ADU and IRA Home Loans Hot Topics – Orange County Register



There is nothing better than running a mortgage column for a large city newspaper. Can you believe it’s been 10 years?

Aside from my weekly concern about whether my editors (and you) will like what I have to offer, I get a lot of feedback from readers about my columns. This is usually something like “Thank you. I had no idea about that. ” Or is it “Your head is up and down. You don’t understand what you are talking about. ” I am grateful that I receive more first comments than second ones. But I get both.

Below I share 10 of the most important takeaways since this column started in August 2011.

1) Fannie Mae has developed an automated appraisal underwriting system called the Guarantee Underwriter. It was released in 2015 and I believe it is an exceptional invention.

Automated The system (in conjunction with loan security consultant Freddie Mac) speeds up appraisal decisions and saves borrowers approximately $ 600 in appraisal fees if a property verification waiver is issued. It is also an excellent means of verifying the value and quality of real estate in human appraisals.

My two cents: why can’t Fannie and Freddie come up with an automated process for filing a borrower’s income? The data giants can easily and accurately determine the salaries of most people. Agencies can combine estimated income with equity / down payment metric. As a result, the bar for accuracy will be lower for wealthier borrowers. Out of peacefulness, it can speed up the loan approval process. No one will get away from this property, say, 30% of the down payment.

2) Yeah, for me it was to find out what you can do with IRA funds. Yes, you can buy a lease with IRA funds as a down payment. There are lenders who are willing to provide a mortgage to your IRA, not to you directly. Many readers told me that they implemented this funding mechanism because they did not have enough cash outside of their retirement accounts.

3) Sometimes people in the mortgage industry, government officials and even consumers lie to me. One of the executives of a large mortgage lender wanted his company to talk about a specific loan program. He explained that his firm was able to strike an exclusive deal with Fannie and Freddie that no one else got. Neither Fan nor Fred confirmed the deal. The story never ended.

My newspaper bosses always told me, “If your mother says she loves you, look.”

4) The 2020 Grandma’s Apartment or Subsidiary Act was probably the most well-received series of articles I have written. (These columns were published in December 2019). In a nutshell, California law has removed the bureaucracy from people when adding living space to their property. This is a very good answer to compensate for the housing shortage.

The law also offers property owners a way to make it easier for their family to get housing or provide rent as additional income. To this day, I have received calls from people wanting to know more about the ADU building process.

5) I love hints. I have written many columns thanks to the people who gave me the story. The best I have ever received was from a peer in the industry about one lender with a nearly 10-year co-op mortgage monopoly in Laguna Woods Village. Even with all the buzz made by the owners of the Laguna Woods co-op, there is still only one co-op lender in Laguna Woods today.

6) In 2011, in the days following the Great Recession, the market share of mortgage brokers was less than 5% of home loans and refinancing loans. (Full Disclosure: I’m a mortgage broker.) Brokers were mostly blamed for the mortgage crisis. Can you say “Scarlet letter”?

According to a consumer survey published last week by the Bureau of Consumer Financial Protection and the Federal Housing Finance Agency, 46% of consumers applied for home purchases through mortgage brokers in 2019. And 38% turned to brokers for refinancing. Let’s talk about resurrection from the dead!

7) Nothing makes a column better than subject matter experts. I have several names on the rolodexes. (Yes, Mr. Old School has two sitting on the table).

Dave Stevens, former FHA commissioner and former president of the Mortgage Brokers Association, is the bionic brain of subject matter experts. He understands problems and knows politics like no other. He is eloquent and thoughtful.

Real estate attorney Mike Hensley, as well as accountants Jeff Hipschman, Warren Hennagin and Marcelo Sroka have become excellent teaching assistants for you and me. And they are generous. Every week, readers call me or email me with poignant column-related questions. These wonderful people have answered countless questions for free.

Nobody ever really thinks about ownership problems until the problem arises. Glenn Avercamp, vice president of attorney title insurance, has been quoted in these columns for many years. And it was a walking encyclopedia of information for readers who were always digging around to solve their tricky title problems. Unfortunately, Averkamp died suddenly and unexpectedly over the weekend.

8) Being on the side of the company in dealing with the media can be tricky. The most daring, tough and professional spokesperson I have ever had to deal with is Tom Goyda, Wells Fargo Bank’s senior vice president of media relations. Perhaps more than any other banker, I have asked Tom many difficult questions over the years about Wells Fargo’s different ways of working and customer issues. He’s a pro.

Goyda was always just as quick to research and respond to trouble when I questioned Wells officials on hot topics. He is always as calm as a cucumber.

9) Forecasting house prices, interest rates, etc. Requires a lot of effort. Saying everything in plain English can be even trickier. My favorite sources are Dr. Raymond Sfeir of Chapman University, Jordan Levin, chief economist at the California Association of Realtors, and chief economist at Lending Tree Tendai Kapfidze.

Separately, but in the same field, news companies Attom Data Solutions, Black Knight and Stephen Thomas of Reports on Housing also offer incredible insight into the housing and mortgage markets.

10) Mortgage conventions and conferences offer a lot of action and a lot of column feed. To my complete surprise, a few years ago, Angelo Mozilo, the former CEO of the failed Countrywide Financial (remember the days of the mortgage collapse), was invited to speak at a mortgage conference. Most of the crowd gave him a standing ovation. God, how interesting it was to write this column.

Freddie Mac evaluates the news

The 30-year fixed rate averaged 2.77%, which is 3 basis points lower than last week. The 15-year fixed rate averaged 2.1%, unchanged from last week’s record low.

The Mortgage Bankers Association reported a 1.7% decline in mortgage applications from the previous week.

Bottom line: Assuming that the borrower receives an average 30-year fixed rate on the corresponding loan of $ 548,250, the payment last year was $ 32 more than this week’s $ 2,244.

What do I see: Locally, highly qualified borrowers can obtain the following fixed rate mortgages per point: 30-year FHA at 2.125%, 15-year standard at 1.875%, 30-year standard at 2.375%, 15-year regular high balance (from $ 548,251 to $ 822,375) at 1.875%, a 30-year regular high balance at 2.625% and a 30-year fixed large balance at 2.75%.

Eye-catching Credit of the Week: Fixed mortgage for 15 years at 2.375% without closing costs.

Jeff Lazerson is a mortgage broker. He can be reached at 949-334-2424 or His site


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