then buy again later down the road, should they wish.  That, and keeping more homes from entering the housing supply and further adding to the supply of Foreclosures and Short-Sales, is how everyone "wins" ... including Realtors, Homeowners (Sellers AND Buyers), and the economy in general.

 

     Stay tuned, as there will probably be more updates between now and implementation of HARP 2.0.  Good thing because March is only 2 months away!

 

 

 

     *  Should you have questions regarding HARP 2.0, credit, credit repair, mortgages and refinancing ... or be in need of mortgage service, please do not hesitate to contact me.  I will be happy to put my 35 years of mortgage and real estate experience and expertise to work on your behalf.

       I can be contacted through any of the following:  

Direct:  815.277.4036   Cell/Text:  708.921.6331

Email:  gene@chicagobancorp.com

Website:   www.genemundt.com

Skype:  630.219.1316

Click here 4 a:  NO Cost NO Obligation Mortgage Consultation