Millions of American homeowners have taken advantage of the generous breaks that allowed borrowers to skip mortgage payments without penalties.
But if you were in patience and now you want to refinance, be sure to follow a few simple rules, – says Richard Pisnoy, head of Silver Fin Capital Group. To be eligible for a refi after abstinence, you must make three consecutive loan payments and formally ask your mortgage officer for an abstinence exemption.
Pisnoy spoke to Bankrate about what he sees in the mortgage market.
What is the biggest mistake borrowers make in your opinion?
Pisnoy: Don’t be honest and straightforward with the loan officer. Typically, borrowers may not know the information they need to receive. If you’ve been patient, there are rules related to refinancing. To get rid of indulgence, you must make three months of consecutive payments before you can close a new loan. These things can be very problematic.
How often do problems with patience delay the referee?
Pisnoy: Over the past six months, this has happened many times. If the borrower has made only a couple of payments, we suspend the loan until the third payment is made. Payment must be on time – June payment cannot be made on June 30th. After you have made the third timely payment, you can proceed to refinancing. But as a borrower, you must contact the lender and put an end to leniency. Another mistake is the lack of prior approval – not only a letter, but also a verification of your assets and your income.
How can home buyers navigate this fast-growing market?
Pisnoy: This is nonsense. We are in the hot seller market. Stocks are low. Sellers are finicky. Real estate agents are finicky. People think their down payment is all they have to come up with. But there are closing costs. There is an escrow. In some cases, the buyer must reimburse the seller for prepaid property taxes. Often shoppers don’t realize that when they close an escrow account, a top-up is required. The buyer may walk up to the table and find out that he needs to shell out another $ 5,000 in real estate tax or insurance.
You were not happy with the new Unified Home Loan Application used by Fannie Mae and Freddie Mac.
Pisnoy: It’s been three months, and it’s very confusing. It has grown from four to 12 pages. In the old Unified Home Loan Application (URLA), the current payment is on the left and the new payment is on the right. Very simple, very easy to compare. The new URLA does not. He does not tell you your new payment. It doesn’t give you side-by-side comparison. What’s the point in that? If you’re refinancing at rate and on time, it’s one thing if the loan officer says you’re saving $ 200, $ 300, or $ 400 a month. It’s another matter to show it. The new URLA doesn’t change the qualifying dynamic, but it just takes more time.
Self Employed Borrowers Still Having Difficulty Getting A Mortgage Loan?
Written: Lenders introduce new rules during the pandemic. Some of this overhead for self-employed borrowers is disappearing, so that’s not a bad thing. But self-employed borrowers still need more work to guarantee. In a sense, this discriminates against the self-employed borrower. We are trying to prepare borrowers. Prepare your bank statements. Prepare your K-1 statements, if you have them. Make sure your bank statements match your P&L. We don’t want the lender to say, “Your bank statements only show $ 10,000 and your income statement shows $ 100,000.”