The mortgage industry has gone through several changes in the last few years. The ability to refinance your home loan has become increasingly difficult, and lenders are requiring borrowers to jump through more hoops than ever. Many homeowners are trying to take advantage of historically low interest rates, but have been surprised by the numerous changes that have taken place and the high qualification standards. There are a few things you should know prior to calling your mortgage broker.

You now need to have a very high credit score in order to qualify for a mortgage refinance. In years past, it seemed that a pulse and the ability to fog up a mirror where the only requirements for refinancing. Now, almost every lender requires a minimum of a 620 Fico score, and many require at least a 660. Lenders will also charge higher interest rates for lower scores as well as cash out. Make sure you get a copy of your credit report and review it for accuracy. You can also improve your credit scores quickly by paying down balances on current debts. It may be a very difficult task, but making sure your credit report is accurate can cost you thousands in the long run.

Homeowners will also need to exercise patience when attempting to refinance a home loan. Due to the lowest rates that many have ever seen, mortgage lenders have been extremely busy with refinance activity. In addition, the housing market that has began to show signs of life. Lenders downsized in 2008 and are now a bit shorthanded to handle the flurry of business. This means that the refinance process can take from 30 to 60 days with some lenders or brokers. Increased underwriting standards have also extended the lending process, so borrowers need to know the entire process is now going to take longer than before.

The most painful aspect of the entire refinance process is the fact that most homes have significantly decreased in value. The value of a home will determine the program and products available to homeowners. Recent programs introduced by Fannie Mae and Freddie Mac will allow loans up to 105% of the value of the home. Be prepared to hear a very low number when you ask about your value. To find out if your home is owned by Fannie Mae (fanniemae.com) or Freddie Mac (freddiemac.com) you can visit their websites or simply call your lender to find out who owns your mortgage. Please understand that owning and servicing your mortgage are not the same thing. You pay your mortgage company, but they may not own your loan.

Points are now a common aspect when you attempt to refinance your home loan. The rates you see quoted online, in the newspaper, and on the television commercials usually include points. The days of the zero point, zero closing cost loans have disappeared. Lenders no longer rely on servicing loans for years to come in order to make money, so fees will be charged up front. You will also find that points can significantly reduce your interest rate and mortgage payment, and potentially save you thousands during the life of your loan. Find out how long it will take to make back the total cost of points by talking to your loan officer. Don't assume points are bad....you may be surprised at how much 1 point can reduce your mortgage payment. You will need to have a good idea of how long you plan on staying in your home to determine if it makes sense when refinancing.

The mortgage industry is changing daily, and you need to work with a mortgage professional that understands these changes and can help guide you through the process. To find out more about the options available for your mortgage refinance, call Tim Marose today at 240-463-3224 or apply online.

As the Presidential Election came to an end on Tuesday evening, Barack Obama was giving his speech and the housing market in the DC Area was starting to pick up steam. Between the new Presidential Administration and the new members of Congress, estimates predict 40,000 people moving to the area while another 40,000 move out.

This transition may be exactly what the DC area needs...A Mini Real Estate Boom! There is an abundance of houses currently on the market, but activity has picked up in many areas over the last few months. There should be more home buyers in areas such as Georgetown, Potomac, Alexandria, Arlington, Chevy Chase, and many cities in between. Many political appointees and high level staffers have already moved into the Obama Administration Transition Offices near the White House, and have already began their search.

Regardless if you wanted President Obama in office or not, one can only hope that his popularity and administration bring something to the DC area that we have needed desperately for the last few years....NEW HOMEBUYERS! Welcome Obama Supporters, now give me a call so we can talk about your financing!

Last week I was off to the office when I received a phone call from a potential client. The potential client and I had lunch plans that day, and he was calling to confirm our appointment, and to ask if I would mind driving. Of course I agreed, and then detoured to the closest full service car wash. With 2 kids, football practice, camping trips and weekend getaways, I was more than overdue for my next full service.

As I was about to pay, I heard a woman talking on the phone about a lock-box and trying to arrange an afternoon appointment. I told her that I knew other people were busy in this industry besides me, and started a conversation about her business. If we spent more than 2 minutes chatting, I would have been surprised. She was a bit flustered about her showing, so we quickly exchaged cards, I gave her a brief description of what I did and what made my company a little different, and we both went on our way.

Later that night I found her business card in my pocket, and sent her a nice little email. More times than not, these emails are not even returned, so I usually don't get too worked up about going into to much detail. Just a little reminder about our meeting, a little more about what we can do, and I was done.

To my surprise, she emailed the next afternoon, told me about the lenders she was working with, and how slow business had been. She promised to keep me in mind on future purchases and to keep in touch. She was extremely pleasant, but again, I have received the brushoff so many times, I felt that was the direction the email was headed.

I wanted to send one more email and push this a bit harder. I explained how much I enjoyed our conversation, and would send her the next deal I received in an effort to establish some type of relationship. I threw in a few one liners, and hit send.

She responded back with a LOL response, and stated she would be anxiously awaiting the referral. I would guess she has heard this response many times before from mortgage professionals, and wasn't about to hold her breath.

I know she could not have been more shocked when I called her later that evening with the name and phone number of a pre-qualified hom buyer, in the same neighborhood she was showing the house the day before, and looking for a realtor to guide her through the process. I still can remember the laughter on the other end of the phone and the shock in her voice. In a matter of minutes, I made a realtors day!

I only had one stipulation.....I do the financing! That was a pretty easy sell considering. For all of you realtors out there....Don't be afraid to make a loan officer's day:-)

The DC Metro area was one of the fastest appreciating areas in the country for homes during the last 5 years. Like the old saying goes, “What goes up, must come down”, and many have felt the pinch of the housing crunch over the last year. Falling home prices have caused financial hardship for many, while others have found relief with a debt consolidation loan.

A debt consolidation loan simply uses the equity in the home to pay off other expenses. Let me give you an example of a recent situation and how a debt consolidation loan changed their monthly expenses.

Mr. and Mrs. Homeowner owe $147,000 on their current mortgage. They paid $160,000 in 2004 with just 5% down. The house, even after depreciation in the last year, is worth $300,000. They currently have a 7% mortgage and their monthly principal and interest payment is $1011 a month.

Mr. and Mrs. Homeowner have used their credit cards a lot in the last year. The cards have been used for everything from household expenses to vacations. They have a Visa card with $13,000 balance and a minimum monthly payment of $390. They owe $7200 on a Mastercard, minimum monthly payment of $216. They have another Visa card with $6800 and a payment of $204, and finally, two department store cards with a $3,000 balance and monthly payments of $90.

Total, they owe $30,000 and pay $900 a month in minimum payments to credit cards. This is just the minimum required! Most credit cards range in interest rates from 13.99% to 24%. If they continue to make just the minimum payments, and don’t charge again, it will take 30 years to pay them off!

With a debt consolidation loan and minimal closing costs, their new mortgage balance is $180,000. The new principal and interest payment is $1079 on a 30 year mortgage. This is only $68 more than they were paying before, and all of the credit card debts have been paid off. They will save $831 per month by consolidating, and now the interest is tax deductable.

If they want to pay the home off sooner, they could take out a 15 year mortgage, and their new payment would only be $1494 per month, and all the credit cards would still be paid. They just shortened the term of the mortgage by 11 years AND consolidated all of the debt!

To find out what a debt consolidation refinance can do for you, visit www.tmmortgagegroup.com today or call 1-800-696-1424.

Timing plays an important role in so many things in our life. There is something to be said about being in the right place at the right time. Buying a stock, purchasing a house, or asking for a raise, are all about timing. Now, refinancing also requires a little bit of timing as well.

Earlier today, I spoke to a couple looking to refinance their current mortgage. They bought a few years ago and decided to take out an interest only loan. This is simply a loan that does not require any of the principle to be paid monthly. Rather, you pay just the interest each month and your mortgage balance remains the same. The loan my customers are in is a 5 year adjustable, so in another couple of years, the interest rate, along with the payment will change. They will be required to pay principal in a few years as well.

This morning was a great morning for many mortgage professionals. Rates opened very low and all signs pointed towards a busy day. I was working with quite a few customers that were about to lock, I locked a few early in the day. The customers I spoke about above called in this morning to ask a few more questions. I answered all their questions, but they decided that they wanted to wait it out a little longer and see if maybe they could get a little closer to 5%. Apparently, 5.5% wasn't a strong enough rate at the time.

At 1:47 this afternoon I got my first email from a lender stating that they were going to increase interest rates. I immediately called my customers to inform them of what was happening. One problem....voice mail. I asked them to give me a call back so we could lock before we saw any other major increase in rates.

3:11 PM. Same Company sent over a second rate change for the day. Rates were still increasing, and all the companies were in line. I received about 15 emails in the next 10 minutes about rates worsening. (I hate this word and would love for someone to come up with something that does not sound like my 5 year old talking). I figured since I already called once, I would send them an email and let them know what was going on. We were so close this morning, but they just were not ready to pull the trigger. I almost locked their loan for them at this time on a hunch, but didn't. This may be a huge error on my part, but felt that I would move when they were ready.

5:50 PM. Same company, same result. Prices Worsened Again! Still no contact with the borrower. One company I worked with had increased interest rates by .50% since earlier this morning. On a $300,000 loan amount, this is equivalent to $95 a month over the next 30 years. One day's pricetag is $34,200 over the next 30 years!

Now, I get to sit back and wait for my clients to call and tell me that the new payment is going to be too high and they will just sit back and wait. After all, they have 2 plus years remaining on their current adjustable rate and can live with where they are now. But what if rates don't come back down? In the back of my mind, I believe they will, but what if? Was the reward of $19 a month worth the risk of $95 a month?

Now before I get the emails about rate protection and negotiating rate, I understand and know all of this. I locked a few loans today and will offer my clients even better rates if they decrease. But in this case, I was completely at the mercy of my client. Should I have been more pushy? Should I have sold them harder? What's the saying? You can lead a horse to water.....

So, my one lesson I would like to give to anyone out there considering a refinance in the next few months, or for those of you like me in the profession. Make sure you have a rate in mind that will make you move!

Once all of the short term and long term goals are discussed, make sure everyone knows what rate will make things move forward. If I would have got a rate that my clients were happy with up front, I could have locked them without talking to them this morning and everyone would have been happy. I try to do this with all of my refinance clients, but failed to do so on this one. Now I have to sit back and wait for the call. I don't know what is more fun, waiting for the call, or watching the rates skyrocket all afternoon. Good stuff!!!