Ed Mawhinney of Aurora Financial Group

You Can Purchase A Home For Little or No Money Down

Lately, there has been a lot of talk in the news about the latest mortgage bailout to help homeowners out who are upside down in the home mortgages. I am posting this article on how the program is setup to help some of those homeowners here in New Jersey.

At Aurora Financial Group, they have prepared the loan officers with the necessary resources to assist the homeowners who may meet the criteria set forth in HARP 2.0.

Here are the facts behind the program:

• The program is available to existing borrowers who have a conventional mortgage owned by Fannie Mae on or before June 1, 2009.
• The program is for primary, 2nd homes and 1-4 family investment properties.
• Terms on the new loan are for 10, 15, 20, 25 or 30 years fixed rate products and also some ARM (Adjustable Rate Mortgages) as well.
•  The minimum loan amount is $5000.00.
•  Closing cost can be included in the new loan amount.
• The maximum cash out is $250.00.
• The minimum credit score is 620.
• The property must have a LTV (Loan to Value Ratio) greater than 80% to qualify.
• The maximum LTV is unlimited.
• The borrower must be current on their existing mortgage and can not have any 30 or more days late in the last 12 months.
• The new loan must be able to lower the monthly payment of the existing loan or move it form a more stable loan, example - ARM product to a fixed rate product.

• The requirement for mortgage insurance is dependent on whether or not the original loan has mortgage insurance, the original LTV and the existing LTV. If the loan being refinanced had an LTV of 80% or less and the new loan is greater than 80% LTV, no new mortgage insurance is required.

From time to time I like to keep my realtor partners and clients alike informed about credit reports so that they may truly understand to complex issues that lenders face everyday when extending credit to borrowers.

Here is an article from Bankrate.com that explains this complex issue.

Pulling back the credit score curtain

The government's free credit score rules took effect July 21, and since then, some consumers have received a crash course in the nebulous world of credit reporting and scoring.

The final rules stipulated that creditors must disclose the credit score used to make a lending decision, along with information related to the score, if a consumer is denied or offered less-than-the-best terms.

Along with the score used, consumers receive the range of possible credit scores under the model, four or five key factors that hurt the score, the date the score was created and the credit reporting agency that provided it.

Bankrate outlines five lessons you can learn from a credit score disclosure notice.

There's more than one credit score

Surprise! There's not just one credit score. Although the most widely used score is the FICO score, another credit score could show up on your disclosure. The new rules don't require lenders to identify the brand of credit score.

"I think you'll have a slice of lenders who will proactively tell the consumer what brand the score is," says John Ulzheimer, president of consumer education at SmartCredit.com.

For everyone else, there are ways to decipher the score's origin. If the range is between 300 and 850, it's a FICO score. Still, it could be a specific FICO score, such as one designed for credit card issuers, and not the one available on myFICO.com. If the range is 501 to 990, it's a VantageScore, which was developed by the three credit reporting agencies, Equifax, Experian and TransUnion. If the range is anything else, it's an obscure model not used by many lenders, says Ulzheimer.

"Call the lender and find out what score it is," Ulzheimer says. "I think that's a reasonable request."

Not all inquiries are created equal

The new rules also require lenders to give additional information about the score, including the four factors, or reason codes, that hurt it the most. A fifth factor can be added if one of those factors is inquiries, or the number of times potential creditors pulled your credit score or report. Not all inquiries count the same, however.

For example, if you shop around for a mortgage, auto or student loan, the FICO score will ignore inquiries made in the 30 days prior to scoring, according to myFICO.com. Inquiries older than 30 days that were made within any 14-day span or 45-day span, depending on the version of the scoring model used, count as one inquiry.

There are also "soft inquiries" that don't affect your score, says Bradley Graham, product management director at FICO.com. That includes when you or your employer pulls your credit report or score. Ditto with marketing offers you get in the mail.

"It only counts when you initiate requests for credit," Graham says.

You don't have perfect credit

One way creditors can comply with the new rules is to send out a credit score disclosure to everyone, instead of just those consumers who get denied or receive unfavorable terms. That means if your FICO credit score is 800 and you received the best terms available, you may get your free credit score.

What may surprise you is, despite your high score, the disclosure will list the four reasons your score isn't higher. Translation: You could do better.

"It's like saying you're super-awesome but not perfect," says Ulzheimer. "But that's OK because lenders don't require you to be perfect to get the best terms."

Credit bureaus don't know your score

The free credit score likely will come from one of the three credit reporting agencies: Experian, Equifax or TransUnion. You'll see the agency identified on the disclosure. But the company won't be able to discuss your credit score.

"We are the source of the credit report used to calculate the score. But we're not the source of the credit score itself," says Rod Griffin, director of public education at Experian.

The agencies won't be able to tell you how much a missed payment deducts from your score or even which trade line is valued the most in the score. What they can do is go over your credit report and make sure there are no mistakes. They can also help you understand the factors that affect your score, which are included in the disclosure notice.

"It seems like a contrary message," says Griffin, "but consumers shouldn't worry so much about the number, but instead focus on the risk factors. That's what is going to improve their scores."

Your credit score can change

The most heartening part of a free credit score disclosure: Your number is not fixed.

"While the score is the one used to make that decision, it's still a snapshot in time," says Graham. Hence the date on the disclosure notice, which indicates when the score was calculated.

So, if you pay down debt, or bump against a credit limit, your credit score could be higher or lower the next time it is pulled. Your score can change as often as the information in your credit report does.

"We want consumers to use the information as a tool rather than a source of frustration," says Griffin.

So if you are in need of improving or correcting your credit report or any other financing needs give me a call at 609-513-0872.

Ed Mawhinney - Mortgage Advisor/Planner
NMLS # 241133
Treasury Mortgage - A Division of Aurora Financial Group
1810 Springdale Road
Cherry Hill, NJ 08003
609-513-0872
eFax: 856-355-4710
emawhinney@treasuryMTG.com
www.EdMawhinney.com

In a recent study, 19 percent of American consumers who reported finding an error in their credit reports opted not to dispute the error, even when they were offered $5 to file the dispute!  Why not?  Well, some said they thought the error was too minor to impact their score, while others said the dispute process seemed too difficult to tackle.

The fact is, when you’re trying to qualify for a home loan, some of the items on your credit report that can pose a threat to your home finance plans might surprise you. Here are 5 surprising credit report entries you absolutely must fix, especially when you are in the process of buying or refinancing a home.

1.     Account balances you recently paid down or off. If you’ve just finished paying a bill down or off, you might not dispute the elevated balance that remains on your credit report because it’s not actually an error, per se.  But the whole point of paying the balance down was to bring down your credit utilization ratio, which is a heavily weighted factor in your overall credit score.  

Correcting the actual balances of your outstanding bills downward to account for your recent pay-down efforts poses such a large potential improvement impact for your credit score that it might even be worth paying your mortgage professional the $30 to $50 it will cost for them to initiate a Rapid Rescore, which can update your reports to reflect your slimmed-down balances in about 72 hours, compared with the 30 to 60 days you’d expect to wait to see results from a traditional dispute or update.

2.     Incorrect former addresses. Of the 19 percent of consumers who spotted an error on their report in the study, nearly 40 percent of those errors were in what the credit bureaus call “header data," things like the consumer's previous street address. Many elected not to dispute these sorts of line items because the error doesn't seem like it would impact their credit score.  While an inaccurate address might not have much to do with your score, it can still wave a red flag, signaling issues that can foul-up your mortgage application.

A misspelling in an otherwise correct street name should not cause you grave concern.  But if the previous addresses listed are in the wrong city or state, or otherwise come out of nowhere, they might signal that someone has used your name and/or social security number to obtain credit at a different address.  Credit card fraud and identity theft are difficult to unravel when you’re not seeking credit; they are much more complicated to resolve when the credit stakes are high and the underwriter as picky as they are in the course of applying for a mortgage.   

Also, current and previous addresses that conflict with where you’ve told the lender you live(d) can raise suspicion that you might be buying a second or rental home, rather than the owner-occupied home you say you’re trying to buy; that can provoke a lender to demand that you ante up more down payment dough, make you jump through greater hoops to prove your true address or even stop you from qualifying for the loan altogether.

3.     Bills that were never yours in the first place. As with completely bizarre former addresses, accounts listed on your credit report that you never opened in the first place can be a red flag that tips you to the fact that someone else might have stolen your identity and opened a credit card or account in your name.  If you find one of these items on one credit bureau report, but it’s currently closed or has a zero balance, you might be tempted to let it slide, thinking it can’t move the needle on your credit score.  In reality, though, if someone is using your identity to obtain credit and you fail to dispute that the bills belong to you, they might continue to use it, which can cause you real problems.  Of course, if the bills weren’t paid on time or have been placed in collection, disputing the accounts’ presence on your credit report is a must.  

If they were paid on time every time, though, the analysis might be different.  Unfortunately, instituting a fraud-based credit freeze or fraud alert on your credit reports at the same time as you’re applying for a mortgage can complicate your own loan qualification process significantly.  If you find yourself in this situation, carefully scrutinize the rest of your report and the credit reports you receive from the other bureaus to detect whether other fraudulent accounts exist, then consult with your mortgage professional on exactly when and how you should go about disputing the accounts which weren’t actually yours.

4.     Limits listed as lower than they really are. As with closed accounts that were never yours in the first place, accounts that are listed on your credit report as having limits that are lower than they really are might seem like a battle not worth fighting.  But the fact is that only two inputs go into the credit utilization ratio that comprises about 30 percent of your FICO score: how much credit you have available, and how much credit you have used.  So, if you have account balances that show up on your credit reports as lower than they actually are (i.e., that you have less credit available to use), that inaccuracy can skew your credit score and screw up your mortgage qualifying efforts. Big time.

5.    Derogatory items that should have aged off. Very few of us are perfect, and you might have worked hard to pay your bills on time in an effort to overcome a credit ding from back in the days.  Although the impact a derogatory item has on your credit score wanes over time, it’s still your right (and your responsibility) to make sure negative items disappear from your credit report when they are supposed to – that’s 7 years for a late payment, 10 years for a bankruptcy.  If you are still seeing credit dings on your report after more than the relevant time frame has elapsed, dispute them and claim the rehabbed credit (and score) you’ve since earned.

It’s not very common that credit report disputes cause dramatic changes in credit score, but again, many borrowers aren’t disputing these sorts of items they don’t realize could make a difference in their homebuying or refinancing prospect.  

Beyond that, if you’re close to a credit tier cutoff, like 620-640 or 740-760, depending on your loan type, even a few points’ difference can be the difference in qualifying for a home or not, or paying a higher mortgage interest rate for the life of your loan.  For these reasons, it behooves every potential borrower to be proactive in spotting and correcting these 5 must-dispute errors.

Reprinted from Trulia

Ed Mawhinney - Mortgage Advisor/Planner

NMLS # 241133

Treasury Mortgage - A Division of Aurora Financial Group

1810 Springdale Road

Cherry Hill, NJ 08003

609-513-0872

emawhinney@treasuryMTG.com

www.EdMawhinney.com

March 30th, 2011

Robert Germano becomes a Realtor Partner with Treasury Mortgage

Ed Mawhinney & Harry Mehlman of Treasury Mortgage - A Division of Aurora Financial Group is pleased to announce that Robert Germano of deSatnick Real Estate of Cape May, NJ has become a professional partner with them. Robert has been with deSatnick for several years and specializes in residential and commercial properties in the Cape May area.

Now that Robert has become a realtor partner with the Treasury Mortgage Team of Ed Mawhinney & Harry Hehlman he will begin to enjoy the benefits of having a co-marketing team of realtor's and mortgage professionals to help him secure more buyers and listings. Some of the benefits that Robert will experience are:

• Co-op advertising with mortgage professionals
• Custom made co-op flyers for each property with actual financial options for her clients, great lead generator.
• Custom made co-op flyers covering a board range of real estate and mortgage subjects for his clients.
• Free website postings of all her listings syndicated to over 30 different syndicated partner sites for maximum exposure of all his listings.
• Access to a team of mortgage professionals 24/7 for both her and her clients.
• Any much more!!!!

Let's all welcome Robert and congratulate him on becoming the newest Realtor Partner of the Treasury Mortgage Team of Ed Mawhinney and Harry Mehlman.

Ed Mawhinney	Harry Mehlman
Mortgage Advisor/Planner	Senior Loan Officer
NMLS# 241133	NMLS#206630
Treasury Mortgage A Division of Aurora Financial Group	Treasury Mortgage A Division of Aurora Financial Group
609-513-0872	609-289-7379
emawhinney@treasuryMTG.com	hmehlman@treasuryMTG.com

To find out more about our Realtor Partner program that Robert just joined please feel free to contact either Ed or Harry. Also don't forget to visit their award winning website at www.EdMawhinney.com.

March 19th, 2011

Ms. Ann Marie Gibbs becomes a Realtor Partner with Treasury Mortgage

Ed Mawhinney & Harry Mehlman of Treasury Mortgage - A Division of Aurora Financial Group is pleased to announce that Ms. Ann Marie Gibbs of Prudential Fox & Roach Realtors of Northfield, NJ has become a professional partner with them. Ann Maroe has been with Prudential Fox & Roach for many years and specializes in residential and bank REO properties.

Now that Ann Marie has become a realtor partner with the Treasury Mortgage Team of Ed Mawhinney & Harry Hehlman she will begin to enjoy the benefits of having a co-marketing team of realtor's and mortgage professionals to help her secure more buyers and listings. Some of the benefits that Ann Marie will experience are:

• Co-op advertising with mortgage professionals
• Custom made co-op flyers for each property with actual financial options for her clients, great lead generator.
• Custom made co-op flyers covering a board range of real estate and mortgage subjects for his clients.
• Free website postings of all her listings syndicated to over 30 different syndicated partner sites for maximum exposure of all his listings.
• Access to a team of mortgage professionals 24/7 for both her and her clients.
• Any much more!!!!

Let's all welcome Ann Marie and congratulate her on becoming the newest Realtor Partner of the Treasury Mortgage Team of Ed Mawhinney and Harry Mehlman.

Ed Mawhinney	Harry Mehlman
Mortgage Advisor/Planner	Senior Loan Officer
NMLS# 241133	NMLS#206630
Treasury Mortgage A Division of Aurora Financial Group	Treasury Mortgage A Division of Aurora Financial Group
609-513-0872	609-289-7379
emawhinney@treasuryMTG.com	hmehlman@treasuryMTG.com

To find out more about our Realtor Partner program that Ann Marie just joined please feel free to contact either Ed or Harry. Also don't forget to visit their award winning website at www.EdMawhinney.com.