All Forum Posts by: Ed Wood

"The next question is - If I were to offer $75,000 and have a promissory note drafted for the remaining $100,000, will I be able to get a conventional mortgage on the $75,000 and assume the title/deed?"

Do I understand this right? So a purchase contact for 75k and a promissory note outside of escrow for 100k then and have a lender finance 75k? If this is the case the lender will use 75k as the sales price which you'll have to put down 25% ($18,750). A lender will only lend on the purchase price or appraised value whichever is less. In addition you will need to disclose the terms of the 100k promissory note so the liability can be counted against you.

huge tenant demand for rentals right now

I've got customers who own propertie in vacation areas like within 1/2 mile of Disneyland, up in Big Bear lake, the beach etc and they list their properties on sites like homeaway.com

Yup and instruct escrow to pay you $x at close you quit claim off and whamo it's done. If it's in CA I can do the loan at a smokin rate shop around then call me for a quote I've done a ton of investment properties loans.

You would think the gardner would let you know I mean if the grass is dead what has he been cutting? I guess you could also say in a year and a half and you haven't driven the property? If you lived there prior you would think the neighbors call or text you saying, "hey your house looks lawn like crap fix it".

As a side note make sure you itemize what the deposit deductions are for, that you've given them a opportunity to fix the items and and what you have to fix have receipts for. You'll need to send them certified mail the receipts and reason for deduction. I've had customers get popped in small claims for 2x the deposit amount for the tenant saying "I never received the deposit back" and the judge saying "Mr. Landlord did you send the deposit certified within 21 days of the tenant leaving"...

Great Resource Link Here

@Tomasz Strzemecki

If your going full doc 25% down more than likely your loan are fannie/freddie. You can ask the LO they'll be straight with you. If your in the 4's or low 5's on a 30 year fixed more than likely your getting a fannie/freddie loan...

Compensation is pre-set so the borrower receives savings benefit not the LO the very reason for the 2010 ruling. In your example if you would have went with Provident vs the other lender the you would have gotten the 1/2 rebate, not the LO.

If you are saying the LO has 1 point lender paid compensation higher than the other lenders they work with, or different compensation levels with many different lenders, this could be looked upon as steering by the CFPB.

If the borrower qualifies for Provident and the originators compensation is equal to all other lenders they work with Provident would be the borrowers best opportunity then the originator should send the loan to Provident because it's in the best interest of his/her client and not because the LO has to work harder.

Being in a high cost area 600-800k range on units the price differences is huge 5-$8000 in fee so if the loan fits Provident's guidelines we'll submit there. If we're going to ask for exceptions we'll use another lender who we know will do the loan. We get the letters of explanations up front prior to submission, title supplements, VOEs, insurance, CPL letter, etc prior to submission. So we have a pretty good idea of which lender is best for the file before submitting.

@Dana Anghel

Oh man! You're missing out especially if your DTI is less than 43% these days. Most LO's and processors can't live up to their expected standards for package in a loan so borrowers get steered to a "easier" lender.

I've done a lot of loans through Provident funding often times with little to no prior to doc conditions, but then again if I submit a loan to Provident I do the processing I can't trust my account to just anyone submissions need to be perfect or they'll cut you off. I do like Provident because there are no surprises it's all done by the book.

They've got to be doing something right I've seen them fund 9 billion in a quarter and they continually have 4-8% market share.

Here's the story.

New rules call for a maximum DTI of 43%, though there is the temporary reprieve until 2021 or until Fannie and Freddie come out of conservatorship. Some lenders underwrite to the 43%, or will go off of the Fannie Mae / Freddie Mac automated underwriting findings which presumably will allow a higher DTI for the time being.

Some lenders such as Provident Funding wholesale and retail have guidelines show with the 43% DTI for their conventional loans. Most jumbo's I've seen have gone to a 40/43 max DTI.