What questions to ask to find out their “total” fees and charges to you when looking to purchase a home?

Nowadays, New Jersey home buyers are always looking for the best deal and price. Who isn’t?  They usually call several New Jersey Mortgage lenders to find out who has the best rates and lowest fees. That is another topic I will cover shortly about the proper way to do so.

This topic is focusing on how to properly choose the right attorney and title insurance company. Most often times, the only question a New Jersey home buyer would ask an attorney is, “What is your attorney fee?”. What most people do not understand is that is just the tip of the iceberg when trying to find out what are their“actual fees and costs .

In New Jersey, the average attorney fee ranges from $750-$1200 for a home purchase transaction. But they often have many other fees/charges that you will not find out until you are sitting at the closing table looking over the final HUD (all closing costs associated with your mortgage).

Some questions you should ask your attorney/title company are:

1)   What other fees will I have to pay besides your attorney fee?

2)   Do you charge Title Exam fees, Title review fees, etc ?

3)   What are the recording fees? Attorneys in New Jersey are permitted to “overinflate” the recording fees. The average recording fee for a typical home purchase in New Jersey is about $250. I have seen recording fees in excess of $500 from attorneys.

4)   How much do you charge for email fees/overnight fees/photocopy fees/courier fees/wire fees, and any other miscellaneous fees?

5)   Do you charge a doc prep fee?

6)    Do I actually need to order a survey? Most often times it is up to the investor that you are using if they “require” a survey to close your New Jersey Mortgage loan. Most often times, they DO NOT. But most attorneys do not take the responsibility to call your mortgage lender to see if they require a survey. That phone call most often times can you save up to $700 if a survey is not required. If it is not required, it would be up to the home buyer to decide if they want to order a survey.

TIP:You should use the same approach when comparing lenders by asking for a Good Faith Estimate to see all their fees. Ask your attorney to see a breakdown of ALL their fees. You might be surprised at what they total too and they might be thrown off guard wondering how you knew about all these “other” fees.

Also remember YOU always have the choice to choose which title company you wish to work with. You will ALWAYS save money by using the title company your mortgage lender uses because they often have lower fees because they receive so much business from that mortgage lender that they extend those lower fees to you.

The attorney will usually always try to steer you into using his title company but remember that is YOUR choice not his. Keep in mind, the attorney works for YOU!

If you have any other questions, please feel free to contact me

Written by

John Mattsson

Senior Loan Officer

First Lenders Mortgage

(732) 275-1600

www.firstlendersmortgage.com

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Minimum Credit Scores For New Jersey FHA Loans

What You Need To Know

Remember the days when someone with a 500 credit score could qualify for a New Jersey FHA mortgage? Well over the past year, FHA credit score requirements have been increasing. Nearly 20% of FHA loans are currently in default causing FHA lenders to be more cautious.

In this current mortgage market, to even be considered for a FHA mortgage, you MUST have a 620 minimum credit score. But we are seeing a trend that many other FHA lenders are now following.

Now, FHA lenders are looking for 640-660 credit scores for FHA financing. While there are still many who still require a 620 minimum credit score, NJ FHA lenders are imposing “pricing hits” to consumers who fall below 660 credit scores. So obviously there is an upward trend happening here with consumers looking to apply for an FHA loan.

In the future, don’t be surprised if down payment requirements increase again and credit score minimums gradually increase as well. With rising unemployment and foreclosures, it is causing FHA lenders to alter their lending guidelines going forward.

Keep in mind, there are a “small few” of portfolio FHA lenders that will go below the standard 620 minimum credit score requirement. BUT they are hitting consumers with HEFTY pricing adjustments to get an FHA loan with credit scores below 620.

So if you are looking to obtain an FHA loan, be sure to check your credit scores early enough in the mortgage process, to give yourself ample time to see what you need to do to get your credit scores high enough today to avoid any and all pricing adjustments when applying for a New Jersey FHA mortgage. Also many mortgage companies can assist you in credit repair if necessary. Many mortgage companies will offer this at no cost. Be sure to ask!

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Thought Lower Credit Scores Would Prevent You From Refinancing? Well, Think Again!

Most consumers are under the impression that if their credit score is not above 740 that they cannot qualify for today’s low interest rates. Nothing could be farther from the truth. When you understand how the pricing works with Fannie Mae and Freddie Mac loans you will be able to take full advantage of today’s still attractive mortgage rates.

If your score is 620 and you are only borrowing up to 60% of the equity in your home there is very low pricing adjustments on a 30 year fixed rate mortgage of $417,000 or less. Believe it or not, that goes for both rate & term refinance as well as CASH-OUT!

The better news is that if  your score is 620 and you do need to borrower more than 60% of your homes equity but not more than 75% and you can afford a 15 year fixed, you will get the same rate as someone with an 800 score on a rate & term refinance. If you can afford a 15 year fixed and you need cash-out there is a small adjustment up 60% of equity and a bit larger one to 75% but, still much less than the 30, 25 or 20 year fixed.

If you need to 80% of equity for rate & term or a cash-out refinance with a 620 – 660 credit score then, the best option is a portfolio lender as they make there own rules. If you show strong assets such as stock, bonds, or CD’s and you have an excellent mortgage history they will approve the loan.

Let an experienced mortgage professional review your specific situation to best determine which course of action to take. Yes, obtaining a mortgage has definitely become more difficult then in past recent years but, proper guidance to help navigate all of today’s option will certainly increase your chances of hearing the words, “your approved!”.

Jim Guerriero

First Lenders Mortgage

800-280-APPROVED