New FICO 8 Mortgage Score Now Available on all Top Three U.S. Credit Reporting Agencies

FICO, the nations leading credit score provider announced some big news....

A brand new FICO® 8 Mortgage Score

This new credit scoring model is designed specifically for mortgage lenders and focuses on providing a more precise risk assessment for the real estate market.

FICO® claims that the new FICO 8 Mortgage Score will reduce borrower, lender, and investor risk, and help support market stability

The FICO® 8 Mortgage Score will analyze the full credit history for the borrower and aids mortgage professionals in better predicting a borrowers risk so they can mitigate the incidence and high cost of foreclosure.

Take a look at this Exerpt from the FICO.com website...

"MINNEAPOLIS—October 26, 2010—FICO (NYSE:FICO), the leading provider of analytics and decision management technology, today announced that its latest credit scoring product, the FICO® 8 Mortgage Score, is now available from all three major U.S. credit reporting agencies. Mortgage lenders now have access to more precise risk assessment tailored for the real estate market, which can help support market stability and reduce borrower, lender and investor risk.

The FICO® 8 Mortgage Score was built specifically to help mortgage lenders better predict mortgage performance and improve credit decisions for both current and prospective homeowners. The score analyzes the full credit history on file to deliver significantly sharper assessment of mortgage repayment risk, and aids servicers in earlier identification of borrowers at risk so they can mitigate the incidence and high cost of foreclosure. Validation results have demonstrated an additional predictive value of up to 15 percent for mortgage servicing over the broad-based, all-industry FICO® Score used most widely today.

“The FICO 8 Mortgage Score’s broad availability means that all U.S. lenders and servicers can now easily access scores that are fine-tuned for mortgage performance,” said Jordan Graham, executive vice president of Scores and president of Consumer Services at FICO. “Moreover, by combining this superior predictive performance with the FICO Economic Impact Service, lenders are able to adjust policies and strategies quickly based upon forward-looking economic modeling. This is what we mean by the FICO analytic advantage: the ability to use the most advanced predictive analytics to compete and win in this highly challenging environment.”

“To do the best job of evaluating risk and increasing profits, lenders need updated credit scoring analytics that incorporate mortgage credit performance since the subprime mortgage meltdown,” said Craig Focardi, senior research director at TowerGroup. “The availability of mortgage credit scores across all three credit reporting agencies will enable lenders to upgrade their loan underwriting and account management practices.”

The FICO® 8 Mortgage Score retains the same 300-850® scoring range, minimum scoring criteria, authorized user and inquiry treatment as the general-risk FICO® 8 Score. To achieve its significant increase in predictive strength, FICO Mortgage Score assesses several additional data variables from consumer credit files to specifically predict mortgage repayment risk. Accordingly, FICO Mortgage Score includes additional score reason codes compliant with the Fair Credit Reporting Act that help lenders understand and explain the scores to applicants."

Full Post here: http://www.fico.com/en/Company/News/Pages/10-26-2010.aspx

How do you think this new scoring system will affect the Lending Industry?

To your success,

Oliver Graf

Real Estate Expert
Follow me on Twitter: Twitter.com/OliverGraf360



*** Make sure you sign up for our FREE mailing list today! ***

The price of a “no-cost” loan

Some home buyers who may be concerned about paying high closing costs might be tempted by a “zero-cost” or “no-cost” loan option, which requires no cash outlay, but typically adds a half percentage point to the rate.

However, some financial consultants say these loans tend to be most beneficial to buyers planning to have the loan for less than five years.

KEEP THIS IN MIND

• One of the primary differences between a no-cost loan and similar loans is that no-cost loans do not tack on closing costs to the balance, but instead increase the rate.

• With no-cost loans, third-party fees including the appraisal, credit report, title insurance, recording, and the use of a mortgage broker are paid by the lender. The fees, including the amount the broker is being paid, are disclosed on the closing statement.

• Home buyers who bypass a broker and work directly with a lender may encounter less transparency, as loan officers are not required to disclose the amount the bank is making on the loan.

• Borrowers weighing their loan options are advised to use a mortgage amortization calculator to compare the costs for a conventional loan compared with a no-cost loan. The Federal Reserve provides an amortization calculator on its Web site at www.federalreserve.gov.

Read the full story:
http://www.nytimes.com/2010/10/24/realestate/24mort.html?ref=realestate


What are your thoughts on "No-cost" Loans?



To your success,

Oliver Graf

Real Estate Expert
Follow me on Twitter: Twitter.com/OliverGraf360



*** Make sure you sign up for our FREE mailing list today! ***



--
Real Estate Purchase
Real Estate Sales

Real Estate Buying

San Diego Based Real Estate Blog

The FHA’s 203(k) Rehab Program provides loans that cover Rehab & Renovation costs

Here is a great loan program if you are looking to do Rehabs or buy a property that needs work...

A little-known loan program for fixer-uppers

Home buyers thinking of purchasing a distressed property in need of repair, but who are concerned that the cost of the repairs could drain their savings account may qualify for the Federal Housing Administration’s (FHA) 203(k) rehabilitation program.

MAKING SENSE OF THE STORY FOR CONSUMERS

* The FHA’s 203(k) rehabilitation program provides loans for covering renovation costs as well as the purchase price of the primary residence. Investors are not eligible for this program. Additionally, similar to traditional FHA loan programs, the rehab program allows for a down payment of as little as 3.5 percent.

* A common misperception about the program is that the house needs to be unlivable. Realistically, the property just needs to be outdated, according to a lender familiar with the program. The property “just has to appraise below market value and then at market value with the repairs.”

* Improvements deemed “luxury” are ineligible; however, the program has a wide range of definitions for “repairs” and “modernization.” Covered repairs include items such as a new roof or heating system, as well as decorative changes, like replacing vinyl with ceramic tile on the kitchen floor or painting the interior.

* In addition to putting down at least 3.5 percent of the current value of the property, buyers also must use a HUD-approved lender, appraiser, and a contractor approved by the lender for the repairs. One list of approved businesses can be found at 203kcontractors.com.

* Borrowers considering the FHA rehab loan program should be aware that loan rates typically run around a percentage point higher than conventional loans, and come in 15- to 30-year terms, either fixed or adjustable. Additional paperwork for inspection, appraisal, title updating, and the like can increase closing costs by $1,000 or more higher than the average.

* For additional information about the FHA 203(k) rehabilitation program, please visit http://www.hud.gov/offices/hsg/sfh/203k/203kabou.cfm

From Oct. 21st, 2010. Market Matters Weekly Advisory
Reprinted with permission of the CALIFORNIA ASSOCIATION OF REALTORS®

How do you think buyers can benefit from this program?

Tips on loans and financing for Mobile and Manufactured Homes

What are mobile home loans?

Mobile homes are actually manufactured homes which are normally found in campsites or mobile home parks. They are transported by tractor-trailers over public roads to sites. Sometimes they are used as temporary accommodation on campsites. These houses can be placed in one location permanently as well as can be moved to other areas. If you want to buy this kind of homes, then you can take the help of mobile home loans from FHA (Federal Housing Administration) approved lenders. FHA approved lenders generally give loans from their own funds to eligible borrowers to finance the purchase of mobile home. FHA insures the lender against loss if the borrower can't make the payments.

Objective of the loan
The mobile home loan is used to purchase a manufactured home, a lot on which a manufactured home is to be placed.

How to qualify for mobile home loans?
The eligibility criteria for the mobile home loans are as follows:
• Borrower should have sufficient income to make the minimum required down payment.
• Borrower must be able to prove that they can make the payments on the loan and cover their other expenses.
• Borrower primarily intends to occupy the manufactured home as his principal residence.
• Borrower must have a suitable site to place the manufactured home. It can be a rental site in Manufactured Home Park or can be a home site. The site should have adequate water supply and garbage disposal facilities.
• The borrower should have an average credit score.

Loan term
The maximum term for a manufactured home or a single-section manufactured home is twenty years. However, for a multi-section manufactured home and lot, the term is for 25 years. For a manufactured home and lot, the term is for 15 years.

How can you find the dealer who gives mobile home loans?
You can get the contact details of the lenders in your area who give mobile home loans from the local retailers. Contact us if you need help of have any questions.

However, it should be noted that one of the basic criteria for getting mobile home loans is that manufactured homes must be according to the Model manufactured home installation standards.


Investing
Mobile home parks can be a great investment for the short and long term. If your interested in comercial real estate, especially mobile home parks, I recommend you take a look at this system, they give you everything you need to succeed. Click Here to find out how to make money with mobile homes!








Guest Post by:
Sabrina Gomez
http://www.mortgagefit.com/mobile-homeloan.html


****** Make sure you sign up for our FREE mailing list today! *****



--
Real Estate Purchase
Real Estate Mobile homes
Real Estate Buying
San Diego Based Real Estate Blog

How to Successfully Launch a profitable Real Estate Business

How to Successfully Launch a profitable Real Estate Business

The hardest part of getting your Real Estate Investing business started is overcoming the fear of the unknown that comes with attempting anything new. Many of my students get stuck before they even start suffering from analysis paralysis. Getting caught in the train of thought that if they just buy one more seminar, they will finally feel confident enough to get in the game and finally start doing deals.

What we all need to understand is that fear will never go away no matter how many courses you buy, or how many boot-camps and seminars you attend. The only way to get over this fear is by actually getting in the game, you need to face your fears and execute! We do not need to start with huge deals getting started, or even any of our own money. So many times, investors think that they need to put everything on the line to get into real estate investing. That is so far from the truth, I did my first almost 50 deals without ever using any of my own money or credit. This are what everyone has heard of called "baby steps", everyone that is successful today started with baby steps. These are just stepping stones to growing a big investing operation like myself and my partners have. It all started with finally pulling the trigger and doing are first deal. Looking back on it now with over 300 deals under my belt, the only regret I have is not getting started sooner!

Here is an easy action guide for you to start using today, this will help you finally start working towards your goals. Follow these easy steps and you will be well on your way to being a successful real estate investor!

Attend a REIA / Meetup / Investment club meetings : Networking with other investors is the best and first step to starting your investing career. The people you will meet at these events can be a big help to you while first getting started. I always say that "Relationships are the only shortcuts to success". For a lot of us this can seem a little nerve wrecking in the beginning, but be rest assured that this is the most important step in starting your business. Another major bonus is that these meeting are usually free! If this is a big challenge to overcome, you might want to consider attending one of my events to help you sharpen your networking skills. Remember... you are always on the air!

Meet with successful Investors: Sometimes we need to see before we can believe. Meeting with an active successful investor will give you the inspiration you need to get your butt into gear. When I was first getting started I made it a point to meet and surround myself with as many of these people as I could. We have all heard that saying..."You income is the exact average of the 5 people you hang out with most"...so why are you hanging out with your broke friends? If you need help finding successful investors to meet with, a REIA or Networking group as explained above is a great place to start.

Take Action: The only way to invest in your first deal is by finding your first deal!! Whatever your chosen model is, you need to find properties to invest in. So if you are going to be looking for motivated sellers, then you need to get on the phone with sellers. The only way we can get better at talking to our clients is by talking to more and more of them. Practice makes perfect, right? No! Perfect practice makes perfect! Practice your scripts, roll play your scripts and get on the PHONE!! Read this very carefully...TAKING ACTION WILL MAKE YOU RICH!!

Getting starting and making money investing in real estate is not easy and anyone that tells you it is has not done any deals. If you want to be successful you need to be ready to get outside of your comfort zone and act in spite of fear! Because of this we must make sure we are always surrounding ourselves with the right people on a regular basis as well as feeding our mind positive thoughts on a regular basis. Make sure to check back for my next post on "The Winning Mindset."

What are you going to do to get started?


Yours in Success,

Sam Khorramian

Success Expert



****** Make sure you sign up for our FREE mailing list today! *****


Real Estate Buying
Real Estate Investing
Real Estate Tips and Tricks
San Diego Based Real Estate Blog

Escrow Checklist - How to Close your Real Estate deals Easy and Fast with these handy checklists

Escrow Checklist - How to Close your Real Estate deals Easy and Fast with these handy checklists

Escrow Checklist – Closing Checklist - List of Items needed

Below is a great escrow checklist for closing your deals. When agents and investors start closing deals sometimes the details can get over looked. So as your deals start coming to fruition you will want to systemize things to make it easy. Take a look below at some of the Items that will be needed for most closing’s in CA (Other states will vary slightly). Print out the checklist below and turn it into a checklist for each one of your buyer/seller transactions. Put them in each file and check them off as you get the Items in, that way you can stay on track and make sure there are not delays as you progress towards a successful closing.

Seller Escrow Checklist

1) Escrow Instructions – Review with escrow officer and check for accuracy

2) HOA information (if applicable) – Get HOA information and find out if there are any problems with the building. Make sure a condo cert has been ordered. Get all contact info and payoffs.

3) Confidential Statement of Information – Must be fully and accurately filled out so the title company can complete their title search.

4) Certificate for 1099 Reporting – Make sure it is complete and signed

5) Affidavit of Non-Foreign Status – IRS requires buyers to buy from a foreign seller to withhold 10% of the purchase price from the sale proceeds, this form shows that they are in fact a US Resident and of “Non-Foreign Status”

6) California Real Estate Withholding Certificate (Form 593-C) – Completed. Determines if the seller is exempt from Franchise Tax Board. For additional Information call the Franchise Tax Board at 888 792 4900

7) Grant Deed – Signed and Notarized. Make sure the names match title.

Buyer Escrow Checklist

1) Escrow Instructions – Review with escrow officer and check for accuracy

2) Confidential Statement of Information – Must be fully and accurately filled out so the title company can complete their title search.

3) Insurance Information – The lender will

require at least fire insurance prior to funding. Designate an Insurance agent and supply contact information.

4) Preliminary Change of Ownership – Filled out and submitted to the County Recorders office at the time of recording the grant deed. Used by the tax assessors office.

5) Vesting worksheet – Showing how title will be held. Needs to be supplied to lender prior to docs.

6) HOA information (if applicable) – Get HOA information and find out if there are any problems with the building. Make sure a condo cert has been ordered.

What else are you using on your checklists, how can we make this list better?

To your success,



Oliver Graf

Real Estate Expert

Follow me on Twitter: Twitter.com/OliverGraf360







*** Make sure you sign up for our FREE mailing list today! ***







--

Real Estate Purchase

Real Estate Sales

Real Estate Buying

San Diego Based Real Estate Blog

Foreclosure Properties are selling at a Record Pace - Get them before they are gone!

Good Foreclosure Properties are selling FAST!

Buyers in most areas are finding that bank owned / real-estate owned (REO) properties(homes that the lenders have repossessed and put back on the market)often are selling the day they are listed for sale, sometimes faster. According to the founder of Foreclosure.com, offers on REO properties are coming in immediately after the listing comes on the market, and some homes have been put into contract in less than 90 minutes.

What this means to buyers today…

• On average, inventory on California properties priced less than $300,000—the most-competitive price point for todays foreclosure buyers—have dwindled from a 10-month supply a year ago, to less than a 4 month supply in July, according to the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)

• Since the inventory levels of homes priced in the lower end of the market are so low, buyers are finding that lenders/sellers are not willing to negotiate on the price. In many instances, lenders/sellers expect the first offer to be the best and highest possible for the buyer, and most are being sold over list price. Since competition is so high, when writing offers be prepared to make the best offer you possibly can upfront in order to be considered.

• Instead of holding onto REOs for the best prices—and paying the property taxes and maintenance and carrying costs—many banks are selling these properties as quickly as possible, according to Foreclosure.com. “In this market, if banks can liquidate them fast, it makes more sense to get them off the books,” said the company’s founder.

• In spite of efforts by lenders and the government to prevent foreclosures, many economists and housing experts are predicting another wave of foreclosures by year’s end, and many of those properties will be offered for a quick sale. According to the U.S. Comptroller of the Currency, 53 percent of loans that were modified in the first half of 2008 fell back into arrears and will most likely end up in foreclosure down the road


If you are serious about buying property while taking advantage of the available tax credits make sure that you and your agent are prepared to work quickly!


What have you noticed from the REO buying experience?


For any help or questions on buying REO’s Please contact me:

Oliver Graf
Real Estate Expert


*** Make sure you sign up for our FREE mailing list today! ***

--
Real Estate Purchase
Real Estate Sales
Real Estate Buying
San Diego Based Real Estate Blog

How to write up the Perfect Real Estate Offer

How to write a perfect Purchase Offer

Top 10 Tips for Writing Purchase Offers

So you’re ready to buy a house? First off congratulations!

The first step in buying property is writing up an offer. Many people do not realize how important the offer contract can be when buying real estate. If you have a poorly constructed offer it can cost you getting the property you want, while a well written offer can get you the property you want at the price you want!

Meanwhile use the following tips as a guide to creating a great offer:

1. Get the right Contract

This might seem basic, but there are a lot of purchase contracts out there. Each state has its own rules and regulations. Realtor associations publish purchase contracts. If you are looking to buy in California, please contact me and I will help you with the correct forms.

Some example purchase contracts would be:

• · New Construction Residential Purchase Agreement
• Notice of Default Purchase Agreement
• Residential Purchase Agreement
• Residential Income Property Purchase Agreement
• And many more

2. Determine what price you want to offer

Evaluate market conditions and come up with what you think is a fair offer price. TIP: Initially offer a bit less than you expect to pay, this will give you some room to negotiate and possibly get an even better deal. Be prepared to move quickly, in today’s market the good properties are being sold very quickly.

3. Put down a deposit

You will need to make a “good faith” deposit. The most common deposits can be cash, personal check, or cashier's check. On average the deposit amount should be at least 1% of the sales price. This money(a copy of the check) will be submitted with your offer.

4) List your Financing Terms

Disclose the type of financing you hope to obtain: The amount of money down and the type of loan (conventional, FHA, VA, contract of sale, assumption or other).

Please remember that your deposit, when added to your down payment and financing should equal the total consideration paid.

6. Include Contingencies

Contingencies are: Conditions --or "safety valves" written into Real Estate offers and contracts that protect they buyer from buying a house that is unsatisfactory--either structurally or financially

Contracts carry provisions for contingencies as:

• Appraisal (California gives 17 days to complete all inspections)
• Loan Funding
• Physical/Home Inspections.

7. When do you take possession of the property?

• Spell out the possession date. Is it on closing? A day after closing?
• If possession will be prior to closing, enter into a rental agreement to protect all parties.
• If possession is more than two or three days after closing, execute a rental agreement to protect the buyer.

8. Negotiate Who Pays the Fees

Even though most contracts call for fees to be negotiable, some fees, depending on your state, are customarily paid by one party. You can spell out who pays fees for title, escrow, and county or city transfer taxes. In most cases the Seller will pay the fees.

9. Request Special Reports

If you are concerned with anything with the property ask for a Special Report Upfront. Example Reports: Termite Report, Lead based paint report, and Mold inspections.

10. Clearly State Expiration of Offer

Clarify when the offer will expire. You will want to give the seller enough time to come to a decision, but not allow them to take their sweet time.

For any help or questions on creating a great offer contact:


Oliver Graf
Real Estate Expert

Follow me on Twitter: Twitter.com/OliverGraf360


****** Make sure you sign up for our FREE mailing list today! *****


--
Real Estate Purchase
Real Estate Sales
Real Estate Buying
San Diego Based Real Estate Blog