Larry Morris, CMPS, Newberg Oregon

One of my primary lenders just issued new guidelines on how a property being converted from Primary Residence to Pending Sale, 2nd Home or Investment Property should be treated. These are quite a bit stricter then I've seen in the past and are probably indicative of things to come.

If you are a Realtor and are suggesting to a Seller to retain a property as an Investment Property, or your Seller would like to keep their property as for that purpose, you had better do some digging and make sure that they will still qualify for a new loan. If they are trying to close on their new home prior to selling their current home you also could run into some problems.

If you are a Lender and are trying to prequalify a Borrower who is retaining, or hasn't sold their current Primary Residence, you had better check with you lender to make sure that you are meeting credit guidelines.

If you are a Buyer or Seller you need to understand what you options are given your income, assets and credit. Your plans just might not work.

In today's credit climate, it is imperative that you are confident that your clients are truly in the position to accomplish their goals if it includes the purchase of another property.

As always, I cannot stress the importance of working with a Certified Mortgage Planning Specialist who can help walk you and your clients through the new mortgage maze.

Here are the Guidelines.

"Conversion of Primary Residence Policy

When qualifying borrowers who are purchasing a new Primary Residence and retaining their existing primary residence:

Pending Sale

If the current principal residence is a pending sale, but the transaction will not be closed (with title transfer to a new owner) prior to the new transaction:

• Both the current and proposed mortgage payments must be used to qualify the borrower

Conversion to Second Home

If the current principal residence is being retained as a Second Home:

• Must meet qualifications as a Second Home as defined in the Credit Policy Manual
• Both the current and the proposed mortgage payments must be used to qualify the borrower for the new transaction
• Property has not been listed for sale in the past 90 days (unless evidence of job transfer is provided)
• Property has been owned at least 12 months (unless evidence of job transfer is provided)
• Reserves equivalent to:

1) 6 months PITI for both properties is required; OR
2)2 months PITI if there is documented equity of at least 30% in the existing principal residence (as determined by an appraisal or AVM).

Conversion to Investment Property

If the current principal residence is being retained as an Investment property

• Both the current and the proposed mortgage payments must be used to qualify the borrower for the new transaction
• Property has not been listed for sale in the past 90 days (unless evidence of job transfer is provided)
• Property has been owned at least 12 months (unless evidence of job transfer is provided)
• Reserves equivalent to 6 months PITI for both properties is required.
• Up to 75% of Rental Income may be used to offset the mortgage payment if:

1)There is documented equity of at least 30% in the existing principal residence (as determined by an appraisal or AVM); AND
2) Provide a copy of the fully executed lease agreement; AND
3)Provide evidence of receipt of a security deposit from the tenant and evidence that it has been deposited into the borrower's account.

Feel free to contact me should you have any questions.

Larry Morris, CMPS
503-421-0096

102% Financing for Sherwood, Oregon.

Guaranteed!!

It is becoming harder and harder for a home-buyer to purchase a home, yet there are still many affordable homes if you have a down payment or the advantage of a program that helps you qualify for more home.

Eligible Persons

• Have an adequate and dependable income.
• Must be a U.S. citizen or be legally admitted to the United States for permanent residence.
• An adjusted annual household income that does not exceed the published limits for Washington county . Call me for information on the income limits. Income includes the total gross income of the applicant, co-applicant, and any other adult in the household. It excludes certain expenses and adjustments. The larger the family, the more income is acceptable
• A credit history that indicates a reasonable willingness to meet obligations as they become due.
• Demonstrate repayment ability.
  

How to Apply

Click on the following link. Oregon Rural Loans

Homes that Qualify

• Guaranteed loans can be made on either new or existing homes.
• Plumbing, heating, water, waste disposal, and electricity must be certified as adequate and the dwelling must be free from termites and dry rot.
• No restrictions exist on the size or design of the dwelling financed, but must be considered modest.
• Must be a residence, not a farm.
• Dwellings with in-ground swimming pools, are prohibited.
• Homes must be located in rural areas. Rural areas include open country and places with a population of 10,000 or less and, under certain conditions, towns and cities with less than 20,000 population. Call me for a list of additional eligible areas..

Larry Morris is a loan Officer with Equipoint Financial Network in Newberg, Oregon. He specializes in relocations and Sherwood, Oregon neighborhoods and Yamhill County. He is a member of the Sherwood Chamber of Commerce.He can be reached at larry.morris@equipoint.com. His website is www.PDX-Mortgage.com. This material is copy protected 2007 by Larry Morris, Mortgage News that Matters. All Rights Reserved His opinions do not necessarily represent the views of Equipoint Financial Network.

Licensed in: OR, WA.

FitPregnancy Magazine has listed Portland, OR as the top city in the nation for having a baby. Just another reason to live or move here. Portland, and the surrounding cities are considered some of the best places to live for many reasons, and according to a number of different sources.

In this study, Portland ranked high on low maternal and infant mortality, health of baby, breastfeeding, use of midwives, doulas and lactation consultants. The availability of high-risk pediatricians was also stated as well as the number of parks and state laws allowing breast feeding in public.

So, if you live here, CONGRATULATIONS!! If not, pack up and move here. Home values are relatively stable and I've got a loan program with your name on it.

Larry Morris is a Certified Mortgage Planning Specialist (CMPS) with Equipoint Financial Network in Newberg, Oregon. He specializes in relocations, helping clients maximize their equity position through proper debt structure, as well as financing for Senior Citizens. He is a Board Member of the Sherwood Chamber of Commerce. He can be reached at larry.morris@equipoint.com . His website is www.PDX-Mortgage.com .

This material is copy protected 2008by Larry Morris, Mortgage News that Matters. All Rights Reserved His opinions do not necessarily represent the views of Equipoint Financial Network.