JoAnn Papsidero Srein, Florida REALTOR

What happened? You got an estimate of your closing costs to close on your new home. You went through all the motions of obtaining financing. You got to the closing table or maybe you were lucky enough to know a day ahead of time that you do not have enough money to close the transaction. Has this happened to you? What do you do? Many times borrowers are faced with this dilemma of where to find the additional funds at the last minute. The most recent person to call us was $1500.00 short at his closing and we were not involved in the transaction! In 33 years in the mortgage business, we've learned that there are others in the industry who are not as professional as they appear to the unknowing consumer.

An estimate is just that...an estimate. In today's society we've all learned to look for a bargain. When you are looking for a contractor to work for you, you will most likely want the lowest estimate. The low man usually gets the job. Consumers look for the same in financing. You "shop" for your mortgage gathering three or more estimates. How do you choose which mortgage company to use?

Here's the problem: Consumers are often led astray by understated good faith estimates and fees change at a later time to someting more objectionable. This is called a "Bait and Switch". It is our experience that if a loan officer or mortgage broker has been in the business for any length of time, he should know how to "estimate" the expenses assciated to the closing on the home.

Where Estimates are Understated:

1. Taxes and Homeowner's Insurance - To accurately disclose, he should know a little more about the property such as what the real estate taxes and homeowner's insurance costs are. We do the homework on the property before we release an estimate. In Florida we will often OVER estimate the homeowner's insurance for a worse case scenario until the borrower chooses an insurance company because this affects two areas of the good faith estimate. The 12 month premuim up front and the monthly amount to put in the escrow account. This amount also affects the monthly payment. It is always better to work off a higher number and go downwards than it is to work off a lower number and go upwards.

2. Escrow Account - If a professional has closed enough loans, he knows how many months of taxes and insurance need to go on the estimate!

3. Additional Junk Fees or Higher Fees than Anticipated - This area seems to bear the most abuse in underestimating. The loan discount fee, loan origination fee and mortgage broker fee should not change without the borrower's knowledge!!! If the loan amount has changed or the borrower has chosen to pay an additional discount fee to lower his interest rate, a new estimate should be prepared, delivered AND signed by the borrower to acknowledge the change well before closing. This procedure is actually required by HUD and federal law (RESPA)!

Why did your mortgage professional underestimate your costs? Simple! He is either new to the business and just didn't know OR he wanted to be the "low man who got the job". A poor salesman will tell you what you want to hear and worry about the consequences later. You won't know until the very end. What are you going to do? Walk away from the transaction, delay the closing or fork over the additional funds? None of those options are fair!

Make sure you are not the next victim of Bait and Switch. Better to call Steve or JoAnn Srein - People's First Financial Services, Melbourne, FL 321-242-8240

Recently an applicant contacted me who is a first time homebuyer. She had no idea where to begin on the loan process. Even if I believe the person will not qualify for a mortgage at this time, I try to educate the person in order to prepare for the future.
The following are a few tips I use to help you get started in your quest for a mortgage for your home purchase:

There are 5 criteria for mortgage underwriting: We call this E-CASA
1. Equity - How much money you will be putting down (down payment).

2. Credit - You will need a credit score of 620 or higher as well as anyone else who will be on the loan application. Bankruptcies need to be discharged 2 years ago for FHA and 4 years ago for Conventional. If you had a foreclosure, it will be extremely difficult at this time to obtain financing for a home.

3. Ability - The ability to pay the loan back - what your current debts and future debt (house payment) are compared to your income. This is called debt to income ratio.

4. Stability - How long you have been on your job or in your field of work - Generally a lender wants to see a two year work history in the same field with no gaps in employment.

5. Assets - How much money will you have left after the loan is closed? What is your net worth? The more assets you have shows your ability to save money. Do you have any overdrafts on your bank statement? Do you take your account down to the last cent every month? If you do, you will not be able to show that you can handle a larger payment each month.


If any of these basic 5 areas are weak, the loan has to have a compensating factor for the weak area.

A consumer may pull their own credit report once a year at http://www.annualcreditreport.com/. The Federal Trade Commission made it possible for you to do this to keep tabs on your own credit profile. Your credit score is not lowered if you pull your own credit report.
Start by getting your credit report to see what your profile looks like. That is the best place to start. If there is derogatory credit, you will need to start repairing it. Good Luck to you!

In the last couple of weeks I have heard this question so much! I cannot stress to a homebuyer enough that there is even more of a reason now to get a pre-approval than ever.
A gentleman telephoned this week in need of a mortgage for a second home in Florida. He is currently working with a Realtor and he has already obtained a home inspection - meaning he has already spent money out of his own pocket. He stated that he has excellent credit scores (over 800 and that is excellent) and that he won't have a problem getting a mortgage. That may be true - 1- 2 years ago! What once was, is not true for today. He only has 10% to put down on his Second Home that he is under contract to buy. He needs 20% down. He has called all over the state of Florida trying to find a lender who will lend him 90%. Unfortunately, he most likely will not find one unless it is a small local bank. Lending guidelines change so rapidly in our state as we are one of the states in the top 3 for foreclosures right now. RISK! The gentleman could have avoided spending money needlessly and wasting his time and the Realtor's time if he would have secured his financing first. Why shop for the largest ticket item you might ever purchase without knowing how you will pay for it and how much you can spend?

NOW...What is the difference between a Pre-Qualification and a Pre-Approval?
You may not know that there is a difference. There are some real estate and mortgage professionals do not know that there is a difference!

A Pre-Qualification is based on simplified information that you tell a mortgage professional. Sometimes your credit report is obtained and other times it is not. The loan officer is going strictly off of what you have told them.
A Pre-Approval means that you have made application, you have given the loan officer your paystubs, bank statements and tax returns and your credit has been obtained by the lender. Your information has now been "verified".

Steve & I take it a step further and run the loan scenario through the FannieMae Desktop underwriting system since FannieMae is the actual investor supplying the funds for the purchase. FannieMae also provides the guidelines for which to obtain financing to the particular borrower. We supply the Realtor with the FannieMae Pre-Approval along with the pre-approval certificate. The loan is then subject to Appraisal and Title report on the property only. The buyer and his credentials are "good to go". That is what every Realtor and Home Seller wants to hear. It may be a more conservative approach for the buyer, but you can bet he will not be embarrassed if he contracts on a house and cannot obtain financing afterwards.

It's a great time to buy! Get a pre-approval before you start to look and call Steve & JoAnn Srein to make it happen! (321-242-8240)

Friday evening, my husband Steve and I decided to take a walk on the beach. We quickly jumped in his Miata, put the top down and began to enjoy the evening air. The area that we like to go to is the park at the end of SR 518. Better known as Eau Gallie Blvd to the locals. It ends at the Atlantic Ocean. We parked the car and headed for the boardwalk over the dunes and walked down the steps to the beach. I took off my sandals and walked in the surf. The water was warm, yet refreshing. As we walked along we talked about the day's events and enjoyed watching the sandpipers running alongside us. The sun had just set and the glow in the sky was a pretty pink, orange and blue. We probably walked a mile and then turned and began to walk back. We went about halfway when up ahead I saw something small and dark moving from the dunes to the water. Immediately, I knew what it was. A baby turtle had just hatched and was headed for the water!

As we drew closer we began to see more emerging from the dune. I don't know how many emerged before we arrived on the scene but we got to see 6 baby turtles scurry to the edge of the surf and wait for their next big wave to the ocean. It is an awesome sight to see! Turtle hatchlings are rare to see with so many obstacles during their incubation period to keep them from making it to their destination! We were privileged to watch and cheer the little guys on. Their tiny flippers propelled them along quickly in the sand and once they caught their wave, they were gone! With the recent tropical storms and erosion, it was unexpected sight to say the least.

On the way home, I found myself truly amazed that these little creatures know exactly when to pop out of the nest buried in the sand dune and then without thinking know which way is east!

I love nature and the beauty it offers. I also love living in Melbourne along the coast of Brevard County, Florida!

The Avenue Mall in Viera, Florida

What town would be a fun spot without a mall? Viera, Florida has a wonderful outdoor mall located just due west of I-95 in Brevard County. It's called "THE AVENUE VIERA".
There are over 80 stores and restaurants to choose from for your shopping & dining experience. Anchor stores include Kohl's, Belk Department Store, Bed, Bath & Beyond, Sport's Authority, Books A Million, Old Navy and World Market.
For those less interested in shopping with you, they can be deposited at the Rave theatre in the same mall arena. There's also an array of restaurants and snack food stores such as Mimi's Cafe, Chili's, Longhorn Steakhouse, Cold Stone Creamery, Planet Smoothie, Shane's Rib Shack and much more!


The Avenue also has special events sponsored by the stores located in the mall. Petland is having National Dog Week Sept. 20 - 21. Free dog training in store between 12 pm and 2 pm on Saturday and Sunday. This would be a great time to get "fido" and yourself out of the house for a few hours!

Click on the link to go to The Avenue website to sign up for the "A-List", an exclusive membership rewards program. You'll receive a monthly newsletter with retailer promotions and Avenue events. You'll also get a free bottled water while you shop! Mall shopping hours are Monday - Saturday 10am - 9pm and Sunday 12pm - 6pm. Another great reason to come to Brevard! - JoAnn Srein - Golden Realty Group of Brevard, Melbourne, Florida

P.S. My good friend Janet Brown said I need to mention that Michael's is coming ot the Avenue as well. Michael's is an arts & craft type store.