Interview with a Mortgage Planner: Real Estate Advice from Asheville NC

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by Nora Hall
on Friday, September 17, 2010

Kabir Mahadeva is a Certified Mortgage Planning Specialist (r) with Alpha Mortgage Corporation in Asheville, North Carolina. He works with home buyers to pre-qualify them for an appropriate loan, structure the deal so approval is easy, anticipate any possible issues and complete a successful closing. Mr. Mahadeva has worked in the mortgage industry since 2001 and is an expert on a variety of conventional, government and jumbo loans. He was kind enough to share his thoughts on how to get a mortgage in today's real estate market. The answers he shares in this candid interview are thought provoking and helpful to anyone interested in buying a home.

Q. What are the biggest changes in the mortgage industry since 2008?

A. There are three major changes I observed. First, qualifying for a loan is more difficult-higher credit, lower debt ratios and larger down payment requirements all affect potential buyers. Second, there are new regulations governing appraisals and new Good Faith Estimate disclosure requirements. Third, there are far fewer loan originators still in the profession. Since 2008 many companies have closed their doors.

Q. What strategies can potential buyers use to put together a plan to qualify in the future if they don't currently?

A. The best strategy is to work with a mortgage planner who can clearly identify where they are today and help them put together a plan to qualify in the future. I began working with a young couple last May that needed higher credit scores and some savings for a down payment and closing costs. After counseling them for almost one year, they're closing on a home in a few weeks. If buyers work with an experienced mortgage planner they can overcome obstacles more easily and quickly.

There are really only a few basic mortgage types, and a professional mortgage planner helps borrowers choose the right product for their situation. While a low rate is important, most people need to focus on the total cost of a mortgage over the time frame that they will have it. On average, most people don't have the same mortgage loan for more than 5 years. Also, if negotiating a purchase, sometimes using seller contributions properly can make a dramatic difference in a mortgage.

Q. What are the advantages of working with a mortgage banker instead of a mortgage broker?

A. A broker is a middleman between the borrower and the lender; the broker helps the borrowers choose a loan program, takes their application, then submits the application and other documentation to a lender who makes the loan decision (underwriting) and closes the loan (funding).

The mortgage banker works directly for the lender. Just like the broker, they counsel borrowers, and take applications. However, mortgage bankers are more closely tied to the loan because the underwriting and closing take place within the same company. Appraisals are ordered as well. Mortgage bankers can also broker loans if necessary, but the primary advantage of working with one is that the accountability for the loan stays within the same organization, with no middleman.

Q. Should I try to find a lender on the Internet or go with a local lender?

A. Getting a loan is very different from buying anything else. Every loan is highly personalized, and all loan applications require certain issues or problems to be solved. Working with a local lender who is familiar with the area, local business practices, and local mortgage resources can mean the difference between closing on time, or even closing at all. A local lender is more personally accountable to you and other professionals helping you with the purchase.

Q. What is the most important advice you have for homebuyers?

A. Consider making the move before April 30 so you can take advantage of the tax credit (check with your tax adviser about eligibility). Rates are likely to increase after March because the Fed will stop purchasing mortgage-backed securities (which has been keeping rates down). Move-up or former homebuyers are able to afford more house now than possibly this summer due to increases in rates and monthly payments.

Also, talk to an experienced mortgage planner before you go shopping. People like me can help you know what you can afford for a payment, how this translates into a sales price, and how much money you will need to have on hand before making an offer.

Kabir Mahadeva is a mortgage planning specialist in Asheville, North Carolina. For more information visit http://www.KabirM.com.

Content Source: www.norahallrealtor.com

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