Brian Leavitt, REALTOR®

OK, It's real estate..

When one of my clients called the other day with a real estate question, I was surprised when she prefaced the question with “I know your main business is mortgage but...” I was delighted to help her with her question and found it interesting that the image I had cultivated is that mortgage is my primary business. One of the things this tells me is I need to do a better job educating my clients, so here goes.

Real estate is my primary business. In pursuit of my goal of delivering excellent service in real
estate I found that a consistent weakness in transactions was the mortgage component. This led me to the conclusion that the only way to make sure my clients were adequately served was to become
an expert in mortgage as well as real estate. I began serving my clients with their mortgage needs more than 18 years ago. The objective of the mortgage company has, from our first day in business, been threefold:

1. To serve my real estate clients by thoroughly educating them about their financing options so that they can select the best mortgage product for their needs.

2. To deliver competitive interest rates and low fees.

3. To maintain the highest level of integrity putting client needs first always.

Because of this we weathered the mortgage industry meltdown in a market that most of our
competitors did not survive.

As stated previously, real estate is my primary business but a large part of my success is the unique
ability to merge both the real estate and mortgage component taking service to a higher level. Even in the event that my client uses another source for their mortgage financing, the same level of
service and heart of the teacher are there.

In closing I would like to take a moment and say thank you to my many, many loyal clients who helped me during this very difficult time by referring friends and family for both their
real estate and mortgage needs. I can never thank you enough for your loyalty and support. I am blessed because of you.

Brian

Congressional action raises interest rates..

If you are thinking of a refinance or for that matter a home purchase, now is the time.

Conforming prices will increase based on recent Congressional action. Freddie Mac and Fannie Mae are increasing their guarantee fee effective with April settlements which will
worsen pricing. In order for a loan to meet the April settlement requirement it must fund prior to February 29th 2012.

The guarantee fee increase will worsen prices up to 80 basis points (8/10 of 1%) depending upon the note rate. Some lenders are staggering the increase based upon when the loan is locked in an effort to offer lower rates to consumers in the market for as long as possible.

If you are considering a refinance or purchase do it now if you can . Although interest rates remain at record lows there's no telling how long they will remain low and with this announcement we know that the cost of obtaining financing will increase.

Please note that the guarantee fee increase does not impact government loans.
For more details on this and any other financing options please call Brian Leavitt at Northstone Mortgage.

The Top 10 myths and misunderstandings about refinancing in today’s market..

1. It is just too hard to get a loan. The fact is for some time lending guidelines
   were just too easy. Today's guidelines have moved to a place that really does make sense. Qualified borrowers are finding the process to be reasonable and streamlined. The restrictions that have been put in to place are good for borrowers and for the banks making the loans.
2. I'm waiting for rates to go down. Right now rates are the lowest that they have
   ever been. Although it is possible rates could go down more it is unlikely. The Federal Reserve has indicated that they will be holding rates down for a period of time in order to help stimulate the economy but today's low rates are not going to last forever.
3. Since home values have dropped my loan would be above 80% so I would have mortgage insurance. Many borrowers qualify under the new HARP refinance program. Under HARP guidelines if you do not have mortgage insurance now you would not have it with the new loan. With rates now under 4% it is an amazing time to refi.
4. My credit score is just too low. Your credit score is not the only criteria
   the lender looks at. Often there are compensating factors that can mitigate a low score. For owner occupied homes refinances are available with scores as low as 620.
5. A refinance is just not worth the expense. Maybe true, maybe not. It is a simple calculation to determine the “recapture” time for the refinance. If your payment
   goes down $200 per month and the cost is $2,000 then $2,000 (cost) divided by
   $200 (monthly savings) equals ten months for recapture. If you plan on owning the home more than 10 months then it makes sense. Right now Northstone Mortgage is closing refinance loans with costs averaging in the range of $2,000 including all closing costs. *
6. My debt to income ratio is too high so I think it is likely I won’t qualify. Again
   this is a case by case decision taking into account multiple factors. I am seeing some high debt to income ratio loans get approved but when it makes sense. For example a borrower who is current on all of their obligations and having their monthly housing expense reduced is a “makes sense” loan with a high probability of getting approved.
7. I was on unemployment so my income was interrupted so I don’t think I can qualify. If you are back to work in the same line of work this is easily covered by a simple letter of explanation and a verification of employment from your present employer indicating that continued employment is likely.
8. I don’t want to start over with my loan. Good point. Rates are so low that we are moving many borrowers from 30 year loans to 10 or 15 year loans often without a significant increase in payment. We also offer 20 year loans. Paying your loan off quickly is one of the smartest money moves you can make. Call me anytime for more details on this one including a simple step by step plan to do it.
9. As soon as values come up I am selling so I don’t want to spend the money on a loan that I am paying off soon. Again, good point, however if you are waiting for values to rise it could be a long wait. Goldman Sachs released a report recently indicating that they do not believe we will see house values return to 2006 levels before 2023… that’s not a typo. It goes straight to the recapture question discussed in myth 5 above.
10. I have a second mortgage that I want to keep. I have been told that if I refinance I will have to pay it off and close the account. This one is sometimes true but usually not. Most of the time we can do what is called subordination. The way loans work is that when you close the loan you sign a promissory note which is your promise to pay the loan back and you also sign a deed of trust which is a document that is a lien on your home securing the promissory note. Each deed of trust is in lien priority based upon when it is recorded. When you pay off your existing first mortgage your second mortgage would then become the first lien UNLESS we ask the second lien holder to allow the new mortgage to be in first lien position or “subordinate” to the new first loan.

These are questions and concerns that I have been hearing from borrowers I have been recently serving. If you have questions about your specific situation please let me know. I am pleased to help any way I can. Usually the only way to learn if a refinance is a good idea is for us to “run the numbers.” There is no charge for this service.

*These fees are based on zero point loans with the lender paying the loan origination fee. Call for a free quote based upon your specific needs and situation.

Brian Leavitt

Northstone Mortgage

MLO#114864

Even if you pay all your bills on time ...

You could be bringing your credit score down without realizing it. The main factors considered in creating your credit score is whether you pay your credit cards and bills on time.

But some factors that can shave points from your score are not as obvious and not as well known. They include:

* Ordering several new credit card accounts in a short period of time. Maybe you're just taking advantage of low-interest offers, but to credit scorers, it looks bad. Better yet, avoid credit cards altogether.

* Transferring a balance to a new card, and then closing the old card account. It's OK to transfer the balance, but keep the old account open. If you close it, you won't have as much total credit and your credit-utilization ratio will increase. The amount of debt you have is calculated for balances on individual accounts, as well as your overall credit limit.

* Charging a lot to a department store credit card. Say you have a $4,000 credit limit. You are buying new furniture, so you charge $3,500. Before that, you only owed $100 on your store card. Now, you owe $3,600 on a $4,000 card, which means available credit on that account will be way down. It's not good for your credit score. And the store charges high interest rates.

Here's a better solution. Save for the item and pay cash. Cash talks, you can almost always negotiate a discount for cash so you avoid the credit card debt and save money as well.

* Other situations you might think are not related to your credit score include library book fines, parking tickets, back rents, medical bills and any other fees or charges you put off paying.

In time, they will be turned over to a collection agency. Even after you pay them, the collection will stay on your credit report for seven years.

Remember to review your credit report on at least an annual basis. You can do this for free at https://www.annualcreditreport.com. There are lots of so called "free" credit report sites out there but this one is the real deal sponsored by the credit bureaus and is completely free with no membership or service fees required. Also, if you are turned down for credit because of anything revealed in your credit report you have the right to a free copy of your report. For more information on your rights under the Fair Credit Reporting Act go to http://www.ftc.gov/os/statutes/fcrajump.shtm

HARP Here we come

The latest news on the new Home Affordable Refinance Program, HARP, is that Federal regulators have recently made key changes that will help borrowers who owe more on their loans than their homes are worth. Every week I receive inquiries from home owners who are current on their mortgages but can't refinance because their loan balances are higher than the value of their homes. The new HARP guidelines will help many homeowners reduce their interest rate. Based on today's rates this would be at or below the 4% range for a 30 year fixed loan.

There are two options with the new HARP changes. Timing is critical on both options and require clear understanding of your home's value. I am uniquely positioned as both a real estate broker and mortgage broker to assist you with this.

OPTION 1: Applications taken from December 1^st 2011 to February 29^th 2012 (yes, an extra day for us for leap year) are eligible for a loan to value (LTV) up to 125%. Appraisals will be necessary during this time period to determine the LTV. Unlimited combined loan to value ratios (CLTV) are acceptable. The combined loan to value ratio is the combination of your first mortgage and second mortgage or home equity lines (HELOC).

OPTION 2: Applications taken on or after March 1^st 2012 are eligible for unlimited LTV and CLTV and this is where those most highly impacted by declining values will get relief. There has been no specific announcement if appraisals will be required but I think not since the plan is to allow unlimited LTV.

The following conditions will apply to both options:

1. Current 1^st mortgages must have closed prior to May of 2009.
2. The loan cannot have mortgage insurance.
3. Loans must be owned by Fannie Mae or Freddie Mac. Call or email and I can research this for you.
4. Primary, Second Home, investment, and condos all qualify.
5. Second mortgages can be subordinated with no maximum CLTV.
6. You must have a qualifying credit score of 640 or more with no credit lates in the past 12 months.
7. You will still have to qualify based upon income but the good news (better news?) is that with a significant decrease in interest rate your payments should go down.

Mortgage lenders are going to be swamped with applications on this program so right now is the time to get ready. Since applications must be dated no sooner than December 1, 2011 we can have everything ready to go so that we can submit the application as early as possible. For some of you it will be necessary to wait until March 1^st 2012 but the anticipated rush will be even greater.

This is by far the best opportunity "underwater" home owners have had during the course of the recession.

If you are a home owner finding yourself in this position my advice is that we review your situation to determine if you are eligible and if it is best to proceed on December 1^st or wait until March 1^st.

Call or email me today! I will answer your questions and run the numbers to determine just how much money you can save each month!

Brian Leavitt

Designated Broker

Northstone Mortgage

MB 114722

MLO 114864

 

Planing to own a home some day? Eliminate Debt

Loans
Most loan payments are calculated using compounding interest, which is the interest that is added to the principal of the loan each month that the balance is outstanding, causing you to pay interest on interest. Although it’s designed to work against you, it is possible to pay off the loan three to four times faster with minimal additional cost to you, just by knowing your “magic number.” Your “magic number” is the portion of your monthly payment that goes to pay the principal. To pay your loan off quickly, double, triple or quadruple your  principal, or “magic number” each month.

Consumers have an average of 13 credit obligations on record with a credit bureau.
Source: http://myfico.com

Credit Cards
The average credit cardholder has 3.5 cards.* If you have outstanding balances on two or more credit cards, use the rollover formula to pay them off.

• Make a larger payment on the card with the highest interest rate and pay the minimum on the rest.
• Once this card is paid off, apply the amount of its payment to the minimum amount you were paying on the card with the second highest interest rate.
• When the second card is paid off, add that amount to the payment of the third card, etc. until you have paid off all of your credit cards.

The average American with a credit file has over $16,635 in debt, excluding a mortgage.
Source: US News and World Report

Tips to Help You Stick to Your Budget

• Set 90 day goals.
• Track daily and weekly expenses to know where your money is going.
• Ask for help. Enlist a friend or loved one to help you remain accountable to your budget.
• Focus on the win! Imagine how you’ll feel when you’ve paid off your debt and have achieved financial freedom.
• Use a small portion of the surplus to reward yourself.

Lowest interest rates on record

This is an excellent time to refinance.  Northstone Mortgage rates are significantly lower than the national average.  Check them out at northstonemortgage.com

 

Freddie Mac (OTC: FMCC) today released the results of its Primary Mortgage Market Survey® (PMMS®), coming on the heels of the Federal Reserve's recent announcements. The conventional 30-year fixed averaged an all-time record low at 4.01 percent; likewise the 15-year fixed averaged an all-time record low at 3.28 percent for the week. Of the five regions surveyed in Freddie Mac's survey, the West region recorded the lowest average rate for the 30-year fixed dipping below 4.00 percent to 3.95 percent.

30-year fixed-rate mortgage (FRM) averaged 4.01 percent with an average 0.7 point for the week ending September 29, 2011, down from last week when it averaged 4.09 percent. Last year at this time, the 30-year FRM averaged 4.32 percent.

15-year FRM this week averaged 3.28 percent with an average 0.7 point, down from last week when it averaged 3.29 percent. A year ago at this time, the 15-year FRM averaged 3.75 percent.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.02 percent this week, with an average 0.6 point, matching last week when it also averaged 3.02 percent. A year ago, the 5-year ARM averaged 3.52 percent.

1-year Treasury-indexed ARM averaged 2.83 percent this week with an average 0.6 point, up from last week when it averaged 2.82 percent. At this time last year, the 1-year ARM averaged 3.48 percent.

Frank Nothaft, vice president and chief economist at Freddie Mac, reports, "Fixed mortgage rates fell to all-time record lows this week following the Federal Reserve's announcement of its Maturity Extension Program and additional purchases of mortgage-backed securities. Interest rates for ARMs, however, were nearly unchanged as the Federal Reserve plans to sell $400 billion in short-term Treasury securities, which serve as benchmarks for many ARMs."

"Meanwhile, the spring and summer home-buying season gave a boost to a number of house price indexes. The Federal Housing Finance Agency reported that its National index (not seasonally adjusted) rose for the fourth consecutive month in July. Similarly, the S&P/Case-Shiller® 20-City composite index, which has a broader scope of properties, rose 0.9 percent between June and July with 17 of the cities experiencing positive monthly growth. Finally, CoreLogic® reported that its index, excluding distressed sales, increased at a 1.7 percent monthly rate for the same month."

Bye Bye Bank of America Wholesale Lending

 

Bank of America announced today that it plans to exit the wholesale mortgage lending business.  They state that as part of their “customer driven” business model they have decided to focus on opportunities to “deepen our relationships with existing Bank of America customers" and to offer responsible and competitive mortgage products to new customers.  “By responsibly exiting our relatively low market share" (22%) “in the highly diversified wholesale mortgage market.  We can redirect critical operational resources to enhance capabilities for consumers to purchase or refinance homes” 

So let me get this straight, they think that by limiting distribution of their mortgage products they can somehow help consumers?  It seems to me that by limiting access to product they are directly opposing what is in the best interest of consumers. 

We have seen this before.  In Washington Mutual's “glory days", that is the years before the whole mortgage meltdown, we watched Washington Mutual move in and out of wholesale lending time and time again.  Interestingly enough their most profitable years coincided with the years that the majority of the loans they originated were through their wholesale lending relationships.  We certainly wish Bank of America best success in this endeavor, after all it is a free country so why not put the squeeze on consumers if you can.  Brokers, do not worry, they will be back.  In the meantime, Bank of America is not the only game town

This blog was written by Brian Leavitt, Designated Broker of Northstone Real Estate Inc, and Northstone Mortgage.

Brian serves clients within the Northwest Multiple Listing Service. And specializes in residential re sale homes, condo’s and land, and is uniquely qualified as a short sale negotiator holding both real estate and mortgage licenses.

You can contact Brian directly by phone at 800-806-3145 or by email at brian@northstone.net.  Click here to view his client newsletter.

Brian is licensed with the Washington State Department of Licensing and the Washington State Department of Financial Institutions License number MLO-114864 and is a member of the Seattle King County Association of Realtors and Northwest Multiple Listing Service.

Dear Zillow please blog this

From Zillow April 27, 2010

 

“Dear Brian,

 

In reviewing your recent quote ZQ-XXXXXX, we see that this rate is too low. If you feel this is not the case please provide information with the details such as who is the investor, what is your base rate, and lastly what are the ad-ons.

Community Relations

Zillow.com”

 

Response April 27, 2010

 

“Dear Zillow,

I reviewed the quote, and in fact reviewed all of my recent quotes, and have verified that indeed the quote is correct.  I suspect that once again my competitors are complaining about our rates.  You might find this surprising but our clients NEVER see this as a problem.  As far as telling you who my investor is that information is confidential.  My base rate and all fees are disclosed in the quote.  Perhaps the best way for you to verify these rates is to allow me to refinance your home or assist you in a purchase.  Upon completion of a loan application I will be delighted to lock your loan as disclosed in the quote and guarantee this rate.  What is your rate now?

 

If you have an opportunity I would appreciate it if you would blog about this on the Zillow website.  I find it interesting that just because my competitors can’t compete this is viewed as a problem.

 

A mutual friend of ours works for Zillow and I forwarded him a confidential copy of our wholesale pricing matrix so that you may verify the authenticity of these rates although he will not provide you with the investor details.

 

P.S.  If you think this is low wait until you see our new JUMBO program rolling out this afternoon.

 

Brian Leavitt

Designated Broker

Northstone Mortgage

425-837-4700

broker@northstone.net”

Refi Plus Now In Effect

The Making Home Affordable program announced by President Obama and the U.S. Department of the Treasury on 03.04.09 includes a new initiative, Home Affordable Refinance, to provide refinance opportunities to borrowers with mortgages held or guaranteed by Fannie Mae. This initiative is for borrowers who have demonstrated an acceptable payment history on their mortgage but due to a decline in home prices, have been unable to refinance to obtain a lower payment or move to a more stable product. Use this loan lookup tool to determine if your loan is held by Fannie Mae.

 

Many consumers, lenders and mortgage professionals like myself have been waiting for the Refi Plus Program sponsored by FNMA to go into effect.  We have been told it will on April 5^th, 2009.  Below are bullet points that will summarize the benefits to home owners with mortgage loans:

 

·         No Minimum Credit Score Required.

·         New Lender Does Not Need to Be the Current Lender.

·         Reduced Income Documentation Allowed on All Loan Applications.

·         The automated system most lenders use (DU) will approve borrowers on this program. This will help increase the number of approved clients requesting Refi Plus.

·         If existing loan does not have mortgage insurance (MI), the new loan will not have MI regardless of the Loan to Value.

·         The New Loan must be a 5 year + fixed term loan (5, 7, 10 15, 30 year type loan).

·         Loan to Value ok up to 105% with an unlimited CLTV subject to the 2^nd lender allowing the subordination.

·         3 to 4 unit only ok to 80% but after May 3^rd, 2009, ok to 105% Loan to Value.

 

This program is now available through Northstone Mortgage

by Brian Leavitt Northstone Real Estate, Inc.

Brian Leavitt is a Licensed Real Estate Broker and a Licensed Mortgage Broker representing  Northstone Real Estate Inc and Northstone Mortgage.

Brian Serves clients within the Northwest Multiple Listing Service.

You can contact Brian directly by phone at 425-837-4700 or toll free at 800-806-3145 or by email at broker@northstone.net

Click here to see Brian's client newsletter.

Brian is licensed by the Washington State Department of Licensing and the Washington State Department of Financial Institutions License number 510-MB-19802 and is a memberr of the Seattle King County Association of Realtors and Northwest Multiple Listing Service.