Introduction

Mortgage deferment and forbearance are two options for homeowners that help in temporarily lowering their monthly mortgage payments. The major difference between these two options is whether the interest accrues and the time for repayment. Here, we will be talking about the difference between mortgage deferment and forbearance. There are multiple aspects when it comes to these methods like payments, interest, etc.  

What’s the Difference Between Mortgage Deferment and Forbearance?

• Payment Assistance– In a mortgage deferment, the mortgage borrowers can delay past payments during the forbearance period. They can furthermore repay them at the end of the loan’s tenure. Here, as your mortgage payments are deferred, you are required to pay your monthly payments on time. Furthermore, forbearance pauses or reduces payments for homeowners suffering from financial hardships for a certain amount of time. Although the borrower has the option to make payments during the forbearance period, it’s not obligatory. In some cases, lenders may require the borrower to provide regular updates on their financial transactions during the forbearance period.
  
  
• Interest Accrual- In an interest accrual, the mortgage payments that have been deferred to the end of the loan’s tenure don’t accrue additional interest. Whereas, in forbearance, the interest accrues each month as scheduled.
  
  
• Repayment – Concerning repayment, in forbearance, you may have to catch up on the past payments post the forbearance period ends. Although, this depends solely on the loan and forbearance terms. For example, if your monthly payment structure is $1500 and you apply for 6 months of forbearance. You’ll owe $9000 towards the end of forbearance. Furthermore, deferment allows you to delay missed payments in case you sell your house or refinance.

What’s the Right Choice for You?

A deferment can be an ideal choice for you if you’ve come to the end of the forbearance period. You may benefit from deferment if you have just ended a period of forbearance. Also, if you are able to resume monthly payments but cannot afford to make up the payments missed during forbearance. This applies even to a repayment plan. Moreover, if you do not wish to permanently modify the loan terms you may be able to opt for deferment.

On the other hand, forbearance can be the right choice for one who is experiencing a brief period of financial hardship. This can be inclusive of job loss, illness, or any kind of disability. Here, you will have to provide proof stating the reason for the crisis. 

Additional Information

COVID-19 may affect your ability to repay the outstanding payments. Although, under the CARES Act, you are able to request forbearance without providing documentation. If your loan is backed by either of the departments given below. You must have been requested an initial forbearance by September 30, 2021.

The departments are as follows-

• Department of Housing and Urban Development (HUD)
• Federal Housing Administration (FHA)
• United States Department of Agriculture (USDA)
• Department of Veterans Affairs (VA)

Furthermore, Fannie Mae and Freddie Mac do not impose a deadline for asking for an initial forbearance on your loan. Borrowers with federally backed mortgages won’t have to make a lump-sum payment at the end of the forbearance. Considering the COVID-19 adversity. Additionally, these borrowers will be eligible to defer the pending payments for up to 12 months. 

The Bottom Line

According to the information above the conclusion is that forbearance provides momentary relief to homeowners suffering from the financial crisis. Although, at the end of the forbearance payments the monthly payments must be given in full. In such instances, homeowners may consider having deferment to postpone the one-time amount until the end of the loan’s tenure. Moreover, if you want to avoid the hassles and sell your house you can contact Elite Properties. We are a cash buying company which means we can help you sell your house fast for cash. Call us today at 718-977-5462 and sell your house in any condition and location.

Let us be honest, we all have some itchy mortgage home loan questions that are difficult to ask. Opening up your personal life and finances can be uneasy. Borrowers may hesitate to talk on certain topics that can eventually lead to a troublesome mortgage home loan process. Read our blog ‘Are you embarrassed to ask these mortgage home loan questions?’, and elude yourself from being in an uncomfortable situation.

If you are hesitant to ask questions that you feel may put you in a compromising state, think again. Loan officers hear it all the time and they have answers to all your questions. Some of the questions are given below. 

Is It Possible To Get A Mortgage Home Loan Without A Job?

The first step to qualifying for a mortgage home loan is employment verification. Your lending institution will look at your debt-to-income ratio, W2s for the past 2 years, etch, to understand your finances. Now, the question is what happens if you lose your job during the home-buying process? Firstly, it’s important for a buyer to be honest with the loan officer and disclose every little detail. Hiding the situation will only get you in trouble and increase the risk of loan default. The loan officer, in this case, will recalculate your savings/earnings and submit a new mortgage application.

Although, you may still qualify for a smaller loan and get a house in that price range.   

How Do I Take An Ex-Off My Mortgage Post Separation?

There are usually two options available in this case

• Sell your house
• Let one spouse buy out other

Selling your house and dividing the yields is the most suitable option to resolve the issue of homeownership. Here, the spouses need to settle on a buyout figure (i.e. the home’s appraised value minus the selling price). The remaining amount will be split between the spouses. Furthermore, the spouse keeping the house may decide to employ a mortgage refinance to pay the buyout. So when you purchase back home with this option it will eventually remove the other partner from the property’s title.

What Happens To The Mortgage Loan If I File For Bankruptcy?

Keeping your home while facing bankruptcy is probably one of the biggest concerns for homeowners. Legally, a mortgage lender cannot punish you for filing a bankruptcy either way by changing your loan terms or raising your rate. Although, the cases are different keep in mind several factors and circumstances. Homeowners filing for chapter 7 bankruptcy may risk losing their homes. Whereas, homeowners filing for chapter 13 bankruptcy may keep their home and continue paying their mortgage home loan. 

Does It Matter In Case I Owe Back Child Support?

A child support arrear can be a negative sign on your credit that may lead to failure of mortgage prequalification. Additionally, back child support that has reached the judgment phase may make you appear as a risk to the lender. You may want to consider talking openly to your loan officer about the ways you’re trying to pay the debt. It may also possibly improve the odds of qualifying for loan eligibility. 

The loan officer may also ask you for a court-approved repayment plan to know how you’re managing your debt. Furthermore, paying the debt in full can also ease the toll of credit and qualify you for mortgage programs.

• I Didn’t Pay My Property Taxes And Got A Letter From The Lender. What Do I Do?

The reason homeowners pay taxes is to fund the municipal services and county. If you fail to pay the property tax bill, the local tax office will commence charging monthly interest. Additionally, you may also have to pay penalty charges for overdue payments. If this becomes a continuous thing a tax lien will be put on your property. The lien indicates you can’t sell the property until the tax bill is paid. 

If you receive a tax notice from your lender, then it’s crucial to contact the tax attorney and your loan officer. Failure of property tax payment translates into the ‘event of default’ that will put you at risk of foreclosure.

There are some options that your loan officer may guide you through

• Allowing late payments
• Seeking a tax deferral
• Creating a payment plan
• Taking out a property tax loan to pay a debt in monthly installments

• Why Is It Important To Know Where The Money Deposited In My Account Comes From?

While the mortgage approval process, large deposits of money that are apart from your earnings need an explanation. An underwriter will ask for verification of the large money deposit, to ensure it comes from an admissible source. Confirmation of the deposit also ensures if you’ve taken a new loan that potentially affects your debt-to-income ratio.

• I Am Unable To Make My Mortgage Payment, What Do I Do?

If you think foreclosure is the only way out if you default on mortgage payments, think again. There are several options available, one of which is to contact your loan officer. Your officer will ask you about the financial crisis and why you won’t be able to make payments moving forward. The objective of the officer here is to help you to keep your house and explore the possibilities. There are options like loan modification, mortgage refinance, repayment plans, forbearance, mortgage assistance programs, or short sale. These options can be a big consideration before the homeowner faces bankruptcy.

Additionally, the Consumer Financial Protection Bureau recommends a free HUD-approved housing counselor. Having a counselor by your side can aid in receiving professional guidance and saving you from foreclosure. 

Bottom Line

Having awkward questions is okay as far as you have solutions for them. Although, if you want to avoid such situations you can sell your house to Elite Properties. We buy houses as-is and offer you the authentic fair market value of your house. Call us today at 718-977-5462 and sell your house fast for cash.

In order to assess property taxes, localities usually have a home appraisal. When you sell your house or refinance it, the bank is liable to order an independent appraisal. This is done to assure it is lending against the property’s true value. The satisfaction of a home appraisal relies on if you are a seller, a prospective buyer, or a taxpayer. If you’re someone who is unhappy with their home appraisal, scroll down to read our blog ‘This Is How You Can Challenge A Low Home Appraisal’.

A thing to keep in mind is that not all homes are up for appraisals if you are a cash buyer you can opt-out. Although, this only happens when the price inclines on the steeper end of the market and the inventory is low. However, if you are planning to finance your new home appraisal is mandatory. On the other hand, according to most housing experts, if you are paying for your house in cash, it is always better to know its worth.

The Multiple Kind of Appraisals

To understand better make sure you are aware of the multiple types of appraisals.

• Online Appraisal

Many companies nowadays have started performing electronic appraisals to cut costs. Here, they do internet research on comps (comparable homes) to fix the value of your home based on comps and other factors inclusively. Although, in an online appraisal there is a high chance that information on newly renovated rooms or items can be skipped. If something like this occurs, it might impact the assessment of your house as these things are not visible online.

• County Appraisals

Drive-by appraisals are another kind of appraisal that usually takes place for counties. In drive-by appraisals, a person may take the current picture of their home and comparables, again without the need to visit the house.

• Traditional Appraisal

Lastly, the traditional appraisal occurs when the appraiser visits the house and gathers information. The appraiser further asks questions regarding improvements. Post which he/she will make a comparison to other similar houses in the area or town. Furthermore, a traditional appraisal may cost several dollars and takes place when a home is sold to the new owner.

Here’s How To Challenge A County Appraisal

The reason for conducting a county appraisal is to assess property taxes based on the current value of your home. If you aren’t thinking of moving any time soon, and when the assessment comes in lower than your expectations. A thing to consider is that your property tax bill will also be less. Additionally, if you want to sell your house in the future you can call the county auditor. There are many localities that allow you to appeal the assessment by providing proof of upgrades or improvements.

Furthermore, while evaluating the property a real estate agent researches the comps in the area. This means using the county’s assessed value may not hold as much importance.

Here’s How You Can Challenge Other Appraisals

If you’re buying a house and the appraisal comes in too low, it will result in declining your mortgage loan approval from the lender. Although, you still have multiple options to try before giving up.

First off, as the purchaser of the appraisal, you are entitled to view the appraisal. Make sure to work closely with the seller’s real estate agent and ensure all major upgrades are taken care off while the assessment. Additionally, ask the seller’s real estate agent to talk to the appraiser about the comps they examined while finalizing the selling price.

You can also request the appraiser to re-examine their results based on comparables. If there are a handful of recent sales in the neighborhood. The appraiser may have found similar homes in other neighborhoods that weren’t comparable as initially thought. If you can provide authentic information to the appraiser there is a possibility they might reconsider the assessment.

Lastly, remember to always be polite while challenging an appraisal. The appraiser may not want to admit that they’re wrong while putting in a place of defense. Make sure you challenge the assessment with absolute respect and talk it through.

Conclusion

There might be times when a low appraisal may work in your favor regardless of your status. Remember, an appraisal relies on multiple factors starting from the home’s condition, its market value, and comparables.

Furthermore, if you have strict time constraints and are planning to sell your house fast you can get in touch with Elite Properties. We buy houses for cash and make an offer based on the fair market value. Also, we offer fast closings so that you can work according to your timeline. Call us today at 718-977-5462 to know more.

After a lot of house hunting, you’ve finally found the home of your dreams. A house with the right amount of rooms and a beautiful front yard so, what do you do next? How do you turn yourself into a homeowner from being a potential buyer? It’s simple, you apply for a mortgage to finance the purchase of your new home. As simple as it sounds there’s a lot that goes into applying for a mortgage and one of them is the mortgage underwriting process. If you’re a potential buyer, here’s a Step By Step Detail On Mortgage Underwriting Process.

What is Underwriting?

Underwriting is a critical step in the mortgage approval process where a qualified individual, known as an underwriter, assesses your financial information and determines whether you meet the lender’s requirements for a loan. This process involves a comprehensive review of your creditworthiness, income stability, debt obligations, and the property’s value. The underwriter’s role is to minimize the lender’s risk and ensure that you can repay the loan.

What Is Mortgage Underwriting Process?

An underwriting process merely determines whether a buyer is able to pay back the loan to the lender. It is a process due to the lender, assessing the risk of lending money. The lender here will assess and verify your income, debts, assets, etc. towards the decisive approval for your loan.

What Goes Into Mortgage Underwriting

A mortgage underwriter’s responsibility is to assess the overall risk of the potential buyer, and whether he/she would be able to repay the mortgage. The underwriter evaluates the factors which help the lender comprehend a buyer’s financial condition that including –

• Buyer’s credit score
• Buyer’s credit report
• Property intended to be bought by the buyer

Additionally, the underwriter also aids the lender in determining if the buyer may or may not see a forthcoming loan approval. The motive of this process is to ensure the buyer doesn’t end up closing a mortgage that they can’t afford. An underwriter further will investigate the buyer’s credit history, order an appraisal, verify the income and employment, analyze the Debt-To-Income Ratio, and lastly, verify your payments and savings. 

Here’s what an underwriter does:

A mortgage underwriter is a crucial player in the loan approval process. They are responsible for assessing the risk associated with lending to a borrower and determining if the loan meets the lender’s guidelines. Here are some key responsibilities of a mortgage underwriter:

1. Review Your Credit History: This includes a thorough examination of your credit report, credit score, and payment history.

2. Analyze Your Finances: Lenders typically adhere to federal financing guidelines. For example, Fannie Mae guidelines require borrowers to have a maximum loan-to-value (LTV) ratio of 97 percent, a credit score of 640 or higher, and a maximum debt-to-income (DTI) ratio of 36 percent. The lender might also incorporate its own criteria. Additionally, they’ll consider specific aspects of your financial situation. If it’s an income-producing property, they might assess whether you plan to occupy the property alongside tenants and take into account your financial reserves, such as investments, assets, and savings.

3. Conduct a Property Appraisal: The approval of your loan is influenced, in part, by the relationship between the amount you’re borrowing and the value of the home you’re purchasing (used as collateral). As a result, the underwriter will request a property appraisal to ensure that the asking price aligns with recent sales of comparable homes in your area.

4. Render the Approval Decision: Once all the necessary reports and paperwork are gathered, the underwriter makes the critical decision to approve or deny your application.

Common Factors That Can Impact Mortgage Underwriting

Mortgage underwriting is a complex process that takes into account various factors to assess your eligibility for a loan. Let’s explore some of the common factors that can impact mortgage underwriting.

1. Credit Score: Your credit score plays a significant role in mortgage underwriting. Lenders use this three-digit number to evaluate your creditworthiness and predict your ability to repay the loan. A higher credit score indicates a lower risk for the lender, making it easier for you to secure a favorable loan.
2. Income: Underwriters carefully evaluate your income to determine if you have the financial capacity to make regular mortgage payments. They will assess your employment history, stability, and the consistency of your income. Generally, a higher income level makes you a more attractive borrower.
3. Debt-to-Income Ratio: Your debt-to-income (DTI) ratio is another crucial factor in mortgage underwriting. It measures the proportion of your monthly debt payments to your monthly income. Lenders prefer a lower DTI ratio, as it indicates that you have enough disposable income to comfortably handle mortgage payments.
4. Employment History: Underwriters consider your employment history to gauge the stability of your income. They typically look for a steady employment track record, preferably with the same employer or within the same industry. Frequent job changes or gaps in employment can raise concerns for lenders.
5. Property Value: When underwriting a mortgage, the value of the property you’re purchasing or refinancing is also assessed. Lenders want to ensure that the property’s appraised value aligns with the loan amount. A lower loan-to-value ratio (LTV) is generally preferred, as it reduces the lender’s risk.

Understanding these common factors can help you prepare better for the mortgage underwriting process.

What Information Do Underwriters Look at?

Mortgage underwriters analyze a range of documents and information to assess your eligibility for a loan. Here are some of the key items they review:

1. Credit Report: Underwriters obtain your credit report from the three major credit bureaus – Experian, Equifax, and TransUnion. They scrutinize your credit history, including your payment history, outstanding debts, and credit utilization. A clean credit report with a history of timely payments enhances your chances of approval.
2. Income Documentation: Underwriters review your income documentation, such as pay stubs, tax returns, and W-2 forms. They verify the stability of your income source and calculate your debt-to-income ratio. Self-employed individuals may need to provide additional documentation, such as profit and loss statements or business tax returns.
3. Bank Statements: Underwriters analyze your bank statements to assess your financial health and verify your assets. They look for consistent deposits, large cash transactions, and any red flags that could indicate undisclosed debts or financial instability.
4. Employment Verification: Underwriters verify your employment history and income by contacting your employer directly. They may request additional documentation, such as employment verification letters or recent pay stubs, to confirm your income details.
5. Appraisal Report: Underwriters review the appraisal report to ensure the property’s value aligns with the loan amount. They assess the property’s condition and location to determine its marketability and potential risks.

By understanding the information underwriters evaluate, you can gather the necessary documents and ensure that your financial records are in order. Now, let’s explore the step-by-step process of mortgage underwriting.

Types of Underwriting Categories

There are three main types of underwriting process. Those are: loans, insurance, and securities.

Loan Underwriting

All loans, in some capacity, undergo the process of underwriting. This involves the evaluation of an applicant’s credit history, financial records, collateral value, and other factors that vary based on the loan’s size and purpose. The appraisal duration can range from a few minutes to several weeks, depending on whether human intervention is necessary.

The most common form of loan underwriting that involves human underwriters is for mortgages. This is the type of underwriting that most individuals encounter. The underwriter assesses an individual’s income, liabilities (debt), savings, credit history, credit score, and more, considering their unique financial circumstances. Mortgage underwriting typically has a “turn time” of a week or less.

Refinancing often takes longer, as buyers facing deadlines receive preferential treatment. The loan applications can be approved, denied, or suspended. The most receive “approval with conditions,” requiring clarification or additional documentation.

Insurance Underwriting

In insurance underwriting, the focus is on the potential policyholder – the individual seeking health or life insurance. The medical underwriting for health insurance was used to determine pricing and coverage decisions. These are based on health status, often considering pre-existing conditions. However, since 2014, under the Affordable Care Act, insurers are no longer allowed to deny coverage or impose limitations based on pre-existing conditions.

Life insurance underwriting aims to evaluate the risk of insuring a potential policyholder based on factors such as age, health, lifestyle, occupation, family medical history, hobbies, and other criteria determined by the underwriter. The outcome of life insurance underwriting can lead to approval, along with various coverage options, prices, exclusions, and conditions, or outright rejection.

Securities Underwriting

Securities underwriting, which evaluates the risk and appropriate pricing of specific securities. That are related to Initial Public Offerings (IPOs), is typically conducted on behalf of a potential investor, often an investment bank. Following the underwriting process, the investment bank may purchase (underwrite) securities issued by the company attempting the IPO and then sell those securities in the market.

Underwriting ensures that the company’s IPO will raise the necessary capital and provides the underwriters with a premium or profit for their services. Investors benefit from the vetting process that underwriting provides, enabling informed investment decisions.

This type of underwriting can encompass individual stocks and debt securities, including government, corporate, or municipal bonds. Underwriters or their employers purchase these securities to resell them for a profit, either to investors or dealers (who sell them to other buyers). When multiple underwriters is involved, it is referred to as an underwriting syndicate.

What Is Automated Underwriting Vs Manual Underwriting

A mortgage underwriter has two options to assess the loan application. The first is to do it manually and the other through software. The one with software is known as automated underwriting. An automated underwriting process is much easier and faster than the manual one as a computer evaluates it. Although, it has some limitations that are non-negotiable like inconsistent income, poor credit score, etc. That may be a deal-breaker for borrowers. Hence, in such circumstances, manual underwriting is an easy option. Furthermore, in some situations, lenders combine automated and manual underwriting to avoid the complications of the loan application.

Mortgage Underwriting Process Steps

As explained above in brief, an underwriter evaluates your finances and forwards them to the lender. Although, there are more aspects that need to be analyzed while proceeding with the underwriting process. Some of the aspects are given below.

1. Income

While assessing a buyer’s income the underwriter requires a set of documents as proof to determine if he/she can cover the monthly mortgage payments. As a buyer, you’ll need to submit documents like –

• W-2 (of last 2 years)
• Bank Statements (2 most recent ones)
• Pay stubs (2 most recent ones)

Furthermore, if the buyer is self-employed or has a share in a business. There are some additional documents that need to be submitted. Such as –

• Profit And Loss Sheets
• Balance Sheets
• Personal And Business Tax Returns
• K-1s

Adding to the above, the underwriter will verify if the buyer’s income is as mentioned in the payslips (or any other format where the income details are provided). Also, the underwriter will verify your employment status with the employer as well. 

2. Assets

Your assets help you qualify for a mortgage. As they can sold for hard cash if you fail to satisfy the outstanding loan amount. An underwriter will go through your savings accounts, stocks, and property if any. As the closing amount ranges from anywhere from 3%-6% lenders use assets to make sure the buyer makes monthly payments post-paying closing costs.

3. Credit

It is one of the most important aspects of mortgage approval, is assessing your credit score. An underwriter will evaluate your credit score to understand how well you have managed to repay your past loans. Assessing your credit score helps the underwriter to predict your capacity to repay the loan. 

4. Collateral

The underwriter needs to understand the worth of the house you’re interested in buying. The motive for seeing the collateral risk is to avoid putting the buyer’s money in a house that is not worth it. Hence, as a part of the closing process, the lender will order an appraisal.

Potential Underwriting Consequences

There can be only three possible consequences of the underwriter’s evaluation as given below.

1. Conditional / Contingent Approval

You can submit documents to satisfy the underwriter’s questions. Although, you’ll be clear to close while the documents go through the assessment. One of the most common requests includes verification/proving large amounts of deposit in the buyer’s bank. In such situations, a gift /donation letter from the donor is vital to prove it’s not a loan.

2. Suspension

This means there are significant questions in your file for which a loan officer will work with you closely to resolve the underwriter’s questions.

3. Denial

If the buyers got the loan pre-approved and review of their finances thoroughly, their loan will still be ultimately declined.

How Long Does Underwriting Take To Complete?

The underwriting process takes up to 5-8 days. Although, there are dependencies like your financial condition, loan type, missing paperwork, etc. that may prolong the whole process. Additionally, a point to remember, underwriting is a mere part of the process. A complete closing can take up to 40-50 days in total.

Tips for Smooth Mortgage Underwriting Process

1. Organize Your Documents

The key to a streamlined mortgage underwriting process is to have all your financial documents ready before applying for a loan. Keep the following document ready when you apply:

• Employment details from the past two years (for self-employed individuals, include business records and tax returns)
• W-2s from the last two years
• Pay stubs covering 30 to 60 days before application
• Comprehensive account information, including checking, savings, CDs, money market accounts, investment accounts, and retirement accounts
• Additional income details, such as alimony, child support, annuities, bonuses, commissions, dividends, interest, overtime payments, pensions, or Social Security payments
• A gift letter if you’ve received funds from friends or relatives for your down payment

2. Enhance Your Credit Profile

A lower credit score can make mortgage approval challenging and result in a higher interest rate. Improve your creditworthiness by taking the following steps:

• Pay down existing debts
• Avoid applying for new loans during this period
• Aim for a favorable debt-to-income (DTI) ratio (ideally 36% or less)
• Review your credit report for errors and dispute inaccuracies

3. Consider a Larger Down Payment

The underwriter also evaluates your loan-to-value (LTV) ratio, which compares your loan principal to the property’s value. A higher LTV ratio puts the lender at more risk if you default on the mortgage. You can improve this ratio by making a substantial down payment upfront. Borrowing less through a larger down payment increases your chances of qualification. Don’t hesitate to explore down payment assistance programs or seek support from family and friends.

By following these steps, you’ll pave the way for a smoother mortgage underwriting process. Also, well-prepared and maximizing your chances of loan approval.

Takeaways

A pro tip to speed up the process is to keep the documents in place, maintain a good credit score and always put a larger down payment. This way it’ll make the mortgage underwriting process a smooth sail. Furthermore, if you are in a hurry to move out and don’t have time for a traditional home-selling process then sell your house to Elite Properties. We buy houses as-is which means no hassles of legal documentation. We close a deal in less than 7 days and offer you hard cash. Call us today at 718-977-5462 and sell your house fast for cash.

What Are the Steps in the Mortgage Underwriting Process

Mortgage underwriting involves several stages that culminate in the lender’s decision to approve or deny your loan application. These steps are

1. The process begins with completing a loan application and submitting it to the lender.
2. Once your application is received, the underwriter performs an initial review to ensure all necessary documents and information are included.
3. Underwriters analyze your credit report, income documentation, and other financial records to assess your creditworthiness.
4. Underwriters review the appraisal report to ensure the property’s value supports the loan amount.
5. Underwriters may issue a list of conditions or additional documentation required for loan approval.
6. Once all conditions are satisfied, the underwriter grants final approval for the loan.

What are the factors that impact the duration of mortgage underwriting?

Several factors can impact the duration of mortgage underwriting, those are

1. Application Accuracy
2. Lender’s Workload
3. Complexity of the Loan
4. Third-Party Involvement

How Long Does Mortgage Underwriting Take?

On average, the underwriting process takes approximately 30 to 45 days from the time of application submission. However, it’s important to note that this timeframe is just an estimate, and the actual duration may differ.

FAQ

What Are the Steps in the Mortgage Underwriting Process

Mortgage underwriting involves several stages that culminate in the lender’s decision to approve or deny your loan application. These steps are

1. The process begins with completing a loan application and submitting it to the lender.
2. Once your application is received, the underwriter performs an initial review to ensure all necessary documents and information are included.
3. Underwriters analyze your credit report, income documentation, and other financial records to assess your creditworthiness.
4. Underwriters review the appraisal report to ensure the property’s value supports the loan amount.
5. Underwriters may issue a list of conditions or additional documentation required for loan approval.
6. Once all conditions are satisfied, the underwriter grants final approval for the loan.

What are the factors that impact the duration of mortgage underwriting?

Several factors can impact the duration of mortgage underwriting, those are

1. Application Accuracy
2. Lender’s Workload
3. Complexity of the Loan
4. Third-Party Involvement

How Long Does Mortgage Underwriting Take?

On average, the underwriting process takes approximately 30 to 45 days from the time of application submission. However, it’s important to note that this timeframe is just an estimate, and the actual duration may differ.

When it comes to a home selling process in real estate, selling psychology is always a part of it. When you sell your house there’s always an underlining message you put out for your buyers. You may not be aware of it but you’ve been sending these messages to buyers secretly. In these cases, you might want to send the right message to potential buyers. It is essential to understand the demography of buyers and your locality. For eg: If there are grad students residing in your neighborhood or there might be a retired couple. When home selling psychology comes into play, you have to picture who your ideal buyer is and think accordingly from a buyer’s perspective.

Clutter Can Be A Strong ‘NO’ For Buyers 

For a buyer, it is important to feel homely while picturing themselves in the house they’re visiting. When you have your personal belongings lying in the house while walkthrough, sellers may feel a bit intrusive. No buyer should feel as they are invading your personal space rather should feel homely and imagine themselves residing there.

What’s The Solution?  

Cleaning up personal items such as trophies, family portraits, collages, etc. can help avoid such awkward situations.

Take Time In Preparing Your Home     

Buyers will never make significant changes in the house unless they’re a real estate investor. If a buyer has infants or toddlers in a family they’d not buy a house with a pool or lavish landscapes. Besides, even staging your house excessively will have certain drawbacks. In order to keep your home tidy, you don’t necessarily need to stage it. A well-planned staging with minimal neutral upgrades can sell your house fast for cash. Eventually, it is vital to understand the buyer’s demography and make upgrades accordingly.

What’s The Solution?

As it might be difficult for you to understand initially who your buyers are? You can always switch to keeping the tone of your house neutral. Having a neutral room can allow buyers to put ideas into perspective. However, you can do basic upgrades like plumbing and fixing the roofs, etc., and avoid extra decor to make your house look beautiful.

It Is Important To Have A Purpose

Defining the purpose of each room can sell your house fast. Most people have a room for multiple purposes. For eg: A storeroom, which is also your gym or office space that has a play area. If this is the condition of your rooms as well then you might want to start defining the purpose of each room. Setting a room that is multifunctional can be practical for your family. Although, as a potential buyer it can still be a little confusing for them to understand the purpose of the room/s.

What’s The Solution?

If you have a total of 3 rooms excluding the kitchen and living area make sure the other three rooms are plain and neutral. Avoid creating chaos by having a multipurpose or multifunctional room while selling your home. Let the buyers have the advantage to think about how the rooms can serve their purpose.

Sell Your House With Elite Properties

A traditional home for sale method will require money, time, and energy. You can contact Elite Properties they are cash buying company that provides cash for homes New York. Selling house to a cash buyer (selling psychology) is much feasible as they don’t charge you any upfront costs. You can sell your house within 3 days in any condition and we will pay your closing cost. Call us today for an offer at 718-977-5462.

There is always a debate amongst people about what is better. Buying a House Cash vs Mortgage? In this blog, we will try to clear the picture and try to help you in the home selling process.  A lot of finance experts say buying a house in cash can avoid drowning in debt. Although, the other half believes in getting a mortgage and repaying it over the 15/30-year mortgage. Every method of purchasing an asset has its pros and cons. We will share an overview of each method and how it varies in each situation.

Why Must One Buy House in Cash?

In simple terms buying your home in cash allows you to avoid foreclosures and you are free of debt. You have complete ownership of your assets as you buy the property in full cash. Although every scenario has its pros and cons, scroll down below to know more.

Pros Of Buying a House in Cash

• Free Monthly Cash Flow

One of the big reasons to buy a house in cash is free cash flow. If you buy a house in cash you aren’t entitled to pay monthly mortgage installments. It allows your income source in multiple bifurcations as per your convenience and needs. Although, you’d still be paying the homeowners association fees, property taxes and maintenance costs, homeowners insurance, etc. You will pay these extra costs even if you don’t get your house on mortgage. When you buy a house on a mortgage, you pay a big chunk to the lender whereas in this case, you avoid it entirely.

• Save A Lot on the Interest

If you purchase a house in cash, you can save a lot on the interest of the mortgage. When you take out a mortgage, the interest rates are bound to escalate over the tenure. Example: A mortgage of $170,000 having a 4.375% interest rate costs you around $135,000 as interest expense for 30 years. Furthermore, mortgage debts are one of the cheapest in the USA if calculated on the APR (Annual Percentage Rate) basis. So, buying your home in cash might save a big chunk on the repayment.

• You Are a Preferred Prospect

Sellers always prefer cash buyers as the deal closes faster. When a seller sells the property to a cash buyer, it only requires the buyer’s due diligence and mutual closing date. Whereas, when a buyer applies for a mortgage, he/she has to work on a lot of things. Things like the verification process, legal documentation, the underwriting process, etc. The real estate market is big, but sellers usually pick cash offers as they are enticing and close faster. Also, a cash offer allows negotiation in closing costs as you trade in hard cash. If you are a cash buyer, you’ll be the preferred prospect instead of the one with a mortgage.

• Faster Closings and Lower Closing Costs

When you buy a house in cash, you avoid paying the associated loan fees. Also, costs like the originating fee, mortgage insurance premium, credit card report fee, etc. A cash offer may help you get away with legal processes and verification. Remember, an all-cash offer is less than the traditional bidding price. Getting paid in hard cash eventually is better than the orthodox mortgage bid, which is time-consuming. Additionally, as stated above, you close a deal faster with flexible closing costs.

Cons Of Buying a House in Cash

• Tying a Lot of Money into One Asset

If your property is worth $150,000 and you are a cash buyer, it can be quite risky. If you invest a large amount of your savings in one asset, you are tying up a lot of money. Such transactions do not show a positive outcome on your credit score.

• Low Liquidity

The real estate market or a house is an illiquid asset, which means it is difficult to sell it fast. Selling a home is time-consuming and a daunting task. Assets like bonds and stocks which have high liquidity are easy and quick to resell whereas a house is not. Therefore, putting a lump sum amount in one asset is never ideal as it slumps access to the liquid assets.

• Missing Out on Tax Benefits

The itemized taxes may help in putting the money back in your kitty. You can deduct a lot of amounts on mortgage rates through itemized taxes. Itemized tax deductions levy on multiple assets; it is advisable to check the taxes before purchasing. If you are using cash as your primary payment source then you are definitely losing some good tax benefits.

• You Are Left with No Savings

Buying a house in cash blocks your savings, and you have nothing, which means no emergency funds. It is always advisable to keep petty cash handy during an unexpected crisis.

Why You Must Consider Getting a Mortgage?

Buying a house on a mortgage allows you to maintain your savings and caters to the funding. Many people do not have enough savings to buy a house in cash. Prospects get a mortgage and keep building the equity over the tenure of repayment.

Pros Of Buying a House on a Mortgage.

• Flexibility Savings

When you get a mortgage, you have the flexibility to put your savings into other investments, which promise good returns. You can pick from innumerable liquid investments and grow your wealth and manage your monthly payments as well. Buying a house on a mortgage is always a better option as you have more flexibility to manage the money.

• Low Mortgage Rates

Comprehending the pandemic and the current state of the market, it’s a better option to opt for a mortgage. The mortgage rates are low, and the inventory has houses sitting for potential buyers. Hence the above makes it an ideal situation for purchasing a home.

• Improve Your Credit Score

If your credit report shows timely repayments, you will ultimately have a good credit score. Unlike buying a house with cash, it is essential to show the diversity of debts for a better credit profile. Credit reporting agencies prefer timely repayments of debts including home loans. It improvises the borrower’s profile allowing them to get a faster mortgage and boosting their credit score.

• Advantages Of the Tax Deduction

Mortgage debts are tax-deductible, which means more benefits for the person getting a mortgage. Married couples planning to buy a home can write off interest taxes up to $750,000 if filing together. If you are filing separately, you can write off tax interest up to $375,000.  Post the tax reform in the year 2018 write-offs were not as profitable. Although it still is beneficial for homeowners with outstanding mortgages.

Cons Of Buying a House on Mortgage.

• The Intricate Mortgage Process

It’s no hidden truth that getting a mortgage can be a really daunting and tiring process. You have to keep track of all financial documents inclusive of your IDs, which can be frustrating at times. Lenders will ask you for every detail and if you miss even a single document, you won’t qualify for the loan.

• Paying Mortgage Insurance Premiums

When you pay less than 20% on the property, having a mortgage insurance premium will be mandatory. A mortgage insurance premium is an addition to your monthly mortgage payments. Insurance is an added cost to secure the lenders in events if you miss out on paying the installments.

• Drawback Of Additional Costs

When a mortgage has lenders involved, it always comes with extra costs. The buyers are liable to pay lender fees, closing costs, mortgage origination fees, and appraisal fees. These additional fees can add to the existing cost and make the purchase even more costly.

• You Still Don’t Have the Ownership of the Property

When you buy a house on a mortgage, the lender has ownership while you keep making the monthly payments. They are entitled to hold your property until the last installment. If you fail to pay a consecutive number of installments, there is a high risk of losing your home.

Bottom Line

We know buying and selling a home is an overwhelming task. It can be a very confusing, lengthy, and mentally draining process. We tried to cover the pros and cons of buying a house in cash or by getting a mortgage. So, choose wisely keeping in mind your monetary status and plan futuristically.

If you are planning to sell your house fast for cash in NY, get in touch with Elite Properties. It is a ‘We Buy Houses For Cash Company’ which means you can sell your house fast for cash. Give us a call on this number at 718-977-5462 and we’ll help with fast home selling.

Losing your job is a very tense and stressful situation after which selling your house becomes the only feasible option. The burden of covering insurance and mortgage stands to be the need of the hour. In such circumstances, you wouldn’t want to wait for the traditional home selling process which can take months or even years. If you want to learn about the topic of ‘How do I sell my house fast after a job loss?’ scroll down below to get the insights.

Selling your house to ‘we buy houses for cash’ company will help you in many ways especially when a financial crisis comes into play. Many foreclosures occur due to job loss and unemployment or homeowners’ lack of cash, which becomes a problem while you pay mortgage or insurance. As a fact, foreclosures can lead you to bankruptcy and you won’t be given any loan further as your credit score is affected.

Avoid the Hassles of Clean-Up and Repairs

In such tight constraints, it is almost impossible to give an aesthetic change to your house. Making physical changes or cleaning your house can be time – consuming whereas, staging your home can be extremely costly. Furthermore, it is difficult to find buyers who would buy your house in a traditional way. Here, you can get in touch with ‘we buy house as-is’ companies and they will take care of the rest. There is no need to spend a dime on de-cluttering of your house, staging, or improving the curb appeal, once you get in touch with them.

No Need to Listing Your House on the Market

Listing your home on the market requires a lot of time, the process can last up to many months until you have found a serious buyer. People end up hiring a real estate agent which again is an additional cost while they have a naught budget. An Agent will always end up advising you to stage your home and make it presentable before you list the home on the market. Not forgetting, you will have to pay around 6% commission for the services they provide adding to the rest, closing costs and tax fees are the left-out aspects that round up the deal while closing.

You can also chuck the process of the walkthrough, as it typifies energy, money, and time consumption. It is a long process that doesn’t elude the havoc created by inviting strangers to have a look around your place. Showings additionally can hamper your timeline as well, instead of finding ways to achieve an income source you end up showing your house to strangers who’d hardly care to buy.  

Sell Your House Fast For Cash

Lastly, all you can do is sell your house fast for cash and save yourself from the frustration of the home selling process. Selling your house to Elite Properties can save a lot of your time and money altogether in one, how? We are a cash buying company which means we buy your house as-is without any commissions lying in the middle of the road. We propose you a no-obligation offer and buy your house at the current market value which means; only profit and no loss. We also pay the legal fees and closing costs. It is also advised you do some research around the neighborhood and get insights into selling your house. 

The most feasible option is to sell your house as-is to us, rest assured we’ll help you in this tough situation. Call us today at 718-977-5462 or visit us at Elite Properties.

Selling Your Home as is for Cash doesn’t have to be costly. Your home is a big asset and you wouldn’t want to spend a lot and get less than the desired value. You might be thinking that selling a house will be expensive and never-ending, which is partially true. However, we would like to tell you how you can find ways to save money while selling your home quickly and cherish the yields of the sale.

Sell Your House for Cash

Selling your house for cash is the most feasible solution while selling your home, how? Selling a house for cash has several perks, the sale closes in a much faster timeline, which allows you to proceed with your timeline. Second, if you choose Elite Properties you can sell your house within 3 days, so if you have a tight deadline, you have a solution. Third, you are offered an all-cash offer which means you have immediate cash for your next purchase.

Avoid Real Estate Agents

As much as real estate agents are saviors in the home selling process sometimes it’s better not to pick them.

Why?

Hiring a real estate agent has many pros, but in the specified situation, there are none. When you hire an agent you are automatically liable to pay the fees in multiple facets like commission and sale profits. Paying additional costs might decrease the value of your sale and would not produce any profits. In the worst-case scenario, you would end up spending a lot rather than saving. Also, an agent will take his or her time to make a fast-paced sale which will again cost you dollars.

For Sale By Owner

A ‘For Sale By Owner’ or FSBO listing is one thing that is accessible while trying to save money. The process can save you loads of money and can guarantee a profitable sale. There are many phases to such kind of a sale like; walkthroughs, attending prospects, marketing your property, etc. which will be solely done by yourself. Handling all these things at once might be challenging as it consumes a lot of your time. As a drawback, conducting showings and attending prospects personally will hamper your daily routine. You’ll have to perform repairs by yourself instead of a handyman, remember leave no space for any glitches.

Although, you can utilize the digital era to your advantage, taking pictures of your property (some exclusive drone shots) will help entice prospective buyers. You can list your property online for free on social media platforms that will serve you in gaining positive attention. By doing this you are cutting the costs of hiring a photographer and a broker which typifies an expenditure of more than a hundred dollars.

Sell House With Repair Discounts

Selling your house with repair discounts is the finest option to get away from a rugged property. If a part of your house is in bad condition or requires a little more than repair, you can list your property with a repair discount. A repair discount is when you sell your home by cutting a little chunk of the amount as a credit to the buyer to make further renovations. So instead of spending your equity, you can let the buyer make renovations according to his or her desired taste. Also, when you make repairs on your own the estimate will add construction costs, which is a mandated expense to your budget. You can sell your house in as-is condition to buy houses from cash companies it is one of the best options rather than doing repairs by yourself.

Consider DIY

As stated above doing things on your own will save you from bleeding dollars from your pocket. Your home is probably functioning great but what about aesthetics? You would require a painter, a handyman, and for minimal repairs probably a plumber. Hiring people for each job can be time, energy, and most importantly money consuming. Consider the ‘Do It Yourself technique, you can perform many things on your own like painting, cleaning, staging (if required), and repairing. This will work like magic on your estimates, as a result, you’ll save thousands of dollars, which helps in retaining your equity. Although DIYs are fun to do, you also have to keep in mind they will require all your efforts and time which you are surely running out of.

Sell Your House As-Is

Selling your house as-is is a better option than FSBO, how? FSBO listing will take up a lot of your time and energy whereas selling your home as-is will need none. This process doesn’t require a lot of time or any legal documentation as well. Selling your house as-is to cash buying companies will offer you a fair market value of your home by considering the condition of your house as well. They will also propose to you an all-cash, no-obligation offer which is a cherry on the cake.

If you want to sell your house fast for cash or have any queries regarding the real estate crisis we will be happy to help you. Get in touch with us today to learn more about ‘How can you save money while selling home’. Reach us at 718-977-5462 and we will provide quality solutions for all your problems.

A home is an extremely big asset for couples. When a couple chooses to separate, the relationship as well as the house also goes through a lot. A divorce comes with a lot of deliberations and mutual agreements which is important for the long run. Here, your part is to decide whether you want to sell your house or buy out to your spouse. Given below is a guide to Sell Your Home fast after the divorce which will help you with your existing chaotic situations.

If you have chosen to sell your house, there are many things down the lane waiting for you. Selling your home is a long and lengthy process, it isn’t a smooth run. In such a case, the best way out of it is to talk it out with your partner. Mutual decisions go a long way and where real estate is involved it can be extremely expensive and hard on pockets. It is the tight sure way to Sell Your Home fast.

Sell and Split

The best option which will reduce the disagreements is selling your house and splitting the proceeds of the sale equally. Why selling your house is a feasible option? First, neither of the spouses can afford the maintenance of the property. If the couple has kids it can double the expenses, with the ongoing expenses of divorce it can be a tough situation to tackle. Selling your house for cash is a feasible option because the proceeds of the sale can be split equally. Therefore, selling your house is an optimal solution for multiple reasons.

Buy Out the House

The second option is to buy out the house which means; the spouse who wants to maintain the ownership would recompense the other with half of the share. They can share a part or whole value of the house which can be transferred to the other half as a settlement of the divorce. Here, the spouse on the receiving end gets to keep a part of the house and receive the calculated share once it is sold.

Hold On To the House

If a couple with children is getting divorced, they would choose to hold on to the house. In this case, the couple can hold on without altering the ownership. You can choose to stay until your children move out for work. This can only happen when the couple can bear each other’s differences and think financially.

Sorting Out the Mortgage

Before taking a step to sell your home, you will be accountable to ask questions yourself. Questions like what are your income requirements if you chose to keep the house and retain ownership? What aspects would come into play if you sell your house? Will my children be affected by the decision, what are their needs? Etc. Once you know the answers, you can move ahead.

If a couple has a joint mortgage, they usually prefer to sort the mortgage on a single name (either of the spouse’s names). It is beneficial from both sides because the person residing in the house won’t rely on another half for the mortgage. Lastly, the person who discards the name from the mortgage can lend more money for a new home as they are exempt from the joint mortgage.

Understanding Your Property Rights

A house is an immensely big asset for one to keep. If you are going through a divorce, it becomes necessary to protect and understand your property rights. Securing property rights saves you from any felonies that your partner does without any knowledge. Home rights ensure neither partner can’t be forced to vacate the home even if it is under their ownership or not.

It is important to be aware of the laws and regulations while going through a divorce. The “Family Law Act” gives access to:

• Staying in your home unless a court order states to vacate the residence
• You will be notified of any repossession action taken by your mortgage lender
• If you have moved out, you can urge the court to grant permission for returning back

Sell your house fast for cash

As stated earlier in the blog, selling your house is the fastest solution after a divorce. Selling your home to cash buying companies eludes the chaos of legal processes and additional costs. Elite Properties is a reliable company when you choose to sell your house fast for cash. We buy houses all cash so you can sell your house within 3 days and move on with a new life. Rest assured we will buy a house in any condition, any location.

A divorce is a tiresome process that can drain you mentally. To Sell Your Home fast for cash will save you time, money, and energy, you can split the yields and move ahead with the rest of your plans. If you have any queries regarding the same you can call us at 718-977-5462 or visit us at Elite Properties we will provide you the best possible solution in your rough time.