Your Questions About Mortgage

Richard asks…

What is the difference between Mortgage Modification and Refinance?

Also, if a wanted to do a Mortgage Modification should I do it directly with the bank I have the mortgage with or should I seek help from a lawyer or those institutions that do mortgage modifications?

admin answers:

Modification simply modifies your existing mortgage while a Refinance initiates an entirely new mortgage with new terms. You should always do the easiest thing first which is to consult the lender you have the original loan with and ask about modification. They have a financial interest to work with you, if they choose, but no legal obligation to do so.

Michael asks…

How do I become a mortgage broker in ohio?

I know the mortgage industry is in a mess right now, but I am looking toward the future when we rebound. Wondering what requirments there are to become a mortgage broker in Ohio. I am looking to work this industry on the side, as I already have a full time sales job. Also what are the typical commisions paid to brokers for sub-prime, prime, and jumbo mortgage loans…is this split with the company you work for? I already work 100% commission, so that is not a problem. Any input on this career is greatly appreciated, ie the ups and downs.

admin answers:

Here’s a link to the application required by the state. It included a list of requirements to be eligable. Http://www.com.state.oh.us/dfi/documents/mainofficemortgagebrokerapppacket_000.pdf

I would start by getting some of the required education. You may want to also work for a company before typing to open your own brokerage. Even if you only work in a related field it will be very helpful later on. Such as as a real estate assistant to a successful real estate agent.

Robert asks…

What is the difference between mortgage tax and property tax?

mortgage tax is the same as property tax but mortgage tax is pay to the bank because you borrow the mortgage loan?

admin answers:

There is mortgage interest not mortgage tax. That is paid to the loan company. Property tax is paid to the county.

William asks…

How can I become a mortgage broker in california?

I simply cannot seem to find legitimate information on becoming a mortgage broker in California. Many of the web sites that purport to have information really share very little of anything and some are just plain frauds. I’d like to find information on mortgage broker training and possibly information on finding a school (preferably Los Angeles) where I can get training on becoming a mortgage broker.

admin answers:

What are you thinking BRO that is a bad job especially this time of the year. You only get two applicants a week. No houses selling.

Susan asks…

Mortgage Finance Experts: How will the market affect homeowners who will be refinancing next year?

My parents bought their home 4 years ago at a 4% rate, which is due to change next year when their loan rate. With the market crunch and the new strict lending that’s bound to occur as a result of this, they are worried about what refinancing has in store for them. The good news is that they have flawless credit (they successfully removed their PMI, and they are early every month on their mortgage payments —and they pay an extra couple of hundred dollars than they should. Not to mention their credit card debt is very low (only a couple of thousand dollars). They’ve both been at their great paying jobs for over a decade; but they are still worried about whether they will be able to secure a decent fixed rate when their mandatory refinance is up. Any hope?

admin answers:

The biggest impact on our market is the following:

1. – There is no longer any subprime lending
2. – Jumbo loan rates have been rising disproportionate to the rest of the market
3. – The ALT-A market has all but vanished
4. – FHA Loans have become increasingly attractive.
5. – Fannie Mae loans have for the most part remained unaffected.

While I certainly cannot predict what the market will be like a year from now (if I could I wouldn’t be writing loans and training loan officers for a living) I don’t see subprime on the radar for quite some time. Everything else will come around and normalize.

Here’s a point that everyone seems to be missing. For the most part this is a market problem – Given time the market will correct the problem. Not the Senate.

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Your Questions About Reverse Mortgage Lenders

Nancy asks…

Regarding Reverse Mortgage, what is the pros and cons of HECM lenders vs. non-HECM lenders?

I have done a lot of research regarding reverse mortgage and I understand that this is much like “Payday Advance”. The overall interest including all the fees, etc. are substantial however, it is an opportunity to have the money now. I’ve own my house for close to 35 years now all paid up. It’s a comfortable place situated in a comfortable neighborhood. I don’t want to leave it and go to Belize where I can live on my social security alone. It’s the comfort that I don’t want to lose. If and when I’m incapacitated then I’ll land up in an old age home of sorts. My children are fairly well off and the inheritance left from the house may just cause trouble among them. So by augmenting my income now from this mortgage, I hope to gain a bit more quality and comfort of life. I fully understand the position many contributors endorsed. The math stinks overall. But I wish to enjoy life now. When I croak either way I become the loser. But thanks for the inout.

admin answers:

Money Magazine had a report on reverse mortgages.
They considered them one of the worst financial mistakes a person can make in a lifetime.

They suggested to sell your home.
Take the cash equity and buy a much smaller home or rent.

Are you sure you really want a reverse mortgage.
They are big money makers for the brokers – they can be very pushy
Keep your head on straight with them.

At age 80 – are you really going to want to be taking care of a home?
Cutting the grass, making repairs, fixing faucets.
Get a condo – and let someone else do all the work.
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Charles asks…

Reverse Annuity Mortgage?

What are the risk factors associated with Reverse Annuity Mortgages from lenders‘ and borrowers’ point of view? Explain how they would affect lenders and borrowers

admin answers:

Every reverse mortgage I have seen has been an FHA program for older people and they normally choose to get all the money in one chunk. They are set up so that the owner never has to make a payment as long as they live in the house- but if they go to a retirement home they will need to sell the house and (because of the interest build up and maybe the weak real estate market) the seller might owe more than the house is worth. Again this FHA program is pretty good because it is a non recourse loan so that all the lender can do is take the house – they can’t file against you personally.

Robert asks…

How does a lender benefit from reverse mortgage?

Looks like, what I read tells me, the lender pays the homeowner roughly up to 65% of the home’s value, or up to $625,000

What is the benefit for the lender to put up such cash? Do they collect the house when the borrower dies? Or at any point? What must a borrow “violate” or “do wrong” for the lender to “win” (in comparison to traditional mortgages, where a person stops making payments and the lender collects his house).

What does reverse mortgage mean to a person’s heirs? Can they inherit the house? Or can the lump sum be inherited (and if they do, does the house go to the lender?)?
So is a typical reverse mortgage something like this?

a) Old Joe has a house worth $200,000
b) reverse mortgage lender offers him $130,000
c) when he dies, his heirs either allow the lender to have the house or pay back the $130,000 which their father took.
d) I’m not sure where the “interest” comes in? What does the borrow have to pay? Does he start making payments back to the lender the first month he gets his lump sum of $130,000 ?

admin answers:

My peer is correct. YOU seem befuddled about reverse
mortgages. They are not much different from regular ones.
Money is lent, collateral is put up and the lender earns
interest.

IN this case, during the history of the loan, the borrower
gets money. EVERY month. AT the conclusion of the
history of the loan–when the mortgage payments are due
to cease, the home owner [whomever that is at the time]
re-finances the home or sells it to pay off the lender.

A reverse mortgage can be from near nothing [4%] of the valule of the home
to 100%, it is all negotiable.

Ruth asks…

Who are the lenders for a “Program 69 Mortgage”? What states is this “Loan Program 69” availiable in the US.?

Better than a reverse mortgage it is specifically for seniors over age 69.

admin answers:

Dear ,

I was also searching for same thing couple of days ago and found this one  
http://yourloans.noads.biz

Regards,

Jenny asks…

Why don’t people realize that a reverse mortgage is a scam?

Sadly, large companies with big PR departments get away with expensive ads on television about the greatness of reverse mortgages and what they can do for you. The truth is all it will do for you is give you dribbles of money on your own equity while a lender has your money and just pays taxes. If you have paid off your house you can simply sell it and get all that money in hand. Don’t be scammed!
For those who are wondering about my credentials. I’m a successful real estate investor and I am well read on the processes involved. I simply want people to be aware of this. I expect a mortgage lender to say that this is a good thing. You are the people who are the scam artists.

admin answers:

And I suppose your better idea would be for the old people of america to just quit claim their homes to you instead and expect you to take care of them.

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