Atlanta Mortgage News

SKIPPING THE MORTGAGE PAYMENT  March 28, 2020

Have you heard the news talk about skipping a mortgage payment? Or perhaps the news discussed forbearance options and delayed foreclosure or evictions? This is always the last resort because you signed a legal agreement to pay the mortgage payment if you want to keep the house. A home is not a right in this country.

    Some borrowers will be tempted to skip payments whether they need to or not. Before you cancel that auto-draft, go to your lender‘s website which it has lots of options, mights and maybe’s. The note you signed with the attorney at the closing table has NO mights or maybes. Don’t be deceived. Those skipped payments are NOT forgiven but mIght or maybe delayed or restructured, resulting in a large lump sum or higher interest rate with a restructured mortgage payment months later.

    If you have the financial resources, you should continue to make payments, as skipping payments will likely cause significantly more financial strain at a later date. If you really have no money and absolutely can not make your payment, don't just stop paying. Call your lender and discuss the options thoroughly so you understand the full consequences of your next step. The hold times and recordings may be long, but knowing their next step will be worth the wait.

Posted by Elizabeth Washburn on March 28th, 2020 10:22 AM

Good afternoon,

 

A few weeks ago, the industry saw a rate drop due to a volatile 10 Yr US Treasury. Today, the industry is giving out higher  rates while things are constantly changing and evolving in these unprecedented times. Here are perhaps the main risks influencing rates today, not specific to any lender but the mortgage industry as a whole:

  1. The market has been extremely volatile lately, and the recent pattern of the market tanking-rallying-tanking-rallying is resulting in expensive and dangerous margin calls often costing an entire point or more. This is a VERY risky time for lenders to take new locks under these market conditions, which is a big reason you are seeing rates industry-wide that seem to say, “We aren’t locking right now”. To survive this storm, mortgage lenders have to make very smart decisions, including not taking huge indeterminable risks that could be detrimental to the longevity of the company.

  2. Mortgage Backed Securities are viewed as riskier today in these anything-but-typical market conditions we are currently seeing because:

    1. There is a concern that a disproportionately large number of the mortgages closing now will be paid off via refinances within 12 months (AKA “EPO, Early PayOff”) if rates drop again when the market stabilizes, resulting in an enormous cost to the original lenders. 

    2. There will certainly be a huge influx of missed mortgage payments in the coming months due to factors such as Fannie Mae and Freddie Mac temporarily suspending foreclosures and evictions, new forbearance options allowing borrowers to delay some mortgage payments, and borrowers losing their jobs or experiencing a pay cut affecting their ability to pay their mortgage payments. Some estimate that 25% of borrowers may not make their mortgage payments in the coming months. 

NOTE: Under current policy, mortgage servicers are STILL responsible for paying the principal, interest, taxes, and insurance to the bondholders, even when the borrower does not make the mortgage payments to the servicer. This is expected to cost the mortgage servicers up to an estimated $40 BILLION dollars over the next 3-4 months across the industry without Federal help.

Posted by Elizabeth Washburn on March 25th, 2020 5:52 PM

Rates are hovering at 3.25%! 

 If you have a old mortgage and want cash out but still want your payment to go down, call me.  I bet we can do that!

If you have a new mortgage, and your rate is over 4%, call me to check the numbers.

If you have a VA loan with a rate over 3.75%, we need to get you a streamline VA and drop that payment as well as skip a payment! I bet we can do that too!

If you were thinking about that second home or an income producing property in your portfolio, now is the time.

This is a fantastic time to get your real estate portfolio in order! 

Add it to your list of things to do by calling me!!

Elizabeth

New Threshold Mortgage, Inc.

Direct: 678-467-2330

ORDER CREDIT REPORT
2500 Caladium Drive NE

Atlanta, GA 30345

GA License #19238  NMLS LO License #169110  CO #168980 

A Georgia Residential Mortgage Licensee

 

Posted in:Refinancing and tagged: refinancemortgage
Posted by Elizabeth Washburn on February 4th, 2020 10:02 AM

ACCESSING THE 401(K)

Before you race to the bank and cash-out your retirement to purchase your castle, take a few minutes to assess the implications outlined below.

LIQUIDATION

Ordinarily, you can't take money from your 401(K) plan until you retire, leave the company or become disabled, but many accounts permit certain “hardship withdrawals” when there is an immediate financial need. While hardship withdrawals are allowed by law, your employer is not required to provide them in your plan. Sometimes this "hardship withdrawal" includes the purchase of a principal residence. If unsure as to whether yours does, check with your employer’s human resources department.

The drawback of liquidating in this manner is that the funds are immediately taxable since they were saved tax free. Likely they would be taxed at your current tax rate, but it could be higher if the fund liquidation puts your income into a higher tax bracket. There is also a penalty, typically 10% of the funds withdrawn. The exact amount of the penalty is spelled out in your plan.

LOAN

Another option is borrowing against your 401(K).  Often you can borrow as much as 50% of your account balance. You pay interest on the loan, and the interest is credited back to your account.  Sounds great, eh?  The money you receive is not taxable either (as long it is paid back), and there is no penalty.  Most plans offer anywhere from five to thirty years to pay the loan.  In a perfect world, it's a perfect plan!

However, this is not a perfect world.  There are some risks involved in borrowing from your 401(K) too. If you lose your job or leave your employer, you must pay back the loan in full within a short period of time, sometimes in as little as sixty days. If the money is not paid back in time, the loan is converted to a withdrawal and subject to the taxes and penalties you were trying to avoid.  The hardest part of that scenario is that unlike the liquidation, your bank did not hold back the taxes and penalty costs, so you will be subject to finding those funds by tax time and you might be unemployed while all this is happening. That’s no fun. When reviewing your qualifications, most lenders will NOT count the money you borrowed from your 401(K) as an additional debt, but they will reduce the asset by 30% and subtract the amount of the loan as well.

DECISION MADE: DO IT RIGHT

When you set this ball in motion, it is very difficult to stop so make sure you lender has seen the account where you plan to deposit the funds BEFORE you do it.  A good broker has an eye for anything funky on a bank statement.  Also, keep a copy of ALL the paperwork.  This includes applying for the liquidation, any correspondence from the bank, any check or wire record, and the printout from the bank showing the funds transferred into your bank account. Be in full communication during the liquidation process so nothing gets in the way of obtaining your new home.

Posted by Elizabeth Washburn on January 10th, 2020 12:23 PM

BLUES AND GREENS

REFINANCE BLUES- adj- The feeling you have when you know you need to refinance, but you are dreading the cost and the process involved.

REFINANCE GREENS - adj - The color of your wallet and your friend's faces when they know you are done with your home refinance.


This year will be one to remember!  Rates hit in the 3's again, and lenders have come a long way in driving down closing costs too! It is very exciting!! 

We may be able to WAIVE the appraisal.  Ask me to check your GA property for eligibility. That's nearly $500 in savings!  "YES WE CAN!"

We have access to Simple Refinance Closings.  Ask me to use my closer if you are open to the option of where you close for $500-700 in savings.  "YES WE CAN!"

If you don't want to wait 5-7 days for someone to underwrite your file, so you need an extremely long lock and months to get this done, let me know.  "YES WE CAN!"

Does this Blog look obnoxious?  YES IT DOES!  But so is refinancing so lets just get it done!!

Call me/ Text me / Email me if your ready to do a quick crunch of the numbers and get the savings started!  678-467-2330 

(If you already know what you generally want, go ahead and text "showmethemoney" to 36260 :)  

The more you follow the automated application process, the more the savings are passed on to YOU! Apply from your phone!

(Georgia only)


and tagged: refinance
Posted by Elizabeth Washburn on August 23rd, 2019 2:42 AM

Title Insurance - Is It Worth the Extra Expense?

Likely, the biggest investment you will make is purchasing a home.  In the State of Georgia, determining the rights and interests to real property is the responsibility of the closing attorney who represents the lender. 

Let's start with the basics but HANG WITH ME!  This gets really interesting at the end, but I need to review the basics first.

What is title insurance?

Title is the paperwork for the ownership of property. Names on the title change as the property is sold.  The title company hired by the attorney searches the title (or ownership) history of the property. Through its research, the title company can almost always identify any title problems and clear up these problems before you close on the property; however, sometimes they miss something in the chain of title and that is where insurance comes in play. Sometimes the problems include:

· Defective title — "Defective title" covers any number of problems with the title to your home. It can even include a "contested title". Defects are rare, but they can be very difficult to get rid of, making the property inaccessible, unbuildable, or unsaleable. Any number of other complex problems define "Defective title." 

 ·  Contested title — This happens when someone who owned or even lived in the home before you claims to still have ownership. If this happens, the title insurance company will defend your title and the process will cost you nothing.

REQUIRED: Lender’s title insurance

The lender requires you get LENDER'S title insurance that protects the mortgage balance. 

OPTIONAL: Owner’s title insurance

The OWNER'S TITLE protects your interest in the property and it can vary in protection and cost. Here is the interesting part for the financially-minded:  Attorneys are legally obligated to quote STANDARD TITLE INSURANCE pricing unless they have permission within their forms to quote an ENHANCED TITLE INSURANCE. So I’m guessing you know what form most likely is include in their paperwork? :)

Here is the only significant between the policies:

STANDARD TITLE INSURANCE covers the equity between the purchase price and loan amount at the time of purchase. 

ENHANCED TITLE INSURANCE covers the house’s appreciation over a period of five(5) years up to 150% of face value.

The ENHANCED policy sounds really good until you read that sentence again.  Five(5) years, not 15 years or 30 years, or even 7 years (the average length of home ownership), is what they are covering extra with a significant jump in price. ASK and comparison check before you agree to your new policy. If the State requires STANDARD TITLE INSURANCE be quoted, that might be reason to pipe up with the questions and shop carefully.

**And here is my CMA -  I am not an attorney and this is not legal advice. If you want more information about title policies, search up title insurance companies or get quotes for both policies yourself. 

Posted by Elizabeth Washburn on March 14th, 2019 10:33 AM

Save money during the holidays to buy your dream house in the New Year

The holidays can put a dent in your savings especially if you're planning to buy a home, but there are several ways to cut costs so your finances aren't in the red by New Year's Day. Consider the following money saving tips:

  • In lieu of buying presents for every family member, suggest a gift exchange and draw names out of a hat.
  • Agree on a spending limit for gifts for friends and family and stick to it.
  • Make your holiday meals a potluck and assign each guest an item to bring.   
  • Consider buying a joint gift rather than individual gifts for a family such as a zoo membership or movie tickets. 
  • For young children, half the fun of holidays is often opening the gifts. Hit the dollar stores! Wrap small, inexpensive items separately - trinkets and treats! 
  • Give homemade treats like fudge, truffles, cookies or jams and jellies.
  • To cut down on postage and holiday card costs- mine has run up to nearly $100 per year! Send e-cards, which are usually free.
  • To keep your electricity bill down, use a timer to turn outdoor lights on and off at designated hours.
  • If you know you won't be able to pay your credit card off right away, make sure you use a single low-interest card to make purchases - that way you can easily track them.
  • When traveling during the holidays, try to fly on Christmas Day. It's usually cheaper and there are plenty of seats.
  • Subscribe to receive e-newsletters from your favorite online merchants. They will often e-mail coupons to use for savings on purchases and shipping costs. Or subscribers may receive private sale information.
  • Sometimes buying an item online is cheaper than going to the store since many sites don't charge sales tax and offer free shipping. Use the savings to have the gift mailed directly to the recipient instead of standing in line at the post office. 

Yes, you may feel a bit like a bit of a scrooge, but by keeping things low key, those friends and family might be thrilled to join in your summer cookout at your new home in 2019.

Posted by Elizabeth Washburn on December 5th, 2018 2:01 PM

Quick Reminders of Store Safety

Although we'd like to believe the holidays bring out peace on earth and good will for all, the weeks between Thanksgiving and New Year's Day tend to be a prime season for criminals. During this busy time of year, you can take some easy precautions to prevent becoming a victim of theft. Consider the following safety tips:

When holiday shopping this week: 

  • Put your shopping bags in your trunk and move the car if you can. Better yet, take your packages home after a shopping spree and then go back to the new stores.
  • Don't carry large amounts of cash with you, or keep it in your front pocket not in your purse or wallet. Better yet, use your credit card for instant insurance if things are stolen. 
  • Be extra careful when carrying a purse - they are the prime targets of criminals in crowded shopping areas. If you must carry one, make sure it has a strap that can go over the shoulder and be held under the arm, making them more difficult for purse snatchers to grab.
  • Keep your receipts separate from the packages.  If things are taken, it is easy to determine what was taken.
  • Keep a record of all of your credit card numbers in a safe place at home and if they get stolen, after you call the card holder, reporting the theft to the three big credit bureaus  can be useful too.  They can put a lock on your credit so the fraud stops before it starts.  This can be very helpful when its time to get a mortgage!
  • Beware of strangers approaching you.  Extended eye contact is your friend and so is the word no. You are allowed to have personal space in a public environment.

At home:

  • When leaving home for an extended time, have a neighbor or family member watch your house and pick up your newspapers and mail.
  • Leave a light on when you leave your home at night or put your lights (including Christmas lights) on an automatic timer.
  • Make sure your holiday gifts are not visible through the windows and doors of your home.
  • Never say you are away from home on the outgoing message on your answering machine or voice mail.

During the holidays, many people can become distracted then vulnerable to theft. These easy steps can protect yourself and your home from potential crime and ensure you have a safe and happy holiday season. Happy Thanksgiving!!

Posted in:General and tagged: Safety
Posted by Elizabeth Washburn on November 20th, 2018 5:59 PM

Avoid the Scam
Wire Transfer Fraud: A New Twist

 
The security of my clients is a top priority.  There continues to be wire transfer fraud focused on mortgage transactions.  Now there is a new twist.

The Scam
 
Hackers often attempt to divert closing proceedings from title companies, attorneys, banks, and Realtors’ email with wiring instruction changes. The thieves, who compromise buyer and seller email accounts to intervene when a wire transfer is about to happen, are stealing thousands of dollars through these wire transfer scams.
 
There is a new twist in this – thieves will call the victim first as a cold call notifying them that there has been a change and to look out for the email with the new instructions.
 
Tips for Buyers and Sellers
 
Verify Wiring Instructions Changes
 
Customers receiving requests for changes to the wiring instructions should verify the change with all of the involved parties using telephone numbers previously provided. Under no circumstance should wiring instructions be changed based on a phone call alone.
  
Do Not to Accept Wiring Instruction Changes through email
 
Hackers target emails with wiring instructions. They use the information to send a modified email with updated directions for wiring money into their personal account. Never accept directions to modify a wire transfer from any email.
 
Watch for Name & Location Discrepancies
 
Be extremely wary of wires going to any account that is not in the name of the escrow company or attorney. Also, be suspicious of any account with a geographic location different than the seller—and never wire outside of the United States. There are possible explanations for different names and odd locations, but ALL red flags should be explored in detail with a phone call to the attorney's office with the number given to you verbally by me, your mortgage officer.  It took some time to earn that money.  Let's make sure it get to your new home.

 

Posted by Elizabeth Washburn on October 8th, 2018 5:42 PM
Posted by Elizabeth Washburn on September 23rd, 2018 7:37 PM

Did You Know? 

Making one extra principle and interest payment a year will knock about 7 years off your mortgage and save you thousands of dollars.

Beware of Mortgage Reduction Services/ Savings Program Scams

"Bi-Weekly" mortgage payment programs  charge fees and do for you what you can easily manage. They say they save you an impressive amount of money on your mortgage and reduce the number of years you pay on your mortgage. 

This is true, but you  don't NEED them to get those savings, and by doing it yourself, you save even more money!

This is how they typically work: The company places your 1/2 mortgage payment in their account every two weeks, then they hold the payment until all of the mortgage payment is collected.  During the course of a year 26 deductions will be made from your account. With the extra 2 deductions, the "Service" makes one additional mortgage payment every year. In other words rather than making 12 mortgage payments, 13 payments are made.

The enticement is that they are providing a special service when you don't have the time or discipline to make it happen.

The real story is that there is an easier way to do this - with no payment shock- and your mortgage company will immediately credit the payment to your account. Just deduct your mortgage payment automatically from your account each month with an additional 1/12 of your principle and interest payment applied to the principal balance each month. (Extra money is automatically applied to principle unless you tell your mortgage company to do something else with it.)

          New Monthly Payment = Monthly Payment  + (Principle & Interest /12) . 

At the end of 12 months, you will have made an additional mortgage payment and you won't pay any fees to a servicer nor will you have had your money held in limbo. Now that just makes cents!

Remember me when you are talking homes!

I'm passionate about helping people achieve their home dreams

with the best possible financial options. 

Posted by Elizabeth Washburn on April 24th, 2018 8:05 AM


Teaching the 3rd Grade

Recently I had the distinct pleasure of participating in Career Day at our local elementary school.  I started the lesson with self-employment.  I explained, while it is nice being your own boss and having a flexible schedule, your success will directly reflect in your pay check and your reputation within the community. 

It is difficult to properly convey the excitement of compound interest when your audience is eight-years-old.  I was competing for their attention with police officers, firefighters, and marketing directors (who had lots of gadgets).  Totally unfair!!  So, instead,  I reminded them, that though they may not want to be a loan officer, they may work with one when they want to own a home.  They seemed to enjoy looking a house photos and discussing prices.  We generally discussed how to buy a home too.

Finally, I explained the LIFE LESSON I wanted them to always remember, long after Career Day was over. (In the photo, that's what is highlighted on the board in yellow.)  Maybe you know this lesson?

If your outgo exceeds your intake,

then your upkeep will be your downfall.

I think some of them understood our discussion and all of them wrote it down.  I'm hopeful that a seed of financial knowledge has been planted on Career Day.  Have a fantastic week!  Need help on a mortgage?  Grab my app at http://NewThresholdMortgage.com

Elizabeth Washburn

Posted by Elizabeth Washburn on April 10th, 2018 2:49 PM
Posted by Elizabeth Washburn on March 7th, 2018 10:21 PM

   

The Changes for 2018 Taxes

Two lost housing deductions pop off the new tax bill which you should know about, and I've also included one reminder of an unchanged deduction.

MOVING EXPENSES 

They are no longer deductible if you are not active military. Before they were deductible if you moved over 50 miles for a job.  There were more specific terms, however, now it is simple.  You can't deduct the expense.

HOME EQUITY LINE

This product's interest has been deductible forever, but no more. This essentially kills the benefits of the piggy back loans (getting a first and second mortgage combination product), though they have decrease in popularity over the last five years. 

Having that handy equity line available is still nice due to its low interest rate, but it is no better than a low interest credit card and potentially worse for you, since it is tied to real property. This makes it a much more secure bet for the lender and gives you no added benefit for allowing the lender to hold a piece of your property’s equity. You can't deduct the expense.

Here's more information: https://www.marketwatch.com/story/most-home-equity-loan-borrowers-dont-understand-how-trumps-tax-code-affects-them-2018-02-02

 

MORTGAGE INSURANCE

Having no deduction on the equity line make mortgage insurance more appetizing.  Yes, I never thought I was say that either, but the legislature did not touch the mortgage insurance deduction. 

So, you could go get a fixed rate second mortgage at 9% or so, or you could have the dream that the mortgage insurance is going to go away in a few years, and during the life of the mortgage insurance, it could be entirely tax deductible. Not a bad dream, sort of, until you get to the “however”. And here it is. However, it’s only tax deductible up to a point.  If your adjusted gross income exceeds $109,000 or $54,500 if married and filing separately, the IRS prohibits you from deducting mortgage interest premiums.

Here is more information:  https://investormint.com/tax/property-tax-deduction

WHAT ARE MY CHOICES IF I HAVE AN EQUITY LINE!?!?!?

1 -Bite the Bullet and Endure

Honestly, it might not matter. The “might” is the problem, so take the second choice.

2 - Review your debt allocation and consider whether a refinance will benefit you.

If you want to look into rolling the first and equity mortgage together, let’s take a look.  Even if you need a bit of mortgage insurance for a time, it may still be beneficial due to the tax deduction. We can look at your gross adjusted income, how much you pay in interest with your current mortgage profile, and what is deductible currently vs. the future, then you can consult your tax advisor too.*  Shoot me an email or text for a review.

*As you know, I am a mortgage broker, not a tax advisor.

 

 

 

Posted by Elizabeth Washburn on February 3rd, 2018 10:08 AM
With all the talk about the security breach at Equifax, quite a few people have asked for guidance on disputing their credit. 

If you do encounter a mistake on your credit report, several steps need to be taken to correct the matter:
 
1. The first thing to do is get a copy of your credit report from each of the three major CRAs (Credit Bureaus): Equifax, http://equifax.com; Experian, http://experian.com; and TransUnion, http://www.tuc.com. Credit reports from every bureau are provided to consumers for free once a year. 
NOTE - They will try to get you to buy the credit score. Save your money. You don't need it to find out if there are errors or fix discrepancies.
 
2. If there is an error, in a written letter, tell the credit bureau what information you believe to be inaccurate on their report, and only their report, i.e. don't dispute an item with Equifax that is on the TransUnion report. Include copies (not originals) of documents that support your position with your complete name and address. Identify each item you dispute and request deletion or correction. Be sure to make copies of your dispute letter and papers.
 
3. Send your letter by certified mail, return receipt requested, so you can document when the bureau received your request.
 
4. The FCRA mandates that all Bureaus reinvestigate the items in question — usually within 30 days — unless they consider your dispute frivolous. They also must forward all relevant data you provide about the dispute to the credit card, i.e. third party. After the credit card company receives notice of a dispute from the bureau, it must investigate, review all relevant information and report the results back to the bureau.
 
5. If the disputed information is found to be inaccurate, the credit card company must notify all nationwide Bureaus so they can correct this information On your report. Disputed information that cannot be verified must be deleted from your credit.
 
6. When the reinvestigation is complete, the Bureau must give you the written results and another free copy of your report if the dispute results in a change. If an item is changed or removed, the Bureau cannot put the disputed information back in your file unless the credit card company verifies its accuracy and completeness, and the Bureau gives you a written notice that includes the name, address, and phone number of the credit card company.
 
7. In addition to the credit bureaus, you should also write to the credit card company about the error. Again, include copies of documents that support that they made an error. Further, at your request, the Bureau must send notices of corrections to anyone who received your report in the past six months.
Posted by Elizabeth Washburn on September 22nd, 2017 3:26 PM

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