A guide to home ownership in 90 days
I AM A LENDER FOR PURCHASES
WHO IS MELANIE? I am a Mortgage Loan Officer that specializes in lending to people with eventful and uneventful credit. Life happens
REFINANCES RENOVATIONS
LOAN TYPES
INVESTMENTS
CONVENTIONAL LOAN This is a standard mortgage with 3%-20% down. 20% down eliminates mortgage insurance. You
to the best of us, And I mean the
qualify for the best rates and your loan is not
BEST of us. That doesn't mean
backed by the government.
you don't deserve to be a home
FHA LOAN
owner or that you are excluded
This is a government backed or sponsored loan
from building wealth. As an
that allows not-so-perfect credit applicants to
entrepreneur of 3 businesses, I understand the value of time and money; mine and my clients. As
become homeowners. Mortgage Insurance required for the life of the loan. Low down payment of 3.5%. VA LOAN
your Loan Officer, I will help
This loan is backed by the Veterans
make your dream of home
Administration. 100% financing no money down.
ownership and wealth building
JUMBO LOAN
come true.
This loan is for $510,400 and above in financing.
Purchase a home in 90days
GETÂ QUALIFYING CREDIT SCORE GET LENDER PRE-APPROVAL
DAY 8-30
CONNECT WITH REALTOR WRITE OFFER FINAL WALK THROUGH FOR CLOSING
640 and up credit score uneventful
DAY 1-7
COMPLETE LENDER APPLICATION
GET CREDIT SUGGESTIONS SUBMIT DOCUMENTS FOR RESCORE
DAY 31-60
GET LENDER PRE-APPROVAL CONNECT WITH REALTOR WRITE AN OFFER / EARNEST DEPOSIT
DAY 61-90
ORDER APPRAISAL / HOI APPRAISAL / ADDRESS REPAIRS FINAL WALK THROUGH FOR CLOSING
580 and up credit score with events
DAY 1-30
COMPLETE LENDER APPLICATION
CREDIT
COMPLETE AN APPLICATION TO GET YOUR TRUE CREDIT SCORE First-time buyers rely on online credit reports when the reality is, mortgage lenders never use that scoring. Each lender has it own credit report used specifically for mortgage credit worthiness.
CREDIT RESTORATION VS CREDIT SCRUB Credit Restoration companies will charge you a monthly fee to manage your debt and over time your score is suppose to increase.
Credit Scrubbing is illegal. This is when your real debt is removed or deleted without creditor approval. This is a red-flag for a lender.
INCREASE YOUR CREDIT SCORE After reviewing your credit report for installment debt history, payment history, amount of student loan debt, bankruptcy, or foreclosure, I will walk you through any suggestions to improve your credit for FREE.
ASSETS
UNDERSTANDING ASSETS FOR DOWN PAYMENT Lenders typically recommend homes with a cost no more than three to five times your annual household income, with a 20% down payment and moderate amount of other debt. Who has that! There are other options.
TYPES OF ASSETS Initially you'll provide some financial information to your lender - such as your income and amount of savings.
401k Savings is an asset Life Insurance is an asset Real Estate is an asset People are an asset
DOWN PAYMENT REQUIREMENT Non Qualified Mortgage 580 or less requires 10% - 15%
FHA Loan 580 - 640 3.5%
Conventional Loan 640 - 800 3% - 20%
VA Loan 540+ VA 0% down
INCOME
INCOME REQUIREMENTS Buyers always want to know how much house they can afford before doing anything. The reality is, your credit score, debt, assets and income will determine your buying power no matter how much you make.Â
INCOME CALCULATIONS You don't have to work a 9-5 to buy a home. But you do have to have a stream of income to support the mortgage. Independent/Contract Disability/SSI/Trust Child Support/Alimony annual salary / 12 = AMI hourly rate x hours per week / 52 = AMI
DEBT-TO-INCOME RATIOS Non Qualified Mortgage 40/50 FHA Loan 31/43 Conventional Loan 36/45
DTI Recurring monthly debt / AMI
Front End Ratio PITI / AMI
Back End Ratio PITI + Debt / AMI
STEP 1
Get pre-qualified Initially you'll provide some financial information to your lender - such as your income and amount of savings. For pre-approval, I will need 2 years of W-2 statements, 30 days of paystubs, 2 months of bank account statements and permission to run a credit check.
connect with a realtor Take your pre-approval to your Realtor and begin searching for your dream property. Always remember you can rehab the property to be what you want it to be.
submit an offer After touring homes in your price range, your realtor will assist you in writing an offer on the right home. You'll present a fair offer based on the value of comparable homes in the area. You will also submit
earnest money
to
show good faith that you want the property. The earnest money is usually $500 - $1000 or 1% of the cost of the property.
STEP 2
HOME INSPECTION
HOME OWNERS INSURANCE
The immediate step after making an offer
Homeowners insurance can be rolled
and having it accepted is to complete any
into your mortgage payment. This is
inspections that the offer was contingent
used to cover repairs and
upon. If one of the contingencies was a
replacements on systems and
home inspection, you'll have a certain
appliances in your home, usually for
number of days to complete this after the
a period of a year. Can cost
offer is accepted. It will cost around $300.
between $50-$175 monthly.
APPRAISAL
TITLE
This is a standard cost to the buyer.
Handled by the Seller's Attorney, A
The price may vary depending on the
title search is a review of the chain
property type. The purpose of the
of title (owners) to your property
appraisal is to confirm the value of
done by a title examiner at the
the property. It can cost between
local courthouse to ensure there are
$450-$850.
no liens or bills due that will prohibit the property from being sold.Â
STEP 3
UNDERWRITING, APPROVAL & CLOSING "Final approval” on your mortgage loan comes from the underwriter. These are the individuals responsible for reviewing and analyzing all the paperwork lenders require. After a first review, the underwriter will issue a list of requirements. These requirements are called “conditions” or “prior-to-document conditions.”
Your primary job during the time your loan is in underwriting is to move quickly on document requests, questions, and anything else that's asked of you. No matter how absurd you think the doc request might be, set that hoop aflame and jump through it as quickly as possible
TERMS TO KNOW Lender –
The financial
institution funding your loan
Realtor –
A Licensed
Loan Officer –
A Licensed
Appraisal –
A lender
professional managing your
requirement for funding. It
loan file for the purchase of
will prove the value of the
the property.
home. Costing $450-$800.
professional showing you properties. See this person
Closing Costs
for contract issues and
costs occur when the title of
showing you have submitted
earnest money instructions.
property is transferred from
income and assets and can
the seller to the buyer. The
shop for a property. Expires
total dollar amount of
after 3 months.
Down Payment
- Cost to
– Closing
Pre-Approval
– A document
buyer of 3% - 20% of the
closing costs is stated in the
purchase price. The buyers
Loan Estimate and again in
Earnest Money Deposit
investment in the
the Closing Disclosure.
Money submitted with offer
transaction.
Closing costs may be paid
to show serious interest in
by the seller or the buyer.
property. $500-$1000
–
r o f tips
:
MORTGAGE FINANCING Always check with Melanie before doing any of the following prior to closing on your home: Making a big purchase:
Avoid making major purchases, like buying a new car or furniture, until after you close on the home. Big purchases can change your debt-to-income ratio that the lender used to approve your home loan and could throw the approval into jeopardy. Opening new credit:
Do not open any new credit cards or get a loan without speaking to Melanie first. Missing any payments:
Pay your bills on time to keep your credit score from dropping. Cashing out:
Avoid any transfers of large sums of money between your bank accounts or making any undocumented deposits - both of which could send "red flags" to your lender. Keep the same job:
Don't begin looking for new work right now, unless it's a second job to make extra money or a higher salary in the same field.
Notes
Key into 2020 Melanie McQueen NMLS #1686985 Mortgage Loan Officer Cell: 708.420.3923 Fax: 331.214.3398 Email: mmcqueen@prmg.net Website: mmcqueen.myprmg.net Designed by: White Box Events by Melanie LLC