“Real Estate Lender – Finding the Right One ” by Jack Sternberg

Jack Sternberg here with a real estate article.

 

Following is a real estate article I just recently published.

 

 

Real Estate Lender – Finding the Right One

By: Jack Sternberg,

 

When choosing the right mortgage lender or broker you are looking for someone who is trustworthy and someone you feel comfortable with. This way you will feel confident that your mortgage loan is in good hands. Remember that it’s your money on the line; the last thing you want is to have a less than honest lender use your lack of experience against you and cost you thousands of dollars and your home. The more knowledge and awareness you bring to the table, the better your chances are of securing a loan that’s to your advantage.

 

Before choosing a lender it is important to know what kind of loan you’re looking for. You will save the most money by getting the right type of loan for your lifestyle. Know your situation and how much you can afford each month. Since all lenders don’t offer the same types of loans; if you have an estimate of what you can afford, that is a good starting point when choosing a lender.

 

Another good place to start is http://bankrate.com.

 

Competition is tough in the mortgage business and loans are sold, not bought. What does that mean to you? This means that lenders will try hard to get you to buy your loan through them. Since they have incentives to get you to buy from them they may package a loan to make it seem extremely attractive. These types of loans may help the lender get a bigger commission, but they won’t help you save on your overall payments.

 

Some mortgage lenders and brokers also have a “one size fits all” attitude and market a loan that works best for their company. They try to convince borrowers that the loan they are “selling” perfectly suits them. The problem with that is; they tell everyone the same thing even though everyone’s circumstances are different. For example, the goals and expenses of a first-time homebuyer will be very different from that of a retired homebuyer. So with a one-size-fits-all approach, either the first- time homebuyer or the retiree will not get the best loan for their circumstances. Usually lenders have other loans to offer besides the one they are “selling,” but unless you know the type of loan you need, you could end up with a loan that sounds good, but in reality it only benefits the lender.

 

It is important to understand that there are different types of lenders. Some lenders sell only their own products while others will broker any product that fits their client’s needs. Basically it comes down to which type of lender you prefer, there is no exact way to determine which one is right for you. But it is very important to find the lender who is willing to find a loan that fits your needs, not theirs.

 

But it is very important that you know before looking for a lender, that you have many options. You should find a lender who is able and willing to give you a loan that fits your specific financial circumstances. They should be willing to get your loan approved with the best possible terms available for your situation.

 

A good lender will be familiar with all of the available loans options and will take the time to help you decide what kind of loan would be best for you. An experienced lender will understand the reasons you may have a lower credit score or why you’re not able to put down a large down payment as a first-time homebuyer.

 

If you would like to learn more about this subject and for a much more in-depth view of the real estate and mortgage world, go to my other blog at http://www.jackthinks.com     See you there.

 

Jack Sternberg

Real Estate Investor

 

Jack Sternberg Discusses Real Estate

Hi, Jack Sternberg here…

 Today, I would like to discuss the Purpose and Function of Fannie Mae.

 

Recently, I published this article:

The Purpose and Function of Fannie Mae by Jack Sternberg

“Fannie Mae” is the nickname for the Federal National Mortgage Association.

Although it has the “Federal” name in its title, it’s actually a separate, chartered corporation that operates in the secondary mortgage market.

In this article, I’ll give you the background and history of Fannie Mae, describe typical properties, and show you how to buy those properties for investment purposes.

Fannie Mae’s Background

Fannie Mae is a federally chartered organization. Its purpose to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market.

Essentially, Fannie Mae operates in America’s secondary mortgage market to ensure that mortgage bankers and other lenders have sufficient funds to lend to home buyers at low rates.

Along with Freddie Mac, it’s the main secondary lender in the country. As the Fannie Mae web page states, “Our job is to help those who house America.”

The History of Fannie Mae

To give you a historical perspective. Fannie Mae was created by President Franklin D. Roosevelt and Congress in 1938. At that time, there wasn’t a consistent supply of mortgage funds. As a result of the Depression, millions of families risked losing their homes or couldn’t become home owners.

So, the federal government established Fannie Mae to address this need. Its aim was to “expand the flow of mortgage funds in all communities, at all times, under all economic conditions, and to help lower the costs to buy a home.”

In 1968, Fannie Mae was re-chartered by Congress as a shareholder-owned company. It’s funded solely with private capital raised from investors on Wall Street and around the world.

Types of Fannie Mae Properties

These include all forms of single-family homes such as detached homes, condos, and town houses. The inventory often includes homes in modest to more expensive neighborhoods.

All Fannie Mae homes are sold in an “as-is” condition. These conditions range from good to poor and include “repo’s” which may or may not be in poor condition. Note that Fannie Mae sometimes fixes these properties up in order to get a higher price; at other times, it simply leaves them in the same condition.

In order to obtain one of these properties, Fannie Mae secifies that you go through a local realtor.

Real Estate Agents are required to list these properties on the local Multiple Listing Service. Any local agent can show you a property and make the offer for you to Fannie Mae. You can find further listings of Fannie Mae Properties is available online at http://www.mortgagecontent.net

Making Offers to Fannie Mae

The process is the same as with conventional deals. Fannie Mae can accept or reject your offer or make a counter-offer. Typically, there are several rounds of offers and counter-offers. A benefit of negotiating with Fannie Mae is that, unlike HUD or VA negotiations, you’re able to add contingencies and other conditions to your offer.

Here are two examples of contingencies:

Example 1: You can ask for a professional home inspection after the offer is accepted.

Example 2: You can negotiate terms, down payment and financing.

Note: Fannie Mae will not accept a contingency that requires the prior sale of a seller’s current property.Source: http://www.fanniemae.com

In terms of financing for these properties, Fannie Mae offers its own REO financing, but the terms are usually no better than conventional sources. This means that buyers may be able to get better terms if they come into a deal with outside financing.

Opportunities for Investors

Fannie Mae properties may present good opportunities for you as an investor, particularly in the area of foreclosures. To operate effectively in this market, it pays to know the ins and outs of the federal bureaucracy as well as the latest regulations.

Key Point: Keep up to date on the Fannie Mae market through your own study of its regulations and with the help of an experienced realtor.

Jack Sternberg