What Is A Licensed Mortgage Loan Originator?

If You’re Looking To Take Out A Mortgage, You’ll Need To Work With A Licensed Mortgage Loan Originator.

If you are new to this, you may be wondering: What is a licensed loan originator? And how can they help me?

A licensed mortgage loan originator is a professional who assists potential borrowers. They are sometimes called a licensed loan officer. They do client interfacing and review financial documents.

They ensure that application requirements are complete and accurate. They check a borrower’s background including credit reports. They look at the debt-to-income ratio to assess the risk. In the end, they decide if the applicant is a ‘fit’ borrower.

A licensed loan originator will also oversee loan approval and closing. They provide updates on the progress of the loan. If there are any issues along the way, they offer advice and support.

Lending is a highly regulated industry. A licensed loan officer must be registered in the Nationwide Multistate Licensing System.

They must not engage in “discriminatory lending practices.” They must ensure that borrowers know enough to make a well-informed financial decision. This is especially applicable to high-risk mortgages.

The Truth in Lending Act (TILA)[1] requires lenders to provide loan cost information. The intent is to give borrowers an opportunity to “comparison shop.”

If your loan is covered under TILA, you have up to three days to reconsider your decision. You can back out of the process without losing money. This prevents borrowers from giving in to “high-pressure sales tactics.”

What Should You Look For In A Licensed Mortgage Loan Originator?

• They are familiar with various loan products. They give you loan options based on your unique financial needs and situation.
• They provide end-to-end support. In the beginning, they should be able to educate you and provide sound advice. They should be available to answer questions. Towards the end, they provide progress updates. A reliable loan officer should see you through a successful application.
• They are aware of industry updates or changes in regulations that may affect your mortgage loan.
• They have good relationships with real estate agents, accountants, and other industry professionals.
• They understand the applicable state and federal laws on lending.
• They have strong analytical skills. They can look at your financial history and assess your loan options.
• They are customer-oriented. Taking out a mortgage is a major financial decision. A licensed mortgage loan originator should guide you through the process so that it improves your financial future.
• They have excellent communication skills. There many complex terms and policies you may need to navigate. A loan officer should be able to help you grasp these concepts with ease. Discussing finances can also be a delicate matter for many people. Your mortgage loan originator should be able to handle this with discretion.

Meet Our Sun Mortgage Funding Team

Our team at Sun Mortgage Funding meets all these criteria and more. Our licensed loan originators, Dianne Corona, Tammie Cavanagh, and Annette Hesse, have a combined total of 94 years of experience in mortgage funding. When you work with us, you’ll know you are in very capable hands.

Let our experts help you. Contact us now to get started.

Additional reference:

[1] https://www.occ.treas.gov/topics/consumers-and-communities/consumer-protection/truth-in-lending/index-truth-in-lending.html

Benefits Of Renovating Your Home

The Benefits of Renovating Your Home Are Worth Taking A Look At.

Renovating your home requires a lot of time, money and effort. So, why do it? It starts with knowing why you want to do it. For many homeowners, it can be as simple as improving the quality of life.

For others, it can be a way to mark a new beginning or to close a chapter in the family’s life. Empty nesters may want to renovate to help them adjust to life without kids at home. A young family who just bought a fixer-upper may want to renovate to ensure the house is suited to their needs.

Home renovation can also be a more ‘sensible’ alternative to moving. If you’re looking to stay in your neighborhood for the next couple of years, it might make more sense to renovate.

Renovating your home means avoiding inevitable costs related to selling. These can include your agent’s commission, taxes, and legal fees, among others.

What Are The Other Benefits Of Renovating Your Home?

• Boost your property’s value. A well-planned and executed renovation can increase your home’s value. If your intent is to resell or rent, consult with an agent. Find out which improvements will most likely appeal to tenants or buyers.
• Be more environment-friendly. Renovating your home can be an investment towards minimizing your carbon footprint. You can also enjoy long-term savings. Low flow taps and shower heads can reduce water use. Installing solar panels can help lower energy costs. Do note that these eco-friendly changes may cost you more at the beginning. Over time, you should be able to appreciate the return on investment.
• Maximize your space. As families grow or priorities change, so must your space. A home renovation project can help you make sure your home is well-suited to your changing needs.

Tips For Renovating Your Home

• Get ideas from magazines and brochures but don’t buy just yet. Check to see if there are cheaper alternatives or if there are more cost-efficient ways to achieve your goal. For instance, if you want to make a room look brighter, a paint job can do the trick. If you want to create the illusion of a bigger space, the strategic placement of mirrors is an inexpensive way to do that.
• Set a limit to how much you are willing to spend. Not sure how much? Go back to tip #1. This will give you a ballpark figure. Don’t forget to factor in a buffer for unexpected expenses.

Also, don’t be shy about negotiating for a better deal. But when you do, make sure you look the part. Don’t wear designer clothing or noticeable jewelry. Keep it casual and simple. If you look like you don’t need the discount because you can afford the fancy stuff, you’re probably not going to get it.

• If you’re on a budget, choose which area will benefit you most once renovated. It also helps to break down the renovation into smaller projects. This is to avoid getting overwhelmed and losing track of the budget.
• Professional help. If you are not confident about your DIY skills, you may end up making costly mistakes. Consider investing in professional help. Find a contractor who can work with your budget and timeline.

Now that you’ve got ideas for renovating your home, here’s the next big question.

Where Do You Get The Money For Renovating Your Home?

Whether you’re renovating your first home or fixing an investment property, we can help you. Sun Mortgage Funding offers a loan product specifically for home renovations.

We also offer expert assistance in project planning and inspection. From interim funding to permanent financing, we can guide you so you can renovate with confidence.

Call us now and let’s see how we can make your renovations goals a reality.

The post Benefits Of Renovating Your Home appeared first on Sun Mortgage Funding.

The Pros And Cons Of Refinancing A Mortgage

It’s Important To Understand The Pros And Cons Of Refinancing A Mortgage.

Are you thinking about refinancing a mortgage? It’s a big financial decision to make, so it is important that you understand its short, and long-term impact. Before we review the pros and cons of refinancing a mortgage, here’s a quick recap of how it works.

• Define your goal. Why are you refinancing?
• Talk to your current lender. Ask about your refinance mortgage options. In most cases, they would want to try and keep you as a client. Use this as leverage to get a better deal.
• Shop and compare rates. Don’t get blinded by lower rates. Read the fine print. Consider the upfront fees. Once you have a shortlist, ask for a loan estimate. This allows you to compare in detail. It helps to set a meeting so you can assess a lender’s credibility. This is also your opportunity to ask refinance mortgage questions specific to your situation.
• Check if interest rate applies to the life of the loan. Some rates are only available for a set period. Afterward, it reverts to a higher rate and you may end up paying more.
• Apply within a short period. Bulk applications can affect your credit score.
• Lock the rate you agreed upon. Interest rates are always changing. Make sure you get the rate you agreed to.

So, What Are The Pros And Cons Of Refinancing A Mortgage?

Pros of Refinancing

The most obvious advantage of refinancing a home mortgage is getting a lower interest rate. You may have to pay an upfront fee. However, what you’re getting is the chance to pay less each month. This frees up your budget for other financial goals like short-term savings or an emergency fund.

If you can now afford to, refinancing also allows you to finish paying your mortgage debt in a shorter period. If you are switching from adjustable to fixed interest rate, you can avoid ‘surprises’ that lead to a sudden surge in payments.

Refinancing a mortgage lets you access your home equity. Home equity is the difference between your home’s market value and what you still need to pay off. Accessing your equity means you can get cash for major expenses like tuition fees or hospital bills.

Cons of Refinancing A Mortgage 

If you are too far in your mortgage, refinancing may not always be a good idea. You may end up paying more monthly, even if you get a lower interest. In the early stages, your payments hardly make a dent on the principal amount. Therefore, it makes sense to consider refinancing.

But if, for example, you are on year 15 of a 20- or 30-year mortgage, refinancing now may not be a good deal. A great and simple way to find out is to use a mortgage refinancing calculator.

Refinancing comes with certain risks that you can weigh beforehand. For instance, is your refinanced mortgage a recourse product? This means that if you default on payments, the lender can seize your assets. Another thing to check is if there’s a prepayment penalty for your original mortgage.

Still on the fence about refinancing? We can help you. Our mission is to help you achieve your goals through smart refinancing. And we do this by empowering you with the knowledge to make an informed decision.

Not sure how to use a mortgage calculator? We’ll break it down for you. Call us now and let’s see how we can help.

The post The Pros And Cons Of Refinancing A Mortgage appeared first on Sun Mortgage Funding.

Expenses Of Home Ownership Both Expected And Unexpected

Is Buying A Rental Property A Good Investment? 

Let’s talk about buying a rental investment property and the potential expenses of home ownership that you may incur. Yes, there are advantages to homeownership. However, buying a property as an “investment” is not as clear cut as many seem to think.

Many people think owning rental property is a simple, and easy way to make a lot of money. It is much more complicated than that. There are many unexpected and unpredictable expenses that can and will arise. This happens both in the purchase and renovation of an investment property. It also happens in the actual use of the property.

Visit here to see if you qualify to buy a rental property.

Predictable Expenses of Owning A Home

• Appreciation –

Even though some expenses can be predicted, there is still an element of uncertainty that cannot always be eliminated. For instance, insurance and tax payments are predictable in the sense that they are paid annually and at the same time every year. However, based on insurance claims being paid out or assessment changes from the city government, those payment amounts can sometimes vary widely.

Also, taxes and insurance tend to increase in cost over time. It makes sense that if a property has an increased value, the taxes and insurance for that home would go up as well.

• Property Insurance for Coverage –

There are many variables that can affect that insurance amount as well. There are different kinds of insurance that pay you differently based on how the policy values your property. Some policies will use “Replacement Cost” while others will use “Actual Cash Value”.

Replacement Cost policies are usually more expensive. This is because they will pay out however much it costs to rebuild and “replace” the physically damaged house or part thereof with brand new materials, and labor costs. This is a higher figure than what an “Actual Cash Value” policy would pay.

An “Actual Cash Value” (ACV) policy pays for the cost of replacing the damaged premises, but it subtracts out the “depreciation” of the premises. That means, if a roof lasts for 20 years, and it needs to be replaced due to a covered loss after 10 years, the insurance company would pay you ½ of the cost to replace it with a brand new one.

Obviously, this could be a serious amount of money you may have to come out of pocket for this roof replacement. If the new roof installation is $20,000.00 then, in this case, the insurance company would pay you $10,000.00, and you would be responsible for the other $10,000.00. It is clear why this type of policy costs less than a “Replacement Cost” policy.

• Flood Insurance –

What also adds to the list of expenses is flood insurance. Flood insurance is different from property insurance. If a flood occurs and you have only property insurance, you may get nothing from the property insurance company towards your loss.

Flood Insurance can be purchased using replacement cost or actual cash value for the valuation of the lost property. However, it is not a true replacement cost or actual cash value policy. This is because a true replacement cost policy has a guarantee that will replace the total of the damaged property regardless of the coverage amount.

A true actual cash value policy will pay the full depreciated cost of replacement regardless of the coverage amount. Most government flood insurance programs are written on an actual cash value basis. The main difference is that a flood insurance policy will only pay up to the coverage amount.

Most government flood insurance programs have a maximum coverage limit of $250,000.00. An additional policy can be purchased to cover additional amounts if a property is worth more than $250,000.00.

Unpredictable Expenses of Home Ownership

Some costs can be more easily predicted. For instance, when buying a property that has a sales price, you know that while you pay somewhat more or less than the purchase price, the price itself is a pretty good benchmark for what you can expect to pay to purchase the house.

You can also predict and estimate the closing costs of buying the house at a decent level of accuracy. It is usually based on the price but also may depend on any additional legal services or filings that arise. However, some expenses of home ownership can be extremely hard if not impossible to predict.

We refer to these as “unpredictable expenses”. Some of these expenses are, repairs, market fluctuations, default by tenants, vacant property carrying costs, natural disasters, change in law or ordinance, and environmental changes.

• Property Repairs –

Some repairs can be predicted in advance. If you can see that paint is starting to peel or wear away, or if a roof looks like the shingles are not in good shape you can estimate when it will need to be redone or replaced. But some repairs come out of the blue.

A plumbing repair is usually hard to predict and can depend on how the tenant is using the plumbing. Some other unpredictable repairs might be due to appliance or some other kind of installed fixture malfunctioning. If the air conditioner goes out in the summer, that will be not only unpredictable but also would need to be fixed A.S.A.P.

The same situation would occur if a heater or heating element goes out during the winter. Also, some repairs that you think maybe far off can sometimes progress quickly and become imminent. Such as some woodwork that is deteriorating suddenly falling off or becoming dangerous.

Go here if you need to get financing for a repair or property renovation.

• Changes In The Rental Market –

Market fluctuations can also become an immediate cost or expense. Overtime rental amounts usually go up. However, this is not a hard and fast rule. If you are trying to rent a house or unit, and it is sitting vacant for too long, you may need to decrease the rent amount in order to get it occupied.

If you are asking $1200 per month, and you go for two months with no rent, you will have lost $2400 in income. Dropping the asking rent amount to $1100 instead and rent it after one month the overall loss after a year would be $1200.

So, holding out for a higher rental amount isn’t always worth it. This may have absolutely nothing to do with the market though, it could just be a coincidence that it still hasn’t rented. It is impossible to know the exact cause of demand changes for rental properties.

An additional option if it seems like you are not able to get the rent amount your property should be getting is to update parts of or all of a property. Some updates are more costly than others, and you should make sure your updates will translate into increased rental amounts. This would fall into the category of unpredictable expenses of home ownership.

Do you qualify to refinance your rental property for needed updates? Go here and find out!

• Tenant Default –

Tenant default is another expense that can be hard to predict. You should try to limit the risk of a tenant defaulting on rent by screening your tenants carefully via verifications of employment, credit reports, and referrals from previous landlords. Even with this, it’s impossible to predict all of the changes that could affect a tenant’s financial health. Just a few things pop into mind; a health problem, a family problem, even a legal problem.

• Natural Disasters Are A Great Example of Unpredictable Home Expenses

Damages from natural disasters can also be an unpredictable expense. Who can predict a natural disaster? Nobody! However, you can have a property insured. But not all insurance policies are the same, and yours may not cover “loss of rent”.

You can have that coverage added, but it will cost you to do so by adding to your premium. Even if you do have insurance, there is almost always a part of the loss that is to be paid by the insured. That is usually referred to as a deductible, coinsurance provision, or a retention amount.

• Environmental Changes / Climate Change –

Natural disaster expenses can also be tied to changes in the global environment. We have been seeing over the past 10 years historic amounts of storms, as well as larger more powerful and slower-moving storms.

We have also been seeing a steady increase in sea levels. This changing environmental situation has led to an evolving threat. If we are experiencing more storms and more covered insurance losses than before, we may need to change how we cover our property with insurance.

If you are having more flooding problems, or many more dangerous storms in your area than before, you may need to either increase your coverage amounts or reduce the Deductible amount. These efforts will help to avoid an even bigger loss. Other more costly adjustments can also be made, such as raising a house or adding impact-resistant windows.

Find out if you qualify to raise your house or make it hurricane ready, visit here.

• Changes In Law Or Ordinance For Home Owners –

The final, in the category of unpredictable expenses of home ownership,  is a change in law or ordinance. This means if rules about rental property change it can directly affect your bottom line. For instance, if it turns out that the Federal government changes interest deductions for individual or business income taxes, that could cost or benefit you.

It seems to really depend on the current government and its desires to influence or change policy. You can typically expect a conservative government to reduce taxes, and a liberal government to increase taxes. However, it can depend very much on who has the majority in Congress.

Another change in law or ordinance that has happened nationally but locally as well are the changes in the Air BNB laws. Initially, many people rented full houses out to Air BNB tenants for unlimited periods of time. There are now new laws and penalties locally that make it much more difficult to rent out Air BNB units.

Based on the new rules surrounding Air BNB’s, you could end up falling short of your needed income. Another change in the law that could affect income is film tax credits.

When Louisiana enacted tax credits for films it brought an onslaught of short-term rental business to the city. However, what goes up must come down. Once the tax credits ended, so did the short-term rental business that came with it. If you had planned on that demand being there, it could come as an unpleasant surprise.

In summary, there are an awful lot of potential expenses for home ownership to consider before embarking on a rental property as an investment journey. Make sure you can afford it before setting sail!

If you would like to know if you can afford to buy a particular rental property, use our mortgage calculator.

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Benefits Of Home Ownership

Buying a primary residence and dealing with the many faces of real estate investing

There are several ways to invest in real estate. In this article, we will explore investing in a property to be used as a primary residence. There are many benefits of home ownership and we have selected what we think are the best, both psychologically and financially.

Be The King Of Your Castle

To many people, the ultimate feeling of freedom and control is to own the residence they live in. Nobody can tell you how to live in your house.

If you decide to keep the AC set at 59 degrees, you can do that without anyone else’s permission. Well maybe with the exception of your significant other that is. If you decide that you don’t need an alarm system, you don’t have to have one.

However, this does bring up another side to this coin. If you decide not to have an alarm system, or to not pay for insurance, if the house gets burglarized, or gets struck by lightning, you could be left paying for the repairs out of pocket. As the property owner, these would be your decisions to make.

Contact us on exploring insurance costs through our financing resources. There surely is a higher level of responsibility for a homeowner than a tenant. It is important to be certain that you can afford all the expenses related to home ownership. Would you like to calculate your mortgage payments? Visit our “calculator” page here.

Mortgage Interest Deduction

One of the many benefits of home ownership is being able to deduct interest paid on mortgages. One way the IRS helps U.S. homeowners is by allowing some interest paid on mortgages to be deducted from income for tax purposes. That way some of the money that gets paid to the mortgage company is “saved”.

An individual can currently deduct interest paid annually on debt up to $375,000.00 for an individual, or $750,000.00 for a married couple. There is a higher interest deduction limit of $1,000,000.00 per married couple for debts that were incurred prior to 12/16/17.

Having A Mortgage Makes Improving One’s Housing Situation Much More Practical

Part of the “American Dream” is the ability to improve one’s life situation. Imagine if you didn’t qualify for a mortgage and had to purchase a house using only whatever cash you had saved.

For most people, that would seriously limit the houses you could afford to purchase. Some loans require little or no money down at all. This makes the amount of cash you might have available for a down payment would hardly matter. If the mortgage you are looking for requires 20% of the purchase price as a down payment in cash, that means if you were interested in a $100,000.00 house, you would be required to put up $20,000.00 as a down payment.

If you didn’t have the option to finance the purchase of the house through a mortgage, you would be limited to a house that costs no more than $20,000.00. A mortgage gives the homeowner the ability to pay for a nicer house than they could otherwise afford. This is accomplished by paying for it over time. Fill out an application and find out what mortgage programs you qualify for! Go here to fill out an online application.

Increasing Property Value (Appreciation)

Another benefit of owning your own house is that property typically increases in value over time. Physical buildings on a property “decrease” in value over time through use. The cost of land typically increases in value over time, since the supply of land is finite.

The number of people on earth has historically increased whereas the amount of land has stayed the same. It’s all about Supply and Demand. If there is less of a supply of land, then the demand is higher, and therefore the prices as well. Although it will cost some money to keep a property in good condition and well maintained, one can expect the overall value of the property to increase over time.

Forced Savings Plan

One of the key benefits of home ownership is having a savings plan working for you that you probably weren’t aware of. Having the structure and requirement of making a monthly mortgage payment assists people in their savings goals. This is the result of the monthly mortgage payments being required to keep your mortgage in good standing. Those payments work as a type of forced savings program.

Yes, you have to make the payments, but with each payment made you are increasing the amount of equity you have in the house. If your monthly payment shows $120 going to principal, then that means now you own $120 more of the house than you did prior to that payment.

You can save more or less depending on your situation. You can pay it off faster or slower, as long as you make the minimum payment. If at some time you need to access some money, you will be able to “Refinance” if you have equity in your house. Visit our loan programs page to see what options would work best for you.

No More Rent Payments

One of the best reasons to buy a home is to stop paying rent, and instead, pay down your mortgage. When you make your mortgage payments not all of that money disappears down a “Rent” black hole. The amount paid to principal is the amount the loan balance is reduced by, and your equity (the part you own) is increased by.

For most mortgages, the amount going to principal will increase with each made payment, as the principal balance the interest is based on decreases. With each mortgage payment, you are one payment closer to having it paid off. Once it is finally paid off, all that money that used to be spent first on rent, and then on a mortgage, will be able to be saved.

Another problem with paying rent is that it is subject to change. It is a common practice to increase rental amounts for tenants when they extend their lease.

This is something else an owner can avoid by owning their own property. Although your taxes may go up or down, you will never be at the mercy of a landlord asking for more in rent.

This list was intended to summarize some of the main benefits of home ownership. While careful thought and preparation are required to make sure a purchase is the right decision for you, the benefits mentioned above are well understood to be beneficial to a consumer.

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Funding a Loan for a Mortgage

The term "fund" refers to the process of wiring or releasing money from a mortgage lender to title or escrow prior to closing a real estate transaction. Funding often occurs a day or two before closing, and you can't close unless and until it happens.

The Funding Process
The process of funding a loan differs from state to state, but it typically doesn't take place until all the loan documents have been signed and all the funding conditions have been satisfied. A homebuyer often signs loan documents a few days before the actual closing, but this can vary by state. Closing can sometimes take place the same day a buyer signs the loan documents in some areas of the country.

Expect the lender to do one final check of your credit and employment status at the very end of the process but before any money changes hands. A buyer might think her loan is a sure thing so she runs out and buys a house full of furniture—on credit—in the days before funding. This move can be disastrous if you had a borderline credit score to start.

What Does Funding a Loan Take?
A closing disclosure is sent to the buyer a few days prior to signing the loan documents. The buyer is then permitted to sign the mortgage documents. If some of the paperwork seems identical to other documents you've already signed, it is. Everything must be signed regardless if you want to fund your loan.

Loan documents also require notarization, which means producing two acceptable forms of identification and placing your signature on certain documents in the presence of a notary public. Many title and escrow company employees are notaries. You can also sign with a mobile notary in the privacy of your home or at your place of business.

The loan documents are returned to the lender for review after all the parties have completed signing the escrow paperwork. Underwriting is likely to require that all loan conditions be completed by this time as well.

Wet Closings vs. Dry Closings
The lender prepares to fund the loan after reviewing the executed loan documents. Funding generally means wiring the loan monies to the title or escrow company. The exact timing depends on whether it's a wet closing or a dry closing.

Regardless of whether you're the buyer or the seller, you'll want a wet closing, which means the lender wires the funds immediately on the day of closing. The money is present and accounted for at that time, typically in the title company's bank account.

If you sign everything and then have to wait for the lender to review all the documents one more time, that's a dry closing. It can occur when a lender has not worked with a particular title company before so the lender doesn't have the comfort level necessary to trust the title company with a final review of the paperwork. State law also matters. For example, all closings in California are dry closings. The delay associated with a dry closing is usually no more than two to four days.

Refinancing and the Right of Rescission
The process of refinancing is almost always a dry closing because, as the borrower, you typically have a right to rescind or cancel the transaction for 72 hours after closing. You can waive your right to rescission at closing by signing the required document, but your lender still might not release the funds until the rescission period has passed.

Read Full Article Here: Funding a Loan for a Mortgage