Jeff Eisenberg

Okay, our wonderful Government just instituted a new Good Faith Estimate that all brokers and banks have to begin using as of 1/1/2010. This estimate is supposed to help take any confusion out of the consumers mind and help them better compare one lender with another. Hmmmm! Not so sure that it will work. Basically it lumps all the fees into one and holds the broker or lender to tolerance levels. If the fees are more than 10% of what was quoted, the broker/lender will have to eat it. They are making us quote fees that we have no control over, like escrow, title, etc., but we are still liably. Okay, so this is what our government wants. We also were told not to issue a good faith estimate unless we have all six of the following items: borrower name, social security, loan amount, property address, income and value of the property. So don't expect to get a written good faith estimate if you are just looking for a pre-approval without a property. We can tell you or give you something in writing that will give you a rough estimate of the closing costs, but we can't give you an actual good faith until all 6 of those items have been given.

2010 looks to be an interesting year for the mortgage industry. Loans may take a bit longer at closing because escrow companies are required to rectify any tolerances over that 10% mark and that could delay closing. For more information on this topic, please contact me at 661.964.2600 or email me at jeff@somloan.com.

Jeff Eisenberg
Southern Oaks Mortgage, Inc.
http://www.somloans.com/
http://www.loanmanjeff.com/
www.twitter.com/loanmanjeff

Tax Credit for Homebuyers




First-Time Homebuyers (FTHBs): First-time homebuyers (that is, people who have not owned a home within the last three years) may be eligible for the tax credit. The credit for FTHBs is 10% of the purchase price of the home, with a maximum available credit of $8,000.



Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.



Current Owners: The tax credit program now gives those who already own a residence some additional reasons to move to a new home. This incentive comes in the form of a tax credit of up to $6,500 for qualified purchasers who have owned and occupied a primary residence for a period of five consecutive years during the last eight years.



Single taxpayers and married couples filing a joint return may qualify for the full tax credit amount.



What are the New Deadlines?



In order to qualify for the credit, all contracts need to be in effect no later than April 30, 2010 and close no later than June 30, 2010.



Tax Credit Versus Tax Deduction



It's important to remember that the tax credit is just that... a tax credit. The benefit of a tax credit is that it's a dollar-for-dollar tax reduction, rather than a reduction in a tax liability that would only save you $1,000 to $1,500 when all was said and done. So, if a first-time homebuyer were to owe $8,000 in income taxes and would qualify for a tax credit of $8,000, she would owe nothing.



Better still, the tax credit is refundable, which means the homebuyer can receive a check for the credit if he or she has little income tax liability. For example, if a first-time homebuyer is eligible for a tax credit of $8,000 but is liable for $4,000 in income tax, she can still receive a check for the remaining $4,000!



Higher Income Caps



The amount of income someone can earn and qualify for the full amount of the credit has been increased.



Single tax filers who earn up to $125,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, single filers who earn $145,000 and above are ineligible



Joint filers who earn up to $225,000 are eligible for the total credit amount. Those who earn more than this cap can receive a partial credit. However, joint filers who earn $245,000 and above are ineligible.



Maximum Purchase Price



Qualifying buyers may purchase a property with a maximum sale price of $800,000.



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Remember, the new tax credit program includes a number of details and qualifications. For more information or answers to specific questions, please call or email me today.

jeff@somloans.com
http://www.somloans.com/
http://www.southernoaksmortgage.com/
http://www.loanmanjeff.com/
www.twitter.com/loanmanjeff

The big banks have been trying for years to take over the mortgage industry. Why you ask? Because they see how much money they can make off of the unassuming consumer. Today, the majority of mortgage loans are still originated by mortgage brokers, approximately 60% and the banks aren't happy about that. The banks have lobbyists in Washington backed by tons of capital, mainly our deposit money. They are trying very hard to oust the mortgage brokers and take a larger share of the profits. They go on the media via TV and radio bashing the mortgage brokers for all the bad loans out there and the whole mess financially our economy is in. The funny thing is, however, is that the mortgage brokers are not the ones who underwrite the loans. The broker is just the originator and then sends the file into the "Bank" who underwrites it and then approves it. So how can mortgage brokers be to blame? Good question! The more the banks can verbally bash the mortgage broker, the easier it will be to finally do away with them. Consumers in general believe that going directly to their bank cuts out the middleman. In a way that is true, however, banks have enormous overhead, like payroll,health insurance, worker's compensation, bonuses, vacation, etc to cover, so if you think that the rate or fees aren't increased due to all that, you are surely mistaken.

Last time I checked, America was a free country and people could make their own decisions. These big banks are trying to socialize the mortgage industry. Imagine a world where the only loans that consumers can get are from the big banks. Their loan officers are typically not licensed by the Department of Real Estate, they typically don't have years of experience and are responsible for opening checking and savings accounts as well. The banks are already overwhelmed with the 40% of the marketshare they already have. Add more business to that and guess what? Service levels will go down, interest rates will go up and free enterprise has just been eliminated. You should have the right to choose for yourself which way to go. Yes, there were bad mortgage brokers out there that did bad things, but I also know that there are some bad bankers that did the same bad things. All in the name of money. Now that the mortgage industry as a whole has been under such scrutiny, the major of the bad ones are gone. Thank God!!!

Don't let the big banks try and take over the industry, nothing good can happen from it. Protect your rights as a consumer to shop for the best deal. Mortgage brokers have the ability to shop the best loans available for you. Remember, it is your choice whether to go directly to a bank or directly to a mortgage broker, but it should be your choice not by banker's force! For more information, please call Jeff Eisenberg at 661.964.2600 x104 Southern Oaks Mortgage, Inc. - When the Right Loan Matters! www.somloans.com, www.loanmanjeff.com or email me at jeff@somloans.com

Well, Fannie and Freddie are at it again. It's like a roller coaster ride. Guidelines and rules seem to be changing faster than a formula 1 racecar. The rule now regarding one person financing multiple properties is set at 10. However, the stipulations are that if it is a primary or 2nd home, it must have an LTV of 75% and borrower must have a 720 Fico score. If it's a investment property, it must have an LTV of 70% and borrower must have a 720 Fico as well. But here is where it gets tricky. If it is an investment property, you must show 6 months of PITI (Principal, Interest, Taxes & Insurance) as reserves on every property that you own. So be aware that if you don't have the cash to show that you have the reserves, you might just be out of luck. One way to get around this is to put your properties into LLC's. Once they are in a Corporation's name, they don't get counted in the mix.

Major complication is that there is not a lender that I've found yet that has adopted this new guideline. So even though Fannie/Freddie say you can do it, the lenders and their investors haven't jumped on the bandwagon just yet. So stay tuned....

And remember to visit my site, www.somloans.com, www.southernoaksmortgage.com and to get a copy of my newly released book, www.loanmanjeff.com