You know one of the most powerful aspects of Active Rain is how elegantly this medium brings together so many different perspectives from all walks and levels of our industry. From newbies to old hands who both have much to share about our business and business in general!
MYTH-OLOGY: On a recent post of mine, a commenter quoted an inaccurate fact that was slanted with opinion, based on that fact. While I was blissfully working with clients that day, the commenter was corrected and later graciously retracted and edited their comment. When I returned to my post later, I was discovered what had transpired from another member who communicated this to me. Cool! Folks here are amazingly generous and fair in sharing ideas and information among co-pros; it's a great place to research, test ideas and yes, check our facts. And the best part: we are among friends who respect each other and bother to let you know what's what!
MYTH-INFORMATION: Which brings me to a conversation I had with a Realtor about a program I am feeling pretty enthusiastic about: USDA Rural Home Loans just happen to target large tracts of our tri-county area where the average income is considered inadequate to meet average housing costs. These are true 102% loans, funded by the USDA with some amazing features. While lenders charge a funding fee on top of the loan, there is absolutely no monthly mortgage insurance. And the best part: sellers can contribute any amount within reason to assist the borrower as long as the home is sound and they can afford it using standard full documentation guidelines. Credit risk and underwriting are 'make sense' make it happen. There are eligibility zones and 'average income' limits to effectively subsidize rural home ownership, but it's certainly not handout material! So...why would every Realtor and lender on the planet NOT support this a 102% program?
MYTH-QUOTE: Well, it seems some folks in Whatcom/Skagit/Island Counties (where this program is a godsend) have a wrong headed notion that I had not heard before: an esteemed competitor has been perpetuating the notion that USDA Loans have an 'equity sharing' function which means when a person sells the home they lose a percentage of their equity. Upon hearing this, I suspected the lender was either uninformed or not accredited to fund these loans. Just to be sure, I immediately contacted my 15 year veteran AE of the Rural Division of the SAME BANK as the person who quoted this factoid... and his one word reply was: myth.
MYTH-TRUST: OK, so why spread myth? You notice I didn't use the 'lie' word. I suspect, like the commenter on my earlier post, it would be literally impossible for everyone here to be in possession of the facts about every program. For starters, they keep changing!!! That's why you need folks whose business it is to know such things. So do I. Sure, things have changed a lot in the last five years (make that five months) and sure there are a lot of old hanging-on notions about very good loans because we forget and...well...who would TRUST a BROKER these days? Well, who else is motivated to tell you the truth? We don't get brownie points for leading folks on or wasting your time. I only get paid when I succeed and I only succeed by using my noggin for something besides holding my pillow down.
MYTH-BUSTERS: In conclusion, my I suggest we use Active Rain and check our facts before being tempted to spreading myth-information among our less knowledgeable buyers and investors. Many other very good programs are MYTH-UNDERSTOOD. I know the half truths are out there. They hit me at every turn: one Realtor swore the VA would NEVER approve a home because it was old. WRONG! Not only did the VA appraiser approve the home but the value came in much higher than the sale price and he assisted in helping verify a repair was made prior to closing so it would fund on time. Another told their client that ALL Reverse Mortgages are a rip off and she was too young to get one. WRONG. Sigh.
We could all use more accurate, up to date and and useful information to become better professionals!
Any popular myths you'd like dispelled here? Bring 'em on! Blessings!
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