Your lender is a reflection of YOU!!! Who are you Realtors sending your business to?
Since you Realtors already know this fact….. let’s cut to the chase.
I recently got a lady pre-approved for a loan that I didn’t know about 2 yrs ago.
My borrower was pre-approved by another lender. She was quoted almost 8% on 20% down loan(with a 3yr prepay penalty). Why? Well, she had a $17,000 medical collection. And 2 yrs ago…. I probably would have priced her the same loan.
Well, it seems that she makes less than 80% of the median income for her county. And I found a loan program that would ignore the collection and give her a loan in the mid - high 6’s….. This is called a “Community Commitment” loan. There are similar loans, but this one is powerful. Banks have a vested interest in lending money to people who earn less than the median incomes in their area. Why? The community Reinvestment Act!! Thats why!!! Because they can get heavy fines if they cherry pick certain parts of town to put their money.
Why didn’t the other lender do this? Why didnt the Realtor say….. Whoaaaaaa?
There are programs out there that a lot of brokers/lenders are not aware of these days. Don’t let YOUR buyer get stuck in a sub-prime loan because the loan officer is lazy or doesn’t have this knowledge.
Hook up with a lender that can talk to you honestly about loans. Ask why one guy is subprime and another lady is prime when they have relatively the same credit score.
Why would a Realtor want to arm themselves with this information? They aren’t lenders. That is not their job. But it IS the job of their lender partner…. who is an extension of Realtor themselves.
1) Is B of A the only one out there doing “Community Commitment Loans” or is that their name for this type of loan and others do it also?
2) Talking about “vested interests” does B of A wholesale this loan? Is there enough fee in it to make the mtg broker talk it up?
3) What are the criteria for qualification?
Comment by Jeff Perkins — August 30, 2007 @ 11:23 pm
1. I believe a couple of other banks have something similar. I think most banks buy this loan from BofA to satisfy Govt requirements.
2. Yes. They allow brokers to bring in this loan.
3. They have several different loans. Criteria is all different. Mostly, you have to be low/moderate income or live in an underserved market as defined by Fannie Mae using census tract data.
Comment by tomburri — August 31, 2007 @ 4:58 am