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Comments by Mortgage Professor
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Loan Programs
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Priced On-Line by LENDER X
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Fixed-rate
programs are usually identified by their term.
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Fixed-Rate
Programs
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40-years
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30-years
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X
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25-years
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20-years
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15-years
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X
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10-years
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Balloon-loan
programs are identified by the period for which the quoted rate holds.
The balance is due at the end of that period.
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Balloon-Loan
Programs
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5-year
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7-year
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Adjustable-Rate
Programs
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The
first figure is the initial rate period, the second figure is the rate
adjustment period after the initial rate period ends.
ARM programs are also identified by the interest rate index that
they use, and other features. See
Requirement 4.
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1 month/1 month
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3 months/3 months
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6 months/6 months
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X
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1 year/1 year
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X
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3 years/1 year
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X
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5 year/1 year
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X
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7 years/1 year
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X
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10 years/1 year
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X
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3 years/3 years
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5 years/5 years
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FHA Programs
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VA Programs
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Second Mortgage Fixed-Rate Programs
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X
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Second Mortgage Adjustable-Rate Programs
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State Coverage |
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| Not
all lenders operate in every state. |
All
states except Alaska and Hawaii |
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Property Types
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Few
lenders make loans on all types of properties
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Single-family
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X
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2-4
family homes
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X
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Condo,
less than 5 stories
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X
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Condo,
more than 5 stories
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X
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Co-ops
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Manufactured
homes
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Land
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In
a planned unit development (PUD)
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Farms
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Commercial
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Alternative Documentation
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The
precise details of alternative documentation requirements may differ a
little from one lender to another.
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�
Stated income�, �stated assets�, or both: income and/or assets are disclosed but not verified by
lender.
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X
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�No ratio�:
maximum ratios of housing expense
and total expense to income are ignored by lender.
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X
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�No
income�, �no assets�, or both:
income and/or assets are not disclosed.
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Shoppers
should expect to pay more for a waiver of escrows or a float-down, less
for accepting a prepayment penalty. A
float-down is a lock plus the right to a lower rate if market rates
decline.
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Options
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Waive
escrow of taxes and insurance
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X
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Prepayment
penalty
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X
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Float-down
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Interest-only
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X
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Temporary
buydown
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Special
Loan Purposes
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All of these cost more than loans taken
out to purchase a home for permanent occupancy, or to refinance with no
cash out.
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Cash-out
refinance
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X
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Use
house as vacation or second home
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X
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Rent
out house
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X
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Borrower
a non-resident alien
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Construction
loan
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Bridge
loan
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Maximums
and Minimums Across All Programs
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Max
& Min of Lender X
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Warning!
The maximums and minimums vary for different programs.
For example, the longest lock might be available for ARMs but not
FRMs. Further, the stated
maximums and minimums are not likely to be available on the same loan.
Don�t expect to get a 107% loan, for example, if you have a 540 credit
score. (Note: you can get
your credit score on www.myfico.com.)
Housing expense is the sum of the mortgage payment, property taxes
and homeowners insurance.
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Maximum
ratio of loan to value
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107%
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Minimum
credit score
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540
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Maximum
loan size
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$4 million
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Minimum
loan size
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$10,000
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Maximum
ratio of housing expense to income before taxes
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65%
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Maximum
ratio of housing expense plus other debt payments to income before taxes
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65%
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Longest
lock period available
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60 days
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