Increase in Maximum Conforming Loan Limits

HomeInspection

Increase in Maximum Conforming Loan Limits

The FHFA recently raised the conforming loan limit from $417,000 to $424,100, marking the first increase since the year 2006. Since the baseline is increasing, the ceiling will also be increasing from $625,500 to $636,150. The raise in loan limits will apply to loans that are backed by Fannie Mae or Freddie Mac for one unit properties.

“The Housing and Economic Recovery Act of 2008 (HERA) established the baseline loan limit of $417,000 and requires this limit to be adjusted each year to reflect the changes in the national average home price,” read a statement from FHFA. This news is a good indication for the housing industry and it is a recognition of higher home prices that have returned to 2007 pre-decline levels.

Best of all, this raise in the loan limit will benefit consumers, as many will now be able to afford homes in higher priced areas of the country since they will have a better chance of qualifying for a Conventional loan. As a result, home buying for lower income families and first-time home buyers could become easier as the new limit changes will help lenders better address high costs and financial hurdles that might be standing in the way of those currently seeking home ownership.

This change will take effect on January 1st, 2017.

QUESTIONS TO ASK YOUR LOAN OFFICER

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It’s easy to get nervous about something as big as applying for a mortgage. What is not so easy is putting our minds at ease if you’re in the middle of the process and things aren’t going the way you had thought they would. Here is a list of questions you can ask your loan officer before you begin the process to help you prepare for what’s ahead.

1. What are the steps and process for getting a loan approval?

To avoid any delays or surprises, be sure your loan officer takes the time to clearly explain the process and the steps from application to closing.

2. Interview your loan officer.

Be sure he or she is someone you trust and feel comfortable working with.  Ask about their experience with your loan type. Be sure you explore all the loan programs with your loan officer to determine that you are selecting the best choice for you.

3. What are the total fees / costs associated with the loan?

Borrowers pay fees at closing for services provided by the lender and other parties, such as title companies. Be sure you have a full understanding and a breakdown of all costs you will incur from application to closing. You should also be made aware of any out-of-pocket expenses you will have associated with the loan (i.e. appraisal fees, homeowners insurance, etc.)

  • Lenders may also charge discount or origination points. One point is equal to 1 percent of the loan amount. (i.e. on a $150,000 mortgage, one point would be a fee of $1,500 added to your closing costs.) Discount points reduce the interest rate or are used to buy the rate down. They are prepaid interest and are typically tax-deductible. Origination points are fees charged by the lender to cover the costs of originating the loan. Ask your loan officer if this will apply to you.

4. When can I lock the interest rate?

Interest rates can and do fluctuate. To prevent risking a higher rate, you can lock in your rate based on the market the day of locking. Locks are based on a set time frame, typically 30, 45, or 60 days.  Shorter term locks typically offer the best pricing.  Because the rates can change daily based on market, it is always your decision when to lock in your rate. Ask your loan officer about how you can lock in the best rate.

5. Is there a prepayment penalty on this loan?

Be sure you ask up front if your loan has a prepayment penalty.  Some lenders charge a penalty if you prepay on the mortgage. Some apply only when you refinance or reduce the principal balance by more than a certain percentage.

6. What is the minimum down payment required for this loan?

Be sure to explore your options regarding down payment.  The bigger down payment might mean a lower interest rate and better loan terms. With a down payment of less than 20 percent, you will likely have mortgage insurance (PMI) that will either increase your monthly payment or your rate.  By exploring your options you may also find that there is a program that will allow you to not have to make a down payment and keep those funds for reserves.

7. What documents will I have to provide?

Your loan officer should be able to provide you a list of required documents.  Understand the documents requested are required per federal lending guidelines and the sooner you provide those documents to your loan officer, the better they will be able to direct you.  Most Lenders require proof of income and assets, including bank statements, tax returns, W-2 statements and recent pay stubs.  More may be required based on your individual situation.

8. How long will it take to process my loan application?

There are a lot of moving parts to getting a mortgage from application to closing.  The time frame can vary based on the type of loan program and all the parties involved responding to requests in a timely manner.  Purchase offers are typically written with closing dates anywhere from 30 to 60 days from accepted offer date.  As soon as you have an accepted offer, be sure you are notifying your loan officer right away to keep things rolling.  Your loan officer should be able to provide you an estimated time line along with frequent updates on status so you know you are on track for closing on time.

9. What can I do to ensure a timely closing?

Keeping your loan officer informed that you are writing an offer and provide updates until the offer is accepted.  Responding to your loan officer in a timely fashion is important. Asking what else you can do to keep the process moving along can help things go more smoothly.

10. What might delay approval of my loan?

Be sure you are up front with you loan officer, one of the things that can slow the process is when information is uncovered that was not known at the time of application.  If a job changes, a decrease in salary, a new debt, a change in your credit history, or a change in marital status happens during the loan process, it is imperative that you communicate this with your loan officer as early in the process as possible so they can assist you in avoiding any delays.  The best way to avoid that is to put your financial life in a holding pattern until you reach the closing table.

Remember, you and your loan officer are on the same team, working together to get you into your new home as quickly and smoothly as possible.

Happy Thanksgiving!

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Happy Thanksgiving!

How much do you know about Thanksgiving? It may have all started with a 3-day festival of hunting and feasting in celebration of the pilgrims first successful harvest almost 400 years ago, but we bet there are a few things you didn’t know. Here are some fun facts on Thanksgiving:

  • The very first Thanksgiving menu included venison – not turkey, pumpkin pie, or mashed potatoes!
  • Abraham Lincoln proclaimed Thanksgiving an official holiday in 1863 during the Civil War – hundreds of years after the Pilgrims first feasted with the Wampanoag Indians.
  • In 1989, George Bush began the tradition of pardoning one turkey each year.
  • On average, about 280 million turkeys are sold for Thanksgiving feasts. Californians consume more turkey than any other state.
  • On average 50 million pumpkin pies are eaten during Thanksgiving.
  • Turkeys can’t see very well in the dark.
  • Benjamin Franklin wanted the turkey to be the national bird of the United States.

From all of us at Inlanta Mortgage, we hope you have a wonderful Thanksgiving holiday!

Fact Sources: History.com, WHSV

WINTER HOME MAINTENANCE TIPS

Have you recently purchased your first home? If so, you might be wondering what you could do to prepare your new home for the upcoming cold. Here are a few winter home maintenance tips to help you care for your new home.

Six Winter Home Maintenance Tips

  1. Caulk Windows – Seal openings with caulk to prevent water from getting in. Water seeping through small openings can freeze and cause cracks and mold build up.
  2. Check Heating System – Ask a licensed heating system contactor to inspect your furnace, wood stove or fireplace.
  3. Check Your Roof – Look for missing or loose roofing shingles. Roofs are the first line of defense in protecting your home. It’s much better to fix a few loose or missing shingles then to discover a leaking roof during a blizzard.
  4. Seal Your Driveway – Clean and fix any damage to your asphalt driveway – then seal with a commercial sealer. Sealing your driveway will extend the life of your asphalt.
  5. Clean Your Gutters – Jammed gutters can cause ice dams. After all the leaves have fallen, make sure you clean out your gutters and downspouts to prevent damaging ice dams. While you are at it, tighten brackets and inspect joints for existing damage.
  6. Clean Yard Equipment – Prepare your yard machines for winter by draining fuel from all gas operated machines. This is also an opportune time to check the quality of your snow equipment before the first snow fall.

While this list of winter home maintenance tips is by no means exhaustive – new home owners would be wise to follow them. For homebuyers with homes in need of repairs or renovations – Inlanta Mortgage offers two loan programs that allow borrowers to refinance a home and any necessary repairs or renovations (restrictions apply).

Should You Opt Out of Credit Offers?

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Where Do Pre-Approved Credit Card Offers Come From?

Consumer credit reporting companies, like Experian, Equifax and TransUnion, allow companies to pull lists of individuals meeting specific credit criteria to send pre-approved or pre-screened offers of credit or insurance (referred to as “Firm Offers”).

Benefits of Receiving Firm Offers (Pre-Approved Credit Offers)

According to the official Consumer Credit Reporting Industry website that processes requests from consumers to Opt-In or Opt-Out of firm offers of credit or insurance, there are benefits to allowing firm offers:

  • Consumers are provided with product choices
  • Consumers learn about and have an opportunity to take advantage of offers that may not be available to the general public
  • Firm offers help consumers to “comparison shop”, which may increase a consumer’s buying power.

In fact, there is an entire PDF focusing on the benefits of continuing to allow unsolicited credit offers. Click here to view the PDF.

Put an End to Unsolicited Credit Offers

If you feel the benefits of receiving pre-approved credit or insurance offers do not outweigh the risks – you are not alone. Many people feel that it’s far too easy for identity thieves to steal your mail or your garbage and use a pre-screened credit card offer to obtain credit in your name. Visit optoutpresecreen.com to opt out from receiving firm offers. You can always choose to opt-in again at a later time.

What are Trigger Leads?

Want another reason to opt-out? If you are in the process of buying or refinancing a home, once your credit has been pulled for a mortgage application (as required), the credit agencies actually sell this information to “trigger lead” companies. They sell the fact that you are contemplating a home purchase or refinance. This has nothing to do with the mortgage company you are applying with. Once your information is sold, you can find your phone ringing regularly even if you’re on the “Do Not Call” list. Worse still, the companies that resort to purchasing these trigger leads have been known to misrepresent themselves or engage in bait and switch tactics. Use of trigger leads is not permitted at Inlanta Mortgage.

Trigger leads get re-sold many times over. Some of the less savory characters that purchase trigger leads might contact you under the guise of being your lender and try to extract important personal information. For safety’s sake, NEVER provide your social security number or mother’s maiden name over the phone. Want to do more? Tell your Congressional representatives at (202) 224-3121 to stop the credit agencies from selling your information.

Assure Your Security and Peace of Mind

Fraud and identity theft are not things you want to face at any time. Identify theft can take a long time to resolve. Opting out of pre-approved offers is free and only takes a couple of minutes. That’s far less than the time you could spend shredding unwanted mail, dealing with unwanted calls, or trying to come back from identity theft.

Go to www.optoutprescreen.com to opt out today.

If you believe you may have already been targeted or defrauded, contact the Federal Trade Commission at 1 (877) 382-4357.

Choose a Mortgage Company You Can Trust

Not every mortgage company relies on shady tactics to earn business. Inlanta Mortgage relies on relationships and referrals. The majority of our customers are referred to us from Realtors or past customers.

Renting Vs. Owning

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Renting vs. Owning is one of the greatest debates consumers face. What are the pros and cons of each? Which option is cheaper? What is better for my current lifestyle? These are some of the questions renters face when trying to decide whether home-ownership is the right choice for them.

Contrary to popular belief, renting may not actually be cheaper than owning your own home. Rent prices are on the rise and starting to exceed the cost of a mortgage payment, and there are many other benefits to home-ownership that you may not have thought of, such as investment opportunity, tax deduction, stability, and freedom.

Investment Opportunity

Some people say investing in a home is risky; but with no risk, there is no reward. Studies conducted by the Federal Reserve have shown that owning can provide a net worth that is from several to hundreds of times higher than that of renters. When you own, improving your home increases its value. When you rent, improvements only increase value for your landlord. Ultimately, paying rent will only get you a roof over your head. There are virtually no benefits that paying rent offers beyond having a living space. Further, making mortgage payments on time helps build your equity and credit score.

Tax Deduction

Some people benefit from claiming deductions for mortgage interest and real estate taxes. Others find a standard deduction more valuable. Even if you exclude the tax benefit, the real cost of owning can still be less than renting.

Stability and Freedom

When you move into a home, it is something that is truly yours. You are free to decorate your environment as you please without worrying about restrictions from your landlord. By settling into a home, you will likely find yourself more involved in the community, whether that is through volunteering, participating in your home owners association, or simply establishing relationships with your neighbors. Renting is typically less stable than home-ownership and relationships with those around you tend to be avoided. Payments for a mortgage can be consistent with a fixed-rate mortgage, making the payment process easier.

So, with the cost of rent on the rise, finally taking that leap into home-ownership may be well within your means and could prove to be beneficial.

 

10 WAYS TO PROTECT YOUR HOME WHILE TRAVELING

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From booking travel arrangements to packing, a lot of preparation goes into planning a vacation/holiday visit. One thing many people overlook, though, is preparing their home for what may happen after they leave. When you go out of town, especially for an extended period of time, ensuring your home is safe from possible intruders or other incidents should be a priority. Aside from checking that all of your doors and windows are locked, there are many other precautions you can take to protect your home. Here are some tips to help keep your home safe while you’re away.

1. Give friends spare keys

Give a set of keys to a trusted friend or relative in case of an emergency. If you have any spare keys outside under a flower pot, door mat, or any other hiding spot, move them inside while you’re away.

2. Don’t advertise your vacation on social media

When you advertise your vacation on social media, your home becomes a target. You may think there is no need to worry since you are just sharing the information with friends. However, your friends are not the only ones that can see your posts on social media. Posts can reach friends of friends or even complete strangers if you do not have the proper privacy settings. These people may not be so trustworthy. Save the sharing until you are back from vacation.

3. Set lamps and radios on timers to avoid looking vacant

A home that is noticeably dark for multiple days is a clue that you and/or your family are on vacation. Give the illusion that someone is home by putting lamps and radios on programmable timers.

4. Have a friend check on your house frequently

Since you have already given someone spare keys in case of emergency, have the same friend come over to check on your home frequently while you are away. Ask them to check for signs of home or property damage or signs of a break-in. Have them care for any pets that are still in the home. Request that they bring in the mail if you do not suspend your mail service. By having someone maintain a presence at your home, it will help give the appearance that you are home.

5. Turn down the heat or turn up the air

Setting your thermostat at a lower temperature during the winter, or a higher temperature during the summer can significantly reduce your heating and cooling costs while you are away. You can even use this trick while you are at work every day to save money on your monthly energy bill!

6. Advertise home security with signs

If you have a security system, post signs outside to signify your home is protected. Burglars are less likely to approach a home if they know there is a risk of setting off an alarm.

7. Stow valuables in a safe place

Hide valuable items in a safe place. Be cautious about using a small safe; it could be a target if it is small enough for the thief to walk off with. Consider getting a safe deposit box at your bank to store your valuables.

8. Unplug and switch off electronics

Reduce the chances of an electrical fire by turning off and unplugging non-essential electronics. Many electronics will still use energy even if they are turned off. Therefore, you will also save money on energy costs by unplugging your electronics.

9. Cover garage windows

If you have windows in your garage, invest in some curtains to cover them. If someone can clearly see there is a missing car or two from the garage, it could increase the chances of a break-in.

10. Park an extra car in your driveway

Parking an extra car in your driveway lets people know that someone is home. Whether they think it is just a visitor or the resident’s car, if there is one parked out in the driveway, it can be a red flag for a burglar.

You should spend your vacation/holiday relaxing and enjoying time with your family, not stressing out about your home security. Give yourself peace of mind while you’re away by taking these precautions before you leave.