Don't forget to tune into KFBK Radio on Sunday, Jan 22 for THE REAL ESTATE SHOW with Terry Knight. I will be aguest on the show.
We will discuss mobile home transactions, manufactured home parks, buying and selling mobile homes, mobile home short sales, and mobile home lending!
The weekly Real Estate Show is heard on 92.5FM and 1530 AM in Sacramento. (I will be on during what is normally the time slot for Rush Limbaugh during the week).
Please call in and ask me a question about mobile home transactions.
Friday, December 30, 2011
Wednesday, December 14, 2011
I Will Be A Guest On KFBK Real Estate Show, Sunday Jan 22, One-Hour Show on Mobile Homes and Manufactured Homes, 92.5 FM & 1530 AM, with Terry Knight
I will be a guest on THE REAL ESTATE SHOW on KFBK Radio, Sunday morning, Jan. 22nd, 2012, at 10 a.m.
The host of "The Real Estate Show", Terry Knight, has invited me to be a guest. We will discuss mobile home transactions, buying and selling mobile homes, financing mobile homes, and all aspects of the manufactured home and mobile home business.
CALL IN and ask me a question!
The Real Estate Show with Terry Knight is a very popular weekly radio show in Sacramento, heard on both 1530 AM and 92.5 FM. This show has been on the air for many years. The host, Mr. Kngight, seems very interested in this subject and has knowledge of manufactured housing.
The host of "The Real Estate Show", Terry Knight, has invited me to be a guest. We will discuss mobile home transactions, buying and selling mobile homes, financing mobile homes, and all aspects of the manufactured home and mobile home business.
CALL IN and ask me a question!
The Real Estate Show with Terry Knight is a very popular weekly radio show in Sacramento, heard on both 1530 AM and 92.5 FM. This show has been on the air for many years. The host, Mr. Kngight, seems very interested in this subject and has knowledge of manufactured housing.
Is The Rate War Over Between Mobile Home Lenders?
MH Chattel Lenders Rate War Over? and MH Lenders Choose to “Fly The Coop” On MH Co-Op Communities
FINANCING
by Dave Shanklin
BREAKING NEWS out of Seattle: CU Factory Built will be raising rates .25% on their very popular “One-Step” loan product effective December 1. This announcement seems to indicate that the “rate war” between the MH chattel lenders is coming to an end.
The “One-Step” loan, with a very low start rate for the first five years, has a new floor of only 4.75%. This is still an amazingly-low rate for manufactured homes in LLCs as personal property.
The “rate war” was hot and heavy during the summer between CU, Triad, and US Bank. We saw stunning drops in rates as our major lenders fought for top-tier borrowers applying for MH chattel loans. Stay tuned here for unfolding developments...
Other news that hasn’t changed is our industry’s lenders’ policies toward placing loans in co-op parks, also known as Resident-Owned Communities (ROCs).
Often our industry’s lenders refuse to place loans into co-op parks. As a loan officer, I’ve always questioned this policy. Co-op parks are resident-owned and therefore are very unlikely to fall into the hands of “predatory” park owners. So why do our chattel lenders say NO to ROCs?
It’s not the communities that are the issue. It’s the certificate or shares of ownership. The banks don’t wish to finance the share of ownership. If the share of ownership is included in the sales price of the home, which is usually the case, most banks won’t take it.
Since the lenders refuse to finance the share or shares of ownership, the banks are left in a precarious position in the event of default. If the home goes into repossession and someone else owns the ROC certificate, the owner of the certificate can theoretically tell the bank: “GET OFF MY LAND.” The bank will have to pull out the home and move it to a different community.
Our industry’s major lender out of San Diego, U.S. Bank, has little or no objection to financing MH’s in ROCs. They insist that the homeowner must own the share and the cost of the share needs to be separate from the home purchase. However, there are some ROCs in Coastal California that this bank won’t take due to share prices of $100,000+. This would leave the bank in a bad situation in the event of default and having to re-market the home with an additional $100,000 for the ROC certificate.
Why won’t the lenders finance the share of ownership as part of the cost of the home? There appears to be no clear answer. To date, they haven’t been persuaded to change their minds. As the trend of converting LLCs to ROCs sweeps the country, perhaps a major voice in our industry will be successful in persuading them to be more flexible. I can see a separate loan product for this with LTVs that vary case-by-case depending on the cost of the share.
If you need a loan for a home in an ROC, your best bet is to find a regional bank. Local lenders are more willing to place loans into co-op communities. The reason is they feel that ROCs are generally more desirable than LLCs and are less likely to be purchased by major corporations who might drastically increase the rent. ROCs are generally in desirable areas making it theoretically easier for the bank to re-market the home in the event of default.
Land/home communities (LHCs), for example, are an entirely different matter with obvious different legal issues. The biggest roadblock to obtaining financing in land/home communities is the lot size. It seems ironic that chattel lenders don’t care about lot size, but land/home lenders do. You can get a loan for a manufactured home in a LLC even if all the homes are squeezed in like sardines, but you can’t very easily get a loan in a LHC
given the size of the site. You may have to go with an FHA product. Last I checked, FHA has no objection to a small lot size. # #
Dave Shanklin is a loan originator with Mobile Brokers Acceptance, Fair Oaks, CA. NMLS ID #314463. He primarily handles MH chattel loans in LLC’s. Call (916) 962-7128 or (800) 401-3372 or email Info@MobileHomeDollars.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
FINANCING
by Dave Shanklin
BREAKING NEWS out of Seattle: CU Factory Built will be raising rates .25% on their very popular “One-Step” loan product effective December 1. This announcement seems to indicate that the “rate war” between the MH chattel lenders is coming to an end.
The “One-Step” loan, with a very low start rate for the first five years, has a new floor of only 4.75%. This is still an amazingly-low rate for manufactured homes in LLCs as personal property.
The “rate war” was hot and heavy during the summer between CU, Triad, and US Bank. We saw stunning drops in rates as our major lenders fought for top-tier borrowers applying for MH chattel loans. Stay tuned here for unfolding developments...
Other news that hasn’t changed is our industry’s lenders’ policies toward placing loans in co-op parks, also known as Resident-Owned Communities (ROCs).
Often our industry’s lenders refuse to place loans into co-op parks. As a loan officer, I’ve always questioned this policy. Co-op parks are resident-owned and therefore are very unlikely to fall into the hands of “predatory” park owners. So why do our chattel lenders say NO to ROCs?
It’s not the communities that are the issue. It’s the certificate or shares of ownership. The banks don’t wish to finance the share of ownership. If the share of ownership is included in the sales price of the home, which is usually the case, most banks won’t take it.
Since the lenders refuse to finance the share or shares of ownership, the banks are left in a precarious position in the event of default. If the home goes into repossession and someone else owns the ROC certificate, the owner of the certificate can theoretically tell the bank: “GET OFF MY LAND.” The bank will have to pull out the home and move it to a different community.
Our industry’s major lender out of San Diego, U.S. Bank, has little or no objection to financing MH’s in ROCs. They insist that the homeowner must own the share and the cost of the share needs to be separate from the home purchase. However, there are some ROCs in Coastal California that this bank won’t take due to share prices of $100,000+. This would leave the bank in a bad situation in the event of default and having to re-market the home with an additional $100,000 for the ROC certificate.
Why won’t the lenders finance the share of ownership as part of the cost of the home? There appears to be no clear answer. To date, they haven’t been persuaded to change their minds. As the trend of converting LLCs to ROCs sweeps the country, perhaps a major voice in our industry will be successful in persuading them to be more flexible. I can see a separate loan product for this with LTVs that vary case-by-case depending on the cost of the share.
If you need a loan for a home in an ROC, your best bet is to find a regional bank. Local lenders are more willing to place loans into co-op communities. The reason is they feel that ROCs are generally more desirable than LLCs and are less likely to be purchased by major corporations who might drastically increase the rent. ROCs are generally in desirable areas making it theoretically easier for the bank to re-market the home in the event of default.
Land/home communities (LHCs), for example, are an entirely different matter with obvious different legal issues. The biggest roadblock to obtaining financing in land/home communities is the lot size. It seems ironic that chattel lenders don’t care about lot size, but land/home lenders do. You can get a loan for a manufactured home in a LLC even if all the homes are squeezed in like sardines, but you can’t very easily get a loan in a LHC
given the size of the site. You may have to go with an FHA product. Last I checked, FHA has no objection to a small lot size. # #
Dave Shanklin is a loan originator with Mobile Brokers Acceptance, Fair Oaks, CA. NMLS ID #314463. He primarily handles MH chattel loans in LLC’s. Call (916) 962-7128 or (800) 401-3372 or email Info@MobileHomeDollars.com This e-mail address is being protected from spambots. You need JavaScript enabled to view it .
Wednesday, September 21, 2011
Mobile Home Appraiser Reports Orders Are Up 600%
One of the leading MH appraisers for Northern California reports that appraisal orders for August have increased 600%, compared to August 2010.
Perhaps a contributing factor in this startling increase in sales activity is the fact that lenders for mobile homes in parks have dropped their rates considerably, and prices for used mobile homes have become very affordable.
As far as lending is concerned, the industry's new "floor rate" for MH's in parks is now 4.5%. As recently as 2006, the "floor rate" was 10.5%.
Now is the time to start looking at manufactured / mobile homes in parks.
Contact Dave Shanklin at Mobile Brokers Acceptance in Fair Oaks, CA for advice with financing.....800-401-3372, or 916-962-7128.
Perhaps a contributing factor in this startling increase in sales activity is the fact that lenders for mobile homes in parks have dropped their rates considerably, and prices for used mobile homes have become very affordable.
As far as lending is concerned, the industry's new "floor rate" for MH's in parks is now 4.5%. As recently as 2006, the "floor rate" was 10.5%.
Now is the time to start looking at manufactured / mobile homes in parks.
Contact Dave Shanklin at Mobile Brokers Acceptance in Fair Oaks, CA for advice with financing.....800-401-3372, or 916-962-7128.
Tuesday, August 23, 2011
Mobile Home Lenders Start "Rate War"; Rates Drop to 4.5% and 5.99% for Mobile Homes and Manufactured Homes in Parks
Our industry's major lender based in Jacksonville, FL has announced its biggest single-day rate cut in that company’s 50-year history. A reduction of .75% for all categories of loan products for MH’s in parks to take effect immediately.
New "floor rate" , with 20% down, is a 10-year loan @ 5.99% fixed.
This news came out barely two weeks after our industry’s other lender, CU Factory Built, rolled out its new “step-up” loan with very low rates starting at 4.5%.
This is a typical reaction among our MH chattel lenders who are competing for top-tier borrowers (which means borrowers with 700+ credit scores). Without having seen rate sheets, it cannot yet be confirmed if this rate reduction from Triad will affect all tiers of their loan products. However, the source for this story did indicate that the .75% reduction will be “across the board”.
We now have very attractive rates to offer to manufactured home buyers moving into parks. Four years ago, the “floor rate” with our biggest lender was at 10.5%. We can now potentially offer rates less than half what they used to be.
After years of sour news, this is something that should be told to all buyers of manufactured homes in parks. Check back frequently for the latest in this “rate war”.
####
Dave Shanklin
Mobile Brokers Acceptance
Fair Oaks, CA
NMLS # 314463
800-401-3372
916-962-7128
New "floor rate" , with 20% down, is a 10-year loan @ 5.99% fixed.
This news came out barely two weeks after our industry’s other lender, CU Factory Built, rolled out its new “step-up” loan with very low rates starting at 4.5%.
This is a typical reaction among our MH chattel lenders who are competing for top-tier borrowers (which means borrowers with 700+ credit scores). Without having seen rate sheets, it cannot yet be confirmed if this rate reduction from Triad will affect all tiers of their loan products. However, the source for this story did indicate that the .75% reduction will be “across the board”.
We now have very attractive rates to offer to manufactured home buyers moving into parks. Four years ago, the “floor rate” with our biggest lender was at 10.5%. We can now potentially offer rates less than half what they used to be.
After years of sour news, this is something that should be told to all buyers of manufactured homes in parks. Check back frequently for the latest in this “rate war”.
####
Dave Shanklin
Mobile Brokers Acceptance
Fair Oaks, CA
NMLS # 314463
800-401-3372
916-962-7128
Thursday, August 11, 2011
Major Mobile Home Lender Lowers Rates to 4.5% for Used and New Mobile & Manufactured Homes in Parks
Our industry's major lender out of Seattle, CU Factory Built Lending, has again rolled out a new loan product with eye-popping low rates for manufactured homes in leased land communities.
Their new floor rate is 4.5%. This is a "step-up loan", not an adjustable rate mortgage. The low start rate is locked in for the first five years, then "steps up" to the higher rate for the remiaining term at 7.25% fixed. This lender's loan products are always fully amortized. The terms are very flexible and not too difficult to qualify for. They don't accept applicants with any mortgage defaults or any mortgage delinquencies in their background.
For example, a used 1980 multi-section in-park home would qualify with 10% down. Assuming top tier credit, the applicant can get a 20-year loan at 4.75% for the first five years, and 7.5% for the remining 15 years. With 20% down, the start rate would be 4.5%, stepping up to 7.25%.
Better yet, for a 10-year loan, with 20% down, the first five years will be fixed at 4.5%, and the remaining years fixed at 6.25%. The borrower may pay the monthly based on the higher rate, resulting in an accelerated principal reduction, and saving thousands in interest.
This new "One Step Program" loan product is available in all states. Cash-outs and refinances are also eligible, case-by-case. In CA, the older "pre-Huds" are eligible, but with a 1% rate adder.
This will make financing new and used MH chattels much easier. Our industry needs a good shot in the arm.
Their new floor rate is 4.5%. This is a "step-up loan", not an adjustable rate mortgage. The low start rate is locked in for the first five years, then "steps up" to the higher rate for the remiaining term at 7.25% fixed. This lender's loan products are always fully amortized. The terms are very flexible and not too difficult to qualify for. They don't accept applicants with any mortgage defaults or any mortgage delinquencies in their background.
For example, a used 1980 multi-section in-park home would qualify with 10% down. Assuming top tier credit, the applicant can get a 20-year loan at 4.75% for the first five years, and 7.5% for the remining 15 years. With 20% down, the start rate would be 4.5%, stepping up to 7.25%.
Better yet, for a 10-year loan, with 20% down, the first five years will be fixed at 4.5%, and the remaining years fixed at 6.25%. The borrower may pay the monthly based on the higher rate, resulting in an accelerated principal reduction, and saving thousands in interest.
This new "One Step Program" loan product is available in all states. Cash-outs and refinances are also eligible, case-by-case. In CA, the older "pre-Huds" are eligible, but with a 1% rate adder.
This will make financing new and used MH chattels much easier. Our industry needs a good shot in the arm.
Wednesday, June 22, 2011
Mobile Home in Sonoma sells for $55,000 above appraised value
SONOMA, CA --
It's a good sign that the market is turning around in the MHP business.
The appraisal fell $55,000 short, but the determined buyer didn't back out of the deal.
This is THEE house for this couple. The contract sales price was nearly $180,000, but due to dropping sales prices in the subject park, the appraisal came in at $125,000.
It's been several years since anything like this has happened.
Buyers paying substantially more for a used manufactured home in a park than the appraised value.
Let's see if this trend continues.....
Dave Shanklin
Mobile Brokers Acceptance
Fair Oaks, CA
NMLS ID # 314463
800-401-3372
It's a good sign that the market is turning around in the MHP business.
The appraisal fell $55,000 short, but the determined buyer didn't back out of the deal.
This is THEE house for this couple. The contract sales price was nearly $180,000, but due to dropping sales prices in the subject park, the appraisal came in at $125,000.
It's been several years since anything like this has happened.
Buyers paying substantially more for a used manufactured home in a park than the appraised value.
Let's see if this trend continues.....
Dave Shanklin
Mobile Brokers Acceptance
Fair Oaks, CA
NMLS ID # 314463
800-401-3372
Mobile Home Buyers : Take Advantage of Very Low Interest Rates for Mobile Homes and Modular Homes in Parks
Our industry's main lender out of Seattle is holding on to their very sweet interest rates for MH's in parks.
Their "floor" rate is still at 4.99% for short-term financing.
If you'd like to consider an adjustable, Arm products are available for manufactured homes in parks built after 1991. Minimum 5% down.
Call for details!
Dave Shanklin
Manufactured Home Finance Specialist
Mobile Brokers Acceptance
NMLS ID # 314463
800-401-3372
info@MobileHomeDollars.com
Their "floor" rate is still at 4.99% for short-term financing.
If you'd like to consider an adjustable, Arm products are available for manufactured homes in parks built after 1991. Minimum 5% down.
Call for details!
Dave Shanklin
Manufactured Home Finance Specialist
Mobile Brokers Acceptance
NMLS ID # 314463
800-401-3372
info@MobileHomeDollars.com
Tuesday, June 7, 2011
TOP FIVE REASONS WHY LENDERS DECLINE LOAN APPLICATIONS FOR MOBILE HOMES IN PARKS
Top Five Reasons Why
Lenders Decline Loan Applications
for Mobile Homes in Parks
By Dave Shanklin
1. MORTGAGE DEFAULTS. This has been the biggest nightmare for MH chattel loan officers. Short sales, foreclosures, and applicants burdened with mortgaged homes that they can’t sell. Our industry’s lenders started to show signs that they might be softening their position on mortgage defaults on credit reports, but they’re still turning down applicants with mortgages that have gone “belly-up”.
Our major lender out of San Diego will occasionally tolerate recent bouts of unemployment, recent bankruptcies, FICO scores in the low 600’s, and even recent mortgage lates. This lender has become what I call a “sub-prime” lender, based on the above, eventhough they will probably deny this title. Most of our industry’s lenders have a zero tolerance policy toward recent mortgage lates. But this lender has been accepting borrowers with less than perfect mortgage history, as long as the home loan was paid in full and didn’t default.
I am being told that FannieMae lenders are now approving applications with short sales that are at least three years old. This is helpful to the entire real estate market. Hopefully, in an upcoming column I can announce that our lenders are doing the same.
2. “I OWN A HOME WITH A MORTGAGE, AND I WANT TO RENT IT OUT AND BUY A MANUFACTURED HOME AND GET A LOAN FOR IT”
It’s long been a FannieMae guideline to accept rental income and deduct part of that income from the borrower’s debt ratio. A few strict rules apply here.
Our lenders will, from time to time, accept rental income on mortgaged properties as qualifying income. However, the rental income has to be documented with at least two years’ of tax returns. Only 70% of the rental income, after expenses, will count as qualifying income when computing the borrower’s debt ratio. Most of the time, the homeowners are in the red and don’t realize it. If a house rents for $1200/month, and the mortgage payment is $1200/month, then the mortgage payment is not “covered”.
3. “I WANT TO BUY A MANUFACTURED HOME FOR A FAMILY MEMBER AND FINANCE IT”
This is what the industry calls a “buy-for” transaction. Good luck getting the LL community manager to agree to this. Most LLC’s do not allow non-owner-occupied homes.
As far as lending, there is one lender in our industry that will consider “buy-for’s” on a case-by-case basis. The home needs to be 1991 or newer, with a maximum loan of $75,000, and a very strong co-signor. This lender prefers the co-signor to be an immediate family member, and they will have to nearly “walk on water” credit-wise to get loan approval.
Loans that are less than 100% full-time owner-occupied are considered to be the highest risk category of loan for the chattel lenders. They are so paranoid that one of our lender’s underwriters now routinely makes phone calls to the applicants BEFORE making a credit decision, just to make sure that all people on the loan application intend to live in the manufactured home that they are borrowing money for. Exceptions are made for “vacation properties”. But forget about buying a manufactured home, financing it, and renting it out, even if the home is with owned land. The land/home lenders are equally as strict on these matters.
4. “I WANT TO BORROW THE DOWN PAYMENT”
As I have mentioned in past columns, down payment funds must be true equity, free and clear of encumbrances. Preferrably, the entire down payment should be the borrower’s life savings. This is the “glue” that holds the buyer to the asset, making it less likely that they will turn their back on the house if the have a bad year.
Family members may gift part of the down, or in some cases, all of the down. The gift provider will have to provide bank statements and sign a gift letter. With one lender in our industry, the gift provider will have to send the loan officer additional bank statements showing the funds being transferred from the gift provider, and the gift recipient will have to provide a bank statement showing that they received the funds. This is called “paper trail”. This is to rule out any possibility that any part of the down payment was snuck in via a credit card cash advance, and disguised as a gift from a family member. This would be considered a fraudulent transaction, and any loan originator who goes along with this and gets caught will be immediately unemployed and unemployable in this industry.
5. “I HAVE INCOME BUT NO CREDIT, BUT MY SPOUSE HAS CREDIT BUT NO INCOME”
As a new loan officer, I sent in several applications of husband-wife situations with one spouse with good credit and no income, and the other spouse with high income and no credit, or bad credit. The applications got declined.
Underwriters will NOT accept a co-applicant’s income unless it is backed up by strong credit report. If one spouse has enough income on their own, and good credit, then the other spouse can be added to the loan, but their income will not count if they have unacceptable credit.
Quite often, loan officers find themselves giving advice on how to build credit. If the consumers follow the advice, then in a few short years they can turn the situation around and become proud homeowners. Quite often, the consumer is never heard from again. I guess they ignore the advice, keep going down the wrong road, and keep renting……..
Dave Shanklin
NMLS ID # 314463
Mobile Brokers Acceptance
Fair Oaks, CA
800-401-3372
916-962-7128
# # #
Lenders Decline Loan Applications
for Mobile Homes in Parks
By Dave Shanklin
1. MORTGAGE DEFAULTS. This has been the biggest nightmare for MH chattel loan officers. Short sales, foreclosures, and applicants burdened with mortgaged homes that they can’t sell. Our industry’s lenders started to show signs that they might be softening their position on mortgage defaults on credit reports, but they’re still turning down applicants with mortgages that have gone “belly-up”.
Our major lender out of San Diego will occasionally tolerate recent bouts of unemployment, recent bankruptcies, FICO scores in the low 600’s, and even recent mortgage lates. This lender has become what I call a “sub-prime” lender, based on the above, eventhough they will probably deny this title. Most of our industry’s lenders have a zero tolerance policy toward recent mortgage lates. But this lender has been accepting borrowers with less than perfect mortgage history, as long as the home loan was paid in full and didn’t default.
I am being told that FannieMae lenders are now approving applications with short sales that are at least three years old. This is helpful to the entire real estate market. Hopefully, in an upcoming column I can announce that our lenders are doing the same.
2. “I OWN A HOME WITH A MORTGAGE, AND I WANT TO RENT IT OUT AND BUY A MANUFACTURED HOME AND GET A LOAN FOR IT”
It’s long been a FannieMae guideline to accept rental income and deduct part of that income from the borrower’s debt ratio. A few strict rules apply here.
Our lenders will, from time to time, accept rental income on mortgaged properties as qualifying income. However, the rental income has to be documented with at least two years’ of tax returns. Only 70% of the rental income, after expenses, will count as qualifying income when computing the borrower’s debt ratio. Most of the time, the homeowners are in the red and don’t realize it. If a house rents for $1200/month, and the mortgage payment is $1200/month, then the mortgage payment is not “covered”.
3. “I WANT TO BUY A MANUFACTURED HOME FOR A FAMILY MEMBER AND FINANCE IT”
This is what the industry calls a “buy-for” transaction. Good luck getting the LL community manager to agree to this. Most LLC’s do not allow non-owner-occupied homes.
As far as lending, there is one lender in our industry that will consider “buy-for’s” on a case-by-case basis. The home needs to be 1991 or newer, with a maximum loan of $75,000, and a very strong co-signor. This lender prefers the co-signor to be an immediate family member, and they will have to nearly “walk on water” credit-wise to get loan approval.
Loans that are less than 100% full-time owner-occupied are considered to be the highest risk category of loan for the chattel lenders. They are so paranoid that one of our lender’s underwriters now routinely makes phone calls to the applicants BEFORE making a credit decision, just to make sure that all people on the loan application intend to live in the manufactured home that they are borrowing money for. Exceptions are made for “vacation properties”. But forget about buying a manufactured home, financing it, and renting it out, even if the home is with owned land. The land/home lenders are equally as strict on these matters.
4. “I WANT TO BORROW THE DOWN PAYMENT”
As I have mentioned in past columns, down payment funds must be true equity, free and clear of encumbrances. Preferrably, the entire down payment should be the borrower’s life savings. This is the “glue” that holds the buyer to the asset, making it less likely that they will turn their back on the house if the have a bad year.
Family members may gift part of the down, or in some cases, all of the down. The gift provider will have to provide bank statements and sign a gift letter. With one lender in our industry, the gift provider will have to send the loan officer additional bank statements showing the funds being transferred from the gift provider, and the gift recipient will have to provide a bank statement showing that they received the funds. This is called “paper trail”. This is to rule out any possibility that any part of the down payment was snuck in via a credit card cash advance, and disguised as a gift from a family member. This would be considered a fraudulent transaction, and any loan originator who goes along with this and gets caught will be immediately unemployed and unemployable in this industry.
5. “I HAVE INCOME BUT NO CREDIT, BUT MY SPOUSE HAS CREDIT BUT NO INCOME”
As a new loan officer, I sent in several applications of husband-wife situations with one spouse with good credit and no income, and the other spouse with high income and no credit, or bad credit. The applications got declined.
Underwriters will NOT accept a co-applicant’s income unless it is backed up by strong credit report. If one spouse has enough income on their own, and good credit, then the other spouse can be added to the loan, but their income will not count if they have unacceptable credit.
Quite often, loan officers find themselves giving advice on how to build credit. If the consumers follow the advice, then in a few short years they can turn the situation around and become proud homeowners. Quite often, the consumer is never heard from again. I guess they ignore the advice, keep going down the wrong road, and keep renting……..
Dave Shanklin
NMLS ID # 314463
Mobile Brokers Acceptance
Fair Oaks, CA
800-401-3372
916-962-7128
# # #
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