In order to be a legitimate buyer in Eugene, Springfield, and anywhere in Lane County – getting pre-approved is a must. When you make an offer on a house your Realtor will want to include a Pre-approval letter with it. Unless you are a 100% “cash buyer”, making an offer without a pre-approval letter could very well cost you the chance to buy your dream home.

The Realtor representing the seller has a tremendous responsibility to screen out illegitimate offers in order to sell their client’s home efficiently. Imagine taking a well priced home, including a foreclosure – bank owned property off of the market when the first offer comes in with a promise from the buyer that they’ll buy it in full in 30 days. Then after a week or two the buyer finds out that they can’t get a loan of any kind or they need to buy a less expensive home. In the meantime the seller has turned away 2 or 3 qualified buyers who have already located other homes. The home goes back on the market and now everyone interested wants to know why it didn’t work out, was there something wrong with the property?

With a good mortgage bank like Summit Funding, Inc. most home loan transactions close in less than 30 days. A pre-approval letter from a Summit Funding Loan Officer is among the most preferred by local Realtors. One of the reasons a fast loan funding is possible is due to a solid pre-approval system. Getting pre-approved with Tom Freitag is a free service for any Oregon property purchase – primary residence, first time buyer, or investment properties. The easiest way to get things started is by clicking on the “apply now” button. Fill out the short application form. You can also make a phone call to get the ball rolling.

What’s the difference between a pre-qualification and a pre-approval?

A pre-qualification is an evaluation of verbal data. What is your income? What are your current obligations & debts? How much money do you have for a down payment? Then a loan officer can determine whether or not there’s a possibility that a person or a couple could possibly qualify for a home. A general price range can also be determined.

A pre-approval involves pulling credit, gathering vital documents such as Bank or Credit Union Statements, paycheck stubs, tax returns, etc. The data is evaluated to determine if there are any potential issues or areas of concern. The loan consultant then submits this data to an “automated underwriting system” to determine whether or not the loan application is pre-approved. There is a great advantage in working with a mortgage bank like Summit Funding. Your loan consultant has direct access to FHA, VA, USDA (Rural Development), Jumbo, and conventional loan underwriters. In addition to the automated approval, they are able to pick up the phone and discuss any areas of concern with an underwriter. Your loan consultant can forward documents for review. In simple terms the underwriter is the final decision maker on a loan approval.

Another benefit of getting pre-approved before shopping for a home.

Some buyers go on an unnecessary emotional roller coaster ride because they are looking for a house in the wrong price range. When you get pre-approved as your first step in the home buying process, you will be able to know what price range you qualify for and also what loan programs you’ll be able to take advantage of.

So it’s time to buy a new home. You’re ready to sign the mortgage loan papers and put an offer down on a house in Eugene, Oregon, but have you really looked at all the options?

Until recently, some of the best values in home buying were only available to cash buyers. These values were often homes in a state of disrepair that needed additional remodel capital which most home buyers just couldn’t afford. With the FHA 203K mortgage loan, the average home buyer can now take advantage of these amazing and often overlooked homes, sometimes gaining “instant equity” of $20,000 to $60,000 or even more.

Right now I’m helping a client in Eugene, Oregon who’s buying a home that needs substantial work for less than $100,000. With the help of a FHA 203K mortgage loan we are able to finance a new roof, remodel of the interior, all new appliances, new electrical wiring, new paint, a new garage door, and much more. When the transformation of this house in Eugene is done, it will be virtually brand new. She will have a 30 year fixed mortgage loan in the mid 5% range and the mortgage will be about $180,000. The best part…The typical price for a similar home, in move-in condition, in that same area would be around $200,000. By utilizing the FHA 203K mortgage loan her house is now worth $200,000+, yet she only paid $180,000 for it! That’s over $20,000 of instant equity on her home!

While its greatest value is in buying a house that’s a diamond in the rough, an FHA 203K rehabilitation mortgage loan can be a smart move in many circumstances. For cases where there’s simply not enough equity in the home to finance needed repairs, the FHA 203K has you covered.  The FHA 203K mortgage loan allows a borrower to finance repairs based upon the value of the home after the repairs are completed. Funds are set aside and paid to the contractors as the work is being done. You can even use the FHA 203K program to remodel your current home!

Over the past few years, a typical approach for a remodel was to take out a fixed second mortgage or a Home Equity Line of Credit (HELOC) and then try to get all of the needed repairs done without running out of funds. The end result with this approach would often be an incomplete remodel and constant headaches and sleepless nights. The FHA 203K rehab loan allows a contingency reserve of 10% to 20% of the planned remodel costs.  The FHA 203K loans also allow you to start your project with low fixed interest rates and no need to refinance once repairs have been completed.

There are so many possibilities with the FHA 203K mortgage loan program.  For more information please contact Tom Freitag at Summit Funding, Inc. of Eugene, Oregon at www.TomFreitag.com. Our company has loan consultants in Oregon, California, Nevada, and Washington.

Whether it’s Lane County, Eugene, Springfield, or anywhere else, the home buyer benefits of the FHA 203K mortgage loan include:

• A low down payment where the seller is able to cover most or all loan closing costs. This means low out of pocket expense!
• A single mortgage loan with a great 30 or 15 year fixed rate.
• Ability to buy a home and remodel it how you want it right from the start – The sky’s the limit with what you can do (within reason of course).
• Instant positive equity position – This loan is not for “flippers” or investment (rental) property, but it’s nice to have a healthy equity position right from the start!

The seller can also benefit from the FHA 203K mortgage loan. It’s perfect for…

• The seller who has a home that is difficult to finance because of its condition or size. Just advertise  the FHA 203K mortgage loan to increase the number of legitimate buyers
• The seller who doesn’t have capital to finance major repairs before they sell their home.  This loan pays the seller before any repairs begin!
• The seller who doesn’t only want a cash buyer. The more buyers you can attract, the higher your home will sell for.

This loan is also available to first time home buyers.  Remember if you complete your purchase by November 30^th 2009 you might be eligible for the first time home buyer tax credit of up to $8,000!

Again, for more information or help with an FHA 203K mortgage loan please contact Tom Freitag at Summit Funding of Eugene, Oregon. Contact Tom Freitag

All Content ©2009 Tom Freitag. Visit Tom at www.TomFreitag.com.

With all time low mortgage interest rates, it’s very important to consider your individual situation. Refinancing now is definitely a smart move if you intend to stay in your home or keep it as a rental for many years. If your only goal is to save on interest charged over the course of the loan, here’s a $20,000+ tip: After refinancing, pay monthly what you now pay – the difference applied specifically to principal – you’ll have your loan paid off much quicker!

Clarify when you plan to sell your home. If you plan to sell your home in 2-5 years, refinancing might wind up being a loss. There are many different perspectives to help determine if your refinance makes sense. For example, if you’re 8 years into a 30 year mortgage, the largest component in reducing your minimum payment could be the re-amortizing of 22 years over 30 years. A face to face office visit with a mortgage professional that reviews a myriad of factors is extremely valuable. Advertising sometimes portrays refinancing a mortgage as a simple “no brainer”. In fact, a mortgage is one of the most serious financial commitments a person makes. If you have an Adjustable Rate Mortgage (ARM), consider refinancing regardless of how long you intend to own your home. Do you see yourself as a landlord, retaining your home as an investment property? Find out what renters are paying to see if market rent might cover your entire monthly payment. Tom Freitag, your mortgage professional can help you understand what constitutes a healthy investment property cash flow.

Set clear goals in your quest to refinance. Know what you want to accomplish. You should have 3 details ironed out before you refinance your mortgage.

1. Understand what you currently have (Some clients were sure they had a FIXED loan, only to find out it was an ARM. When will your current loan be paid off?).
2. Learn what is available to you (based on your current loan balance, home value, etc. options can be made clear – Loan programs & guidelines have become more restrictive. By consulting with Tom Freitag you’ll know what’s available to you specifically.).
3. Know how long you plan to own your property.

Meet with your mortgage professional to help you with steps one and two. It won’t cost you a penny and the advice is literally worth thousands.

Written by Tom Freitag, Loan Consultant – © 2009