Positives Available For Borrowers
Within Today's Mortgage Process
Scotsman Guide - May 4, 2015
“The data shows that 40 percent of the people getting loans now do not have pristine or perfect credit.”
Edward Pinto, Co-Director - American Enterprise Institute’s International Center on Housing Risk
That's a pretty high percentage ...
As a Mortgage Lender in the Chicagoland area, I'd agree with that statement too.
Few of the homebuyers I speak to have what could be categorized as "perfect" or "pristine" credit. Many have financial scenarios that need to be addressed (or explained) at some point during mortgage processing.
We LO's must pay far more attention to detail and must request more info/explanation regarding our clients' credit issues and financial scenarios than ever before.
Scrutiny is at a much higher level for every aspect of the loan. On the clients. And on the professionals too. Scrutiny that was not seen during the early-to-mid-2000's housing boom.
But I believe it's a stretch to infer that this higher level of scrutiny always stands in the way of successful mortgage approval. It doesn't.
So what is true?
A new reality now exists that must be acknowledged and dealt with by current hopeful borrowers (and their professionals):
The current mortgage application and mortgage processing is not simply or quickly navigated in many cases. This FACT must be taken into consideration by all involved within a transaction.
Many things contribute to this new reality:
- New rules and regulations put into place
- Increased scrutiny of Underwriting and Underwriters
- Consumer Financial Protection Bureau oversight
- The credit history of many current mortgage applicants include a Short Sale, Foreclosure, or Bankruptcy
- Young, first-time homebuyers have avoided establishing credit or banking accounts
- Many young, first-time homebuyers have paid their debts utilizing cash
- Many young, first-time homebuyers buy their first home with a Co-signor or using Monetary Gifts
All the above can increase the number of contributing factors that LO's must consider, have explained and verified during mortgage application and processing. Requests for documentation can rise as a result. It all takes a toll on the amount of time needed for processing.
It must be pointed out though: Counter-balances exist to the issues raised above. Positives have occurred within the process that benefit Borrowers in many ways.
- Mortgage information is much more easily attainable that ever before. Many Lenders have websites that offer info and answer financing questions around-the-clock
- Much of the communication and paperwork between borrower and lending professional can be conducted via the internet, texting, emails, web cams, secured e-fax
- The need for face-to-face communications and hand-delivery is no longer a "must"
- Mortgage Applications are routinely conducted at the convenience of the new Borrower. Applications can be taken within a home, at work, via phone call, in a restaurant ... or even via the internet
- Mortgage Closings are often possible during "odd" hours or at locations other than title companies, attorney, or lender offices. I've successfully closed loans in Borrowers' homes
- Borrowers are no longer tied to what was considered the traditional 9 to 5 office hours of the past. Many LO's (and real estate professionals) are available extended hours. During the day and weekends
Yes, it's true. The mortgage process has changed. There's little doubt about that.
It's also true that some of the changes have made the process more challenging and frustrating.
But it's also true: Changes have taken place that clearly benefit and increase the number of conveniences available to current borrowers.
Pair those positives with this fact: Financing exists for borrowers with less than perfect credit.
And when credit issues do exist? Today's knowledgeable, experienced LO's can guide hopeful borrowers back to good credit health and to becoming successful homebuyers.
Also: Mortgage programs exist that may help someone that suffered a Short Sale, Foreclosure, or Bankruptcy buy a home again ... and possibly at an earlier point than they thought.
The article within Scotman Guide was correct on one point. Credit availability could still be better. Hopefully we'll get there soon.
But positives are to be found for borrowers within today's mortgage process. Find me to discuss the positives to be found within yours today ...
Are you hoping to Buy, Build, or Refinance a home in the Greater Chicago - Chicagoland area? Contact me today! I'll put my 37 years of Mortgage experience and expertise hard to work on your behalf.
I can be easily found at:
Gene Mundt, Mortgage Lender, a Lender with 37 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, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, Romeoville, Naperville, etc.), DuPage County, the City of Chicago, Cook County, and elsewhere within IL.
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