Denver Colorado Home Loans Academy National Mortgage

What is going on with this economy?

2008-10-02T14:36:00.000-07:00

The Chinese have a proverb: “May you live in interesting times.” And we are living through interesting times indeed.

Whatever the political posturing regarding the current rescue plan, a plan needs to be passed. Credit markets are frozen and banks are going bust every day. This is not totally because of "toxic" mortgages. This has a lot to do with FASB 157, also known as "mark to market". Each day lenders must mark their assets to the marketplace. It's like you having to appraise your home everyday and if your neighbor was under duress because they got very ill, divorced, lost their job and was forced to sell their home quickly they may have sold it super cheap. Now, does that mean your house is worth that super cheap price? Clearly not. Why? Because you are not under duress. You have the time to sell your home and get a more normal price, which more accurately reflects true market conditions. But "mark to market" does not allow for this, which creates a vicious cycle. Why is this so bad? Because as lenders mark down their assets, the amount that they have loaned previously becomes much riskier in relation to their assets. For example, say a bank has $1 million in assets and say they have $15 million in loans outstanding. Their ratio is an acceptable 15 to 1. But should they take a paper write down of $500 thousand due to "mark to market" requirements, their ratio suddenly changes to 30 to 1. This is because their assets are now only $500 thousand after taking the paper loss, while their loans outstanding are $15 million. And at 30 to 1 this bank is viewed as a risky investment. So the stock price starts to get hit, it becomes harder to borrow, and most importantly harder to make money. The bank is then forced to sell some of its loans to reduce its ratio...at cheap prices. And this makes the vicious cycle continue. And a quick look at the holdings of these loans show that 95% are problem free. Additionally, the Credit Default Swaps (CDS) that are used with the pools of mortgages are relatively safe. But this requires a bit of understanding. You see, when a pool of mortgage loans is put together, it isn't just A paper or B paper etc….it's everything. It’s got some A paper, B paper, C paper…and even what looks like toilet paper. An "A" investor buys the whole pool but because they are an "A" investor their safety is greater because they can avoid the first 20% (an example) of defaults. So they own the whole pool but are sheltered from the first batch of defaults, and for this they get the lowest rate of return. As you can figure from here the more risk investors want to take, the higher the return. So the investments are relatively safe, but the accounting rules currently place undue pressure on the banking institutions.Now add to all this, the opportunistic “shorting” done on the financial stocks, much of it illegal because those shorts did not legitimately borrow shares (called naked shorting), and you exacerbate this whole problem. Thank goodness for the recent temporary ban on shorting in the financial sector. As for the plan the government is the only one who can step in to do this. And they have to do this. And they will do this. The nauseating political posturing from both sides is just part of the process. This is not easy to understand for the general public. In fact most politicians don't get this either. That's why it is a difficult yet critical bill for them to vote on.Once this is done it will take some time but the markets will stabilize. As for the real estate and mortgage industries, it will take a bit of time but we will make it through this. Rates will remain attractive and the influx of credit availability will help the housing market gradually improve. This ultimately will be the medicine needed to improve the situation overall.

As always – please keep in touch, especially during these volatile times. I am here to help you in any way that I can.

A REVERSE MORTGAGE - IS IT RIGHT FOR YOU OR A LOVED ONE?

2008-08-18T13:25:00.000-07:00

A Reverse Mortgage is a special US government-backed loan designed to help older Americans tap the equity in their homes. Instead of making payments each month, a REVERSE MORTGAGE PAYS THE HOMEOWNER.

BENEFITS OF A REVERSE MORTGAGE:

No income needed to qualify
Credit is not an issue
Guarantees that you stay in your home for life
Money that is drawn against the equity of your home is tax free
No monthly mortgage payments
Flexibility - take the equity in a lump sum, set monthly installments, access only as needed or a combination of all three.

REQUIREMENTS TO OBTAIN A REVERSE MORTGAGE:

All persons on title to the property must be 62 years or older
Have sufficient equity to pay any liens against the property
Keep the home in good repair
At least one homeowner must live in the home.
Take a counseling class on Reverse Mortgages (usually about 1 hour)

This is a wonderful tool to help bring more livable income into the household. Use the money for medical expenses, to pay for repairs to the home, take a vacation or anything of your choice.

Denise Wing

Certified Mortgage Lender

303-987-0622

dwing@academynational.net

RENTING A HOME VERSES BUYING

2008-07-22T10:03:00.000-07:00

With home values continuing to drop in many areas of the country, it could be beneficial for you to rent as opposed to buying at this time. One formula for testing the market in an area you would like to purchase is called the rule of 15.

Research the average rent for the area by going to Zillow.com or Trulia.com and calculate the amount you would spend on rent for a year. Example: Rent at $2500 per month times twelve equal $30,000 per year.
Multiply $30,000 by 15 and you have a total of $450,000.
If comparable homes, similar to the one you will be renting, are selling for more than $450,000 it is an indication that the values have not declined in that area. It would be wise to rent for a while instead of buying while keeping an eye on the market.

If renting is not an option for you and you plan to stay in the home you purchase for 10 to 30 years, then go ahead and buy. Make sure you are well informed on the market before signing a contract.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Foreclosure Rescue Corporation Act

2008-07-15T11:39:00.000-07:00

The Bill, at this time, is in front of Congress and will help some homeowners if and when it ever gets passed. The purpose of this Bill is to provide emergency relief to homeowners currently in foreclosure, serious default, or with a reasonable expectation of imminent default. By doing this they hope to accomplish…
1. Extend relief to borrowers who are unable to refinance their loan elsewhere and also to those whose mortgage exceeds the value of their home.
2. Reduce the amount of foreclosures that has caused a downward impact on home values.
3. Encourage mortgage investors and servicers to modify the terms of existing loans to the extent that the borrower can reasonably repay the debt.
Potential borrowers, it appears, will need to qualify for the loan through verification of income, assets and credit scores. The actual criteria for qualifying was not set forth. The majority of homeowners who are either on the verge of foreclosure or in foreclosure are sub-prime borrowers, so it will be interesting to see how many people this new Bill will actually help.
The funds to finance this corporation will come from the issuing of bonds and repayment of these bonds will come from the interest earned off the mortgage loans they originate and service.
To read the full contents of this Bill go to http://thomas.loc.gov/ and search under Bill number H.R. 4135.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

URGENT: SUPPORT DOWNPAYMENT ASSISTANCE!!

2008-07-10T08:23:00.000-07:00

TAKE ACTION NOW

Downpayment Assistance Programs in Danger of Elimination!

The Department of Housing and Urban Development (HUD) has re-issued a proposed rule that would eliminate all private downpayment assistance programs.

For over10 years downpayment assistance has help thousands of families achieve their homeownership goals. Together, we can defeat HUD’s proposed rule.

Act Now! We Have One Month to Stop This Action

Speak up now! The proposed rule comment period ends on August 15, 2008. Making your voice heard is simple. Click on “Take Action Now” at the top of this page and let the Federal housing officials and your congressional representatives know how you feel about preserving private downpayment assistance as an option for today’s homebuyers.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

New changes to the FHA program

2008-07-09T10:22:00.000-07:00

Beginning on July 14, 2008 new rules for the FHA loan program will go into effect. These changes will affect many borrowers looking to refinance out of a non-FHA (Conventional or VA) to an FHA loan. These new rules will affect the rate and future refinances. In short, FHA is tightening their guidelines just like the conventional markets. Loans that were easily approved a year ago are only approvable with much more documentation or not approved at all.

1. Refinancing from any non-FHA mortgage to an FHA loan will now be required to be an FHASecure product. Previously the FHASecure product was used only for borrowers who were delinquent on their non-FHA mortgage due to the Adjustable Rate Mortgage (ARM) adjusting to a higher rate.
It now includes borrowers who are not delinquent on their mortgage, but currently have a Conventional or VA loan and want to refinance to the FHA loan product. This particular FHA loan carries a bit higher rate than a regular FHA loan.
2. Cash-out refinances are not allowed on the FHASecure program regardless of whether the borrower is delinquent or current on their mortgage payments. Previous rules allowed for non-FHA mortgage loans to be refinanced to a regular FHA and receive cash out up to 95% of property value. Now, the only way a person can get cash out with an FHA loan is if they already have an FHA loan.
3. The premium paid for the Upfront Mortgage Insurance (MIP) and monthly mortgage insurance can increase depending on the borrower’s credit history, loan-to-value and credit score. Previous rules with the monthly and up-front mortgage insurance premiums were the same across the board.
4. First time home buyer (a person that has not owned a home in the past 3 years) with low credit scores are entitled to a reduction of the up-front mortgage insurance premium by completing a HUD-approved pre-purchase counseling course.

For further details on the new expanded FHASecure program please contact Denise Wing at 303-987-0622.

Denise Wing, C.E.O
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

When Renting Doesn't Make Sense

2008-06-18T07:33:00.000-07:00

The most costly items to rent are:

Furniture. Renting a Klaussner couch, love seat and coffee table can run you as much as $45.00 per week. Rental centers also have a minimum number of weeks you are obligated to pay, depending upon the contract. If the agreement were for 78 weeks you would end up paying $3,500 for the privilege of using the furniture for 1-½ years. The same set of furniture can be purchased brand new for approximately $1600 to $1700. You end up paying twice as much and you don’t even get to keep the furniture.

Computers. If you own a business it can be cost effective to rent as opposed to buying. Upgrades can take place more often and many come with tech support.
A Dell computer rents for around $40.00 per week and the terms are usually 62 weeks. This adds up to $2480 for an item that would cost approximately $1100 to purchase outright.

Televisions. A 50-inch Toshiba TV costs approximately $35.00 a week to rent with a term of approximately 2 years (104 weeks). This calculates out to paying $3640 for an item that you can purchase new for around $1200.

There is no reason for a person to spend their hard earned money in such a wasteful manner. Search Craig’s List, used furniture stores or Goodwill for furniture and televisions. Talk with family and friends to see if they are planning to upgrade to a newer computer and ask if you can buy their old one.
If your heart is set on buying new, try setting aside $35 to $40 per week and in seven to eight months you will have enough money to buy a 50’ TV, computer or couch and loveseat.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

WHEN RENTING MAKES SENSE

2008-06-03T09:45:00.000-07:00

There are some items, if used on rare occasions, would be better to rent as opposed to purchasing. Below is a list of four items I believe you should consider renting.

Pickup trucks. Unless you work in an industry where owning a truck is imperative, buy a fuel efficient car and rent a truck on the rare occasions you really need one. This will also get you off the hook with family and friends who call on you to haul their things instead of renting a truck for themselves.

Vacation homes. Once the novelty of owning your own piece of paradise near a quiet lake or sun-drenched beach wears off, the reality of keeping up two homes will finally set in. With the home setting vacant for long periods of time you run the risk of damage from undetected leaks, infestation and vandalism.
Your options on choosing a place to vacation will become extremely narrowed and you could end up feeling obliged to spend more time there in order to justify purchasing it.
Leave the worry and expense of keeping up a vacation home to others and rent from them. This will also free you up to choose any area you and your family decide to vacation in without guilt.

Things used annually. Many people have a garage or basement full of expensive tools they use once a year or less. Things such as lawn aerators, paint sprayers, power washers and Rota-tillers, just to name a few, are more economical to rent than purchase.
Items such as a carpet cleaner or sewing machine can be jointly bought and shared with a friend or family member. Swapping with a neighbor can also be an option; you buy the sewing machine and she can buy the carpet cleaner.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Property tax Exemption for Qualifying Seniors

2008-05-27T13:38:00.000-07:00

Who qualifies? Anyone who turned 65 by January 1st of the year they want to apply and have lived in their primary residence for at least ten consecutive years prior to January 1st. The exemption can ONLY be applied to your primary residence, not to additional homes you own. There are exceptions to the ‘ten year’ occupancy requirement listed on the county assessor’s website under ‘Senior Tax Exemption’.

How much is the exemption? At this time the exemption is 50% of the first $200,000 of the actual value of your home. The State Legislature controls the percentage allowed for this exemption and has the authority to raise or lower it depending on the state’s budget for that year.

Do I have to reapply each year? No, as long as you still own and occupy the same property the exemption carries over from year to year. If you pass away and your spouse is 60 years old as of January 1st of that year, he or she can qualify to continue the exemption as long as they meet all requirements, but must reapply with the county assessor’s office.

How do I apply? You can download an application from your county assessor’s web site or contact the assessor’s office and request a printed application.

Below I have listed the assessor’s website for counties within the Denver metropolitan area where you can access full details on requirements and exceptions for the Senior Tax Exemption.

http://www.co.adams.co.us/assessor http://www.denvergov.org/assessor
http://www.co.arapahoe.co.us/assessor http://www.douglas.co.us/assessor
http://www.co.broomfield.co.us/assessor http://www.co.jefferson.co.us/assessor
http://www.bouldercounty.org/assessor

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

LOWER YOUR PROPERTY TAXES

2008-05-20T15:04:00.000-07:00

According to the National Taxpayers Union, roughly one-third of all people who appeal their property assessments end up with lower taxes. Your chances are especially good in a time of declining property values. Assessors use data from the Multiple Listing Service (just like real estate agents do) to determine assessed values. However, in a slow market, sales data is simply not available and there is a good chance that the assessment is faulty.

Here’s what you need to do if you decide to appeal.

Don’t Delay – When you receive your assessment notice, you usually have only 30 to 60 days (sometimes an actual date is stated in the fine print) to let county assessor know that you plan to appeal. At this point, it’s ONLY a “notification” that you don’t agree with the dollar amount. The web-site for your county assessor will state the cut off date for appealing your taxes. At the bottom of this article I have listed the web-site address for counties within the metro area.

They will then provide you with a hearing date, which will give you time to gather your evidence as to why you think the assessment is too high. They should also provide you with a list of “allowed” documents that you can bring to the hearing.

Gather the Evidence – First, go to the assessor’s office to check out the data they have on your property. There may be mistakes in square footage, lot size, or other data may be inaccurate. Write down the addresses of homes similar to yours (in the neighborhood) and ask to see their information, too. Don’t worry, the information is public and others can see what YOUR property taxes are, too. Next, get sales data from a real estate agent and find out what homes sold for in the 24 months period ending June 30, 2006. You will also want to keep a file of information you receive from Real Estate agents of your neighborhood sales currently. You will be able to use this information for future years to protest your tax assessment.

Look for Unique Factors That Could Make a Difference – Are you next to high-tension electrical wires? A drainage ditch? On an extremely busy street versus your neighbor who lives on a cul-de-sac? Check to make sure the assessor made adjustments for negative factors.

Hire An Appraiser – Refer back to the list of documents that you might be required to present when your hearing is held. You may need an appraisal, which could run $300 or more. Word of Caution – If the appraisal or the comparable sales from the real estate agent comes back HIGHER, cancel your hearing appointment. They also have the ability to RAISE your property taxes at that hearing.

http://www.co.adams.co.us/assessor http://www.denvergov.org/assessor
http://www.co.arapahoe.co.us/assessor http://www.douglas.co.us/assessor
http://www.co.broomfield.co.us/assessor http://www.co.jefferson.co.us/assessor
http://www.bouldercounty.org/assessor

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Part IV: Cutting the cost of getting a college degree

2008-03-12T11:49:00.000-07:00

Plan ahead if you hope to get a student loan.

The “credit crunch” has now spread from the mortgage industry into the student loan arena. Private lenders such as banks are raising the criteria for loans and becoming pickier about whom they lend to. Some lenders have either curtailed or completely stopped giving out student loans due to the higher risks of default. Also, the ability to sell these loans to investors, there by replenishing the supply of money available to lend, has dried up.
Sallie Mae, the largest lender of student loans reported a $1.6 billion lose during the last quarter of 2007. They are planning to set aside $700 million to cover possible defaults on loans in 2008. This means they will have less money to lend.
If you are planning to get a loan to cover next year’s tuition and fees for college apply as soon as possible. There is a chance that the lender you used last year is no longer offering student loans or has raised the criteria beyond your qualifications to obtain one.
The student loan that is the least expensive in the long run is one that is guaranteed by the federal government. It has a fixed interest rate that is usually quite low as opposed to private loans that are not fixed and the interest rate can adjust up to 19%.
Keep a close eye on your credit scores since many lenders have raised the required minimum score from 675 to 695. Borrowers who do not meet this standard are considered riskier and could end up paying additional fees ranging from 3% to 10% of the loan amount.
Line up a co-borrower with a good credit history just in case it will be needed to either obtain the loan or to avoid the additional “risk” fees.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Part III: cutting the cost of a college degree

2008-03-10T09:32:00.000-07:00

Miscellaneous expenses. On top of the tuition, room and board, you will also be facing additional expenses during the school year. A moderate budget for miscellaneous expenses is estimated at approximately $4,800 per year. Below are a few tips on cutting the cost of unexpected expenses.
Textbooks: Students, on average, spend close to $1000 per year on textbooks. Purchasing used textbooks for around half the price of new ones can lighten this burden. The Internet services such as craigslist.org, Half.com, CampusBookSwap.com., or discount bookstores are good places to start your search. Before purchasing make sure you have all the information on the textbook you are looking for, such as author’s name, title, and international standard book number (ISBN). The most expensive months of the year for buying textbooks are January, February, August, and September and the least expensive time is mid-semester. If you know which classes you will be taking for the next semester, buy your book during the months of lowest demand and cheapest prices.
Treat your textbooks with care so that when the time comes for you to resell, they will be purchased. Books with torn pages or broken bindings are nearly impossible to sell. If you were able to sell the used textbook for half of what you paid, you would have an overall savings of approximately 75%.
Cell phones: To avoid being shocked each month by your phone bill, shop around for cell-phone plans with a set monthly fee or offers enough minutes per month to meet your needs. BillSaver.com and MyRatePlan.com are useful when comparing cell-phone plans. Above all make sure the plan you choose provides service on your college campus.
Transportation: Between gas, parking passes, and general upkeep of a car you will be spending an enormous amount each year. Your best bet is to leave your car at home. Public transportation can be utilized if you need to go off campus and walking to your classes can be beneficial to your health.

Watch for part IV coming soon.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Part II: Cutting the cost of a college degree

2008-03-06T08:55:00.000-08:00

Reduce the cost of your first two years of college by half. Take a closer look at the community colleges in your area. Many have what is called an “articulation agreement” with certain universities or 4-year colleges. In other words, the four-year college or university has agreed to allow the transfer of all credit hours from the community college towards a bachelor’s degree once the student transfers. In most cases, the student must keep their GPA above a certain level during the two years at the community college in order to qualify for the credit transfer. Some universities offer “merit scholarships” of $1000 to $2000 to students who carried a GPA of 3.3 and above.
The average yearly tuition at a community college is approximately $2,360 compared to $6,185 at a four-year college or university. Over the 2-year period, this will give you a savings of $7,650 in just tuition alone, not to mention, the additional savings from living at home as opposed to paying room and board at the university.
Summer classes. The more credits you can get through a community college the lower your costs will be for a bachelor’s degree. Even after you have transferred to the university or four-year college, you can take classes at your local community college. The average cost for each credit at the community colleges is less than $150 compared to $400 at a university or four-year college. Check to be sure the credits will be transferable before signing up for a class during the summer.
Start taking college class during high school. Some community colleges offer duel-enrollment to qualified juniors and seniors. The student earns their high school and college credits simultaneously. These programs are offered free of charge and the textbooks are loaned to the students by the college. This is the same as getting a 2-year scholarship and the savings is tremendous! Again, make sure most if not all the credits are transferable.

Watch for part III coming soon.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation

Part I: Cutting the cost of a college degree

2008-03-04T09:00:00.000-08:00

Search for free money.

Federal Pell Grants. Grants from this program will not finance the full cost of a college degree, but they are helpful. The amount you receive can range from several hundred to several thousand dollars. The size of grant you receive depends upon your financial needs and the amount the college of your choice has received from the federal government for aiding students. They only receive a fixed amount for each school year so apply early because once the money is gone; it will not be replenished until the following year.
If you qualify for the Pell Grant and plan to major in math or science you could also receive additional money from the Academic competitiveness Grant or National SMART Grant.
State Grants. These grants are also based on your financial needs, but many states also use part of this money to encourage students into certain vocations such as teaching or nursing. If a state is experiencing a shortage of teachers or nurses many times they will offer an attractive incentive to students. Your full tuition or a large part of it will be paid by the state, if you are willing to work a predetermined amount of time in areas of the state with the greatest need for these services. How to apply for these grants can be found on the state’s web site under student-aid or higher-education commission.
Federal Supplemental Education Opportunity Grants. These grants are ear marked for low-income students so be sure to find out the maximum income allowed before applying. If you are living at home, income will be determined off the amount your parents make per year.
Institutional grants. Colleges and universities use these grants as incentives to attract the most desirable students. You cannot apply for these grants, but you can increase your chances of receiving one by applying to schools most likely to want you as a student.
To apply for a federal grant you will need to complete an application for Federal Student Aid. You can obtain this form from the college’s financial office, fill it out on line, or call the U.S. Department of Education at 1-800-433-3243 to have the form mailed to you.
January 1st is the earliest you can apply for the following school year. It is not unusual for the grant money to be used up by mid February so file as soon as possible.
The college, state, or federal grant agency may require additional forms and documentation. Your college’s financial aid office can help guide you through this process.

Watch for part II coming soon

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

Lenders are freezng home-equity accounts

2008-02-27T12:51:00.000-08:00

In a bid to curtail further loses, many of the lenders such as Countrywide, Wells Fargo, Chase, and Bank of America are freezing second mortgages that are home-equity line-of-credit accounts (HELOC). They have sent notices to their borrowers stating the account is frozen and no additional money can be withdrawn. It appears this will be an on going event until every loan file is reviewed. They will be analyzing the borrower’s payment history, debt factors, and the value of homes in the immediate vicinity of the property. If they find that the borrower’s credit scores have dropped, slow or late payments, or increasing debt, the HELOC account could be frozen. This is also the case if the value of the properties in the area are showing a decline and pushing the loan-to-value (LTV) above the lender’s allowable percentage.
The majority of the HELOC loans were approved during a time when second mortgages were granted up to 95% of the home’s value. Today, most lenders will only allow a maximum of 85% LTV, and if the area is considered a severely declining market, the LTV could be set as low as 65%.
As the value of homes decline and foreclosures increase, lenders holding second mortgages are experiencing an increase in losses. Many times after a foreclosed home is sold or auctioned off, there is barely enough money to pay off the first mortgage, let alone the outstanding balance on the second mortgage.
This freeze will have a negative effect for many borrowers who were planning to withdraw from their HELOC to complete a home improvement project or pay for a child’s college tuition. There are also those who opened their HELOC account to use as a cushion in case of major set backs such as losing their job or a long term illness.
Until the housing market heals from this latest slump, HELOC accounts will be more difficult to obtain, even for the A+ borrower. So, if you are hoping to keep your home-equity account open, watch your credit closely and keep an eye on the value of homes in your neighborhood. One web site to check for home values is Zillow.com. Another source for this information is to contact a real estate agent who is familiar with the value of homes in your area. The LTV is calculated by dividing the outstanding loan balance(s) by the value of your home.
If your are planning to take a withdrawal in the future, it may be to your advantage to take the money out now and place it in an interest bearing savings account until you need it.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Homes that hold their value even in a market slump

2008-02-22T08:15:00.000-08:00

If you are in the market for buying a home or if this dream is a ways off, the following tips on choosing the right home will be helpful to you. Even as homes prices in many areas are taking a nosedive some homes are selling above the asking price.

Location, location, location. We have all heard this expression and it still holds true. A house can be replaced, remodeled or renovated, but the land it sits on is permanent. There is far more to location than the views it offers. First and foremost buyers are also looking for a neighborhood that offers good schools and safety for their family.
This is followed by proximity to public services and cultural amenities such as libraries, parks, theaters and coffee shops. One caution though; you want close proximity to these amenities, but not so close that the noise level coming from the busy streets or schools detracts rather than adds to the value of your home.
Canvas the neighborhood. Are the streets and sidewalks well maintained? Open potholes and uneven sidewalk will detract from the desirability to live in this area even if the house itself is attractive.
Choose a house with the broadest market appeal. Do your homework. Find out which homes are selling the quickest and why. A real estate agent familiar with the neighborhood would be your best source of information. He or she could tell you what type of home is selling like hotcakes and which ones are sitting on the market for months on end without a showing. Is a deck an expected amenity or is a covered porch more desirable? Do potential buyers care if the homes in the area have a finished basement, pool, state of the art kitchen, etc.? At this time ranch style homes with low maintenance are weathering the housing slow down quite well.
Up dating your present home. If you already own your home these are still good questions to ask if you are considering remodeling or upgrading your home. Don’t spend $60,000 on an expensive kitchen, if adding a third bedroom would give your home a larger market base for re-sale. Yes, your desires for a home matter, but keep in mind that a home designed with only your wants in mind could end up being very difficult to sell in the future. Making your home more energy efficient by adding additional insulation, high efficiency windows, new siding or appliances can add value and appeal to a potential buyer.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Feds throw out a new lifeline

2008-02-20T08:39:00.000-08:00

The government’s latest program nick named “Project Lifeline” has been enacted to help curtail the one million plus foreclosures that is estimated to take place between now and the end of the year. Six of the largest mortgage lenders have joined forces under this program. They are Bank of America Corp., Citigroup Inc., Countrywide Financial Corp., J.P. Morgan Chase and Comp. Washington Mutual Inc., and Wells Fargo & Comp.
These lenders will be contacting their customers who are 90 days or more pass due on their mortgage payment and offering a 30-day reprieve before foreclosure proceedings are initiated. During this time period, the lenders will be working with the homeowners to restructure their mortgage loan in hopes of lowering the monthly payment enough to stop the foreclosure altogether.
Homeowners who have already entered into foreclosure, within 30-days of being foreclosed upon, or the loan is for an investment or vacation home will not qualify under this program.
Officials are also encouraging homeowners to call Hope Now Alliance, which is an organization that is helping homeowners during this difficult time. Their toll free number is 1-888-995-HOPE (4673).

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622dwing@academynational.net

Stimulus package scam

2008-02-18T08:00:00.000-08:00

Stimulus package scam

Before Congress had fully developed and passed the economic stimulus package, scam artists were at work with a new devious plan.
Over 20 people in South Carolina have reported receiving calls asking for bank account information so that the tax refund from the stimulus package could be directly deposited. The callers are pretending to be an employee of the IRS or from the tax department with the Social Security Administration.

Keep yourself and your hard earned money safe.

1. Stay informed on the progress of the stimulus package and when the government plans to begin sending the money. The latest information I have heard is that the checks will not be mailed out until May or later. The IRS needs to get through the tax season before they can begin working on the tax refund from the stimulus package. No information is available at this time as to whether the refund will be mailed or directly deposited. One thing is sure though, the only people who will have it directly deposited are those who have already provided the IRS with their account information. Neither the IRS nor the Social Security Administration will call and ask you for this personal information.

2. No matter what, never give your personal information to anyone over the phone no matter whom they claim to work for.

3. If you happen to receive a call from a stranger asking for your account information, hang up and call your local district attorney’s office or police department and report the incident.

Denise Wing, C.E.O
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net

Part VI: Teaching your children to be financially wise

2008-02-15T07:36:00.000-08:00

Exposing your children to the world of investments.

This lesson, I must admit, is a longer process than the previous suggestions, but it is as important for your children’s financial stability.
As a family, choose a mutual fund you can deposit a small amount into on a monthly basis. When the statements arrive you can use them as a tool to teach about earning interest on an account. Similar to planting a seed and watching it grow into a mature plant that bears fruit.
Investing in stocks can also help teach your children to become familiar with how the financial markets work. The more you can teach them the better their chances are at becoming good managers or their money as adults. Instead of paying another person to do their investing they could save large sums of money over their adult life by doing their own investing.
If you have any suggestions on teaching children to be financially wise, please email them to me at dwing@academynational.net.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

Part V: Teaching your children to be financially wise

2008-02-13T10:37:00.000-08:00

5. Setting expectations when it comes to helping your children financially.
Laying all the cards on the table when it comes to what you will and will not help your children with financially alleviates misconceptions and misguided expectations. The amount you will have to set aside for each of the needs depends on your financial situation. I suggest making a list starting with whatever area you feel is the most important for their future. The following is an example.

1. College education: I will pay for 1, 2, 3, or all 4 years; tuition, books, room and board, but you will need to work and provide your own spending money.
2. Graduate studies: You will need to get student loans to cover the cost.
3. You will receive $5000 upon graduation of college to get you started in life.
4. Wedding: I will contribute $5000 towards/or pay for your wedding celebration.
5. Down payment on first home: $10,000 has been placed in a timed account.
6. I will purchase your first car, but you will need to pay your own insurance coverage.

The above examples cover some of the mile stones in life that I find cause a majority of the misguided expectations from children. When a child dreams of going to college or having a $30,000 wedding only to find out shortly before the event that their parents are not able or willing to pay, can be devastating to your relationship with them. Letting them know where you stand in advance also gives them the opportunity to work out a strategy to fulfill their dreams by other means.

Watch for part VI coming soon

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

Part IV: Teaching our children to be financially wise

2008-02-11T13:37:00.000-08:00

4. Exposing conspicuous consumption.
Encourage your children to be suspicious of overt displays of opulence albeit an expensive car, fancy house, or designer clothing. This type of spending can create more debt than a person can handle causing stress and frustration, but never happiness. We have all heard the stories of friends or family members who blew their money on high living and ended up broke and depressed. Family fortunes have been squandered away leaving future generations without the financial ability to get a college education, buy their first home, or receive the slightest hand-up in life.
It is far better to drive an older car that is fully paid for, or to live in a home where the mortgage payment does not exceed 25% to 30% of your monthly income. This will free up your money so you can invest in a retirement account, build a savings and still take a small vacation with your family. This is the type of financial planning your children need to hear and encouraged to follow.

Watch for part V coming soon.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage
303-987-0622

Part III: Teaching your children to be financially wise

2008-02-06T08:45:00.000-08:00

3. Family stories can teach volumes.
Along with teaching your children sound financial lessons, talk to them about the struggles you experienced in your early adult life. Most of us lived through those times, unless of course, our parents were extremely wealthy and provided us with a trust fund.
Your first apartment, as with mine, was probably furnished using hand-me-downs from family and friends. The local Goodwill and garage sales helped me fill in the household items needed to make life as comfortable as possible. Dinner could be mac n’ cheese, hot dogs, or a cheap frozen dinner. Tales of your first car held together by duct tap, fishing line, and many prayers. Even stories about the struggles experienced by grand parents, aunts, uncles and cousins can bring home a lesson they could carry with them their entire life. There are as many stories as there are personalities in the world and as varied. Sharing your past can be a time of laughter, conversation, and closeness with your children.
Going through this experience can be enjoyable and challenging at the same time. This is not brought about by wrong financial decisions, but merely a progression of life from graduating college, starting a career and gradually moving up to a better salary and job advancements. Let them know it is ok to live within their means and not to have the large home, new car and vacations early on. These luxuries will hopefully come, but they need to be patient and content with what they have and where they are at in their lives.

Watch for part IV coming soon.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

Part II: Teaching your children to be financially wise

2008-02-04T07:46:00.000-08:00

I could not imagine turning my back on one of my children if they were deep in debt and needed my help. By teaching your children to make sound decisions can save you from being financially drained by an adult child; call it financial self-defense.

2. Making wise decisions.
One trick a friend of mine used, especially when going on vacation or to an amusement park, was to give each of her daughters their own spending money. The money was theirs to do with as they pleased which helped make the outing enjoyable for everyone involved. She was not nagged and harassed for trinkets and they were content knowing they could buy whatever they could afford with their own money.
She found this to be so successful; she began using this trick with her oldest grand child when he was about 6 years old. This tradition has continued with each additional grand child and has produced the same successful results.
As your children get older, you can open a savings or checking account in their name and give them a debit card. Each month deposit a set amount into their account for pocket money, school lunches, entertainment, etc. In their early teens a clothing allowance can be added. In most cases, if they spend the money before the month is up, they will not come to you asking for additional funds. If they do you will need to be firm; replenishing their account will only teach them to be financially irresponsibility.

Watch for part III coming soon.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

PART 1: TEACHING YOUR CHILDREN TO BE FINANCIALLY WISE

2008-01-30T12:06:00.000-08:00

There is one thing we, as parents, want for our children; not to struggle financially when they grow up, but to be responsible with the money they earn. There are many pitfalls along the pathway of life, but lessons learned at a young age will hopefully help them avoid a few of them. I have compiled a list of ideas that can be used to help educate your children. Some I have used over the years and others are ideas I have read or was told to me by parents with grown children.

1. Immediate gratification.
Teaching your children self-control when it comes to wanting immediate gratification is not an easy task, but it is very essential for living a contented life.
Setting aside a portion of an allowance towards a special item your child wants to purchase can be fun, educational, and exciting for them. Provide an allowance to your children once per week for the chores preformed the previous week. This will teach them how the real working world works, (work, then get paid) but will also teach them patience and is a good tool for teaching math and budgeting. Set aside a portion for giving and pocket money with the remainder going into their savings. I believe the anticipation, while saving for the special item, is more exciting than actually buying it. Many times your children will choose to continue saving their money and decide they really can live without a new toy or game.

Watch for part II coming soon.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

This could be the time to get re-prequalified

2007-12-21T10:31:00.000-08:00

If you were pre-qualified for a mortgage loan in the last few weeks, you should contact your mortgage lender to be sure you still qualify. Daily I am receiving announcements from my investors listing qualifying changes on their loan programs and in some cases the discontinuation of certain loan programs altogether.
If the home you plan to purchase is located in a “declining market” many investors are now requiring an additional 5% down payment. On the purchase of a $200,000 home, the down payment would increase by $10,000 and very few people have this kind of money just setting in the bank. An FHA loan would be a good alternative if should this happen, as they do not require the additional down payment.
Credit scores are now playing an increasing role in the interest rate you will be offered. It is calculated on a sliding scale; the lower your scores the higher your interest rate will be. This could very well affect your debt to income ratio and disqualify you for the loan you were pre-approved for just last week.
With some investors, such programs as a cash-out on an investment properties have been discontinued along with “stated income” for borrowers who are not self-employed. Other programs have stricter guidelines requiring lower debt-to-income ratios, higher credit scores, lower loan-to-value percentages and additional cash reserves.
Make sure your lender is staying on top of these changes in the market place so that you are not caught at the last minute without a loan to purchase your new home or to close on the refinance you applied for.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

You're 55 and haven't saved a dime

2007-12-13T11:00:00.000-08:00

Below are a few tips you might want to try if you are looking at retiring in the next 10 years and have little or no money saved.

Do an inventory of what you have and what you will need.
A useful tool is MSN Money’s Retirement Income and Retirement Expense calculators. These can be found on their website under “finance”. Once you see it in black and white, it could be frightening, but hopefully it will motivate you to make huge changes in your spending and fast.
Place every dollar possible into tax-deductible retirement plans.
Enroll in the retirement plan offered by your employer. Many companies match your contribution by 25%, 50% and at times up to 100%. If you already contribute to a 401K plan at work, check into the maximum percentage they will allow and increase your contribution. If your employer does not offer a retirement plan, open at IRA account as soon as possible.
Make a zero-based budget.
This type of budget starts with the most essential expenses then each additional expense is added on by their importance until you run out of money. Your first priority is your contribution to a retirement account followed by your mortgage payment then other debts. If you run out of money before you reach such items as entertainment or a vacation fund then so be it. Living simpler now and having money for retirement is not only practical, but will give you peace of mind.
Start a small home based business.
Normally you are allowed to contribute up to 25% of your self-employment income to a tax-deductible Keogh plan, even though you are enrolled in another retirement plan.
Plan to sell and down size your home.
Plan to sell your present home and moving into one that is smaller. If you have good equity in your home bank part of the proceeds you make. This would give you an additional financial cushion. If selling is not the way you want to go, look into taking out a reverse mortgage once you have turned 62. This loan can give you additional income as long as you live in your home.
Be realistic with your dreams of retirement.
There is a very good chance you will not be able to retire at 65. The longer you work, the more money you can save and less non-earning years you will need to finance. Once you have calculated what you will have by the time you retire, start planning how you can live in retirement with that amount of income.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622

Foreclosure Scams

2007-12-06T12:01:00.000-08:00

At this time the scams being used to victimize homeowners facing foreclosure fall into three main categories.

Phantom help: These self-appointed “rescuers” charge outrageous fees for useless phone calls and light paperwork. This predatory scam costs the homeowners time, money, and hope. They never result in saving the home from foreclosure, but wastes precious time that could have been used seeking qualified help.

The bailout: The homeowners are told if they sell their home to the scammer at or just above the payoff amount of the mortgage they would be able to rent the home and eventually buy it back. It ends up that the terms for the buy-back are so outrageous that it becomes impossible and the homeowner loses possession and the scammer walks away with the equity in the house.

The bait-and-switch: The homeowners are deceived into believing they are signing documents to bring their mortgage payments current, but in fact they are signing over title to the home. In many cases they don’t even know they have been scammed until they receive an eviction notice.

Homeowners facing foreclosure can be very desperate and make decisions that could destroy them financially. Before making any decision based on promises written on a florescent sign tacked to a telephone pole, contact an attorney, credit counselor, or a housing counseling agency. One website is NeighborWorks Center for Foreclosure Solutions. They will make referrals to local agencies that are reputable and truly helpful.

Denise Wing, C.E.O.
Certified Mortgage Lender
Academy National Mortgage
303-987-0622

Reverse Mortgages now being offered

2007-11-20T09:27:00.000-08:00

Academy National Mortgage is now offering Reverse Mortgages as part of our financial services. For the criteria and guidelines on Reverse Mortgages, please see our Blog posted on October 3, 2007.
If you, or anyone you know can benefit from a Reverse Mortgage, please contact me at 303-987-0622.

Denise Wing, C.E.O.
Academy National Mortgage Corporation
Certified Mortgage Lender
dwing@academynational.net
303-987-0622

FHASecure Mortgages

2007-11-20T09:16:00.000-08:00

A brief overview of the guidelines set down by FHA to qualify for the FHASecure Mortgage is as follows:

1. Your present mortgage is a non-FHA adjustable rate product that has reset to a higher interest rate.
2. Due to the resetting of the rate, you are not financially able to make your mortgage payment.
3. You have been current on your mortgage payment, for a minimum of 6 months, prior to the resetting of your mortgage rate.
4. Verification you have sufficient income to make the new mortgage payment after the refinance.

Expect to pay a slightly higher interest rate on this type of loan as opposed to a straight forward refinance with FHA; approximately 1/2% to ¾% higher in rate.
I am stressing the guidelines for this type of refinance due to my concern that unsuspecting borrowers will be told they need to apply for an FHASecure mortgage just so brokers can make more money on the transaction. Investors charge a higher rate to mortgage brokers for this type of FHA program, which justifies the slightly higher interest rate being offered.
If you find you are being quoted an interest rate above the average going rate at this time for FHA loans, please call me immediately and set up an appointment so we can discuss an alternative for your financial needs.

Denise Wing, C.E.O.
Academy National Mortgage Corporation
Certified Mortgage Lender
303-987-0622
dwing@academynational.net

The time to refinance could be now!

2007-11-05T07:43:00.000-08:00

Even if your adjustable rate mortgage won’t reset until months from now, this could be the best time for you to refinance. Home values are sinking and eating up the equity in your home, so the longer you wait the harder it could be to refinance.
If your loan-to-value (LTV) is 80% or lower you will typically have the most options for a loan and best rates, depending upon your credit rating. Once you reach 85%, 90% or 95% LTV, the loan options become less and the interest rate rises. If it ends up you owe more on your house than what it is worth, your options are virtually gone. The lenders who were eager to give loans with 100% LTV are either out of business or have turned away from these types of high risk loans.
The foreclosure rate is predicted to rise in 2008 and most of 2009. Banks, not wanting to hold on to these homes will more than likely sell them far below their actual value. This will drag down the values of homes in many areas even further. To top it off, lenders are scrutinizing appraisals closely and appraisers have become more conservative on their reports.
If you are fortunate enough to live in one of the areas in Denver where home prices are either stable or rising, you can afford to wait before refinancing your loan. But, if you aren’t in one of these areas, you need to consider refinancing before you lose more of the equity in your home.
A review of recent home sales in your neighborhood will help you get a sense of values and price trends. Ask a realtor if he or she would give you an estimate of value for your homes in your area. Once you have an idea of what your home is worth divide what you owe by the value and it will give you your loan–to-value percentage. If values are falling like a rock, it is definitely time to refinance.
If your decision is to refinance your mortgage, please do not hesitate to call so that I can help you find a loan that fits your financial situation.

Academy National Mortgage Corporation
Denise Wing C.E.O.
Certified Mortgage Lender
303-987-0622

Suze Orman on Acceleration Mortgages

2007-11-01T12:36:00.000-07:00

A recent article, written by Suze Orman in The Costco Connection, reiterates what we stated in our Blog on October 9, 2007. The new fangled mortgages such as, The Acceleration Mortgage, The Asset Manager and The Macquarie Mortgage are not your best choice if you are looking to pay off your mortgage early.
Within her article she states, “I am all for accelerating paying off your mortgage, but not with a deal like this.”
For a copy of the article in its entirety, please call 303-987-0622, and we will fax one to you. You can reach Suze at suze@costco.com.

Academy National Mortgage Corporation
Denise Wing, C.E.O.
Certified Mortgage Lender
303-987-0622
dwing@academynational.net

Housing Market - National verses Local

2007-10-19T07:35:00.000-07:00

Reports on the condition of the real estate market at the national level are painting a very distorted picture. A housing market is far more local than national. So much so, that two subdivisions several miles apart can experience differing market trends.
It is very refreshing to hear that the Denver market is doing far better than the national levels. From May to June of this year, home values in the Denver area rose by 1.3% and June to July’s the increase was 0.8%. We did see a 0.7% decrease in values when comparing July 2006 to July of 2007, but the national average for this same time period was 3.9%. Historically, we are counter-cyclical to the rest of the nation. Home prices in Denver peaked in 2001, while most of the nation continued in an upward direction, Denver’s growth rate slowed. Due to the fact our market has been flat for so many years, it should recover faster than other areas that, until recently, saw a huge run-up in prices. It appears from the report produced by S&P and Yale University economist, Robert Shiller; the Denver housing market is in an upward swing. We have enjoyed four consecutive months of beating the national percentages, but also have been encouraged to see if this trend continues before announcing we are totally out of the woods.
Not long ago, Denver was considered the most expensive housing market in the nation without a beach. Now, due to the flat market over the previous six years, the price of a home in Denver is being referred to as a bargain. It would be easier for companies to relocate here than in many other areas of the country. This alone could strenghten the economy of Denver and further spur an upward swing for our housing market.
Colorado is on pace to see more than 37,000 foreclosures filed this year, a 30% increase from the record set last year. We are rated in the top 10 worst areas in the country for foreclosure rates. This will cause “intense pain” for the lower end of the housing market, but the higher-end homes and many pocket areas are very strong showing no decrease in values due to the “sub-prime” crisis that is devastating many areas of the country.
No, I don’t believe all is “peaches and cream” in the Denver housing market, but it is NOT in a major crisis, nor has it fallen into the “black hole” of doom and gloom that is being presented by the national media.

Academy National Mortgage
Denise Wing C.E.O.
Certified Mortgage Lender
303-987-0622

Home-Buying Tips

2007-10-15T07:45:00.000-07:00

The process of making home ownership a reality can be the most exciting and at the same time an overwhelming experience; its been described as an emotional roller coaster ride. With a bit of planning and organization, you can reduce the stress and negative emotions you will encounter by following a few basic tips.

Get pre-qualified for a mortgage before you start looking for your “dream home”. By doing this you will know, in advance, what price range you will need to stay within.
Take inventory of your financial situation and credit history. Pay off small debts so that you will be in as strong a financial position as possible.
Make a list of your housing needs and clearly set them apart for your wants. The need for adequate bedrooms and bathrooms far out weigh the want of a 900 square foot deck with a hot tub. For a free wish list form, contact Academy National Mortgage at 303-987-0622.
Seek out as much information as possible on the home buying process. If you know how it works, you will know what to expect. Contact a reliable real estate agent; use the internet to obtain information on the home buying process. Use whatever source available and don’t be afraid to ask questions; this is not a time to be timid or shy.
Once you choose a realtor, make sure he/she has a clear understanding of your needs and the price range you need to stay within. Discuss this with them before making your choice of a realtor. You don’t need added frustration, because the realtor is showing you homes out of your price range and/or lacking the needed amenities for your family.
Make notes on each property you inspect. Note what was good, what stuck out in your mind, and what was bad. This will help you in deciding the best home for you and your family. For a free home shopping list form, contact Academy National Mortgage at 303-987-0622.
Understand that finding and purchasing a home takes time; don’t be in a rush. Give the realtor and the mortgage broker time to do the best possible job on your behalf.
Once you have chosen your “dream home” get a home inspection completed on the property.
Do a final walk through of the property no later than two days from the closing date. This will give you assurance that the condition of the home is acceptable and all the appliances and fixtures are still intact. Sellers have been known to remove items that the buyer assumed was part of the sale.

Academy National Mortgage Corporation
Denise Wing C.E.O.
Certified Mortgage Lender
303-987-0622

Mortgage Schemes

2007-10-09T07:23:00.000-07:00

When I first heard of the Macquarie Mortgage it piqued my interest. This loan program supposedly originated in Australia and promises the unsuspecting borrowers that they can pay off their 30-year mortgage in 12 to 13 years. I asked myself “how could this be, it sounds too good to be true?” When a person I know who had a 30-year fixed mortgage at 5.5%, refinanced into this program, I had to find out more.
The following is how this mortgage loan unfolds, and it is based on a $200,000 loan at 6% interest rate with an annual income of $100,000.

It is a 30 year Home Equity Line of Credit (HELOC) with the first 10 years being an interest only payment. The initial interest rate is approximately 7.00%, but the rate adjusts each month, it is not fixed.
The account is also used as your primary household account, but you do not earn interest on the money you put into it. The borrower deposits his payroll checks into this account and these funds are automatically credited towards the loan balance. This in turn lowers the balance of the HELOC and supposedly lowers the interest due on your required payment.
You would then write your monthly checks for bills, groceries, gas, entertainment and etc. These withdrawals are added back into your loan balance, raising the amount of interest owed.
You are not told directly that in order to pay off this loan in half the time, it would require you to pay up to 20% of your net income towards the loan balance each month and never withdraw any of that money. The term I saw being used on their website was savings. You are asked how much can you save in a given month, not how much you are willing to pay against the loan balance. Saving 10% of your net income would cut off 2.2 years; 15% reduces the pay off time by 10.7 years. If you were not able to save any money each month, you would owe the full amount of the original loan after the 10-year interest only period. Your monthly payment would sky rocket it order for the loan to be paid off in the remaining twenty years.
This type of loan is setting borrowers up for failure! Very few of us are able to put 20% of our net income aside and never withdraw any of it. Also, the temptation of knowing you can write a check against this HELOC account takes more will power than many of us have. I have a sick feeling that this is what the lender is counting on, so they can collect an astronomical amount of interest from just one loan. For the majority, this loan will not work.
A person would be far better off if they took 20% of their net income and deposited it into a saving account or invested it into mutual funds, stocks or bonds. Placing more into your 401K and taking advantage of the pre-tax status would also be more beneficial to you than the above mortgage loan.
Before getting yourself caught up in this, or any other designer loan, please call Denise Wing at 303-987-0622.

Academy National Mortgage
Denise Wing
Certified Mortgage Lender

FHA Downpayment Assistance

2007-10-05T14:59:00.000-07:00

The Federal Housing Administration (FHA) announced it would no longer allow borrowers to use seller-financed down payment assistance programs from non-profit organizations. This ruling will go into effect October 31, 2007; shutting down nearly 200 organization nationwide that have participated in arranging assistance for lower income buyers. Due to an agreement signed in 1998 between FHA and Nehemiah, this non-profit organization will continue to offer down payment assistance for contract written and signed prior to April 1, 2008.
This is an overview of how the down payment assistance programs are structured.
· FHA requires a minimum down payment of 3% of the sales price. This can come from the buyer, gift from a family member, employer, state and local agencies, or a non-profit organization.
· A buyer makes an offer on a home with the stipulation that the sellers contribute the 3% to the non-profit organization the buyer has chosen. In some cases the sellers contribute the 3% plus enough to cover most, if not all, of the closing costs. For this service the non-profit organization receives a $500 fee that is also paid by the sellers.
· In most cases, the sellers raise the price of their home to cover this cost.
· The non-profit organization “gifts” the money to the buyers at the closing of the loan.
FHA is no longer looking at this type of assistance as a gift, but more as an incentive to purchase, which is not allowed on FHA loans. Also, they feel this type of arrangement has falsely inflated the prices of homes. Further study by the Government Accountability Office, showed that borrowers receiving assistance from these charities were more that twice as likely to default or become delinquent than other FHA borrowers.
This will put an additional squeeze on lower income buyers, but FHA still allows gifts from family members, employers, and state and local organizations. FHA offers programs to help the lower income buyers qualify for a home purchase. Their ARM loans are reasonable and safe for the borrower, and their Buy-Down program to initially lower the payment, is another option for homebuyers.
Call Denise Wing at 303-987-0622, for more details on FHA loan programs that can help you with your financial needs.

Academy National Mortgage
Denise Wing C.E.O.
Certified Mortgage Lender

©Academy National Mortgage Corporation 2007

What is a Reverse Mortgage?

2007-10-03T10:21:00.000-07:00

What is a Reverse Mortgage? It is a loan that converts your home equity into a line of credit that can be used to increase your monthly income, or pay off unwanted debt. This is an adjustable-rate mortgage and the interest rate is calculated off the one year U.S. Treasury Security. Any adjustment in the rate does not affect the amount or number of loan advances you can receive, but causes the loan balance to increase at a faster or slower rate.
Who is eligible? Any homeowner 62 years of age or older and occupies the property as their primary residence. The property can be a single-family home, condominium, townhome, or 2 to 4 unit dwelling. The home needs to be either owned free and clear, or have a mortgage balance that can be paid off by the new loan.
What are the requirements to qualify? The loan process and requirements are fairly simple. No credit report is required and the borrower does not have to prove income, assets, or employment. No monthly payment is required on this type loan, so verification that the borrower being “credit worthy” is not a consideration.
What are the benefits? The monthly payment you receive is not considered “income” so it does not affect your Social Security, Medicare, SSI, or Medicaid benefits. Since the source of these payments are from a loan, they are tax-free.
A reverse mortgage is a “non-recourse” loan. This means if the value of your home ends up being less than the amount you borrowed, neither you nor your heirs will owe the bank any money. You will never owe more than the value of the house.
You can either receive the funds from the loan in one lump sum, or opt to receive a monthly income that will continue as long as you live in your home, or a combination of the two. Since this is a line of credit, you can withdraw money at any time for unexpected expenses, even if you choose the monthly income option.
You can continue to live in your own home as long as you want. Staying in your own neighborhood and near the friends you have cultivated is both a comfort and rewarding.
What are the costs associated with this loan? There are closing costs, but the majority of these fees, such as appraisal, title, attorney, and origination, can be financed into the loan. The out-of-pocket expense would be in the vicinity of $300.
The borrower is required to continue maintaining the property, paying the real estate taxes, and hazard insurance premium while the loan is in place.
How is the loan repaid? Repayment of your loan is not required until you sell your home, or have not used the home as your primary residence for more than 12 months. If you die, your heirs can either sell the home, or use other assets to pay off the loan balance.

Academy National Mortgage
Denise Wing, C.E.O.
Certified Mortgage Lender
303-987-0622

FHA and VA loan Programs

2007-10-01T10:50:00.000-07:00

In 1934 the federal government created the, Federal Housing Administration (FHA), to assist lower income families with purchasing a home. Up to this time, property ownership was not common except for the wealthy citizens. Then in 1944 the Servicemen’s Readjustment Act was passed and as part of it, the VA Home Loan Guaranty Program, was created. In recognition of the sacrifices given by our service men, the government sought to provide an avenue for the veterans and active-duty personnel to own a home.
Neither agency actually loans the money, but insures the loan against default; therefore, the lender is taking less of a risk for potential losses.

The benefits of a VA or FHA loan are:
Very low down payment requirements; 3% for FHA, which can be paid by the borrower, gift from a relative, or from a down payment assistance program. VA offers, for qualifying borrowers, programs with zero percent down.
Both offer low interest rates that are sometimes below the standard market rate.
If you qualify, you can refinance your present Conventional mortgage into an FHA or VA loan.
The federal government insures these loans, so lenders are more willing to grant credit to families with lower incomes.
Both FHA and VA loans are assumable to qualified borrowers.

FHA and VA offer an array of loan programs to fit the needs of many; from first time homebuyers to those needing to refinance into a more stable loan program. FHA is offering assistance, at this time, to borrowers who are delinquent or about to become delinquent on their Adjustable Rate Mortgages.
If you have any questions, or would like to explore the possibility of getting an FHA or VA loan, please do not hesitate in calling me at 303-987-0622.

Academy National Mortgage Corporation
Denise Wing, C.E.O.
Certified Mortgage Lender
303-987-0622

Pros and Cons of a Pre-payment Penalty

2007-09-28T10:25:00.000-07:00

What is a prepayment penalty? It is exactly what its name implies; paying your loan off before an agreed upon period of time; one, two or three years is the norm. The amount of your penalty can be calculated in one of two ways; percentage of the remaining loan balance or a certain number of months (usually 6) of interests. There are also two types of prepayment penalties, hard and soft. With a hard prepayment penalty you are obligated to pay this fee, whether you refinance or sell your home, before the penalty period expires. A soft prepayment penalty is not as stringent. You are released from the penalty if you sell your home, but if you refinance the penalty will be enforced. Be sure you know in advance what type of prepayment penalty, the duration, and the lender’s guidelines for your particular loan program. A prepayment penalty will also indicate that the loan program you applied for is an Adjustable Rate Mortgage. Be sure you know the full details of the loan program you are agreeing to. The Note you sign at the closing table will spell out the duration and how the penalty is calculated, but not whether it is a soft or hard penalty. This information needs to be obtained from the mortgage broker you are getting your loan through.
The main advantage in obtaining a mortgage with a prepayment penalty is that the initial interest rate offered may be lower over the duration of the penalty period, saving you hundreds, if not thousands of dollars in interest payments. The savings on your interest payments will depend on the size of your loan; the lower the loan amount, the less you save. The lender is in the business of making money, so if you pay this loan off early, they lose out on the interest they would have collected at the higher rate.
Whether or not a prepayment penalty is a wise decision for you depends on your personal financial goals. Do you intend to keep your home for a long or short period of time? Are you anticipating a substantial increase in income during the penalty period? Will you be able to comfortably pay the mortgage once the interest rate increases? These are questions only you can answer, and by answering them truthfully, you will make a wise decision.

Academy National Mortgage Corporation
Denise Wing C.E.O.
Certified Mortgage Lender
303-987-0622

What is a mortgage exactly?

2007-09-26T14:24:00.000-07:00

Contrary to what you may think, a mortgage is not a loan. A mortgage is a lien on the property that secures the loan. Today, the terms mortgage and loan have come to be used interchangeably. They are related but, in fact, two different things. Lenders are well aware of this, so it is best that you are informed also.

Perhaps you are familiar with the terms mortgagor and mortgagee, but which is which? The term mortgagor refers to the party that borrows the money and grants, pledges, or gives a lien on his or her property as a security to the lender. The term mortgagee refers to the party that receives the lien as security, the lender

A mortgage loan has three components. Without them the loan would not be viable. Each component must have a value, or the loan cannot be calculated correctly. The components are, the size, the interest rate, and the terms.

The size of the loan simply refers to the amount of money you wish to borrow. The interest rate is the regular and recurring fee that the lender charges on the borrowed money. It has a direct baring on what your monthly payment will be. The lower the interest rate, the lower your payment. The term of the loan refers to how long it will take to amortize, or pay off the loan. It may be expressed in months or years. (30 years or 360 months)

Another term that needs to be addressed is points. A point is equivalent to one percent (1%) of the loan amount. On a loan of $100,000, a point would be equal to $1,000. There are two types of points, origination points and discount points. The origination points are fees that a lenders sometimes charges to process the loan transaction. Discount points are used to help buy down the interest rate. You can opt not to pay an origination or discount fee, but be prepared to pay a higher interest rate.

Academy National Mortgage Corporation

Denise Wing, C.E.O.

Certified Mortgage Lender

303-987-0622

Are you struggling to make your mortgage payment?

2007-09-10T12:50:00.000-07:00

Recently FHA announced an initiative to assist homeowners who are struggling to meet the monthly payments on their Adjustable Rate Mortgages (ARM). This includes borrowers who became delinquent on their payments after the adjustment took place. If you meet the following criteria, this type of refinance could save you from losing your home.

1. Your present mortgage is a non FHA ARM that has reset to the higher interest rate.
2. During the 6 months prior to your ARM adjusting, your mortgage payments were current.
3. Evidence that you have sufficient income to make the mortgage payment on the new loan.

Additional allowance have been made by FHA to help as many borrowers as possible. Please contact Denise Wing with Academy National Mortgage and set up an appointment to discuss whether or not you qualify for this offer.

Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net