The Mortgage Brothers Show

Interest rates for second homes and investment properties are going up. In the last couple of weeks, the big agencies, Fannie Mae and Freddie Mac, basically said that they don’t want to have more than 7% of their whole pool of loans to consist of second homes and investment properties. So, for example, if they bought a thousand loans, they don’t want more than 70 of those to be second homes or investment properties. They’re cutting it down by about half from where it was before.

This week we are talking about closing costs on purchases and how to understand them. Questions we’ll be covering include: What are closing costs? What are the typical average closing costs when it comes to a home purchase? How much are they?

We’re going to answer these questions in the context of a real sample deal that we’ve been working on. If you want to follow along with a visual aid, we suggest watching the video above.

Today we are covering closing costs in relation to refinances. There’s a lot of confusion as to what closing costs are, especially when it comes to getting the prepaids right, and how much they usually cost.

A lot of people ask us “how much can we qualify for” or “how much should we qualify for?” when it comes to applying for a mortgage. In other words: What prices of home should I be looking at?

In this post, we’re going to dig into a question we get a lot: Is it better for me to pay my closing costs upfront or roll them all into the loan?

The number you’re thinking about probably isn’t just closing costs alone

Often what you think of as “Closing Costs” are actually the closing costs plus prepaid taxes and insurance, plus an interest rate. When you get a quote from a lender, they’re likely incorporating the prepaid taxes and insurance in the quote for closing costs.

There’s a whole industry built on trying to help people through bankruptcies and debt consolidation. They have a whole strategy to take all your debt bundled together and help you renegotiate payments. But we’re talking about something very different: refinancing. This comes into play when borrowers have reasonable debt, and they want a structure it inside of a mortgage. They want to take the debt from a car or maybe credit cards, or a home equity line of credit (or HELOC) and combine it.

Often times we’ll get borrowers calling us asking what an escrow account is for and if it is a “Good” OR “Bad” thing to have one on a mortgage. We figured we’d dig in a bit and help people get oriented. First off, escrow refers to an arrangement in which a third party temporarily holds a sum of money or property until a particular condition has been met. Now, let’s dive in.

We get asked this question all the time, but it’s not always in these exact words. Sometimes it’s: How many mortgages can I get on my home? or How many can you just stack? Oftentimes, it’s people simply wondering if they can get another line of credit. They’re thinking of it that way rather than as in terms of positions.

$0 down up to $1.2 million

Today we are talking about VA home loan limits for 2021. Part of this is reminding people of the VA home loan change that happened in 2020. That’s because the loan limit hasn’t really changed and that’s because…

This coming year brings some great news when it comes to FHA loans. The limit’s gone up for 2021 and a whole new potential bucket has opened up for interested buyers. The FHA is really helping a lot of people, especially if they’re on the lower end of the credit score or if they have a higher debt to income ratio.

It’s the time of the year when new things start coming out — new cars are announced, new trucks. But for loan guys like us, nothing is quite as exciting as the new loan limits. And they’ve come just in time for Christmas and they open up a whole new arena for borrowers.

Today we’re talking about trigger leads. We’re going to cover what they are and how to avoid getting annoying phone calls after applying for a mortgage.