Credit Reporting Dispute Process

If you are in the market to purchase a home (or refinance your mortgage), it may be a good idea to check your credit well in advance of house shopping.  

According to a FTC consumer report, an estimated one in five consumers have an error on their credit report.  You may either request a correction via a mailed letter to the credit repository reflecting  the reporting error, or you may request correction via online disputes.  I strongly encourage the online dispute process.

MyFico.com has written up an excellent sample letter if you have a specific account you would like to dispute, or you can follow the link under "online dispute resolution" section of this email to expedite the process stamp free.  Remember, evaluate each of the three credit reporting agencies for inaccuracies.  

If you would like more simple credit tips, please click here.  Arizona and California residence in the mortgage market can contact me directly for further guidance and a no cost evaluation in 10 minutes or less.

Sample Credit Report Dispute Letter of Explanation

ONLINE DISPUTE RESOLUTION:
All 3 of the credit bureaus now accept filing of disputes online. To find out how to initiate a dispute online, click here.

Tell the credit bureau in writing what information you believe is inaccurate. Include copies (NOT originals) of documents that support your position.

You may want to enclose a copy of your credit report with the items in question circled. Send your letter by certified mail, return receipt requested, so you can document that the credit bureau received your correspondence. Keep copies of your dispute letter and enclosures.

Date Your Name Your Address Your City, State, Zip Code Complaint Department Name of Credit Bureau Address City, State, Zip Code   Dear Sir or Madam: I am writing to dispute the following information in my file. The items I dispute also are encircled on the attached copy of the report I received. This item (identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.) is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be deleted (or request another specific change) to correct the information. Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please reinvestigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible. Sincerely, Your name Enclosures: (List what you are enclosing) Source: http://www.myfico.com/crediteducation/rights/sample-credit-report-dispute-letter-of-explanation.aspx

Sun Trust Mortgage Class Action Settlement

Was your mortgage serviced by SunTrust Mortgage between April 1, 2008 and June 18, 2014? If your mortgage was serviced AND you were charged for force placed hazard, flood, or wind insurance issued by QBE, or a subsidiary/affiliate during this time period, you may be eligible to received compensation as a class member as part of an alleged insurance kick back scheme.

You can learn more details about the class action suit HERE.

SunTrust denied liability, but settled the force-placed insurance class action lawsuit to avoid the uncertainty of continued litigation and legal expenses.

Until Next Time,

Craig Turley

Craig Turley is a mortgage and finance consultant located in Scottsdale, AZ.  He has 20 years professional business, finance, and management experience as an entrepreneur and corporate executive, directly funding over $1 Billion in mortgage loans.  Craig is a 1993 graduate of the University of Arizona with a degree in Business Administration, emphasis finance. 

H/T:  Solitude Canyon Investment Advisors

Have You Taken Advantage of HARP Yet?

HARP - Home Affordable Refinance Program is still available.  

As noted in my April 2013 article, HARP is still available for home owners who have not or were not able to take advantage of it over the last few years.  If your rate is above 4.5% or interested in lowering your mortgage term, you may want to take advantage of this stream lined refinance program now.  Contact Craig!

Good news, bad news.

HARP, the Home Affordable Refinance Program, has been extended through 2015 by the Federal Housing Finance Authority. 

 
The Good:

HARP is designed specifically for current homeowners with mortgages owned or guaranteed by Freddie Mac or Fannie Mae (the GSEs) and high loan-to-value (LTV) ratios which make it difficult if not impossible to refinance through traditional programs.  The majority of HARP borrowers are actually underwater on their mortgages with the majority having LTVs in excess of 100 percent.

Find out if you may qualify for a Harp 2.0 refinance here.

The Bad:

The HARP extension did not move the dates for eligible borrowers.  The current HARP guidelines are specific to borrowers who have a loan that was sold to one of the GSEs prior to May 2009.  So, if you have a loan sold to a GSE after June 1, 2009 or not backed by a GSE (see Fannie or Freddie), you would still not be eligible for HARP.  

Until Next Time,

Craig Turley

Please contact Craig at 480-385-1422 if you would like to discuss the good news or the bad news related to the extension of HARP through 2015.  Craig Turley has directed over $1 Billion in funded loans since his career began 20 years ago.  

Improve YOUR Credit for the BEST Mortgage Loan

Do you want the best home mortgage loan rates and fees?  If the answer is "yes" - the following tip sheet will help you get closer to realizing your home ownership dream -with competitive market rates and fees.  Keep in mind, every situation is different - so consulting with a professional mortgage banker is recommended.  If you are in Arizona or California - I can help!


Tip #1: Plan at least SIX - NINE months ahead to review and, IF NECESSARY, fix your credit report.

Like anything worthwhile, improving your credit score will take time.  But you can't change your credit score if you don't know something is wrong in the first place.  If you give yourself enough time, you can correct any mistakes and change up any bad habits.

Pulling and reviewing your credit report ahead of time can save YOU money and time once you elect to enter the housing market.  Email me now for more details on a no obligation credit analysis. 

Tip #2: Use 20 Percent or less of your revolving credit.

Know your credit line high limits and manage your credit line balances accordingly.  For example, if you have a credit card with a $2,000 high limit - manage the balance to around $400 per month.  Optimum management is 10% of credit line.  

High credit achievers keep a low balance on credit cards and loans.

Tip# 3: Keep old credit cards OPEN.  

Established, good payment history is valuable.  If you have had a credit card for 5-10 years and have always paid on time that is a good sign that you are responsible to lenders.

Closing an old credit card reduces your available credit and increases your balance-to-limit ratio.  This is a sign of risk which could lower your credit score.  

The lower the credit score, the higher the mortgage rate in many instances.  

Tip #4: Limit your credit inquiries.

Keeping your credit cards open and active is one thing but you should not run out and apply for 3 cards all at once. Also, applying for different accounts in a short period of time (such as an auto, credit, unsecured bank note, a mortgage, a boat, etc. etc.) can be a detriment to your score.  

Credit inquiries can look very risky to lenders if they see that you have applied and were denied for multiple lines of credit in a short period of time.

Reserve your credit inquiries for a specific event (s) and purpose.  

Tip #5: No MAJOR purchases (auto) six months prior to applying for a home loan.

Inquiries do matter and purchasing a vehicle (boat; timeshare; etc) prior to your home loan can affect your home loan in two different ways.  

Credit inquiries can and will reduce the credit score AND if you increase your monthly debts, this will impact your DTI (Debt to Income) ratio and you may qualify for less home OR even disqualify you.

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Purchasing or refinancing your home will be one of your major financial decisions in your lifetime.  Do yourself a favor and plan accordingly!

You can order your FREE credit reports from www.annualcreditreport.com  --you get 1 free credit report from all three credit bureaus every 12 months.

Craig Turley is a mortgage and finance consultant.  He has over 20 years professional business, finance, and management experience as an entrepreneur and corporate executive.  Craig is a 1993 graduate of the University of Arizona with a degree in Business Administration, emphasis finance.

Craig Turley

Southwest Direct Mortgage, LLC

480-385-1422 (office)

480-385-1450 (Fax)

602-930-2529 (cell)

NMLS #80917

CA-DOC 80917

AZ LO #0920382

Condominiums and Mortgages

As if qualifying for a mortgage these days was not tough enough with stricter underwriting standards and documentation requirements.  Try qualifying for a condominium refinance or purchase of an existing condominium.  The standards are more difficult because not only do you, the borrower, need to qualify - the association must qualify as well to secure many loan programs.

So how do you know if the condominium you currently own or the condominium you have fallen in love with qualifies?

Let's take a peak at some general terms and guidelines:  (Keep in mind, this is a general overview and will vary based on lender, state, etc)

What is a warrantable condominium?

The term “warrantable” refers to a condominium complex with features that lenders view as favorable in minimizing their risk exposure. Lenders view warrantable features protect a complex from future hazards which pose risk, threatening value of the units. Warrantability refers to the condominium complex as a whole, not the individual units.

Features of a warrantable condominium:

• Most of the units are owner occupied (not rental units)
• On established and existing projects, at least 90% of the units must be sold
• For new and currently converted construction, 70% of the units must be pre-sold (closed or under contract)
• No more than 10% of a project can be owned by a single entity.
• No more than 20% of the project can consist of non-residential space.
• 15% or less of the units can be 30 days delinquent on HOA dues
• The Homeowners Association must have at least 10% of its budgeted income designated for replacement reserves

Other requirements do exist, however, the above conditions are generally deemed the most important to Fannie Mae and Freddie Mac. Also, each lender will have their own overlays related to condominium financing, thus, additional restrictions may apply.

So, how do you know up front if the condominium in question for financing is warrantable?

• Check with the property management company or the real estate listing agent to confirm the complex is warrantable.
• Check the eFannie website to determine if the complex meets project standards. (here)
• Have your lender, who pre qualified you for the mortgage, provide your Realtor with a condo certification form to be filled out by the condominium association/property manager. There may be a small fee for this request, but better to find out early on in the process, than after an appraisal fee, home inspection fee and invested time.

Keep in mind, just because your condominium may not be "warrantable" it does not mean you cannot find financing. There are niche lenders who are happy to finance "non warrantable" condominiums - however, much of the time, these lenders will require a bigger down payment and probably a higher interest rate.

For FHA and VA condo project approvals you can search here:

FHA Approved Condo List

VA Approved Condo List

My recommendation - whether selling a condo, buying, or refinancing - do your due diligence up front, hopefully averting disaster later in the process.

Until Next Time,

Craig Turley

Craig Turley is a mortgage and finance consultant.  He has over 19 years professional business, finance, and management experience as an entrepreneur and corporate executive.  Craig is a 1993 graduate of the University of Arizona with a degree in Business Administration, emphasis finance.   You may contact Craig via email or directly at 480-385-1422 for any Arizona and California mortgage questions.

 

5 Reads from the Weekend

The Fourth of July weekend brought us fun, sun (especially in Arizona), and some time to catch up on some reading.

My five favorites from the weekend:

1.)  The Joy of Old Age. (No Kidding) - NY Times by Oliver Sacks.
2.)  The follow up from an ESPN Outside the Lines story of two Cleveland high school wrestlers, Dartaynon Crockett & Leroy Sutton, and the bond created with the producer of the original story, Lisa Fenn.  Video and article.
3.)  "Deal of the Day" from Randall Reinwasser of Solitude Canyon Investment Advisors.  Free T-shirt!!
4.)  From popular blogger and author James Altucher, Have an Adventure Today.
5.)  Mortgage markets rocked negatively on July 5, 2013.  What's really behind the job numbers?  NY Times - Jobs Data is Strong, But Not That Strong, Easing Fed Fears.  We'll see.

Until Next Time,

Craig Turley

NMLS #80917

CA-DOC 80917

AZ LO #0920382

Craig Turley is a mortgage and finance consultant.  He has over 19 years professional business, finance, and management experience as an entrepreneur and corporate executive.  Craig is a 1993 graduate of the University of Arizona with a degree in Business Administration, emphasis finance. 

 

California Home Prices Soaring

According to the California Association of Realtors (C.A.R), median home prices topped $400,000 in April for the first time in five years due to the high demand and tight inventories.

This makes for a very competitive purchase market, producing multiple bids - many over list price.  Consult  a Realtor in your area for expert advice or ask me for a professional referral.

It also allows homeowner who have been unable to refinance their existing home mortgage the past five years an opportunity to review their existing equity position.  Of course, many underwater homeowners were assisted with a loan through the HARP (learn more here) program.  However, many mortgages were ineligible for a variety of reasons.  So, now may be a great time to take advantage of a refinance if your mortgage note rate is over 4%.

Please feel free to contact Craig at Southwest Direct Mortgage, LLC with any mortgage questions in Arizona or California.  Craig has over 20 years of finance industry experience as a mortgage banker and entrepreneur.  

Craig Turley

NMLS 80917

480-385-1422

Source:  Mortgage Daily News

More homes return to positive equity in the United States

According to leading financial analytic company Corelogic (CLGX), more homes in the United States returned to positive equity in the fourth quarter of 2012.

Corelogic:

CoreLogic^® new analysis showing approximately 200,000 more residential properties returned to a state of positive equity during the fourth quarter of 2012. This brings the total number of properties that moved from negative to positive equity in 2012 to 1.7 million and the number of mortgaged residential properties with equity to 38.1 million. The analysis also shows that 10.4 million, or 21.5 percent of all residential properties with a mortgage, were still in negative equity at the end of the fourth quarter of 2012. This figure is down from 10.6 million* properties, or 22 percent, at the end of the third quarter of 2012.

Negative equity, often referred to as "underwater" or "upside down," means that borrowers owe more on their mortgages than their homes are worth. Negative equity can occur because of a decline in value, an increase in mortgage debt or a combination of both.

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If your home is underwater or above 80% loan to value, there may be refinance options available.  Please feel free to consult me to find out if you are eligible for a FHA streamline refinance or Harp 2.0 eligibility.

Regards,

Craig Turley

NMLS 80917