mortgage financing and programs

Archive for the ‘first time home buyers’ Category

8 Ways To Accidentally “Un-Approve” Your Mortgage

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For all the talk of how tough it can be to get approved lately, the basics haven’t changed. Mortgage approvals are still a 3-legged stool of income, equity, and credit.

Have them in balance, and all else is good.

But, it’s not always getting the mortgage approved that’s hard. Sometimes, it’s keeping the mortgage approved. You have to watch out for landmines.

Foreclosures Add “Approval Risk”

In today’s market, mortgage approvals can be split into 2 groups.

The first group is those whose mortgages are reviewed and approved by just one bank — in this case, the end-lender. It encompasses “traditional” purchases and refinances; ones that don’t require third-party approval or sign-off.

Most mortgages meet this definition.

The other group of mortgage approvals does requires third-party sign-off — often by the existing lender. Distressed property sales and short refis are two such examples.

Fundamentally, the mortgage approval process is the same between the two groups. The major difference is the physical sign-off by a third-party, and that’s where home buyers can get trapped.

While Waiting For An Approval, Time Is Your Enemy

It could take up to 6 months to get to the closing table on a short sale or foreclosure depending on the speed of home appraisal, the amount of time required for bank sign-off, and other random factors (i.e. vacation time, furlough, miscommunications).

During those 6 months, a lot can happen.

You could lose your job, you could get sick, your home could be damaged by a storm. These are things beyond your control, but within the realm of possibility. Each could negate your mortgage approval, thereby kiboshing your deal and, potentially, resulting in the forfeiture of your earnest money.

The longer it takes to close, the more chance for catastrophe, of course. It’s one of the reasons why buying bank-owned homes can be risky.

But beyond the things you can’t control, there are things you can control. Mortgage approvals are fragile, living things and nothing’s done until it’s done.

Good behavior matters.

With that in mind, here are 8 things you should absolutely not do between the date of application and the date of funding.  I’ve been doing this long enough that I can say with certainty: Ignore these rules at your own peril.

Bad Mortgage Behavior, Defined

  1. Don’t buy a new car or trade-up to a bigger lease
  2. Don’t quit your job to change industries or start a new company
  3. Don’t switch from a salaried job to a heavily-commissioned job
  4. Don’t transfer large sums of money between bank accounts
  5. Don’t forget to pay your bills — even the ones in dispute
  6. Don’t open new credit cards — even if you’re getting 20% off
  7. Don’t accept a cash gift without filing the proper “gift” paperwork
  8. Don’t make random, undocumented deposits into your bank account

Now, it may be impractical to have follow every rule to the letter.  I know that.  For example, if your car lease is expiring,  you have to do what you have to do.  But before renewing the lease, check with your loan officer to see if renting a car for the short-term might be a more mortgage-friendly solution instead.

The same goes for accepting cash gifts from parents.  There’s a right way and a wrong way to accept a cash gift and, if you do it the “wrong way”, you may not get to use the gift as part of your down payment funds.

There are a bevy of “gotchas” in Mortgageland and you can’t expect to know them all. These 8 rules, however, are a good start.

Financing with Low Down Payments

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20 years ago it was expected that buyers would need to put a downpayment of 20% on the purchase of their home. During the 90′s that began to change as many lenders began offering financing with much less downpayment required. During the housing boom of the last decade low and no downpayment financing was readily available. Then suddenly the housing boom went bust. As the country fell into a recession many people began defaulting on their mortgages. Foreclosures began to rise and lenders began to tighten lending requirements to mitigate risk. Getting home financing with a low down payment became much more difficult. That doesn’t mean it is impossible. Chosad services a number of low downpayment programs. Through the FHA Loan program we offer financing that requires as little as 3.5% down. We also offer low downpayment programs available to certain groups of people like uniformed service members, firemen, and police. Chosad also participates in downpayment assistance programs that help cover downpayment and closing costs for first time home buyers in many of the states we are licensed in. The bottom line is that if you are borrower interested in low downpayment financing Chosad has many options available to you. Contact us today for more details. Fill out an Chosad loan request form, or give us a call at 604-916-2321.

Chosad Hosting First Time Home Buyer Seminar

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Chosad will be conducting a seminar for first time home buyers on April 21, 2010 at 6pm at the Chosad offices in Marlton, NJ. This is your chance to gain in depth knowledge of what to expect when buying your first home. Craig Cook, Manager of Sales at Chosad & Financial will give a presentation that covers all aspects of buying a home and securing financing when purchasing a first home. The presentation will also highlight special assistance programs and tax breaks that are only available to first time home buyers. A question and answer session will follow the presentation. Anyone interested in attending should register at or call 604-916-2321 for more information.

Home Buyer Tax Credit Extended and Expanded

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The First Time Home Buyer Tax Credit created earlier this year in the Economic Stimulus Packagage has been extended to April 30, 2010. The tax credit was set to expire at the end of November. More significantly, the tax credit has been expanded to include buyers who are not purchasing a home for the first time. A $6500 tax credit is now available to homeowners purchasing a new home that have lived in their current residence for five consecutive years. The credit is limited to purchases below $800,000 and to individuals who earn less than $125,000 per year, or couples earning less than $225,000. To take advantage of these tax credits fill out an Chosad loan request form, or give us a call at 604-916-2321.

Without an Extension The Stimulus Tax Credit is Set to Expire in 5 Months

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The $8000 First Time Home Buyer Credit created as part of the Stimulus Package passed by Congress earlier this year is set to expire 5 months from today. There has been much speculation that the tax credit will be extended, but currently there is no definitive indication that Congress will extend the deadline. Right now the clock is ticking. If you have been thinking about purchasing your first home now is the time to act to ensure you capitalize on the credit. 5 months may seem like a lot of time but when it comes to real estate that is not so. It takes time to find the right home, negotiate an offer that is accepted by the seller, get approved for financing, have all the necessary inspections of the home performed, dot all the I’s and cross all the T’s required, and finally get to the table for closing. So don’t delay, get started today. The best way to get started is by filling out an Chosad loan request form for a pre-approval letter. Having a pre-approval letter helps get the buying process moving because it signals to all parties involved that you are a serious buyer. It also provide leverage in negotiations with sellers.

How to Monetize your Tax Credit for a Down Payment

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First Time Homebuyers do not have to wait until filing their income taxes to use the the $8000 tax credit implemented in the Stimulus Package earlier this year. HUD is permitting FHA approved lenders to issue short term bridge loans to monetize the tax credit. This enables buyers to use the tax credit as a downpayment and have funds available for closing costs. If you are interested in monetizing your tax credit for a down payment or closing costs fill out an Chosad loan request form, or give us a call at 604-916-2321.

Tax Tip: Apply your 2009 Home Buyer Tax Credit to your 2008 Tax Return

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Here is some important tax information you may not be aware of. The $8000 First Time Home Buyer Tax Credit available for purchases between January 1, 2009 and December 1, 2009 can be applied to your 2008 tax return. Which means if you are a qualified first time home buyer and you have purchased a home this year you don’t have to wait until next year to claim the credit. If you are buying a home and would like to claim it on your 2008 tax return, but have already filed your 2008 return, you may file an amended 2008 return in order to claim the credit. Consult with a tax professional for more details.

Stimulus Package Contains Substantial Home Buyer Tax Credit

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On Feb 17, 2009 President Obama signed the much anticipated Economic Stimulus Package dubbed the American Recovery and Reinvestment Act into law. This Stimulus Package has a very substantial tax credit available for first time home buyers. Here the details on the credit:

  • The tax credit is equal to 10 percent of the home’s purchase price up to a maximum of $8,000
  • Available to First Time Home Buyers. A First Time Buyer is defined as someone who has not owned a principal residence in the previous three years.
  • Any type of home that is a principal residence qualifies. This includes single-family detached homes, attached homes like townhouses and condominiums, and mobile homes.
  • Applies to purchases made between January 1, 2009 and before December 1, 2009.
  • The full tax credit is available for Single taxpayers with a modified adjustable gross income up to $75,000 and $150,000 for married taxpayers that file joint returns. A partial tax credit is available for taxpayers with greater earnings.

Now is a very advantageous time to buy a home. Home prices have steadily declined in value in most areas of the country since autumn of 2007. This has resulted in a slew of affordably priced homes available for sale. The $8000 tax credit included in the Economic Stimulus Package gives people another great reason to buy a home this year. Contact Chosad and we can get you pre-approved so you can begin shopping for a new home, or if you are already in need of financing we can help you with that. Give us a call at 604-916-2321.

Chosad Now an Approved PHFA Lender

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Chosad & Financial, Inc. has recently been approved as a lender for The Pennsylvania Housing Finance Agency (PHFA). The PHFA has a number of terrific programs available to Pennsylvania borrowers such as The HOMEstead Downpayment and Closing Cost Assistance Loan. The HOMEstead Programs offers eligible borrowers up to $14,999 in downpayment and closing cost assistance in the form of a no-interest, second mortgage loan. For more information give us a call at 604-916-2321.

Chosad Approved For NJ Smart Start Program

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Chosad has recently been approved as a lender for the NJ Smart Start Program. The Smart Start Program offers First Time Home Buyers in New Jersey low-interest fixed-rate mortgages from The New Jersey Housing and Mortgage Finance Agency.

For more information on the Smart Start Program visit

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