News
Over the past year we have seen a real shakeup in the mortgage world. Sub Prime borrowers are essentially a thing of the past. High Loan to value mortgages are almost gone and Stated Income mortgages are few and far between. The pendulum has swung for most liberal to most conservative. So what is next?
Two changes in the mortgage world are going to have a real impact upon how we do business here in the High Country. The first change has already taken place and that is how a mortgage underwriter looks at condos here is our world destination area.
Underwriters are taking the time to do web searches on condo complexes. If the mortgage is being underwritten using Fannie Mae or Freddie Mac guidelines and the underwriter sees that there is a time share or fractional ownership unit in the complex the deal is dead. Just one small studio unit in a complex that has dozens of units can kill the mortgage deal if one of those two types of ownership exist in the complex.
Another subject that the underwriter is looking for is a front desk like those you see in hotels and motels. If one exists and anyone off the street can walk in and rent a condo for the night the deal for that new mortgage is off.
Also, if the underwriter sees that owners are advertising their private condo for rent on a nightly basis the deal could be dropped like a hot potato by the investor.
Now these changes were almost this tight about ten years ago. The rules became quite a bit broader and now we are back to where we were in the old days. I hope to see things loosen up soon but no one knows when that time will come.
The second big change coming is how we work with real estate appraisers. Due to more elected officials involvement in the mortgage world, you and I will not be able to use real estate appraisals we order from our local qualified appraisers. Coming May 1 when I start the process to finance a new purchase or refinance an existing mortgage I will not order the appraisal. The investor that is going to finance the deal will order the appraisal and the appraiser may be coming out of the Front Range into an area that they only see on the news when it snows. This change is a step back as now we will have appraisers working in areas that can be far different than those they are familiar with.
I know that many of my clients start the refinance process with me ordering the appraisal so we know how much the home is worth in today’s market. Once we have that value we proceed with the refinance.
So all condo owners and buyers read this very carefully. Get your mortgage professional involved early on in the buying process and the same for those who are considering refinancing. Know your options right up front to avoid problems down the line.
For answers to your mortgage related questions call Bob Kieber at (970) 262-1199 or e-mail him at rkieber@comcast.net <mailto:rkieber@comcast.net> . Bob is a local mortgage lender and principal of Resort Lending. He has 30-plus years of professional experience in real estate, finance and investments, and is a longtime resident of the High Country.
Two changes in the mortgage world are going to have a real impact upon how we do business here in the High Country. The first change has already taken place and that is how a mortgage underwriter looks at condos here is our world destination area.
Underwriters are taking the time to do web searches on condo complexes. If the mortgage is being underwritten using Fannie Mae or Freddie Mac guidelines and the underwriter sees that there is a time share or fractional ownership unit in the complex the deal is dead. Just one small studio unit in a complex that has dozens of units can kill the mortgage deal if one of those two types of ownership exist in the complex.
Another subject that the underwriter is looking for is a front desk like those you see in hotels and motels. If one exists and anyone off the street can walk in and rent a condo for the night the deal for that new mortgage is off.
Also, if the underwriter sees that owners are advertising their private condo for rent on a nightly basis the deal could be dropped like a hot potato by the investor.
Now these changes were almost this tight about ten years ago. The rules became quite a bit broader and now we are back to where we were in the old days. I hope to see things loosen up soon but no one knows when that time will come.
The second big change coming is how we work with real estate appraisers. Due to more elected officials involvement in the mortgage world, you and I will not be able to use real estate appraisals we order from our local qualified appraisers. Coming May 1 when I start the process to finance a new purchase or refinance an existing mortgage I will not order the appraisal. The investor that is going to finance the deal will order the appraisal and the appraiser may be coming out of the Front Range into an area that they only see on the news when it snows. This change is a step back as now we will have appraisers working in areas that can be far different than those they are familiar with.
I know that many of my clients start the refinance process with me ordering the appraisal so we know how much the home is worth in today’s market. Once we have that value we proceed with the refinance.
So all condo owners and buyers read this very carefully. Get your mortgage professional involved early on in the buying process and the same for those who are considering refinancing. Know your options right up front to avoid problems down the line.
For answers to your mortgage related questions call Bob Kieber at (970) 262-1199 or e-mail him at rkieber@comcast.net <mailto:rkieber@comcast.net> . Bob is a local mortgage lender and principal of Resort Lending. He has 30-plus years of professional experience in real estate, finance and investments, and is a longtime resident of the High Country.
