The Mortgage Advantage http://themortgageadvantage.com Truth in Lending Promotes Trust in Lending Fri, 11 May 2012 22:54:45 +0000 en hourly 1 http://wordpress.org/?v=3.0.4 Is Jamie Dimon A Mother? http://themortgageadvantage.com/is-jamie-dimon-a-mother/ http://themortgageadvantage.com/is-jamie-dimon-a-mother/#comments Fri, 11 May 2012 20:43:14 +0000 dgerdes http://themortgageadvantage.com/?p=1000 Is Jamie Dimon a Mother?

Today Jamie Dimon, the CEO of Chase announced his bank lost almost two billion dollars due to credit default swaps, or Legal Gambling with Our Money.  Dang!  How does a bank lose two billion dollars in six weeks?  And if Chase has that kind of money to play with why, not use the funds to help homeowners who would like to keep their homes, instead of betting at the International Credit Default Swap Casino?  His response: “I’m bad!”  But the quote read “It was stupid” and he used “bad strategy.”
These weapons of mass economic destruction were invented by quants or physicists employed by Chase in the early 2000’s after the repeal of the Glass-Steagal Act in 1999.   Less than ten years after its repeal, these economic weapons led the global economic meltdown, spiraling our country into a different kind of recession.  By the way, Glass-Steagal was passed in 1933, during the great depression, outlawing banks to gamble with depositor’s money.
Gretchen Morgenson wrote in the NY Times on April 1st that financial weapons should have approval from an agency, much like the FDA before allowing new concepts to roll over the free markets.  (Footnote: Free to the big banks, not you and me)  These sophisticated, tangled derivates are not mother’s little helper, nor will they cure ED.  But they have caused long term damage to countries’ economies (Greece) and the lives of over four million American foreclosed borrowers and over 30 million underwater homeowners.   The effects are far reaching: from bankruptcies filed with long time established companies and cities, to the unemployment rate.
With Mother’s Day this weekend (I know, Jamie Dimon and the word mother in the same article, although I doubt if it is a first), we should take the time to think about our great country.
Have our leaders contracted dementia so severe that would allow history to repeat itself only four short years from the last near global catastrophe?   Why do we continue to enable Wall Street’s immediate cash-fix addiction?
Maybe Sheriff Joe should consider a career change of enforcing the banks and Wall Street to play nice.   They could all wear pink underwear and live together in a tent.  And give them monopoly money to play with, not ours.
]]> http://themortgageadvantage.com/is-jamie-dimon-a-mother/feed/ 0 HARP 2.0 What We’ve Learned So Far http://themortgageadvantage.com/harp-2-0-what-weve-learned-so-far/ http://themortgageadvantage.com/harp-2-0-what-weve-learned-so-far/#comments Fri, 27 Apr 2012 17:22:10 +0000 dgerdes http://themortgageadvantage.com/?p=984
Hardly Anyone can Refinance Program or Harp 2.0
We are closing HARP 2.0 loans.  The following is what we have learned so far:
• Please contact Sherlock Holmes, it is a mystery why some borrowers are approved and others are not.
• Interest rates may not be equal for borrowers with higher loan-to values, or self-employed,
commissioned or if the homeowner has mortgage insurance.
• Freddie Mac’s home valuation process implanted in the system is at least six months behind our
increasing values.  As of April 28th, Fannie will “enhance” (their words, not mine) their system to include
their own valuation
• Closing costs are not equal. No upfront fees or out of pocket costs DOES NOT mean there are no
closing costs.  Beware of large Banks and their verbiage.
• Freddie Mac requires some serious meds to get his automated system in working order.  He turns down
more loans than it approves.  And Fannie Mae needs some extra strength Midol for her bi-polar decisions.
Virtually all lenders depend on the automated underwriting systems (AUS) They are truly artificial in their
intelligence in determining approvals.     AUS approvals are the guarantees from Fannie and Freddie
validating they will take the loans.    The fun we are having securing approvals!  Why is the AUS asking
for reserves?  Why is it not taking the value?  Fannie or Freddie may only issue an approval if the term is
20 or 25 years.  Goodbye lower payment.  Great credit score?  Hold on mister, is that a new credit card in
your pocket?  Fannie may pull your approval.
Debra W. Still, Chairman-Elect of the Mortgage Bankers Association (MBA), testified before the Senate
Banking Subcommittee on Housing, Transportation, and Community Development.  In her statement she addressed
the new “Responsible Homeowner Refinancing Act of 2012” currently under advisement.  The new bill addresses
and simplifies Fannie Mae and Freddie Mac’s borrower eligibility requirements.  Right now each bank issues
their own interpretation of HARP 2.0.  She also supports the bill’s provision to prohibiting pricing
differences based on loan to value ratios, borrower income or employment status. Also, to allow all lenders
to participate on all HARP loans, not just the current servicers.
Question: How many government legislations will it take to enforce the banks to play fair with the
underwater homeowners who would like to keep their homes?
FYI:  If your loan originated with MetLife or Taylor, Bean & Whitaker or any lender no longer in business,
your options may be limited.
]]> http://themortgageadvantage.com/harp-2-0-what-weve-learned-so-far/feed/ 0 Is The US Economy Wicked http://themortgageadvantage.com/is-the-us-economy-wicked/ http://themortgageadvantage.com/is-the-us-economy-wicked/#comments Fri, 16 Mar 2012 18:45:36 +0000 dgerdes http://themortgageadvantage.com/?p=965

Wicked, the musical sings and dances through a story of a supposedly green evil witch who is killed after a house falls on her during a terrible storm.  Some may consider it a parable to the U.S. economy.
For the past 4.5 years (has it really been that long?) we have struggled with our banks not having cash, (TARP: Feds spending tax payer’s money to save the banks!), foreclosures (it’s the mother of all depressions!) unemployment, (Yikes!) China, (shaking their booties in our faces with their elitist economic prowess!).   But wait.   2012 is bringing glimmers of change.
The housing market in Phoenix is experiencing multiple bids on homes below $300,000 and half are cash offers. (Although the appraisals for lending have not received the memo.)  Arizona computer chip and aero space industries are hiring.  Trucks with construction workers have reappeared on our highways. The banks displayed strength with all but three of the top 19 getting a thumbs up from the Fed.
Corporations stashed cash over the past few years and are disclosing healthy profits…. and Wall Street is loving it. Apple saved over 84 billion dollars in cash and allegedly stockpiled more money than the U. S. Government. The bond market is recovering which means yields are going up (and so will interest rates, say goodbye to 3.5%) Consumers shed their debt (short sale, anyone?) and maybe we have learned to save a few pennies.
What could prevent us from finally getting our pot of gold at the end of the rainbow? Oil prices? Food? Housing? Idiotic government policy? And how long can we pretend the government deficit has too many zeros to type?
China must be turning green from all of the talk of housing bubbles and the slowdown of their economy.   We would really like to sing ding-dong the Asian witch is ailing, but too much of a Chinese downfall could hurt our still fragile economy.
The yellow brick road has always been fraught with flying monkeys.  And being green yesterday may not have been such a bad thing.  The boxed wine today does not taste nearly as bad as buying a bottle yesterday that I couldn’t afford.

Wicked, the musical sings and dances through a story of a supposedly green evil witch who is killed after a house falls on her during a terrible storm.  Some may consider it a parable to the U.S. economy.For the past 4.5 years (has it really been that long?) we have struggled with our banks not having cash, (TARP: Feds spending tax payer’s money to save the banks!), foreclosures (it’s the mother of all depressions!) unemployment, (Yikes!) China, (shaking their booties in our faces with their elitist economic prowess!).   But wait.   2012 is bringing glimmers of change.The housing market in Phoenix is experiencing multiple bids on homes below $300,000 and half are cash offers. (Although the appraisals for lending have not received the memo.)  Arizona computer chip and aero space industries are hiring.  Trucks with construction workers have reappeared on our highways. The banks displayed strength with all but three of the top 19 getting a thumbs up from the Fed.Corporations stashed cash over the past few years and are disclosing healthy profits…. and Wall Street is loving it. Apple saved over 84 billion dollars in cash and allegedly stockpiled more money than the U. S. Government. The bond market is recovering which means yields are going up (and so will interest rates, say goodbye to 3.5%) Consumers shed their debt (short sale, anyone?) and maybe we have learned to save a few pennies. What could prevent us from finally getting our pot of gold at the end of the rainbow? Oil prices? Food? Housing? Idiotic government policy? And how long can we pretend the government deficit has too many zeros to type?China must be turning green from all of the talk of housing bubbles and the slowdown of their economy.   We would really like to sing ding-dong the Asian witch is ailing, but too much of a Chinese downfall could hurt our still fragile economy.The yellow brick road has always been fraught with flying monkeys.  And being green yesterday may not have been such a bad thing.  The boxed wine today does not taste nearly as bad as buying a bottle yesterday that I couldn’t afford.

]]> http://themortgageadvantage.com/is-the-us-economy-wicked/feed/ 0 HARP 2.0 http://themortgageadvantage.com/harp-2-0-2/ http://themortgageadvantage.com/harp-2-0-2/#comments Fri, 09 Mar 2012 18:00:19 +0000 dgerdes http://themortgageadvantage.com/?p=951
HARP 2.0 PROGRAM HIGHLIGHTS:
(As of March 8, 2012)
• Fannie Mae or Freddie Mac must be the investors on the loan
• The loan must have been purchased by Fannie or Freddie by June 1, 2009
• No mortgage lates in the past six months but one in the previous twelve months is okay.
• Underwater? No problem? No appraisal required (at least that is what we have been told)
• Second’s okay (although they cannot be rolled into the loan) There is no “combined loan to value” cap
• Lower your payment by refinancing into today’s interest rates
• Limited Documentation
• Closing Costs can be included into the loan
]]> http://themortgageadvantage.com/harp-2-0-2/feed/ 0 New Refi Programs http://themortgageadvantage.com/new-refi-programs/ http://themortgageadvantage.com/new-refi-programs/#comments Thu, 09 Feb 2012 17:53:11 +0000 dgerdes http://themortgageadvantage.com/?p=860
Arizona homeowners are anxious to refinance their underwater mortgages utilizing the HARP 2.0 program, with no appraisal and limited income verification.  Across the U.S., eleven million borrowers who have Fannie Mae or Freddie Mac guaranteed loans could be eligible for refinancing.  A few of the big boy banks will roll out
modified versions in the next couple of weeks and others are already taking applications.   The long delay
(remember President Obama announced this program in October) is due to the automated underwriting systems (AUS) upgrades.  Without an AUS approval, there is no guarantee Fannie Mae or Freddie Mac will purchase the HARP 2 loans.  The automated underwriting switch will be turned on sometime in March.    The highlights of the program are the following:
• The current loan is owned or guaranteed by Fannie Mae or Freddie Mac
• It was sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
• The loan’s current loan-to-value (LTV) is greater than 80%
• No mortgage lates in the previous six months and only one mortgage late in the past twelve months.
President Obama announced yet another refinance program on Wednesday to assist non-agency mortgages NOT guaranteed by Fannie Mae, Freddie Mac, FHA or VA.  Half of all US mortgages, approximately 30 million home loans, are owned by nongovernment lenders. This plan would utilize FHA for the refinances and will require Congressional approval. According to the President, the lenders will take a haircut for borrowers who owe more than 140% of current value.  Also, Uncle Sam is NOT paying for this new unnamed plan. Instead, a fee
will be imposed on the banks.  A couple of key points were disregarded during his speech:   The gut-wrenching monthly mortgage insurance premium currently charged on FHA loans and FHA’s default rate that is eroding their reserves.  There was no mention of the rapidly declining Jumbo market, once again ignored.
The Harp 2.0 program will no doubt help Arizona homeowners who wish to keep their underwater homes and allow them to take advantage of today’s interest rates on their current loan balances.   The other plan announced Wednesday, if Congress approves it, will mandate principal reduction but slap a hefty monthly mortgage insurance premium.   Will either assist in the recovery of the Arizona economy and our housing market?  It may be years before we know the answer.
]]> http://themortgageadvantage.com/new-refi-programs/feed/ 0 We’ve Moved http://themortgageadvantage.com/weve-moved/ http://themortgageadvantage.com/weve-moved/#comments Mon, 06 Feb 2012 23:10:09 +0000 emcallister http://themortgageadvantage.com/?p=869

You’re Invited!


To Our,

“We can’t believe we moved

after 17 years celebration!”

Stop by and enjoy food, drink

and tour our new home

Monday February 13th

1:00pm through 4:00pm

Open House


9180 S Kyrene Rd,

Suite 101

Tempe, AZ 85284


Our NEW Office is located in the Kyrene Corporate Center

Directions from I-10: Take Warner Road exit and head East. Turn south on Kyrene Road. Building entrance is the 2nd driveway after La Vieve Road and make a right.

Directions from Loop 202: Take Kyrene Road exit and head North past Ray Road. Building entrance is the first driveway after Knox Road and make a left.

Directions from Loop 101: Take Warner Road exit and head West. Turn south on Kyrene Road. Building entrance is the 2nd driveway after La Vieve Road and make a right.

]]> http://themortgageadvantage.com/weve-moved/feed/ 0 Short Sales & Your Credit http://themortgageadvantage.com/short-sales-your-credit/ http://themortgageadvantage.com/short-sales-your-credit/#comments Mon, 23 Jan 2012 23:39:31 +0000 emcallister http://themortgageadvantage.com/?p=808
What to do if you are buying a home After a Short Sale or Foreclosure

Why a good credit score is not enough

Disputing a creditor could harm your chances of acquiring a home loan

Learn how to improve your credit and your purchasing power

Please join us for a Credit Seminar on
Thursday January 26th, 2012
9:00 am – 11:00 am

Presented by Chuck Fenton, Credit Liaison for
Equifax, Experian, and Transunion

The Mortgage Advantage, Inc.
9180 S. Kyrene Road Suite 101
Tempe, AZ 85284
West side of Kyrene between Warner & Ray
Please call 480-831-1588 to R.S.V.P.
]]> http://themortgageadvantage.com/short-sales-your-credit/feed/ 0 What I’ve Learned So Far In 2012 http://themortgageadvantage.com/what-ive-learned-so-far-in-2012/ http://themortgageadvantage.com/what-ive-learned-so-far-in-2012/#comments Fri, 20 Jan 2012 21:20:35 +0000 dgerdes http://themortgageadvantage.com/?p=825

What I’ve Learned So Far In 2012 (and it’s only January)

1. The new mortgage tax added to today’s interest rates, implemented by Congress to help pay for the payroll tax extension, will aid the housing market. If that is what they are telling us it must be true.

2. The sinking cruise liner in Italy is a parable to the European markets. Much of the crew,

including the Captain jumped ship (oops, I meant tripped) before the passengers. So much for women and children first or paying customers.

3. These candidates are the best the Republicans have to offer? Really?

4. Do not drive under the influence of cold medicine in Arizona. If stopped you could get a DUI (driving under the influence). That Nyquil on the seat beside me? It’s not mine, man.

5. The “first-time” home buyer tax credit from 2009/2010 may be contributing to the FHA defaults. The borrowers received cash from Uncle Sam, but when the money ran out and their homes continued to slide underwater, they began to bail. No skin in the game. No wonder I still drink boxed wine.

6. Fannie/Freddie are considering selling blocks of homes to investors (including buyers from Canada, China, Australia, Mexico), therefore the new foreign landlords can rent them back to Americans. What happened to revitalizing neighborhoods with the American Dream of Home Ownership?

7. Canada is not in a housing bubble although their housing prices continue to rise and the interest rates are low. If that is what they tell us, it must be true, eh.

8. Do not judge entertainment by its black and white, silent cover. “The Artist” is a good movie.

9. Moving a company is painful. A bonfire would have been easier, but it was a no-burn day. Hopefully we will not need to do it again for another 17 years.

10. HARP 2 will roll out the Fannie/Freddie refinance program with no appraisal and no income verification….if that is what they tell us it must be true.

]]> http://themortgageadvantage.com/what-ive-learned-so-far-in-2012/feed/ 0 For Sale: The U.S.A. http://themortgageadvantage.com/for-sale-the-u-s-a/ http://themortgageadvantage.com/for-sale-the-u-s-a/#comments Fri, 11 Nov 2011 17:53:56 +0000 dgerdes http://themortgageadvantage.com/?p=780
Are you a foreign drug dealer, terrorist or one of their extended family members and have pondered for years on how to buy a home in the states AND receive an American visa?  No need to plot any further!  Sens. Charles Schumer (D., N.Y.) and Mike Lee (R., Utah), proposed an awesome bill to allow foreigners to purchase homes and receive a visa.  Mr. Schumer touted it would make up for American buyers that are holding back.
Really?  American buyers are holding back?  Gee, we thought it was because of the ridiculous underwriting and appraisal criteria plus all of the restrictions held against American Citizens for previous short sales or foreclosures.  The senators must be suffering from “Economicblinditis” a condition our leaders acquired in 2007 rendering them blind to the facts of the economic crisis over the past several years.  They are unable to recognize the current housing market is a result caused by bad behavior of the banks and Wall Street, not the American Public.
According to the Wall Street Journal the proposal would dispense visas to those foreigners (if they have money, they are foreigners, if they are broke they are called aliens) who spend $500,000 in the housing market.  And they can choose to buy either all in one lump sum or they can buy two homes and use one for a rental. Warren Buffett, the sage of Nebraska thinks this is a great idea.
International buyers, from China, Australia, India, and Mexico accounted for around $82 billion in U.S. residential real-estate sales for the year ending in March, according to data from the National Association of Realtors and for 4.3% of Phoenix home sales during the month of July, according to MDA DataQuick.
Have any of our great leaders tried to buy a home in China or Mexico or any other country?  If they had, they would find it an overwhelming, if not impossible process.
Yet, true to our recently added American color (as in red, white, blue and greed), show us the money and the house is yours.  Except instead of giving away a free toaster as an added bonus, a coveted visa is thrown in to entice foreign buyers.
Just so we are all clear:  our great leaders will not mandate legislature to demand the lenders shave principal balances to meet today’s values for current home owners and allow them to refinance at current market rates (not some arbitrated, inflated rate). But will mandate a way for non-Americans to buy our homes at the discounted foreclosed/short sale prices?   And this is a good idea?  I’m just saying….
In appreciation of our Veterans:  “It is easy to take liberty for granted, when you have never had it taken from you.” Unknown
]]> http://themortgageadvantage.com/for-sale-the-u-s-a/feed/ 0 The 10 Reasons we LOVE VA http://themortgageadvantage.com/the-10-reasons-we-love-va/ http://themortgageadvantage.com/the-10-reasons-we-love-va/#comments Wed, 12 Oct 2011 18:09:32 +0000 dgerdes http://themortgageadvantage.com/?p=770

Ten Reasons We LOVE VA Loans (yes, we said VA).

There are unfounded rumors swirling around the real estate community regarding VA loans: they are difficult to underwrite, appraisals come in undervalue and the turn times are unreasonable. That is so 2007.

Originating a home loan for our Veterans is an honor, in any market. But not long ago VA loans got a bad rap and sellers were hesitant to accept VA offers.

What’s changed over the past couple of years with VA loans? Are you ready? Very little. VA loans today have a default rate of less than 4%, compared to 10% on other programs. It is the real estate/lending market that has evolved (or regressed depending on who you are talking to).

The following are the top ten reasons we love VA loans:

10. It is an honor to originate loans for our Veterans.

09. Typically, banks will allow lower credit scores, 620 is the norm.

08. Lending after a conventional or FHA foreclosure is two years. If it was a VA foreclosure, and the new home financed is over $144,001, VA may allow the veteran another VA loan (No, it doesn’t make sense). Foreclosed VA loans stay on the Veteran’s record forever. But this “bonus eligibility” has helped many Veterans to reenter the housing market and reuse their VA.

07. Ratios are not considered. VA calculates residual income. But the banks may implement their own ratios. Ratios as high as 63% have been approved.

06. VA will accept rental agreements on current homes if the buyer is moving up. Check with the lender to verify any over-lay criteria.

05. Short sales are considered a market issue, not the Veteran’s (Direct quote from their West Virginia office). But the Veteran is at the lender’s mercy. And banks’ over-lays trump VA guidelines.

04. VA may decrease their upfront funding fees, a direct reflection of the lower default rate.

03. VA is truly zero down and the seller can pay up to 4% concessions towards buyers closing costs.

02. VA Appraisals are still using their same old system. Appraisers contact agents when there is a value issue and encourage their input. Lenders can call and beg for the updates and quicker turn times.

01. It is an honor to originate a home loan for our Veterans.

It is the least we can do.

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