Wednesday, March 13, 2013

Tax Refunds and Assets


It's tax refund time.  Many people ask us if tax refunds can be used to pay for a mortgage down payment or closing costs.

The answer is YES!  All a borrower needs to do to document the tax refund is to provide a copy of the refund check and a bank statement showing that the refund has been deposited into their account.  If the refund was automatically deposited into their account, they won't have a copy of the check, but the notation on their bank statement will show that it is a tax refund.  In the case of automatic deposits, the only documentation necessary is the bank statement.

The money does NOT have to be "seasoned", meaning it has been in their account for 60 days.  As soon as the refund has been deposited, it can be used to pay the down payment or closing costs.


Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

Latest Down Payment Requirements


Here are the latest down payment requirements for various types of loans in Colorado.  Don't miss out because you think you need 20% down!

For conventional (non-government) loans:
  • 5% down for a primary residence (3% is allowed, but the rates are higher and the mortgage insurance is higher)
  • 10% down for second homes 
  • 20% down for investment properties
For FHA loans (primary residences only):
  • 3.5% down - can be a gift from a relative of the borrower
For CHFA loans (primary residences only):
  • $1,000 minimum investment by the borrower - can be a gift from a relative of the borrower
VA loans (primary residences only):
  • 0% down

Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

Getting a Mortgage with Maxed Out Credit Cards


"My credit cards are maxed out.  Can I get a mortgage?" 

If you make enough money to pay your bills, and your credit score is high enough, then you can get a mortgage.  Here's how a lender looks at it:
  • Add up all the minimum monthly payments that show on your credit report.  Only the minimum payments that show on the credit report count, so you need to have your credit pulled by a lender to know what's on it. 
  • Add the minimum payments from the credit report to the total monthly housing payment of the house you want to buy or refinance (principal, interest, taxes, homeowner's insurance, mortgage insurance, HOA fees).
  • Divide the total above by your gross monthly income (that's your income before taxes and other deductions).
  • If the number you get is less than .45, then you probably make enough to get a conventional (non-government) loan.
  • If the number you get is less than .50, then you probably make enough to get a government loan (FHA or VA).

You also need to have a credit score of at least 640 to get a mortgage from most lenders. 

Want to know if you can get a mortgage?  Give us a call and we'll let you know.


Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

Monday, March 11, 2013

How Much is Too Much?


We are often asked if someone will be denied for a mortgage because they have too much money in the bank or have too much income.

The only time having too much income or too much assets would be a problem is if someone is trying to get some sort of down payment assistance loan.  Down payment assistance programs are intended for people who really need the money, so they do have income limits.  Most of the down payment assistance programs do not have specific guidelines regarding assets, but if someone has a lot of money in the bank, they probably aren't the best candidate for down payment assistance.

Many people think that loan programs like FHA and VA have income and asset limitations, but they do not.  You can make millions each year and have millions in the bank and still qualify for an FHA or VA loan.


Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

Interest Rates - Up or Down?


There is never a short supply of people who will tell you that they know whether mortgage interest rates are going to go up or down.  You can get rich by selling advice on interest rates - half the time you're going to be right, and you only need to be right half the time to develop a very loyal following.

The reality is that no one knows whether interest rates are going to go up, go down, or stay the same.  Mortgage interest rates change depending on the demand for mortgage backed securities - mortgage bonds - and the big purchasers of those bonds (China, Japan, investment banks, etc.) just don't tell anyone how much they're going to buy.  If they did tell, then they wouldn't get as big a return on their investment.

No matter what you read online, or in the paper, or see on TV, you are not going to be getting accurate information about how much the bond purchasers are going to buy, so you will never be able to accurately predict where interest rates are going to go. 

Our best advice when it comes to locking in an interest rate is to lock it as soon as you know the closing date.  Your interest rate lock must be good through the closing date or you might end up having to pay for a lock extension, which can be very expensive. 

If you want to wait to lock your rate, just remember that you are gambling.  If someone advises you to wait to lock your rate because they think rates are going to go down, they are gambling with your money, and that's a pretty silly thing to allow anyone to do.


Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

2012 Tax Info


When a loan is submitted to underwriting, one of the things we have to provide is tax transcripts from the previous 2 years.  Tax transcripts are not the same as tax returns.  We order the tax transcripts directly from the IRS and the underwriter compares the income shown on the transcripts with the income shown on the W2's the borrower provides.  The numbers are supposed to match, and this is how lenders make sure that the borrower did not provide phony W2's.

At this time of year, the IRS is backed up and they do not have transcripts readily available, but lenders still want to check the accuracy of the W2's that the borrower provides.  Instead of the transcripts (which are not available yet for 2012), the borrower will need to provide their 2012 tax returns, and also proof that the tax returns have been sent to the IRS.  It is VERY important that you have the proof that you sent in your taxes - having the returns is not sufficient.  So make sure you keep a copy of the proof that your taxes have been filed. 

You do not have to file your taxes prior to April 15 to get a mortgage, but if you apply for a loan after that date and you already filed your taxes, the lender is going to want to see proof that you actually sent them in to the IRS.  If the transcripts are not available from the IRS, then you MUST have proof that you sent them in.

Bottom line is that if you plan to get a mortgage in the first half of 2013, keep the proof that you sent in your tax return.


Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation

Lender Checklist


We get a lot of calls from real estate agents who are looking for new lenders.  Many agents say they don't really know how to tell if a lender is any good, and they ask for our advice.  Here's a quick checklist of questions to help you choose a lender:
  • Do they quote interest rates without knowing the borrower's credit score, the size of the loan, the amount of the down payment, the occupancy type (primary residence, second home, investment property), and the property type (single family residence, townhouse, condo)?  A lender needs to know all of that info before they can possibly quote an accurate interest rate.
  • Can they explain all of the closing costs - not just the dollar amount, but what the fees are actually for?
  • Can they explain all of the disclosures? 
  • Are they approved by Fannie Mae, Freddie Mac, FHA, VA, and CHFA?
  • Do they charge an application fee?  There should never be an application fee.
  • Do they personally attend 100% of their closings?
  • Do they review the final numbers with the borrower the day before the closing?
  • How do they do pre-approvals?  Do they know that they have to manually check the investor guidelines and the mortgage insurance guidelines before they will know whether a loan will be approved, or do they just rely on the Fannie Mae or Freddie Mac underwriting software to give pre-approvals?

Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:



By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.