Home of 580am WDBO expert "Lenny the Lender"

Are Interest Rates Going Up Or Down?

Interest rates have been at historic lows over the last 2 years.  Thus, people want to know: will rates continue to fall?  As the chart suggests, most experts believe rates will decrease slightly over the next few months due to global uncertainty in Japan and the Middle East.

There are lots of factors contributing to interest rate fluxuation.  One key factor is global economic outlook.  Global uncertainties cause investors to be conservative with their money, which drives investment in bonds.  As bond purchasing increases, interest rates come down to lure consumers into taking on credit, which yields greater return for investors in mortgage-backed securities, bringing investor money back to securities instead of bonds.

But all that technical jargon is boring and annoying.  If you’re a consumer thinking about buying a home or refinancing, here’s what you should be thinking about with respect to interest rates:

Real estate prices and interest rates are at historic lows so waiting to see if the market continues to fall doesn’t make a whole lot of sense, unless you’re a super –savvy investor trying to time the market.  If you find your dream home, now is a really great time to pull the trigger.

If you’re refinancing, the general rule of thumb is if you can earn back the fees it costs to refinance within 2 years, do it.  If you’re still at an interest rate in the 6%s and higher, you should be looking to refi.

There are many factors that contribute to getting the lowest interest rate.  Click here to download our FREE report on the Top 10 Insider Secrets for obtaining the lowest interest rate!

Adjustable Rate Mortgage (ARM): Nothing to be Scared About

When most people hear the term “Adjustable Rate Mortgage” (ARM), they immediately press their internal “mute” button and turn off their listening.  ARMs have a negative stigma because of the notorious “Option ARM” products that were a factor in the housing industry collapse in 2007.  The government stopped the sale of risky Option ARMs at that time and are no longer accessible.The fact is, ARMs are a terrific mortgage product for the right home owner.  An educated consumer can really benefit from an adjustable rate mortgage product.  Initial interest rates are lower because the time period – the term – that the interest rates are locked for is short compared to the traditional 30 year fixed rate mortgage.

Here’s how to determine if an ARM is a good option for you and the basics around how ARMs work:

• Consider your future.  The first and most important question to ask is, “how long am I going to be in this home?” (Or “how long until I pay off my mortgage balance in full?”).   ARMs typically come in 3 yr, 5 yr, or 7 yr terms where the interest rate is locked in during that time period.  If you know you’re going to be selling your property or can pay off your mortgage within that time frame, you can save a lot of money by refinancing into an ARM product.
• Consider your loan size.  ARMs provide the biggest bang for the buck with large loan amounts.  For example, if your loan amount is $500,000, a 5/1 ARM might have an interest rate of 3.25%, compared to a 30-year fixed rate that might go for 4.875%.  The 5/1 ARM mortgage payment would save you $470/mo.  On a $200,000 loan amount with the same interest rates, the monthly payment savings would only be about $190/mo.  The savings on a smaller loan amount might not be enough to justify the risk of a shortened rate lock term.
• Understand the lingo.  What does the “5”and “1” mean in a 5/1 ARM anyway?  The “5” represents the # of years the initial interest rate offered is locked in for – in this case, 5 years; the “1” means the adjusting term after the 5 years are up.  In this case, it means 1 year – the loan’s interest rate can adjust 1 time each year, after the initial 5 year rate lock.
• Assess your risk comfort level.  The fact is, we don’t know what’s going to happen in the future.  You may have every intention to refinance, sell, or pay off your mortgage prior to your ARM adjustment term coming due, but the universe has a funny way of changing our future plans.  Know that plans can change and make sure that after your ARM adjusts in the future that if you have to stay in that loan product, you will still be able to make your mortgage payment.

Most importantly, get educated and be informed.  Consider the factors above and keep yourself open to an ARM – it might be the best product for you given your unique situation.

Short sales can get approved for an Orlando Loan in 10 days!

Orlando Loan originator, Lenny Moniz, (a.k.a. “Lenny the Lender”) broadcasts weekly on 580 WDBO on Saturdays at Noon on the Loveland Report.  Recently, Lenny shared good news for former home owners that have a short sale or deed in lieu of foreclosure on their credit.

“As long as the short sale or deed in lieu is 90 days old, we can get the borrower approved for a new mortgage.”

The caveat is that the borrower must have a total of at least 9 months rental history – consecutive months of uninterrupted on time payment history – or 12 months of on time mortgage payments on another property (such as a rental property).

This is breakthrough news as most home owners fear they can’t take advantage of this incredible buyers market for at least 2 – 5 years due to their short sale or deed in lieu.  Many former homeowners are beginning to earn more money and the time to purchase is fantastic given the prices and low interest rates.

“We get lots of questions on the radio show from callers wanting to know if there is an Orlando lender that can get them approved; the answer, of course, is ‘yes…United Mortgage Partners can!”

United Mortgage Partners is a full-service direct lender specializing in Orlando loans, Orlando fha loans, credit repair, low credit borrowers, and conventional loans.

“Play dirt” (with an Orlando FHA Loan)

I’m actually on vacation while writing this blog article.  At the beach.  Playing in the sand, or as my two and a half year old daughter Elizabeth, says, the “dirt.”

While on the beach yesterday, Elizabeth said to me, “Daddy?  Let’s play dirt!” Hmm.

“Um, what do you mean honey?”

She said, “Just go like this.” She proceeded to simply grab as much wet sand as her little hands could manage, and make a big sand – sorry, dirt - pile.

“Is it fun?”

“Yes it is!  Just do it!” So I stopped thinking about getting dirty, or getting sand under my fingernails, or her rubbing sand in her eyes, or about any other thought that stopped me from playing with her.  I just stopped what I was doing, and I “played dirt” with my daughter.

And it was awesome.

Okay, so what’s the mortgage or real estate connection here?  Well, it’s a bit of a stretch but there is a common thread.  Follow me.

I can’t tell you how many people we talk to every day who are thinking about buying their first home, or a vacation home, or a rental property, or trying to time the market and wait until prices drop even further, or wait and see if interest rates will just dip another eighth of a point.

I realized while playing “dirt” with Elizabeth that people tend to hesitate on doing something that is truly awesome because of fear or whatever.  In this case, the real estate and mortgage collapse has paralyzed a lot of people.

Well, I’m no Phd economist but I think it’s safe to say that we’ll never, ever, see real estate prices and mortgage rates as low as they are now in our lifetime.  Never.

In fact, rumors seeping out of the Fed suggest rates will trend higher by year end.

So stop waiting.  If you’re thinking of buying, an Orlando FHA Loan might be the perfect fit.  3.5% down payment.  In some cases, we can approve buyers down to a 580 credit score!

Simple advice, but it’s time to “play dirt” and take action on those real estate dreams.

From denied to approved Orlando Mortgage with 10 day credit fix!

If you’ve applied for a loan and gotten denied because your credit score is not high enough, there’s a very good chance, depending on your situation of course, that you can go from denied to approved in 10 days or less by tweaking some items on your credit report.

All of our licensed Orlando mortgage loan originators at United Mortgage Partners are trained to understand the complexities of credit reports and know what trade lines affect the score and by how much.

For example, recently a client was introduced to us that had a 605 credit score; she needed a 620 to get approved for a particular loan program.  We did a free credit analysis and discovered a trade line mistake on the credit report.  A creditor reported a late payment that was incorrect and we were able to contact the creditor on the borrower’s behalf and got the late removed.

We also recognized that paying down 1 credit card balance by about $500 would make her credit balances look more favorable to the bureaus.  The client had the cash and made the payment.

We did a free rapid rescore 9 days later and her middle score went up and over 620!  She now qualifies for the loan and has an accepted offer on a new home.  It did not cost the client 1 penny for us to do the credit repair.

For a free report on tips to obtain the best interest rate, click on the link below:

The Easiest Way To Qualify For An Orlando Mortgage

We often get asked the question, “Are you an Orlando lender or a broker?” The answer is that we are a lender.  The more specific – and more important – answer is that we are a direct lender, which means once we close a loan, we sell our loans directly to Fannie Mae and Freddie Mac.

Here’s why that matters. Most lenders sell their loans to other banks, who then sell to other banks, who finally sell to Fannie and Freddie.  When loans are sold to intermediary banks, they come with stricter guidelines, known in the industry as overlays.

For example, FHA guidelines stipulate they will buy mortgages from lenders who close loans with borrowers down to a 580 credit score.  However, If a lender says they do FHA loans and their minimum credit score for borrowers is 620, that additional 40 credit score points is considered an overlay.

Overlays are put in place typically by conservative lending institutions to hedge their risk.  The bottom line to the consumer is that it’s harder to get qualified.

United Mortgage Partners sells directly to Fannie and Freddie, with no overlays.  Which means we offer the most liberal lending guidelines in the state of Florida, which means borrowers have a better chance of getting qualified with us compared to other mortgage companies.

Want to know if you can qualify?  Click below and fill out our 10 question application and we’ll get back to you in 24 hours or less.