Questions Your Lender Does Not Want You To Ask

Who pays for the appraisal when the appraisal is ordered and at closing? They are different, some lenders say they pay for appraisal, but they make the borrower pay for it with their own credit card and then credit the borrower back at closing. We take the risk and order it with our own money. 

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Can you email me 3 rates, monthly payments and Total Closing Cost for each of these scenarios. All conventional. 3%, 5%, 10%, and 15% Down LPMI 

(LPMI means the lender is paying for the mortgage insurance not the borrower) PMI means the borrower is paying for Mortgage Insurance with a Private Mortgage Insurance Company in hopes to pay a lower rate. However this normally results in a higher payment. I would never recommend anyone pay MI ever unless its a reverse mortgage. According to HUD, 95% of homeowners who choose a 30 year fixed rate never keep the loan longer than 5 years unless they are retired or about to be retired. 

Are there any Pre Payment Penalties? Can I pay the loan off whenever I want? If rates drop will you inform me and drop my rate for free? If so, what method do they use? Does a human keep track of their rate or do they have autimated software doing it? This is huge, when rates dip to their lowest like a couple weeks ago when I locked in loans at 3.125% for 0 Points and 0 Fees on a 30 year fixed, there is no way I could have checked all 600 clients of mine and notified the ones that were eligible and lock them in the same day without automation. Or when rates dropped to 2.99% on 30 year fixed for FREE in 2012, both of those times the rate was only that low for 1 day. Most mortgage companies do not automate quotes because the software is extremely costly and generally very complicated to use. 

What are your turn times? From the date the lender gets the accepted Real Estate Purchase Agreement (RPA), how long until they lock the rate, order the appraisal and submit the package? For example: We do it all in the same day. How long until they get the full approval? We get ours in 24-48 hrs. Do they work weekends? We never close, ever! How long does it take them to review and clear conditions? We take 4-24hrs.

Keep in mind, unless the seller agrees to pay all the fees picked out by the seller (All Title, Escrow, Notary and any other junk fees from both sides) then you will need negative closing cost of about -$2,000 to make it free.

The lender has no way of knowing what these fees are going to be until after they have made an agreement (the title/escrow fees can range from 1500-6500). That is why I always recommend making the seller cover all the title and escrow cost. (unless the seller allows the buyer to choose their own title and escrow company. Which I have never seen happen.) The reason is if they are picking the fees, why would we pay for them, even if its for us, they picked it out! Let us pick out our title and escrow company and then we will cover it, we know how much our company charges and we know they are reliable and most importantly, ethical. However that is exactly why they will justify using their title company, and that is exactly why you will justify that they cover these cost. 

People Hate Us On Yelp!

This is a screenshot, how to get your reviews back.

Yelp is suppressing companies that get nothing but good reviews to help generate income. Companies that need to advertise to generate referrals have the funds to pay companies like yelp to hide reviews. In my case they are holding some of my best reviews hostage including my most recent and first review from a client that lives in the same city that we operate out of. They want us to pay them for a business membership in order to edit our pictures and get help with reviews that are being held hostage.

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  6/23/2016

  I recently refinanced my home with Michael.  He is amazing   - absolutely professional and extremely detail oriented, which I like.  Michael approaches his clients with a 'teacher mentality'; ensuring you understand everything he's presenting throughout the process.  He offered creative solutions and was always there when I asked about 1000 question through the process. I am very grateful for the wonderful service he provided!!

  Report review

  

  Comment from Michael H. of So EZ Mortgage 
  Business Owner

  6/24/2016  Thank you for your review Dina. We enjoyed getting to know you and working with you for first time and we look forward to a life long relationship with you. Read less
  

  Report comment
• 

  • Dean L.
  • Livermore, CA

  •  3 friends
  •  1 review

  

  11/21/2015

  We just completed refinancing our home with Michael Hansen of SoEZ Mortgage and would not hesitate to do so again. As long time BAnk members, we got regular calls to see if we wanted to refinance the loan we had with them. Each time they found some reason not to. After some research, I found Mr. Hansen. Anyone looking for a broker need look no further. Michael was always available by phone and email and did what he said he would do. Betsy and I highly recommend Michael Hansen.

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• 

  • Gerald M.
  • La Mirada, CA

  •  0 friends
  •  2 reviews

  

  5/12/2015

  Michael Hanson & So EZ Mortgage are absolutely the best! I have done four refi's with Michael, my son has done one, & I can tell you that you will be doing yourself an enormous favor if you choose to work with him. He is a young man, but brilliant, is completely respectful & courteous to his clients, & is a genius in these financial matters. He "gets on stuff" in a hurry, making the process as quick as humanly possible, and will work for you like no broker ever has.
  
      I am in no way related to Michael Hanson, I get no "kick back" for this - I just want everyone to know what a pleasure it is, & what a financial advantage it is, to do business with Michael & So EZ Mortgage! He takes a very personal interest in you and your needs, "serving you while saving you."
  
  He's the best, & nobody else is even in the discussion.  Feel free to call me if you  wish!

This 

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As Expected Rates Dipped Next Year Even Bigger Dip

We posted this chart in February. We have been accurate to the T this year. We also predict even higher home values next year and even lower rates. If you just refinanced or purchased, do not panic, you are not missing a window. Stay tuned for next years rates.

If you have had your loan for 4 months or more, then I would consider redoing your loan now for the lowest rate with the most credit and prepare to do it again next year. This way just in case it does not drop, you still have the best opportunity. 

What is Fannie Mae Form 1003?

Fannie Mae Form 1003 is a loan application form designed by Fannie Mae and Freddie Mac that is used by lenders to obtain financial and personal information from borrowers who apply for a mortgage loan secured by a one to four unit residential real estate. Form 1003 is also known as the Uniform Residential Loan Application (URLA). Form 1003 is widely adopted by mortgage lenders as a standard loan application form. It is generally referred to as Form 1003, or just 1003 and pronounced as "ten-o-three". Freddie Mac also uses the same application form and is known as the Freddie Mac Form 65.

Initial 1003 and Final 1003

Form 1003 is filled at two times during the loan process. Form 1003 is first completed at the time of making a loan application and this form is generally referred to as "Initial 1003". Initial 1003 helps establish the date of application, permissible purpose for obtaining credit report, and intent of borrowers to make a joint application. The initial 1003 may be completed by the borrower or by the loan originator on behalf of the borrower. However, the initial Form 1003 should be signed by each borrower. For applications taken over phone, the loan originator may complete the application form and then send the completed form to the borrower for signature. For applications taken through the Internet, the lender may obtain an electronic signature or send a printed copy to the borrower for signature.

The second Form 1003 is prepared at the time of loan closing. This is generally referred to as "Final 1003" and is prepared by the lender. The purpose of Final 1003 is to have the borrower confirm the loan application information after all the details have been verified by the lender.

Multiple Borrowers

Another Form 1003 is prepared at the time of loan closing. This is generally referred to as "Final 1003" and is prepared by the lender. The purpose of Final 1003 is to have the borrower confirm the loan application information after all the details have been verified by the lender. Therefore, the final 1003 has the income, asset, and employment information that the lender verified and used for underwriting purposes.

Why is Form 1003 used as a standard loan application form?

1. Agency Requirement: Fannie Mae and Freddie Mac require lenders to the use of Form 1003 for all loans that are sold to them. Since lenders sell a large number of loans to Fannie Mae and Freddie Mac, it is much easier to implement the Form 1003 for all loans instead of having different forms for agency and non-agency loans.
2. Simplifies Technology Development and Implementation: Most of the loan origination software systems have support for the Form 1003, including the ability to transmit the loan application electronically. Building customized application form entails additional costs.
3. Widely Understood: Form 1003 is widely used and understood by the industry which makes it easier to sell or transfer loans. This is especially useful when mortgage brokers are trying to shop at different lenders to obtain the best deal. They can simply take the same application form and submit to different lenders and not worry about filling different forms for each lender.
4. Meets Various Regulations: The design of Form 1003 meets various regulations such as Regulation B, Regulation C, and Unfair, Deceptive and Abusive Acts or Practices (UDAAP). Regulation B implements Equal Credit Opportunity Act (ECOA). Regulation C implements Home Mortgage Disclosure Act (HMDA). However, no regulation specifically requires the use of Form 1003. The lenders are free to use an alternate form as long as it is consistent regulatory requirements.

Lender's Considerations

Reviewed By

The loan originator or loan processor should have the primary responsibility to review the form for completeness and consistency of information. Any discrepancy in the income, employment, or asset information should be investigated and verified through independent sources. The lender’s Quality Control (QC) department may perform additional reviews of the form to ensure operational effectiveness. Internal audit, compliance, and risk management department would form the final layer of reviews to ensure that the form is being correctly completed.

Recordkeeping

Form 1003 is a vital document for a loan file and is used to demonstrate compliance with various regulations such as Regulation C, Regulation B, and Regulation X. Therefore, Form 1003 should be kept with the loan file for as long as the loan is outstanding. For cancelled, declined, or withdrawn loan the Form 1003 should be maintained for at least 25 months after the date when the decline notice was sent. This will meet the recordkeeping requirements of Regulation B.

Sample Documents

1. Fannie Mae Form 1003 - Blank
2. Fannie Mae Form 1003 - Blank with instructions
3. Fannie Mae Form 1003 - Fillable
4. Fannie Mae Form 1003 - Fillable with instructions
5. Freddie Mac Form 65 - Blank
6. Freddie Mac Form 65 - Fillable (Doc Format from Freddie Mac website)

External Links

1. Fannie Mae, Form 1003
2. Fannie Mae, Selling and Servicing Guide Forms
3. Freddie Mac Forms Portal