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10/15/2020

Self Employed Qualify For Mortgage

Step 1: Income

In most respects, this is the most critical aspect of your financial profile. The lender will be looking to verify the stability of your income, in addition to how much you earn.

We need to review, but maybe won’t use everything, send in the following documentation:

  • Complete personal income tax returns for the two most recent tax years, complete with all schedules Your IRS 2019 2018 with all schedules and page two signed
  • If your business operates as a corporation or a partnership, we may also require complete business income tax returns for the past two years. Therefore, send me the LLC, S Corp or any and all other Federal Returns for the past two years filings
  • This is not something you may have on paper but get started preparing a year to date profit and loss statement.
  • Later we may also ask for proof that you have an operating business and how you bring in clients. The URL of your business website might suffice or a copy of a business license, or a written statement from a CPA confirming that you have been in business for the past two years.

With this information we might likely average your business income for the past two years (total net income divided by 24 months), but we might only need the most recent year. I won’t send in the whole novel, I wait to verify what Underwriting must have…

Income evaluation is the major criteria that makes qualifying for a mortgage as a self-employed borrower more difficult than it is for employed borrowers.

Step 2: Credit

 

 A credit score over 720 will be a big advantage, but there are methods to raise the score such as paying down high balance cards to less than sixty percent of the line. DO NOT close any accounts, this will hurt the score.

.

Step 3: Assets and down payment

The amount of cash for down payment is also a more important factor with the self-employed. While salaried borrowers might be able get by with a down payment of three or five percent, lenders typically look for larger down payments from the self-employed.

Step 4: Debt-to-income ratio (DTI)

This is a mortgage industry term that describes the formula used to determine that your income is sufficient for the loan you’re applying for.

There are actually two ratios:

Housing ratio

That’s your new monthly house payment, divided by your stable monthly income.

If your stable monthly income is $6,000, in the new house payment will be $1,500, your housing DTI will be 25 percent ($1,500 divided by $6,000).

Your new monthly housing payment includes the new mortgage payment, plus monthly allocations for property taxes, homeowner’s insurance, mortgage insurance, flood or earthquake insurance, or homeowner’s association dues. It does not include utility payments.

Total debt DTI

If your income on the taxes is net zero or negative we may be able to use the deposits in ONE bank account over the past twelve or twenty four months.

Let’s talk about the options to get you the best home loan with the lowest monthly payment!

 

C G

(949) 784-9699

NMLS 324982

 

 This is not a commitment to lend. Equal Credit Opportunity


 

10/13/2020

Monarch Butterfly Mortgage


I have an acre of a variety of milkweed planted to help monarch butterflies.
They are endangered and need our help. If you apply for a mortgage with
me I will send you seeds, a plant if your Agricultural Department allows for
your area, some eggs and instructions. I have several friends who have 
monarch sanctuaries in western states and I donate and support them in our
love for these creatures. Did you know a small percentage of them are super
heroes that fly millions of miles?

Here are two ten second videos of new born monarch butterflies ready to be
freed from my screen porch. Enjoy!








 







9/28/2020

Lower your payment

Now more than ever you need to be careful with money.
Let's chat to see if I can lower your monthly mortgage payment!
(949) 784- 9699
C G



A few mortgage questions and answers for you to review:

Under RESPA, what may a real estate professional give to a colleague who refers real estate settlement service business?

 

A thing of value

A kickback

A thank you

A fee

RESPA prohibits any person from giving or receiving a fee, kickback, or "a thing of value" for referring business to a settlement service provider, or SSP, such as a mortgage banker, mortgage broker, title company, or title agent. Saying thank you is not considered a thing of value for purposes of the Act.

 

 

Question 2

Which of the following is not necessary in order to show that a section 8 violation has occurred.

 

Showing that payment was made for work not performed

A payment for the referral of services is offered

A payment for the referral of services is accepted.

Proving that applicant ends up being charged more for the service.

There is no direct proof of customer harm necessary to prove a Section 8 violation. "The fact that the transfer of the thing of value does not result in an increase in any charge made by the person giving the thing of value is irrelevant in determining whether the act is prohibited."

 

 

Question 3

The Homeownership Counseling List must be obtained no later than ___ days prior to the time the list is provided to the applicant?

 

30

60

45

10

The list must also be obtained no earlier than thirty (30) days prior to the time the list is provided to the applicant. In other words, it cannot be an old list.

 

 

Question 4

How many counseling agencies must be provided on the Homeownership Counseling List?

 

5

10

20

8

Consistent with §?1024.20(a)(1), lenders comply with the Homeownership Counseling List requirement when they provide a list of ten HUD-approved housing counseling agencies.

 

 

Question 5

RESPA rules do NOT cover this type of transaction:

 

Purchase of a condominium with a Federal Housing Administration mortgage

Purchase of a single-family home with a Veteran's Administration loan

Purchase of a two-flat that the owners plan to live in and rent out the other unit financed with a conventional loan

Purchase of a small warehouse financed with a Small Business Administration loan

RESPA's coverage is limited to transactions involving a federally-related mortgage with a first or subordinate lien on residential real property (including individual units of condominiums and cooperatives) designed principally for the occupancy of one to four families. This includes any loan that is used to prepay or pay off an existing loan secured by the same property. Properties used for business purposes are not covered by RESPA.

 

"Customer" means:

 

Someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative, who have a continuing relationship with a financial institution.

Someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative. The term "consumer" does not apply to commercial clients, like sole proprietorships.

An individual that has not yet applied for a line of credit

Someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative, including business clients

A Consumer is someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative. Customers are a subclass of consumers who have a continuing relationship with a financial institution. It's the nature of the relationship - not how long it lasts - that defines a customer.

 

Question 2

The term "nonpublic personal information" means:

 

Information provided by a consumer to a financial institution

All of the above

Information otherwise obtained by the financial institution

Information resulting from any transaction with the consumer or any service performed for the consumer

The Privacy Rule protects a consumer's "nonpublic personal information" (NPI). NPI is any "personally identifiable financial information" that a financial institution collects about an individual in connection with providing a financial product or service, unless that information is otherwise "publicly available."

 

 

Question 3

The disclosure of the privacy policy must be:

 

Provided to consumers in writing or electronic form

Posted on the wall at the financial institution

Given to consumer or customer upon request

Verbally given to the consumer or customer

Financial institutions must give their customers - and in some cases their consumers - a "clear and conspicuous" written notice describing their privacy policies and practices.

 

 

Question 4

Financial institutions are required to send annual privacy notices to individuals who have paid off their loan

 

False, the notice is not annual

True, but only if the account was paid in full less than 3 yearsYou should have checked this.

True only if it was a portfolio loan.

True, but only if the individual still maintains an open active account with the company.

A former customer "has obtained" a financial product or service from a financial institution but no longer has a continuing relationship with it. For purposes of a company's obligations under the Privacy Rule, a former customer is considered to be a consumer.

 

 

Question 5

The GLB applies to:

 

A retailer that offers credit to consumers by issuing its own credit card

All of the above

A retailer that lets some consumer make payments through an occasional lay-away plan.

A storeowner who runs a tab for customers

The Privacy Rule applies to businesses that are "significantly engaged" in "financial activities" as described in section 4(k) of the Bank Holding Company Act.

 

An oral communication is an electronic record:

 

None of the above

As long as it is recorded.

Never

Always

Oral communications or a recording of an oral communication shall not qualify as an electronic record.

 

Here's a few more questions and explanations:

Question 2

Prior to obtaining their consent, financial institutions must provide the consumer, a clear and conspicuous statement informing the consumer of certain disclosures, which is not required?

 

Informing consumer whether the consent applies only to the particular transaction that triggered the disclosure or to identified categories of records that may be provided during the course of the parties' relationship;

Informing the consumer how the consumer may not request a paper copy of a record and whether a fee will be charged if they do.

Informing the consumer of any right or option to have the record provided or made available on paper or in a non-electronic form, and the right to withdraw consent, including any conditions, consequences, and fees in the event of such withdrawal;

Informing consumer of the procedures the consumer must use to withdraw consent and to update information needed to contact the consumer electronically

Prior to obtaining their consent, financial institutions must provide the consumer, a clear and conspicuous statement informing the consumer of the following: Any right or option to have the record provided or made available on paper or in a non-electronic form, and the right to withdraw consent, including any conditions, consequences, and fees in the event of such withdrawal; Whether the consent applies only to the particular transaction that triggered the disclosure or to identified categories of records that may be provided during the course of the parties' relationship; Describing the procedures the consumer must use to withdraw consent and to update information needed to contact the consumer electronically; and Informing the consumer how the consumer may nonetheless request a paper copy of a record and whether any fee will be charged for that copy.

 

 

Question 3

Prior to consenting to the use of an electronic record, a consumer must:

 

Obtain written consent that consumer has hardware and software required to access electronic documents

Verify that consumer has hardware and software capable of receiving electronic documents.You shouldn't have checked this.

Be provided with a statement of the hardware and software requirements for access to and retention of electronic records.You should have checked this.

All of the above

Prior to consenting to the use of an electronic record, a consumer must be provided with a statement of the hardware and software requirements for access to and retention of electronic records. If the consumer consents electronically, or confirms his or her consent electronically, it must be in a manner that reasonably demonstrates the consumer can access information in the electronic form that will be used to provide the information that is the subject of the consent.

 

 

Question 4

Privacy notices can be delivered to customers electronically?

 

Only with consent from the customer, disclosure of certain terms, and a signed waiver

Only with consent from customer and disclosure of certain terms

Only with consent from customer

Any time

Information required by law, to be in writing, can be made available electronically to a consumer only if he or she affirmatively consents to receive the information electronically and the company clearly and conspicuously discloses specified information to the consumer before obtaining his or her consent.

 


9/13/2020

Federal Mortgage laws


 

Under RESPA, what may a real estate professional give to a colleague who refers real estate settlement service business?

 

A thing of value

A kickback

A thank you **

A fee

RESPA prohibits any person from giving or receiving a fee, kickback, or "a thing of value" for referring business to a settlement service provider, or SSP, such as a mortgage banker, mortgage broker, title company, or title agent. Saying thank you is not considered a thing of value for purposes of the Act.



Question 2

Which of the following is not necessary in order to show that a section 8 violation has occurred.

 

Showing that payment was made foe work not performed

A payment for the referral of services is offered

A payment for the referral of services is accepted.

proving that applicant ends up being charged more for the service. ***

There is no direct proof of customer harm necessary to prove a Section 8 violation. "The fact that the transfer of the thing of value does not result in an increase in any charge made by the person giving the thing of value is irrelevant in determining whether the act is prohibited."



Question 3

The Homeownership Counseling List must be obtained no later than ___ days prior to the time the list is provided to the applicant?

 

30  ***

60

45

10

The list must also be obtained no earlier than thirty (30) days prior to the time the list is provided to the applicant. In other words, it cannot be an old list.


Score: 100%

Question 4

How many counseling agencies must be provided on the Home ownership Counseling List?

 

5

10 ***

20

8

Consistent with §?1024.20(a)(1), lenders comply with the Home ownership Counseling List requirement when they provide a list of ten HUD-approved housing counseling agencies.



Question 5

RESPA rules do NOT cover this type of transaction:

 

Purchase of a condominium with a Federal Housing Administration mortgage

Purchase of a single-family home with a Veteran's Administration loan

Purchase of a two-flat that the owners plan to live in and rent out the other unit financed with a conventional loan

Purchase of a small warehouse financed with a Small Business Administration loan ***

RESPA's coverage is limited to transactions involving a federally-related mortgage with a first or subordinate lien on residential real property (including individual units of condominiums and cooperatives) designed principally for the occupancy of one to four families. This includes any loan that is used to prepay or pay off an existing loan secured by the same property. Properties used for business purposes are not covered by RESPA.


"Customer" means:

 

Someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative, who have a continuing relationship with a financial institution.You correctly checked this.

Someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative. The term "consumer" does not apply to commercial clients, like sole proprietorship.

An indivuadal that has not yet applied for a line of credit

Someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative, including business clients

A Consumer is someone who obtains or has obtained a financial product or service from a financial institution that is to be used primarily for personal, family, or household purposes, or that person's legal representative. Customers are a subclass of consumers who have a continuing relationship with a financial institution. It's the nature of the relationship - not how long it lasts - that defines a customer.


Question 2

The term "nonpublic personal information" means:

 

Information provided by a consumer to a financial institution

All of the above. ***

Information otherwise obtained by the financial institution

Information resulting from any transaction with the consumer or any service performed for the consumer

The Privacy Rule protects a consumer's "nonpublic personal information" (NPI). NPI is any "personally identifiable financial information" that a financial institution collects about an individual in connection with providing a financial product or service, unless that information is otherwise "publicly available."



Question 3

The disclosure of the privacy policy must be:

 

Provided to consumers in writing or electronic form ***

Posted on the wall at the financial institution

Given to consumer or customer upon request

Verbally given to the consumer or customer

Financial institutions must give their customers - and in some cases their consumers - a "clear and conspicuous" written notice describing their privacy policies and practices.



Question 4

Financial institutions are required to send annual privacy notices to individuals who have paid off their loan

 

False, the notice is not annual

True, but only if the account was paid in full less than 3 years  no

True, but only if the individual still maintains an open active account with the company no

A former customer "has obtained" a financial product or service from a financial institution but no longer has a continuing relationship with it. For purposes of a company's obligations under the Privacy Rule, a former customer is considered to be a consumer.



Question 5

The GLB applies to:

 

A retailer that offers credit to consumers by issuing its own credit card


All of the above

A retailer that lets some consumer make payments through an occasional lay-away plan.

A store owner who runs a tab for customers

The Privacy Rule applies to businesses that are "significantly engaged" in "financial activities" as described in section 4(k) of the Bank Holding Company Act.


https://carolineg.swmcretail.com/