FHA’s Back To Work Program

Mortgage application

The Federal Housing Administration (FHA) has a program called Back To Work – Extenuating Circumstances which helps borrowers obtain a FHA mortgage who would otherwise not qualify due to scenarios that may not truly reflect their ability to repay a mortgage such as:

  • Foreclosure
  • Bankruptcy
  • Short sales
  • Deed-in-lieu
  • Delinquencies, judgments or other indications of derogatory credit

Qualifications for Back To Work

  • Borrower must show how certain credit impairments were the result of a loss of employment or significant loss of household income beyond the borrower’s control
  • Borrower has to demonstrate full recovery from the event
  • Borrower must complete housing counseling

Housing Counseling

  • Counseling must be completed within a minimum of 30 days (but no more than 6 months) prior to submitting a loan application to a lender
  • A minimum of one hour of one-on-one housing counseling and/or homeowner education counseling from a HUD-approved housing counseling agency
  • Counseling must address the cause the borrower’s economic event and reduce the likelihood of it reoccurring
  • Housing education can be accomplished through a HUD-approved housing counseling agency, state housing finance agency, or an online course

Learn more about this program here.

Contact your Sibcy Cline Mortgage Loan Officer here.

Easier Credit for Mortgage Loans? Yes!

Mortgage application

With the rise of mortgage rates (and refinancing applications falling), the mortgage loan industry is easing up on lending qualifications for borrowers. Per CNBC, credit availability rose 2% in July (and 3% in May when mortgage rates started to rise.) See the CNBC news article here.

The Good News?
Home buyers with lower credit scores and higher loan-to-value ratios will have an easier time obtaining a home mortgage loan.

New Pre-Qualification for a Mortgage Loan?
Sibcy Cline Mortgage Services has worked with home buyers and owners for over 30 years. Their team of mortgage loan officers work diligently to find the best mortgage loan product to meet the needs of the home buyer or refinancing home owner. Sibcy Cline Mortgage Services is a licensed Mortgage Banker and represents many national and local lenders.

 

 

 

Sibcy Cline Mortgage Services Ranked No. 14 of Largest Tri-State Residential Mortgage Lenders

Sibcy Cline Mortgage Services was ranked number 14 of the largest tri-state residential mortgage lenders for the area by the Cincinnati Business Courier in November 2012 .

Sibcy Cline Realtors was the first area real estate company with a mortgage service division, incorporating Sibcy Cline Mortgage in 1983.  Since that time, Sibcy Cline Mortgage Services has been a dependable resource for those home buyers and owners seeking to secure mortgage financing or refinancing.

Products and Programs include:

  • Conforming fixed and adjustable rates
  • Jumbo fixed and adjustable rates
  • FHA fixed and adjustable rates
  • VA fixed rates
  • New construction
  • Extended rate locaks
  • No PMI (private mortgage insurance)
  • 100% Financing
  • Investment
  • International borrowers
  • OHFA (Ohio Financing Finance Agency)
  • KHC (Kentucky Housing Corporation)

Sibcy Cline Mortgage Services has in-house underwriting, processing and closing departments as well as an automated pre-approval system. As a licensed mortgage banker, this Sibcy Cline division represents many national and local lenders and is a convenient, one-stop shopping service.

Sibcy Cline Mortgage Services – Among Top 25 Largest Cincinnati Residential Mortgage Lenders

Sibcy Cline Mortgage Services was ranked by the Business Courier among the Top 25 “Largest Tri-State Residential Mortgage Lenders” in the November 11, 2011 issue. Ranked at #13, the Courier reported $162.6 million in loans closed (from September 1, 2011 – August 31, 2011) with 1,079 loans.

Sibcy Cline Mortgage Services was incorporated in 1983 and offers a variety of loan programs to meet the needs of home buyers as well as the refinancing of mortgage loans.

The company offers competitive interest rates and quality service for a smooth loan process. They offer automated laptop pre-approval systems along with in-house underwriting, processing and closing departments.

Sibcy Cline Mortgage Services represents many national and local lenders:

  • FHLMC Approved Seller/Servicer
  • FHA Direct Endorsed Lender
  • VA Automatic Lender

Feel the Heat of Mortgage Delays?

Pat Kuether, president of Sibcy Cline Mortgage Services, answers some questions about the loan process:

Why does the loan process and underwriting take so long today? PK: You would think lenders would be just waiting to pounce on and approve the next loan that comes through. You would think the processing and underwriting turn times would be faster for processing a loan, underwriting, drawing loan docs, and closing loans. You would think loans could virtually fly through the home-buying process. You would think all that, and yet you would be wrong.

So, just exactly why are loans taking longer than they should right now? PK: Like the movie Risky Business, mortgage lending was a party out of control. And, mom and dad came home early and found the house trashed. Party’s over,  we’re grounded! Mom and dad are making new rules.

PK: Here are some reasons why it’s taking longer industry wide:

Reason 1: Processing Delay
The buyer’s contract is accepted. He is expected to make loan application and pay the appropriate application fee for the lender to order credit and appraisal. But, the fee is nearing $500, so they want to wait until the whole house inspection is complete rather than loose the $500. Loss of time is 12 to 14 days, sometimes longer if they try and re-negotiate items for repair.

Reason 2: Tighter Standards
Credit standards were tightened. Every day brings new underwriting guidelines. Wage-earner stated income loans were an early casualty. Today, there is no common sense underwriting. The Loan Quality Initiative requires that lenders fully process their loans like the old days, however, just before closing the lender has to “re-verify” employment, “re-verify” credit obligations and  “re-verify” property value through an automated valuation model. Adding a small debt to their obligations could stop the closing.

A questionable appraisal could require a second appraisal. Now, lenders are processing loans twice, not just one time.

Reason 3: Fraud – Systemic Changes
Fraud is the mortgage industry’s #1 issue still today. Fraud is defined as a material misrepresentation, misstatement, or omission that is relied upon by an underwriter or lender to fund, purchase, or insure a loan. With fraud bombs falling everywhere and lenders going under every day, there is heightened sensitivity to anything that smells like an early-payment default. Certain states and regions of the country may experience more fraud, but, underwriting standards are established nationally, not individual markets.

Reason 4: Seasonal Factors
Summer is peak buying time. Add to this employee vacations and you have less workforce to get the loans through the system.  Thanksgiving, Christmas, New Years, and July 4th holidays all punch holes in the work week. People leverage time off by combining vacation days and holidays, causing further staffing shortfalls during these peak times.

Reason 5: Declining Values and Appraisal Problems
Declining property values over the last few years have created more work for the appraisers and those who review them. This extra work is required to make sure the lender has a sound investment. Lower values can mean higher LTVs and more challenge structuring a loan that will work. Agency guidelines sometimes call for desk or field reviews of an appraisal, adding extra time to the process.

Reason 6: Bad Lenders
When we save loans from falling apart it’s usually because another lender did not ask all the appropriate questions or understand the buyer’s needs and how to structure the loan. Or, perhaps they did not properly explain the requirements in today’s lending environment. It could be someone inexperienced, incompetent, unprofessional, dishonest, uncommunicative, or otherwise unable or unwilling to do the job.

Reason 7: Changes and Restructuring a Loan
Changing a loan program because of restrictive guidelines, conditions or buyer qualification can delay a closing many weeks. When a buyer cannot, or refuses to provide a loan approval condition it will create more delays.  And, if the loan had already been underwritten and the original request denied, or a condition substituted, it must then go back through the underwriting process as a new loan. Remember, it’s not one item that an underwriter reviews; it’s the combination of many factors that assist the underwriter with their decision and risk assessment.

What can you do about potential delays? PK: There are some things that you can do to minimize the disruption, delays and buyer/seller anxiety. First, work with a knowledgeable and experienced lender. This is no time to hand your buyers over to someone who just got into the business. Second, be flexible. Write your contracts with 45 or 60 days to closing. And last, educate buyers and sellers about potential problems, expect delays, and you won’t be disappointed. Most buyers have not been through this new process and don’t know what to expect.






Mortgage Applications Increase with Low Rates

Sibcy Cline Mortgage Services

Long-term mortgage rates have fallen the last several months, prompting home buyers and existing home owners to take advantage of these attractive rates. Across the nation there has been a spike of mortgage applications for home purchases and refinances.

Sibcy Cline Mortgage Services has seen an increase in applications for the past several months as well.  Says Pat Kuether, President of Sibcy Cline Mortgage Services, “Mortgage rates have continued to decline over the past two months making homes more affordable to stimulate buyers. Conventional financing represented about 60% of all loan applications, while FHA represented about 40% of all our loan applications.”

See current mortgage rates here.

Mortgage Rates At Lowest Level for 2011

Lower Rates = More Buying Power

On Thursday, May 12, 2011, fixed mortgage rates fell to the lowest levels for 2011. This is very good new for buyers currently looking to purchase a home. Patricia Kuether, president of Sibcy Cline Mortgage Services, says, “The rates have dropped from .25 percent to .375 percent from the beginning of the year. It is a win-win situation for home buyers in this current real estate market. They will enjoy low mortgage rates as well as great values on current home-sale prices. Buyers are in a position to purchase ‘more home’ for their money.”

Freddie Mac reported on Thursday, May 12, 2011 that the national average rate on a 30-year loan fell to 4.63 percent from 4.71. The average rate for a 15-year mortgage went to 3.82 percent from 3.89 percent.

Here is a link to up-to-date rate mortgage rate information.