New Jersey Mortgage and Home Loan Information

Will I Get a Better Interest Rate with a Higher Credit Score?

Mon, 15 Mar 2010 19:34:39 -0500

Will I Get a Better Interest Rate with a Higher Credit Score?

The simple answer: Maybe, but there are many variables.

As a rule of thumb, the higher the credit score the better the rate you will receive (or the less fees you will pay). This is most relevant when talking about conventional loan programs. For the best rates and options you want a credit score of 740 of more.

What can make my rate higher?

Credit scores below 740
A property's status: Second home or investment property loans
Type of property: Condo vs. single family vs. mobile home vs. multi-unit
Loan amount: Conforming loan vs. jumbo vs. super jumbo

And the list can go on and on. Each variable can add to the interest rate and/or the cost of the loan. Some combinations can get very expensive as well as very limiting on your financing options.

FHA and VA loans are different than conventional. Many lenders will be able to offer the same rate for an FHA or VA loan if you have a 620 or better credit score. Some lenders will require a 660 or better credit score to get a better rate (or less fees).

What you may find from lender to lender is that the rates offered or the options allowed may fluctuate for the exact same program and financing scenario. On top of the guidelines that Fannie Mae, Freddie Mac, FHA, or VA set, lenders may place their own restrictions, commonly known as lender overlays. Lenders can go as far as to not allow certain loan options even though FHA, Fannie Mae, or Freddie Mac may allow the option themselves.

Keep doing you research. If you find yourself getting different answers to the same questions, you are probably talking to either loan officers that do not know what they are talking about, or one or more lenders you are talking to are telling you their guidelines based off of their particular lender overlays.

So the final answer is ...

Higher credit always helps - but isn't always required to get the best rates. Many lenders can offer the same rates for certain loans whether your credit score is 620, 720, or 820.

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail | NJ Loan Officer .com

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

Zero Down Mortgage Options for New Jersey May Soon End

Sat, 13 Mar 2010 13:26:10 -0600

Zero Down Mortgage Options for New Jersey May Soon End

by Steve Kappre, NJ Loan Officer

One of the strongest loan options for buyers these days is the USDA Mortgage Loan, which has some great features such as 100% financing (zero $$ down) and NO MONTHLY mortgage insurance. It also allows home sellers to pay for most or all of a buyers closing costs.

Some may think this loan is too risky to even consider, but there are checks in place. In fact, this program has common sense guidelines such as debt ratios that can't be "out-of-whack" and some minimum credit score requirements. It also requires full documentation of income, assets, job history, etc.

Here is the bad news ...

When a USDA loan is written for a home buyer, there is a guarantee for the mortgage that is "locked in" once the loan is approved. The issue right now is that USDA estimates that it will be out of money around late April of 2010, which means that this great financing option will no longer be available, at least until the government decides to allocate more money to this program.

What to do now?

If you require this type of financing, than you need to get under contract ASAP on a home. Let us look at an example time-line; If USDA is out of funds by the end of April ... and it takes 2-3 weeks to fully approve a USDA loan ... and it takes one week to negotiate a contract for a home and have it signed by all parties ...

That puts us at the middle-to-end of March ... or RIGHT NOW.

Some buyers will be counting on the USDA loan and the first time buyer tax credit, and with even just a little delay or hiccup can miss out on everything.

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail | NJ Loan Officer .com

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

The End of NJ First Time Buyer Mortgages for Buyers Below 620 FICO Scores

Sat, 13 Mar 2010 09:16:48 -0600

The End of NJ First Time Home Buyer Mortgages for Buyers Below 620 FICO Scores

by Steve Kappre, NJ Loan Officer

It was a nice run while it lasted, and over the last 6-12 months we were effectively able to put quite a few NJ first time home buyers into homes. As of March 15, 2010, NJ HMFA (Smart Start, Tax Prefund, and other options) will not allow a borrower to have a middle credit score below 620.

Another tightening of guidelines will no longer allow buyers to use alternative credit and have no credit score. In the past, a lender could fund such a loan by placing 4 trade-lines that were not already on a credit report (i.e. cell phone bill, auto insurance, gym membership). Now if this is done and there still is no credit score, the loan can not be approved per NJ HMFA guidelines.

It is another blow in the world of mortgage financing.

There ARE some good buyers out there that have credit scores slightly below 620 that would make solid home owners. It is unfortunate that these guidelines restrict otherwise solid home owners. But the line has to be drawn somewhere. This makes the knowledge and understanding of credit scores and reports more important than ever!

With the end of NJ first time home buyer programs for buyers with credit scores below 620, it is more important than ever to work with a highly qualified, local mortgage loan officer. If your credit is marginal or below 620, call today for advice on how to raise your score to qualify for the Smart Start, Tax Prefund, or other HMFA program.

Credit Links

Credit Scoring - What Makes Up My Credit Score? (1 of 6)

Credit Scoring - Payment History (2 of 6)

Credit Scoring - Balances (3 of 6)

Credit Scoring - History (4 of 6)

Credit Scoring - Mix of Accounts (5 of 6)

Credit Scoring - Inquiries (6 of 6)

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail | NJ Loan Officer .com

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

In 3 - 5 minutes, you can help make a wish come true today

Fri, 12 Mar 2010 06:07:33 -0600

Take a minute to simply join Sam's page as a "fan". The link is here as well as below: http://www.facebook.com/#!/group.php?gid=261410896243&ref=ts

Via Mary Pope-Handy, ABR, CRS, ePRO, SRES, ASP (Sereno Group Real Estate):

Sam Callahan, the son of a Realtor (and my friend & Active Rain member) in Silicon Valley, is 14 years old and has cancer which is not responding to two different types of chemotherapy. His cancer, Ewing's Sarcoma, had metasticized before it was discovered on September 22nd.

Sam writes about his battle with Ewing's Sarcoma on the Sam's Team website: http://www.samsteam.org/About_Sam.html He is an amazing 8th grader with a good attitude who wants to beat this thing. If you read his "about Sam" page, you'll find he's a great writer, too.

Normally, we can feel very helpless to "do anything" besides offer our compassion, thoughts and prayers.

But this time, there IS something you can do, and it only takes a couple of minutes. It may not change how he feels after radiation or chemo, but it will lift his spirits and those of his family and friends to see an outpouring of support. And it will help Sam and his family to make a little goal they've set up for themselves.

In addition to the website, Sam's family & friends have a "fan page" on Facebook. It's called I'm On Sam's Team. Their modest goal is to have 5000 fans by St. Patrick's Day. I'd like to help them get there. As of this moment, they have 2608 fans. They want people to know about Ewing's Sarcoma and they want people to know about Sam and his battle with this cancer.

What To Do: So, my Active Rain friends, I know a lot of you are on Facebook. If not, this might be the right time to join!

Please take a moment and log into Facebook.

Go to the Search bar and key in I'm On Sam's Team or use this link once you're logged in:
http://www.facebook.com/#!/group.php?gid=261410896243&ref=ts

At the very top, in the middle, there's a button which says Join Group - click on it

That's it. How easy it is to send some support and encouragement! Of course, read through the website and the FB page too! But it only takes a minute to "fan" a page.

Just to reiterate, Sam is someone I know, it's not one of those fake internet hoaxes and he's part of the real estate family (his dad's a Realtor). Join us on Sam's Team! Please re-blog!

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

USDA Rural Development loans expecting to run out of funds by late next month

Thu, 11 Mar 2010 21:25:04 -0600

Will zero down USDA loans be off-the-table soon? Maybe. Here is an article sharing the unfortunate possibility that home buyers may soon have even less options than they do now. And no doubt this is an option first time buyers are looking at utilizing, especially in the South Jersey counties of Gloucester and Salem where I write the majority of my loans.

If you are considering this loan option, it is best you move fast forward to get the funds set aside for you and hurry up and get to the closing table! Especially if this is your only mortgage option!!

Via Thomas Mortgage, Florida's FHA Loan Pro:

Updated information- Check it out below

I normally hate titles that are meant to scare people into reading but unfortunately this time there is no exaggeration to the severity of the issue. USDA Guaranteed Rural Development loans, one of the best low/no down payment financing programs left, has recently announced they expect to be out of the funds they use to guarantee loans by late April. If no action is taken by Congress to re-appropriate more funds then it will be the next budget year, after October, before we have this financing option again.

But the Tax Credit deadline is looming

Exactly- This funding shortfall couldn't happen at a worse time. Now as contacts are being negotiated, applications are being taken and plans are being made to ensure buyers meet the dates of the tax credit deadline, we throw a wrench in the system. Should a buyer proceed with USDA financingif they have just received a fully executed contract? Should a buyer that has been prequalified for a Rural Development loan continue house shopping? What can this mean to a buyer that is already in the process too far to turn back?

These questions must all be dealt with on a case by case basis, depending on a variety of factors. One of the most important factors to consider is current and anticipated turn times for your local USDA underwriting. Here in Lake County, FL USDA is at 7-10 business days so unless you can have your loan ready to go to the USDA by April 9^th, there is a good possibility you may not make the funding cutoff. This is further complicated by the fact that USDA is the only loan program that does not require HVCC type appraisal restrictions (VA is a different animal but with the same results). This means if you commit to USDA financing now and are forced to revert to FHA or another program, you may need a new appraisal.

Buyers should follow the advice of their trusted lenders and know that proceeding with a USDA loan without enough time to make this cutoff is a gamble. We truly need an act of Congress to approve additional funds for these loans. Although it seems logical that they should want to avoid such a deep blow to the housing industry at this time, we all know oftentimes there is precious little logic in D.C. If you think I'm exaggerating the seriousness of this, do know the USDA Guaranteed RD program resulted in over 3500 transactions since October 1, 2009 in Florida alone! That breaks out to over 350 deals a month. Sure, some may be able to qualify through another program like FHA or VA but many won't.

Is there anything we can do to help?

Yes- please accept this call to action to contact your trade associations and express the severity of this. NAR, NAMB and the NAHB have all been made aware of this and I trust are beginning lobbying efforts to rectify it. You could also contact your members of elected officials in the House and in the Senate and urge them to sponsor legislation and fast track it to minimize the damage a funding delay could cause. This is not a partisan issue, both sides of the aisle should be eager to approve this. This isn't about bailing out the housing industry, it's about maintaining funding for a loan program that has suddenly become much more popular than anyone expected due to the current environment of real estate.

Gerry Suarez, Jr.

Your FHA Loan Pro!

UPDATE 03/11 5p EST- I just received the first notice from an investor on this and interestingly enough they are not allowing locks on USDA loans until a conditional commitment setting aside available funds is received from the USDA. That basically means borrowers will be forced to float their rate until the loan is almost ready to close. Look for more developments on this as more investors chime in with changes.

Your FHA Loan Pro on Facebook

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

When Reapairing Your Credit, Don't Forget About Good Debt

Wed, 10 Mar 2010 18:06:03 -0600

When Repairing Your Credit, Don't Forget About Good Debt

by Steve Kappre, NJ Loan Officer

Anyone who takes the initiative to restore their credit profile should be commended. Keep in mind though that along with removing negative debts and history, many times new debt (that is good debt) needs to be established.

As time passes, older items on a credit report have less and less effect on the credit scores. This is good in the case of bad debt, and not so good in the case of good debt. Good debt would be considered an account that has been active, has on-time payment history, and has low balances (in regards to the allowable limit).

Good debt can be a mortgage, a car loan, credit cards, or installment loans. Some debts are a little better to have than others but that is beyond the scope of this piece.

As a individual makes the effort to rid their profile of negative items, for the score to improve, the credit scoring system will need to see some timely (on-time) accounts. If your credit is too damaged to open a bank loan or credit card, the common method of re-establishing credit is through a secure credit card, which is basically a credit card where you put the "credit" upfront ($500 limit on a card would require a $500 deposit, for instance).

So remember, knowing how to correctly remove and repair items on the credit report is only part of the equation. Be sure to establish new, good debt.

Credit Links

Credit Scoring - What Makes Up My Credit Score? (1 of 6)

Credit Scoring - Payment History (2 of 6)

Credit Scoring - Balances (3 of 6)

Credit Scoring - History (4 of 6)

Credit Scoring - Mix of Accounts (5 of 6)

Credit Scoring - Inquiries (6 of 6)

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail | NJ Loan Officer .com

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

My Credit Scores Need Anger Management Class!!

Tue, 09 Mar 2010 06:41:24 -0600

My Credit Scores Need Anger Management Class!!

Have you ever done something just to spite someone? Sure, we all have. Somehow it makes people feel a little better to act like a jerk or dis somebody. Well I'm here to tell you that getting mad at creditors and not paying your bills out of spite will hurt nobody but yourself!

There's a good chance that the mega bank with 40,000 employees won't feel that spiteful sting when you decide to hurt them by not paying your bill(s). However, your credit can take a beating, now and for years to come.

First the situation hurts your ego. So you open that can of spite and decide to not pay on an account. Next it hurts your credit scores as payments are continually missed. Sometime later it hurts your pocket as lower credit scores cause you to get less desirable loans on other accounts. And if really played out, we are talking wage garnishment. It is official: Your spite just ruined your entire life's finances.

Seem silly? Maybe. Have people done this. ABSOLUTELY!! On anything from a $10 copay to a car repossession to even a house payment.

So next time take a deep breath, forget about the idiot worker that called you with the attitude, and pay your bills. Big or small. In the end it will not only feel right, it IS right.

Credit Links

Credit Scoring - What Makes Up My Credit Score? (1 of 6)

Credit Scoring - Payment History (2 of 6)

Credit Scoring - Balances (3 of 6)

Credit Scoring - History (4 of 6)

Credit Scoring - Mix of Accounts (5 of 6)

Credit Scoring - Inquiries (6 of 6)

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

Interest Only Loans - The Devil or a Godsend?

Mon, 08 Mar 2010 10:16:43 -0600

Interest Only Loans - The Devil or a Godsend?

I read this blog today that got my wheels spinning. The topic: Interest only loans. Interest only loans have a nasty reputation as foreclosure loans or "rent" loans. Heaped into the same pile are negative amortization loans, no doc loans, stated income loans, and others like it. But in my opinion, we are throwing the baby out with the bath water.

These loans are TOXIC!?!?

You don't have to convince me. And please don't try to. Lets try and create a quick parallel. We all use various tools every day; knives, can openers, lawn mowers, bleach, Jack Daniels. Where we run into the real problem is when these tools are misused OR they are given to the wrong people.

You don't give a 3 year old a steak knife. And your 5 year old shouldn't be mowing the grass. Your 16 year old shouldn't be downing Jack Daniels. They are all the wrong match for these "tools".

An interest only loan is a tool. Just like a 15 year loan is a tool. Think I am off my rocker?? I'll show you borrowers that are so aggressive in taking a 15 year loan that they put their family at far more risk than if they had an interest only loan. Point in case: If you are stretching to make 15 year loan payments, it leaves little money in the bank. When an emergency comes along, where does this person get money from? They borrower it via credit cards, bank loans, or maybe a refinance. This situation puts a homeowner in a much worse scenario and more than cancels out all of their pre-payment strategies. It may even put them into foreclosure, which would be doubly sad if they spent years aggressively paying down their home loan only to lose every cent to the bank.

The real issue is matching borrowers with the wrong loans

Did you know that negative amortization loans were around years before they were popular with Countrywide, WaMu, and World Savings? That is right. Various S&L's would carry such products. So why is it that these loans can be around for years and NOW we are getting crushed by them? Because more recently they were given to the wrong people (Wrong tool, wrong borrower, wrong age, wrong financial understanding level).

When you give a first time buyer an interest only loan at 100% financing that has a rate that adjusts after only 2 years, you are creating a serious mess. When you give a negative amortization loan to a borrower that can barely pay the 1% payment rate (but is really being charge 7% - which the loan will later adjusts to), you are creating a serious mess.

These loans got riskier and riskier. As homes appreciated, people that failed with these loans simply listed and sold their homes in a week. All is good. Until appreciation stopped and went in reverse.

Interest only loans in and of themselves are not bad loans. For a financially savvy home owner, an interest only loan that adjusts monthly can be a God send, because they understand finances. (Right tool - right user).

Putting a knife in the hand of a 3 year old is just like lending an interest only loan to the financial noob. It may just be a miracle if things turn out right!!

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

Don't Blame the Underwriter - Blame the Loan Officer!

Sun, 07 Mar 2010 08:33:44 -0600

Don't Blame the Underwriter - Blame the Loan Officer!

Steve are you out of your mind? Aren't you a loan officer?

There has been recent conversation about underwriting and underwriters and how grossly depraved and wicked they are - denying loans, taking a shotgun to files, stripping them of all their dignity ...

But as a loan officer that is experienced with both the broker side and the banking side of mortgage lending, I am here to say more times than not ...

BLAME THE LOAN OFFICER

We loan officers are on the front lines. It can be wickedly brutal out there. We work our brains and hands to the core to obtain business, and when we finally get the business in the door do you think we would ever admit that we made a mistake? (We all know what the answer should be, as well as the factual answer).

Enter the mythical creature known as the underwriter!!!

(Excerpt from an unknown work of Plato)

"The underwriter was born in the underworld, the offspring of Barney Frank and Michael Moore. (The one pictured above is actually a quite beautiful one). Underwriters are so mean because they never see light, they are fed LOTS OF CRAP, and people want them to be God and approve horrendously looking files that were DOA. "

The reality is as mentioned above. Loan officers more times than not are to blame when "files go wild". But as typical (oh that hurts) salespeople, loan officers think they are never wrong, always right, and you shouldn't question their authority. HOWEVER the mythical underwriter to blame is a wretched, depraved being that lives only to deny potential home owners from ever living the American Dream. After all, if the underwriter is damned to the underworld, he/she is not letting anyone else experience happiness.

WHAT REALITY SHOULD BE

LOAN OFFICERS SHOULD

Set the right expectations from day one
Write REAL pre-approvals
Be in constant communications
Be human
Under promise and over deliver
Take off the "Sales Hat" and be more professional
Be able to admit a mistake
Allow direct contact with underwriters so the truth can be told (yeah right)

REALTORS SHOULD

Proactively provide sales contract and anything else important to the loan officer as fast as possible. (I've had agents send over contracts 2 weeks after being fully executed).
Listen to the loan officers regarding time lines, stipulations, potential pitfalls (assuming the LO does his/her homework)
Attempt to work with the same lenders and get a really good feel and working relationship under their belt (wonderful long term success)
Take initiative for their buyers and sellers and be in constant communication with the loan officer (agents on both sides of the transaction)

We could go on forever with tips and ideas. The fact is that a knowledgeable experienced loan officer is the most important part of the financing wheel ... more important than the underwriter, the lender itself, the appraiser, the rate, the closing costs ... (you get the point). Some of us have learned the hard way ...

Garbage in = Garbage out

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

NJ First Time Home Buyer Tax Prefund Program

Thu, 04 Mar 2010 20:52:13 -0600

NJ First Time Home Buyer Tax Prefund Program

The NJ First Time Home Buyer Tax Prefund Program has been a great option for New Jersey buyers needing down payment assistance programs. The program allows $5,000 of the $8,000 first time home buyer tax credit to be used towards your down payment and/or closing costs.

For buyers in the price range up to $142,000, the $5,000 can be used to cover the full down payment requirement for an FHA loan. When this is an option, a home buyer can also have the seller pay some or all of the closing costs. This is a great option for first time buyers because it lets them keep more money in the bank - something everyone homeowner needs!

The NJ Tax Prefund program will only be available while the first time home buyer tax credit is available, which means that both are gone in the coming weeks! To receive the first time buyer tax credit (and prefund option) a buyer must be under contract by April 30th and settle by June 30th.

If you need assistance, DO NOT delay. These loans typicially take about 45 days to close. Call today to get pre-approved for this option.

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

NJ HMFA Smart Start Lender - First Time Home Buyer Programs

Sat, 27 Feb 2010 13:54:32 -0600

NJ HMFA Smart Start Lender - First Time Home Buyer Programs

Whether NJ first time home buyers utilize the available programs or not, every home buyer and Realtor need to know about these options. The main program that is offered by HMFA (Housing and Mortgage Finance Agency) of New Jersey is called the Smart Start program.

The Smart Start program is available for first time buyersand allows for down payment assistance or 2, 3, or 4 percent (%) of the loan amount. As an example, if you were financing $100,000, you could receive a grant of up to $4,000. The interest rate changes based on what assistance percentage is chosen.

The assistance can be used for closing costs or a down payment, or both. Often a home buyer with a little money in the bank can keep their money for after settlement and utilize both the down payment assistance program option and seller concessions. This creates a safer environment for a new home buyer as more of their own money can be kept in the bank.

The Smart Start program has income restrictions. As of 2/27/10 a first time buyer can make as much as $85,600 per household, and the limits go up depending on the county and the number of people in the household. (See Chart).

Although HMFA offers this program and many others like it, HMFA does not approve and finance these mortgages themselves, an approved HMFA mortgage lender such as Treasury Mortgage (A Division of Aurora Financial Group) would write, approve, and close these loans. In fact Aurora is one of only two firms that service these loans so you can do everything under one roof, which is better for everyone.

If you or someone you know is a first time home buyer, or if you are a Realtor, you owe it to yourself to know about these programs. They are not for everyone, but they are a wonderful fit for some and can make the first time home buyer experience a great one.

Some other HMFA options are the Tax Prefund Program, Live Where You Work, Police and Fireman's Loan, and more

Lastly, be quite sure to work with a loan officer and lender that are very experienced with this program. If they are not writing HMFA Smart Start loans every month (be sure to ask them) then you are probably dealing with the wrong people!

Call, text, or write for more information or to be pre-approved for these programs.

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

Understanding and Using All of Your First Time Home Buyer Options

Fri, 10 Jul 2009 17:00:48 -0500

With all the excitement of the first time home buyer tax credit, buyers often get confused and miss out on other important options.

As a first time buyer, don't let the excitement of the $8,000 tax credit cause you to miss out on many other home buying options. It isn't uncommon for a buyer to confuse the federal tax credit with seller credits, down payment assistance, or first time home buyer grants.

First time home buyers have many options. Utilizing one option does not hold a buyer back from utilizing one or more other options allowed to them as a first time home buyer. This article is written not to go into great depth on each option, but to help you realize the different options available as a first time home buyer and how to utilize each/all of these options.

Read on to understand some common terms and how to take advantage of each option.

Tax Credit

The federal tax credit is the (up to) $8,000 incentive that everyone is talking about. Most home buyers that haven't owned a home in the last 3 years will qualify for this. In general, this credit is realized as a credit for you when you complete your taxes in the spring of 2009 (for 2008's income).

For example, if you would have normally received $2,000 back after completing your 2009 tax returns, the tax credit would add an additional $8,000, to make your total amount received $10,000. For additional information and guidelines, go directly to First-Time Home Buyer Credit: Answers.

Seller Credit (Seller Concessions)

A seller credit, better known as seller concessions, is a scenario when the seller agrees to pay a certain amount of your settlement costs. The seller may pay a percentage, such as 2, 3, or 6% of the purchase price, or they may pay a dollar amount, such as $2,500 or $5,000.

For more information on understanding seller concessions visit Understanding Seller Concessions | Seller Paid Closing Costs | Seller Contributions | Seller Assist.

Grants for First Time Home Buyers

Many people miss out on first time home buyer grant options. Once a buyer hears about the $8,000 tax credit, they sometimes go deaf to other options, either out of excitement or because they don't realize they can utilize more than one option.

A grant is a program often issued by a county or state that offers funds to the home buyer for the purchase of a home. Either a flat dollar amount or a percentage of the loan amount is used to calculate the funds offered. A typical grant percentage would be 2, 3, or 4% of the loan amount. For instance, 4% of a loan amount of $100,000 would give you a $4,000 grant.

Grants can be utilized for down payment requirements and/or to pay for closing costs. Depending on the purchase price and the grant selected, a grant can sometimes even cover all requirements the buyer has concerning both the down payment requirement and closing costs.

Down Payment Assistance

As of the date of this article, down payment assistance in the traditional sense is not available.Down payment assistance programs (DAPs) were an option where the seller would indirectly give a buyer the money needed for down payment requirements. These transactions in general had a higher default rate then most, therefore this option is no longer available. Examples were the Nehemiah program or the Genesis program. There is a movement to reinstate these programs. The mentioning of DAPs here is simply to help you differentiate and not confuse them with other options.

How to Utilize More Than One First-Time Home Buyer Option

Here's where the rubber meets the road. A common example of utilizing all of the above options is as follows:

Buyer meets with grant official or loan officer for qualification requirements pertaining to a specific grant option. In our example the buyer will use an FHA mortgage, which requires a 3.5% (of the purchase price) down payment. The purchase price is $100,000, therefore the down payment requirement for this would be $3,500.
Loan officer and buyer determine that the use of a 4% grant would be the wisest choice. Since the down payment requirement is $3,500, the financed amount will be $96,500 ($100,000 - $3,500). Based off of $96,500, a 4% grant would be $3,860 (loan amount x 4%, or $96,500 x .04)). Compare the grant amount with the buyer's down payment requirement of $3,500, and the grant amount is $360 more than the required down payment amount. This type of grant covers the down payment requirements and some additional funds to be applied towards the closing costs.
Assuming closing costs are $5,000, here is how you can determine what to request from the seller to get the closing costs paid as well. We can subtract the extra money left over from the grant, in this case $360, from $5,000. Our sum is $4,640. FHA requirements allow the seller to pay up to 6% of the buyer's closing costs. We don't need all 6% (or $6,000), we only need $4,640 from the seller. So when the purchase of the home is negotiated, the buyer's agent negotiates with the seller's agent that the seller will agree to pay $4,640 towards the buyers settlement fees/closing costs.
Buyer goes to settlement needing $0 to close, and in fact they will get back the money already deposited with the real estate agent and lender.
Lastly, the buyer can still maximize the use of the federal tax credit and receive their $8,000 after filing their 2009 tax returns.

All-in-all, in our scenario the home buyer will receive $16,500 for purchasing a home ($3,860 grant + $4,640 seller's concessions + $8,000 tax credit). The buyer is able to utilize three separate home buying options and in the end, still have their own money in the bank, which will then get boosted in several months by the $8,000 tax credit. Now THAT is the kind of lending and buyer representation that creates solid, well founded home owners, which is exactly what we all desire.

By working with knowledgeable professionals, you can utilize multiple buyer options to make your home buying experience an amazing event!

If you would like more information, as a buyer, seller, real estate agent, real estate office, financial planner, college or other party, feel free to contact Steve Kappre directly on his cell at 856-419-3561 or via e-mail at steve@stevekappre.com.

Steve Kappre is a Mortgage Planner with Treasury Mortgage. Steve specializes in;

• All areas concerning First-Time Home Buyer Mortgages, grants, down payment assistance, police and fire loans, rehab loans, and more.

• Reverse Mortgages

• Equity Management strategies for high-end homes and high net worth individuals.

Contact Steve Kappre directly at 856-419-3561 or at www.stevekappre.com

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

Making Your First Time Home Buying Experience Successful

Wed, 17 Feb 2010 22:54:44 -0600

Making Your First Time Home Buying Experience Successful

Well the run has begun and the whirlwind of first time home buyersis picking up steam all across the country. Every buyer will want to know how understanding and using all of your first time home buyer options comes into play in their personal home buying goals.

BUYERS TAKE NOTE:

What many Realtors and lenders (and therefore buyers) don't understand is that the $8,000 first time home buyer tax credit is not the only first time home buyer incentive right now. Indeed in New Jersey we are looking at a handful of mortgage options including a $10,000 grant-assistance program, a 4% (of loan amount) grant-assistance program, a tax-prefund mortgage option which allows $5,000 of the $8,000 tax credit to be used for buying a home, and a zero-down (100%) financing option. And that is just in Gloucester County!

Why do I say that Realtors and lenders don't know about these options??

Because I talk to buyers (and Realtors) all the time that know little to nothing about such options. Buyers come to me because their agent or their current lender could not answer their questions about such program options.

BUYERS do not need to miss out!! Ask as many questions as possible! Work with a local agent and lender that know their FIRST TIME HOME BUYER STUFF!!!! Do not settle for a mediocre substitute!

Buyers can also check out: Understanding Seller Concessions | Seller Paid Closing Costs | Seller Contributions | Seller Assist

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer

Purchase, refinance, rehab loans

Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

Still Closing Mortgage Loans in New Jersey below 620 Credit Scores

Mon, 22 Feb 2010 21:24:35 -0600

Still Closing Mortgage Loans in New Jersey below 620 Credit Scores

New Jersey first time home buyers still have an advantage these days. If you are buying your first home and are buying in New Jersey, practically every "typical" loan has a minimum FICO score requirement of 620. But there are options for financing a home with credit scores below 620, namely first time home buyer options.

These financing programs not only allow for credit scores below 620 but also allow a down-payment assistance option of up to 4% of the loan amount. As an example, a $100,000 loan amount would allow a $4,000 assistance option, which can be used for closing costs AND/OR down payment requirements. Up until the end of June 2010, there are also additional mortgage options, such as the tax prefund program.

If you are a first time buyer in New Jersey, you owe it to yourself to check out all of your financing, down payment assistance, and grant-type options.

For additional information or to be pre-approved, contact Steve.

Buyers can also check out: Understanding Seller Concessions | Seller Paid Closing Costs | Seller Contributions | Seller Assist

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

How to Be a LOSER When Buying a Home: Pick the Wrong People to Work With

Sat, 20 Feb 2010 07:58:14 -0600

Think You Can Pick ANY Lender or Agent to Work With?

Let me share with you a recent event that caused a home buyer to miss out on $10,000.

I talked to a buyer two days ago. His significant other was doing some research about a local grant programs and they found me. In this case he called about a program that allows first time buyers to receive $10,000 towards the purchase of a home.

There are income limits to qualify for this program. Based off of his income alone, he made just a little too much money. However since his significant other would be living in the property, and is unemployed, this could change the qualifying factors, which also consider the number of people in the household and/or the number of people on the deed. So with two people in the home and on the deed, they now qualified for the $10,000 grant based off of their income.

TOO LITTLE ... TOO LATE

So they qualify now, good news right?? Not exactly. It would have been better had they never found out. Their loan officer told them the whole time that the significant other could not be on the loan since she provided no income.

BZZZZZ - - - NOPE - - - NADA - - - Wrongo

You can indeed have a co-borrower that has no income and have them on the loan. Just think of a housewife, a retired spouse, etc. But due to being misguided, this first time home buyer will miss out on $10,000. He was only a week away from settlement when we talked about this, and the program takes about 45 days to complete. The seller is not willing to delay.

Who's wrong here ... the lender, the loan officer, the Realtor?

Realtors should certainly know about these programs, but this is out of their scope. Is it the lender's fault? Not really. A lender can train a loan officer, but they can't make them know everything. IT IS THE LOAN OFFICER'S FAULT! I'm not about to out that loan officer, I don't work like that. But shall I ask the question again; Do you ...

Think You Can Pick ANY Lender or Agent to Work With?

Well of course you can!!

Steve Kappre is a mortgage loan officer in New Jersey. For more info or questions feel free to contact Steve.

NJ First Time Home Buyer
Purchase, refinance, rehab loans
Conventional, FHA, USDA, VA, HMFA, First Time Home Buyer, Police and Fire, Live Where You Work, and more

Call direct @ 856-419-3561 | Subscribe to Steve's blog via e-mail

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance

New Jersey Mortgage and Home Loan Information

Will I Get a Better Interest Rate with a Higher Credit Score?

Will I Get a Better Interest Rate with a Higher Credit Score?

So the final answer is ...

Zero Down Mortgage Options for New Jersey May Soon End

Zero Down Mortgage Options for New Jersey May Soon End

Here is the bad news ...

What to do now?

The End of NJ First Time Buyer Mortgages for Buyers Below 620 FICO Scores

The End of NJ First Time Home Buyer Mortgages for Buyers Below 620 FICO Scores

It is another blow in the world of mortgage financing.

In 3 - 5 minutes, you can help make a wish come true today

USDA Rural Development loans expecting to run out of funds by late next month

When Reapairing Your Credit, Don't Forget About Good Debt

When Repairing Your Credit, Don't Forget About Good Debt

So remember, knowing how to correctly remove and repair items on the credit report is only part of the equation. Be sure to establish new, good debt.

My Credit Scores Need Anger Management Class!!

My Credit Scores Need Anger Management Class!!

So next time take a deep breath, forget about the idiot worker that called you with the attitude, and pay your bills. Big or small. In the end it will not only feel right, it IS right.

Credit Links

Interest Only Loans - The Devil or a Godsend?

Interest Only Loans - The Devil or a Godsend?

These loans are TOXIC!?!?

The real issue is matching borrowers with the wrong loans

Putting a knife in the hand of a 3 year old is just like lending an interest only loan to the financial noob. It may just be a miracle if things turn out right!!

Don't Blame the Underwriter - Blame the Loan Officer!

Don't Blame the Underwriter - Blame the Loan Officer!

Steve are you out of your mind? Aren't you a loan officer?

BLAME THE LOAN OFFICER

WHAT REALITY SHOULD BE

Garbage in = Garbage out

NJ First Time Home Buyer Tax Prefund Program

NJ First Time Home Buyer Tax Prefund Program

NJ HMFA Smart Start Lender - First Time Home Buyer Programs

NJ HMFA Smart Start Lender - First Time Home Buyer Programs

Call, text, or write for more information or to be pre-approved for these programs.

Understanding and Using All of Your First Time Home Buyer Options

With all the excitement of the first time home buyer tax credit, buyers often get confused and miss out on other important options.

Tax Credit

Seller Credit (Seller Concessions)

Grants for First Time Home Buyers

Down Payment Assistance

How to Utilize More Than One First-Time Home Buyer Option

Steve Kappre is a Mortgage Planner with Treasury Mortgage. Steve specializes in;

• All areas concerning First-Time Home Buyer Mortgages, grants, down payment assistance, police and fire loans, rehab loans, and more.

• Reverse Mortgages

• Equity Management strategies for high-end homes and high net worth individuals.

Contact Steve Kappre directly at 856-419-3561 or at www.stevekappre.com Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003 Licensed by the NJ Department of Banking and Insurance

Making Your First Time Home Buying Experience Successful

Making Your First Time Home Buying Experience Successful

BUYERS TAKE NOTE:

Why do I say that Realtors and lenders don't know about these options??

Still Closing Mortgage Loans in New Jersey below 620 Credit Scores

Still Closing Mortgage Loans in New Jersey below 620 Credit Scores

How to Be a LOSER When Buying a Home: Pick the Wrong People to Work With

Think You Can Pick ANY Lender or Agent to Work With?

TOO LITTLE ... TOO LATE

BZZZZZ - - - NOPE - - - NADA - - - Wrongo

Who's wrong here ... the lender, the loan officer, the Realtor?

Think You Can Pick ANY Lender or Agent to Work With?

Well of course you can!!

Contact Steve Kappre directly at 856-419-3561 or at www.stevekappre.com

Treasury Mortgage - 550 Bridgeton Pike, Mantua, NJ 08051 - 1810 Springdale Road, Cherry Hill, NJ 08003

Licensed by the NJ Department of Banking and Insurance