Gene's Chicagoland Mortgage Blog

Procrastination Does Not Pay When You Hope to Finance a Home

Procrastination Does Not Pay When

You Hope to Finance a Home

“If you want to make an easy job seem mighty hard, just keep putting off doing it.”
– Olin Miller

“A year from now you may wish you had started today.”

– Karen Lamb

“Procrastination makes easy things hard, hard things harder.”

— Attributed to Mason Cooley

“The secret of getting ahead is getting started."

_ Mark Twain

The four quotes above all surround one universal theme ... the dangers that lurk for those that procrastinate.

Stories containing this message or lesson are familiar within many of my posts. In one form or another, stories of procrastination, how it has been the root cause or contributed to a client's mortgage processing misery, and tips for its avoidance, have popped up over and over again throughout my writing.

Why do I focus so heavily and intently on this?

Perhaps in financial decisions, second only to health decisions, does procrastination take such a heavy toll upon someone's life. Doing nothing ... or waiting too long ... can be very costly.

As it pertains to seeking mortgage financing, delaying and avoidance can certainly elevate costs. Those costs can be paid or felt in a variety of ways.

How?

Procrastinate or not perform a proactive credit check prior to actively looking for a home and you will most likely pay a higher interest rate for your mortgage. Cha-ching!

Wait too long to take proactive actions regarding your finances prior to viewing homes or making a mortgage application? That's risky too.

It takes time to raise credit scores. It can eat up valuable time to address credit concerns or errors found on a credit report.

Should you presently be hoping to buy ...

The current housing market (Spring, 2023) we're experiencing is a demanding one, requiring that buyers be educated, informed, and prepared to take action quickly.

Any delay in speaking to a lender, answering questions, responding to communications, or producing needed paperwork while seeking preapproval or making mortgage application will most certainly cause everyone involved in the transaction to feel higher stress levels.

Simply, the more proactively you plan and prepare with your lender for your buying and financing the better. Even up to a year prior to home buying/financing is not too much time to allow ...

Let me repeat: The more time you allow yourself and your lender to "stage" you and your finances for your upcoming mortgage application, the better off you'll be.

Today's home-buying process is still highly competitive in many housing markets. Homes available for sale move very quickly.

Taking pre-emptive actions with your mortgage lender could even protect you from losing out on a home you really love. You'll be better able to make decisions and take action more quickly than unprepared buyers. That can be very appealing to eager sellers.

Your proactive actions also allow beneficial time to your lender ... time they can put to good use. With that time they can:

Check your credit and credit scores
Offer guidance to help you lower or eliminate debt
Help you raise your credit scores
Reveal opportunities for savings
Address initial documentation requests
Find the best loan program for YOUR case
More

If you wait until the time you're actually viewing homes to seek out a lender or perform the tasks above, it's possible it will be too late to perform those beneficial services. That will cost you in money, headache, and stress.

There's so much to be gained. Don't wait. Get started today. It's easy to do. Don't procrastinate ...

Reach out, ask your questions, call, email, or text. Just contact your lender now ...

Are you hoping to Construct, Buy, Refinance or Purchase a home or investment property in Chicagoland or somewhere else in Illinois or Wisconsin?

Looking for mortgage financing answers, options, solutions, and experienced assistance? Contact me! I'll put my 40 years of Mortgage experience and expertise hard to work on your behalf.

I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. #031.0006220 - WI Licensed

American Portfolio Mortgage Corp

NMLS #175656

Direct: 815.524.2280

Cell/Text: 708.921.6331

eFax: 815.524.2281

gmundt@goapmc.com

www.genemundt.com

Twitter Account of Gene Mundt, Mortgage Lender

LinkedIn Account of Gene Mundt, Mortgage Lender

Facebook Acct. of Gene Mundt, Mortgage Lender

Pinterest Acct. of Gene Mundt, Mortgage Lender

Gene Mundt, Mortgage Originator, an Originator with 40+ years of mortgage experience, will offer you exemplary mortgage service and advice when seeking: Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago and the greater Chicagoland region, including:

The Lincoln-Way Area, Will County, (New Lenox, Frankfort,

Mokena, Manhattan, Frankfort Square, Joliet, Shorewood, Elwood, Lockport, Wilmington, Crest Hill, Symerton, Braidwood, Channahon, University Park, Beecher, Plainfield, Bolingbrook, Romeoville, Tinley Park, Homer Glen, Crete, Peotone, Naperville, etc.), DuPage County, Kane County, Grundy County, the City of Chicago, Cook County, and elsewhere within IL & WI.

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#GeneMundt #NewLenoxMortgageLender #ChicagolandMortgageLender #NewLenoxRealEstate #MokenaRealEstate #mortgageexpert #FrankfortRealEstate #LincolnWayHighSchoolDistrict #LincolnWayHighSchoolCommunities #howmuchhomecanIbuy #whatinterestratecanIget #timing #mortgageexpert #moneytalk #homeloansmadesimple #experiencecounts #homebuilding #askquestions #housegoals #VAloans #home #homeloanpro #JolietMortgageLender

#WillCountyMortgageLender #DuPageCountyMortgageLender #GrundyCountyMortgageLender #ChicagoHomeLoans #mortgageinfo #newconstructionloans #endloans #credit #creditreport #40YearsOfExperience #WisconsinMortgageLender #ChicagoMortgageLender #FHAloans #condoloans #investmentproperty #mortgageconsultation #LincolnWayAreaMortgageLender #mortgageprocess #homebuyingprocess #housingmarket #personalfinance #WillCounty #ARM #AdjustableRateMortgage

#ARMloans #fixedratemortgages #procrastination #donotwait

Gene Mundt, Mortgage Originator - NMLS #216987, IL Lic. #0006220, WI Licensed. American Portfolio Mortgage Corp. - NMLS #175656 - IL Lic. #031.0006220

I am a 40+ year veteran of the mortgage/banking industry with extensive expertise and education in mortgages, appraising, management, and financial planning. My assistance is ongoing, as I provide info, advice, and service leading up to, during, and following my clients' mortgage financing process. I aim to develop trust-based relationships that encourages asking questions freely.

ARM (Adjustable-Rate Mortgages): What They Are and Does it Pay to Use One

ARM (Adjustable-Rate Mortgages):

What They Are and Does it Pay to Use One

The rise of interest rates has once again revived the interest in ARM (Adjustable-Rate Mortgage) financing.

Previously, while FIXED interest rates were historically low, there was little need or interest from borrowers to utilize them.

But is this sudden interest in ARM loans a good thing or bad? And is it appropriate for the times?

First, we'll need to know exactly what an ARM is and how it works ...

ARM is an acronym for (Adjustable Rate Mortgage). You'll also frequently hear them referred to as a "variable-rate" or "floating" mortgage. Why? Because ARM loans have a variable interest rate, meaning their rate can go up or down.

During their initial period, an ARM loan's interest rate is the same throughout that 3,5,7, or 10 year period. After this initial period concludes, the interest rate resets in intervals based on a benchmark or index plus the addition of an ARM margin. The index and the margin are pre-determined and disclosed to you as the borrower at time of application and again prior to and at closing.

ARM loans come in 3 forms: Hybrid, Payment-Option, and Interest-Only. Here's the definition of each:

Hybrid Adjustable-Rate Loans (as defined by Fannie Mae): Combine the features of fixed-rate and ARM Loans, and has a total term of 30 years, consisting of an initial term when interest accrues at a fixed rate, followed by the remaining term, during which interest accrues at an adjustable rate
Payment-Option ARM (as defined by ConsumerFinance.gov): An adjustable-rate mortgage with several possible payment choices
Interest-Only ARM (as defined by Investopedia.com): A mortgage loan in which the borrower is only required to pay the interest portion owed each month for a certain period of time and a borrower is not required to pay down any principal owed

Each borrower individually should assess the pros and cons of ARMs and their specific terms as it pertains to their own personal needs and finances.

Performing this assessment weighs and measures the level of risk the borrower can sustain during the term of an ARM loan.

What are the pros and cons of the typical ARM loan?

The positives or pros of an ARM are:

ARM loans generally come with an initial interest rate that is lower than a comparable fixed-rate mortgage
Flexibility: If a Borrower plans on selling their home during the initial period of the loan and prior to interest rate changes, they may save on interest charges incurred
Because lower interest rates and payments are in play early in the loan, lenders can consider the lower amount when qualifying a borrower on ARM loans with initial set periods of 5 years or longer (which can translate to more buying power)
Should interest rates fall, ARM borrowers are able to take advantage of lower rates without refinancing

The negatives or cons of an ARM are:

Changes in Interest Rates (Market Rates) could change the Borrower's monthly payment. (A cap on how high the rate can go over the life of the loan exists)
There is less stability than a fixed-rate mortgage
The rate to which the loan will "adjust" is unknown
Vulnerability: Negative changes in your credit status could impede refinancing to a more favorable interest rate or loan program in the future
ARM loans are typically more complicated or nuanced than fixed-rate mortgages. The need for a borrower to fully understand the terms of their loan is vital

When is it a good idea to consider an ARM?

Arms can be appropriate IF:

The initial rate is lower than the current fixed rates
The initial rate (known as the start rate) is for at least 5, 7, or 10 years in length BEFORE it would adjust
The Borrower intends to sell, refinance, or pay off the ARM loan before the adjustments start
The Borrower fully understands the effects of ... and is prepared for ... the adjustments in terms of potential increases in rates and payments

There is no one set or universal answer regarding the "appropriateness" or wisdom of utilizing an ARM. That answer relies upon the borrower's individual and specific finances, needs, and desires. And it must be added, their comfort level of dealing with potential risk.

The good news is that there are many mortgage options to consider and choose from today. To fully understand all your options and to make the best decision for yourself, talk to a lender as soon as you decide to buy.

Take the time to learn the pros and cons of each option available as it pertains to you personally. Then you can move forward and make a decision knowing you're fully educated and fully informed, basing your decisions on the facts as they pertain to your specific needs.

I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. #031.0006220 - WI Licensed

American Portfolio Mortgage Corp.

NMLS #175656

Direct: 815.524.2280

Cell/Text: 708.921.6331

eFax: 815.524.2281

gmundt@goapmc.com

www.genemundt.com

The Lincoln-Way Area, Will County, (New Lenox, Frankfort,

#GeneMundt #NewLenoxMortgageLender #ChicagolandMortgageLender #NewLenoxRealEstate #MokenaRealEstate #mortgageexpert

#FrankfortRealEstate #LincolnWayHighSchoolDistrict #LincolnWayHighSchoolCommunities #howmuchhomecanIbuy

#whatinterestratecanIget #timing #mortgageexpert #moneytalk #homeloansmadesimple #experiencecounts

#homebuilding #askquestions #housegoals #VAloans #home #homeloanpro #JolietMortgageLender #WillCountyMortgageLender #DuPageCountyMortgageLender #GrundyCountyMortgageLender #ChicagoHomeLoans #mortgageinfo #newconstructionloans #endloans #credit #creditreport #40YearsOfExperience #WisconsinMortgageLender #ChicagoMortgageLender #FHAloans #condoloans #investmentproperty #mortgageconsultation #LincolnWayAreaMortgageLender #personalfinance #mortgageprocess #homebuyingprocess #housingmarket

#WillCounty #ARM #AdjustableRateMortgage #ARMloans #fixedratemortgages

Gene Mundt, Mortgage Originator - NMLS #216987, IL Lic. #0006220, WI Licensed. American Portfolio Mortgage Corp. - NMLS #175656 - IL Lic. #031.0006220

Half of All Homebuyers Don't Do This. Will You?

Half of All Homebuyers Don't Do This.

Will You?

"Americans may be spending more time shopping for shoes than for a mortgage, a report from the Consumer Financial Protection Bureau suggests. Almost half of consumers seeking a loan to purchase a home do not shop lenders, the agency said Tuesday."
(" Nearly half of home buyers don't shop for a mortgage") Diana Olick | Kelley Holland

"Publishing the results of a new survey, it was discovered that prospective buyers spent about as much time researching a new television or vehicle purchase than they did shopping around for a mortgage lender. Overall, the survey found 72% of prospective buyers only plan to get one quote for a mortgage."

( "Report: Homebuyers Fail to Put Due Diligence into Researching Lenders")

From experience, I can't say that the statistic and info above surprises me. I've addressed and written on this topic before as it's an ongoing issue. It's one that I've found often goes hand-in-hand with or foretells just how involved and responsive a borrower will be throughout their mortgage processing and our transaction together.

While trying to address and meet this challenge in those previous posts, I provided a roadmap and concrete examples of important questions that prospective borrowers should ask when searching for their mortgage lender/mortgage services.

When answered, each of the questions will serve the borrower well during their lender search.  I include that sampling of questions below:

   1. How long will my Mortgage Process take?
  (If there are no problems or issues that arise, most mortgages are processed within a 30 to 45-day time period)
   2. What Mortgage program is best for me?
   3. What costs will be involved in my financing?
   (Your Mortgage Originator should provide you with an estimate of your Closings Costs, called a Loan Estimate.)
   4. What Interest Rates are available to me?
   5. Is "paying down" (utilizing Discount Points) the Interest Rate an option ... and is it wise for me to do it?
   6. When will you "Lock In" my Interest Rate?
   7. What is the  Annual Percentage Rate (APR) of my loan?
   8. Is it possible for me to improve my credit quickly so I can receive a better Interest Rate?
   9. What Mortgage term suits my financial situation best?
   10. What is the minimum/maximum Down Payment I will be asked to make?
   11. Will my loan be "sold" after my Closing? And what does that mean regarding the payments I make and where I make them?

   12.   What are the Down Payment requirements for:
   A.  FHA?
   B.  Conventional Loans?
   C.  VA Loans?
   13. Is Mortgage Insurance necessary on all loans with less than 20% down?
   14. Does the cost of Mortgage Insurance vary with the percentage of Down Payment?
   15. Can I finance Closing Costs?
   16. Can someone help me finance with a monetary gift?
   17. When and How am I able to pay my taxes?
   18. Is an Escrow Account mandatory?

Note:  There may be questions you will want to ask that are specific to your financial situation or transaction.

The CNBC article mentioned above went on to say ...

"It's also best to know what kind of designations or qualifications the lender has in the industry. Ideally, the lender should be taking a holistic approach and seeing how the mortgage fits into the borrower's total financial picture. They should not just be quoting a rate, but helping with financial planning".

Simply put, that means that experience counts ...

An experienced knowledgeable loan officer provides their clients far more than just a "quote" or interest rate. Insights and assistance on a wide range of financial topics and issues, i.e. financial planning, is just one of the many ways that an experienced LO can better serve and benefit their borrowers.

The LO's level of experience directly contributes to a more fluid mortgage process. Experience saves time and money and can also lower the stress level of the transaction participants, buyers, sellers, and professionals.

All that is mentioned above, speaks to the importance of conducting a thorough LO search. I can't stress the importance of performing this important step strongly enough!

Make sure you are not in the wrong 50% (the losing 50%) of homebuyers! Be in the smart 50%.

Conduct a thorough LO search ...

Just like shoes, your loan officer needs to fit you right!

I'm easily found at:

Gene Mundt

Mortgage Originator - NMLS #216987 - IL Lic. #031.0006220 - WI Licensed

American Portfolio Mortgage Corp.

NMLS #175656

Direct: 815.524.2280

Cell/Text: 708.921.6331

eFax: 815.524.2281

gmundt@goapmc.com

www.genemundt.com

The Lincoln-Way Area, Will County, (New Lenox, Frankfort,

#GeneMundt #NewLenoxMortgageLender #ChicagolandMortgageLender #NewLenoxRealEstate #MokenaRealEstate #mortgageexpert

#FrankfortRealEstate #LincolnWayHighSchoolDistrict #LincolnWayHighSchoolCommunities #howmuchhomecanIbuy

#whatinterestratecanIget #timing #mortgageexpert #moneytalk #homeloansmadesimple #experiencecounts

#FHA #condominiums #FHACondoFinancing #investmentproperty #WillCounty

Gene Mundt, Mortgage Originator - NMLS #216987, IL Lic. #0006220, WI Licensed. American Portfolio Mortgage Corp. - NMLS #175656 - IL Lic. #031.0006220

Holiday Spending: Beware of the Dangers

Holiday Spending: Beware of the Dangers

A recently released financial report provides stark insights into current financial realities as we head into the holidays this year ...

The report, a collaboration between PYMNTS and LendingClub, states that:

79% of their survey respondents said they will be shopping during the 2022 holiday season. That's nearly a 9% drop from the 88% that shopped last year
Roughly 40% of those holiday shoppers will use financing tools of some sort (credit cards, personal loans or buy now, pay later (BNPL) options) to put gifts under the tree

The statics concerning the use of financing tools ... credit ... is cause for real concern. I've addressed this specific concern in prior posts, but my message bears repeating given the rising numbers of those considering credit as a means of paying for their holiday expenditures.

Credit and financial "dangers" lurk

everywhere while Holiday Shopping!

And as a loan officer, I've seen these dangers manifest themselves negatively way too often (even once is one too many). I know for a fact after viewing many mortgage applicants' credit reports and banking account(s) that:

Holiday-related expenditures can (and have) contributed directly to applicants' ongoing financial and credit challenges. Both their credit reports and bank accounts provided spoke to that being so. The accounting reads like a timeline of their spending activities and credit actions.

Whether it was overspending, spending dollars they really didn't have, opening new credit to take advantage of discount offers, or more, they did damage to some degree to their finances, credit, and options for mortgage financing and home buying. As holiday shoppers, they didn't guard their credit or protect their finances.

So how do you avoid the same fate when you shop?

Just say "NO" to overspending and new holiday credit offers unless one of the following applies:

Your Credit/Credit Score can withstand a new credit inquiry
You can handle the new debt caused by the new card
You can make monthly payments on time, consistently, and faithfully
You will NOT be making application for a mortgage
You are NOT already in the mortgage process
You are NOT hoping to buy a home in the near future
You are NOT maxed out on present credit cards
You have NOT already applied for other stores/credit cards
You know ALL the terms of the new credit account associated with the offer
You know what other credit obligations you have and the total of ALL your debt
The "enticement" offer is so valuable it offsets the negatives of taking on more debt
You have NO credit history and are trying to establish one for a future home purchase

Times are challenging right now. There's no denying that. And while planning, preparing, and establishing spending rules for holiday shopping expeditions and spending is always wise, this year it's become even more so.

Planning how and where you're going to shop will help. Compile a shopping gift list that includes:

A budget: What is the total dollar figure you have to work with?
Names: Who will you want/need to buy gifts for?
A Breakdown: How much of that allotted budget will you spend on each individual gift recipient?
Gift Ideas: What ideas fit the planned expenditure for each gift recipient?

No matter your future plans and goals, but especially if hoping to buy a home soon or at some point down the road, you'll be so glad that you established and stuck by the holiday shopping rules you set. Your overall budget will remain intact and your credit report and scores will prove advantageous to meeting all your financial needs and goals.

Shop smart and enjoy your Holiday Season!

Are you hoping to Construct, Buy, Refinance or Purchase a home or investment property in Chicagoland or somewhere else in Illinois or Wisconsin?

Looking for mortgage financing answers, options, solutions, and experienced assistance?
Contact me! I'll put my 40 years of Mortgage experience and expertise hard to work on your behalf.

I'm easily found at:

Gene Mundt

Mortgage Originator -NMLS #216987 - IL Lic. 031.0006220 - WI License #216987

American Portfolio Mortgage Corp

NMLS #175656

Direct: 815.524.2280

Cell/Text: 708.921.6331

eFax: 815.524.2281

www.genemundt.com

gmundt@goapmc.com

The Lincoln-Way Area, Will County, (New Lenox, Frankfort,

#GeneMundt #NewLenoxMortgageLender #ChicagolandMortgageLender #NewLenoxRealEstate #MokenaRealEstate #mortgageexpert

#FrankfortRealEstate #LincolnWayHighSchoolDistrict #LincolnWayHighSchoolCommunities #howmuchhomecanIbuy

#whatinterestratecanIget #timing #mortgageexpert #moneytalk #homeloansmadesimple #experiencecounts

#FHA #condominiums #FHACondoFinancing #investmentproperty #WillCounty #HolidayFinances #HolidayShopping #HolidayCreditOffers

#JustSayNoToNewCredit #holidays #stayingsafe #ChristmasShopping #credit #debt #ShoppingList #budget

Gene Mundt, Mortgage Originator - NMLS #216987, IL Lic. #0006220, WI Licensed. American Portfolio Mortgage Corp. - NMLS #175656 - IL Lic. #031.0006220

Gene's Chicagoland Mortgage Blog

Procrastination Does Not Pay When You Hope to Finance a Home

ARM (Adjustable-Rate Mortgages): What They Are and Does it Pay to Use One

Half of All Homebuyers Don't Do This. Will You?

Holiday Spending: Beware of the Dangers

Procrastination Does Not Pay When You Hope to Finance a Home

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