Your local Wisconsin mortgage banker offering first time home buyer, refinance, FHA, FHA 203k rehab loans, reverse mortgages, VA, USDA rural housing, interest only, jumbo, FHA refinance, VA refinance and current Wisconsin mortgage rates.
Visit us online at http://www.MadisonMortgageguys.com
or http://www.madisonmortgageloans.com
Toll Free: 877-240-5810
Locally Owned and operated!
Visit us online at http://www.MadisonMortgageguys.com
or http://www.madisonmortgageloans.com
Toll Free: 877-240-5810
Locally Owned and operated!
VA Loans in Wisconsin Illinois Minnesota and Florida: Step 4 of 5: Choosing a Lender
Today we will review step 4 of our 5 step series about obtaining a VA loan. With so much information out there, I have never actually seen anything that explains the entire process of obtaining a VA loan in one place.
1. Service Eligibility
2. Obtaining your Certificate of Eligibility
3. Funding Fee
4. Choosing a Lender
5. Looking for a house
Yesterday we discussed how the VA Funding Fee allows a lender to offer 100% financing with low, fixed rates and no monthly mortgage insurance. Today we will discuss choosing a lender that will best help you reach homeownership, Step 4.
There are basically 3 approaches to obtaining a VA mortgage. Each has its advantages and draw-backs. Please understand that almost all of these loans are combined into bonds that are sold to large investors that remain anonymous to you. The banks and servicing companies with names that everyone recognizes are collecting payments and handling escrows for a fee and passing the interest on to the bond owner. With this in mind, let’s look at the possibilities.
Area banks, credit unions, and branches of national banks usually have a more local feel and name recognition. Many do not deal with VA loans due to the extra work and expense of becoming an approved lender and keeping up with changing guidelines for originating and servicing these loans. Their loan officers are not required to be tested or licensed (they must register in the national data base) and are limited to the rules and regulations of their employer. Underwriting of your file is generally done in the same building where you apply. You may or may not make your payment to the local business, but chances are that your loan has been sold into the bond market with everyone else’s.
Mortgage brokers are another avenue to a VA home loan. In recent years there has been an abundance of misconduct at every step of the home buying process, from buyers and realtors to banks and bond traders, and the mortgage broker seems to be suffering the most criticism and regulatory backlash. Most mortgages in this country were originated by local brokers bringing buyers and lenders together and getting paid for the service by one or both parties. Brokers and loan originators must be educated, tested and licensed in most states and tested and licensed on the national level also. Brokers do not underwrite or close loans. Every piece of information is passed on to the chosen lender for processing.
Correspondent lenders are a third option. Disclosure: I am a loan originator for a correspondent lender. This type of business is hopefully a combination of the best parts of banks and brokers. Like banks, correspondents are authorized to underwrite, close and sell mortgages. Unlike a bank, we can do business with many of the largest loan servicers in the country. These relationships sometimes allow us to offer a customer better terms than a branch of the same company we’re going to sell the loan to. Loan originators must meet the same education and licensing standards as a broker on the state and national levels. The entire process is kept within the correspondent’s company and the loans packaged and sold later.
Most of the people from any of these categories are honest, hardworking individuals trying to make a living in a scary economy. Each of us must work within the boundaries of our type of business and the changing guidelines and regulations.
Now the process of choosing a lender can begin. Understand which of the above groups each person you talk to belongs. Ask questions you know the answer to (from one of the earlier posts perhaps). Be wary of a correspondent or banker that offers a great rate but doesn’t know how the funding fee works. Or broker that can’t get your Certificate of Eligibility but wants to take a full application today!
Once you’ve found a person with whom you’re willing to share your personal financial information, go through the pre-qualifying or pre-approval process. Understand what your credit score is and how it’s affecting the transaction. Know what your payment would be at different rates for different mortgage sizes (funding fee included) and different tax and insurance amounts. Your mortgage professional can only give you limits on what you can spend each month on your housing payment. You must decide at this point what you’re willing to spend. Find the loan size that’s comfortable, stick to it and move on to the next step in the process of getting a home with a VA mortgage.
What’s Next?
Realtor? For sale by owner? Finding the home that works best for you.
Dennis Hardy
Toll Free: 877-240-5810 x104
dennis.hardy@madisonmortgageguys.com
www.madisonmortgageguys.com
Visit my blog at
http://www.madisonmortgageguys.com/blogs_dennis_hardy/
http://www.madisonmortgageguys.com/b...sing-a-lender/
http://www.madisonmortgageguys.com/va.htm
1. Service Eligibility
2. Obtaining your Certificate of Eligibility
3. Funding Fee
4. Choosing a Lender
5. Looking for a house
Yesterday we discussed how the VA Funding Fee allows a lender to offer 100% financing with low, fixed rates and no monthly mortgage insurance. Today we will discuss choosing a lender that will best help you reach homeownership, Step 4.
There are basically 3 approaches to obtaining a VA mortgage. Each has its advantages and draw-backs. Please understand that almost all of these loans are combined into bonds that are sold to large investors that remain anonymous to you. The banks and servicing companies with names that everyone recognizes are collecting payments and handling escrows for a fee and passing the interest on to the bond owner. With this in mind, let’s look at the possibilities.
Area banks, credit unions, and branches of national banks usually have a more local feel and name recognition. Many do not deal with VA loans due to the extra work and expense of becoming an approved lender and keeping up with changing guidelines for originating and servicing these loans. Their loan officers are not required to be tested or licensed (they must register in the national data base) and are limited to the rules and regulations of their employer. Underwriting of your file is generally done in the same building where you apply. You may or may not make your payment to the local business, but chances are that your loan has been sold into the bond market with everyone else’s.
Mortgage brokers are another avenue to a VA home loan. In recent years there has been an abundance of misconduct at every step of the home buying process, from buyers and realtors to banks and bond traders, and the mortgage broker seems to be suffering the most criticism and regulatory backlash. Most mortgages in this country were originated by local brokers bringing buyers and lenders together and getting paid for the service by one or both parties. Brokers and loan originators must be educated, tested and licensed in most states and tested and licensed on the national level also. Brokers do not underwrite or close loans. Every piece of information is passed on to the chosen lender for processing.
Correspondent lenders are a third option. Disclosure: I am a loan originator for a correspondent lender. This type of business is hopefully a combination of the best parts of banks and brokers. Like banks, correspondents are authorized to underwrite, close and sell mortgages. Unlike a bank, we can do business with many of the largest loan servicers in the country. These relationships sometimes allow us to offer a customer better terms than a branch of the same company we’re going to sell the loan to. Loan originators must meet the same education and licensing standards as a broker on the state and national levels. The entire process is kept within the correspondent’s company and the loans packaged and sold later.
Most of the people from any of these categories are honest, hardworking individuals trying to make a living in a scary economy. Each of us must work within the boundaries of our type of business and the changing guidelines and regulations.
Now the process of choosing a lender can begin. Understand which of the above groups each person you talk to belongs. Ask questions you know the answer to (from one of the earlier posts perhaps). Be wary of a correspondent or banker that offers a great rate but doesn’t know how the funding fee works. Or broker that can’t get your Certificate of Eligibility but wants to take a full application today!
Once you’ve found a person with whom you’re willing to share your personal financial information, go through the pre-qualifying or pre-approval process. Understand what your credit score is and how it’s affecting the transaction. Know what your payment would be at different rates for different mortgage sizes (funding fee included) and different tax and insurance amounts. Your mortgage professional can only give you limits on what you can spend each month on your housing payment. You must decide at this point what you’re willing to spend. Find the loan size that’s comfortable, stick to it and move on to the next step in the process of getting a home with a VA mortgage.
What’s Next?
Realtor? For sale by owner? Finding the home that works best for you.
Dennis Hardy
Toll Free: 877-240-5810 x104
dennis.hardy@madisonmortgageguys.com
www.madisonmortgageguys.com
Visit my blog at
http://www.madisonmortgageguys.com/blogs_dennis_hardy/
http://www.madisonmortgageguys.com/b...sing-a-lender/
http://www.madisonmortgageguys.com/va.htm
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