CFS Mortgage Corporation

Fannie Mae allows financing after short sale

2010-04-20T13:16:00.000-07:00

Everyone has their opinion about the impact of a Short Sale on your credit and whether you can get a new mortgage after short selling a home.

To answer these questions we must refer to the current Guidelines for FHA, and Fannie Mae.

FHA has recently changed their rule so that if a borrower has short sold their home and all the payments were made on time, then they may be eligible for a new mortgage. Borrowers are not eligible for a new loan if they pursued a short sale to, take advantage of declining market and purchase at a reduced price a similar or superior property within a reasonable commuting distance. Motivation for new home purchase is subjective and requires careful consideration by the lender. Otherwise, if any payments were made late or you cannot demonstrate extenuating circumstances, then it is a 3 year period before new FHA financing can be considered.

Fannie Mae policy is pretty straight forward – It is a minimum of 2 years to re-establish credit after a short sale.

This is Fannie Mae’s Guideline:
Link to more information from Fannie Mae.

FICO & Short Sales

2010-04-15T14:19:00.000-07:00

The FICO, has become a symbol of credit worthiness. Scores can range from 300-850 and is a statistical calculation which is based upon payment history (35%), credit utilization (30%), length of history (15%), credit type (10%), and recent credit checks (10%). Items stick around for seven years; bankruptcy for ten. Maxing out a card, a 30-day late payment, debt settlement, foreclosure (150 point ding) or bankruptcy (150-200 point hit) all negatively impact FICO. Those wondering whether or not a short sale hurts your credit score as much as a foreclosure, and apparently it depends on whether the borrower stays current on their payments and how the lender reports the sale (try for "debt repaid in full or settled or settled for less than balance").

Financing After A Short Sale

2010-04-15T11:58:00.000-07:00

Real Estate RecoveryHome Loan Program

This loan program is designed for borrowers to SHORT SALE a home and immediately be eligible to purchase a new home!

Guidelines to Real Estate Recovery Loan Program:

Primary residence purchase only
Provide Short Sale Agreement
Approved
Motivation Letter
Minimum middle credit score is 640
No late payments during short sale process
No late mortgage payment in last 12 months
3.5% Down Payment
New home must be in different geographic area (new
city and zip code)

Who benefits from the Recovery Loan Program?
Individuals moving closer to work
Homes with an increase in the number of dependents
Homes with a decrease in the number of dependents
Call with your motivation of new home purchase

Borrowers are not eligible for a new loan if they pursued a short sale to:
Take advantage of declining market conditions, and
Purchased at a reduced price a similar or superior property within a reasonable commuting distance

Call to find out how this loan can lead us all to real estate recovery.

Go to website!
FIND US ON FACEBOOK!

Thanks,
Troy Schuricht CFS Mortgage Corporation 7720 N 16th st Suite 325 Phoenix, AZ 85020 602-354-0537- office 602-241-9912 - fax

www.BankerAdvantage.com

Life After A Short Sale

2010-04-06T11:31:00.000-07:00

There are many misconceptions about short sales. While this process has traditionally been a loss mitigation tool for the bank, it is quickly becoming a viable option for many borrowers that are "up side down" on their home.

One of the largest misconceptions is that you need to have 30 day late mortgage payments to qualify for a short sale. Most banks look for a reason as to why they would issue a short sale. Because every home owner has their own reason; loss of income, divorce, job transfer, over extended, added dependant, and so on, there are no set rules as to whom a short sale is approved for.

If home ownership is a goal of yours after a short sale, then maintaining timely payments (12 months before and during the short sale process) will be required in order to be consider for a new mortgage immediately following a short sale.

If you have been advised to miss payments to help qualify for a short sale, it might be a good idea to contact an attorney to at least discuss your situation. There are attorneys that that will give 1 hour consultations for free. They will tell you that you have no more leverage with late payments than you do with timely payments. If you are missing payments, now the bank actually has the leverage because you have given them the legal right to foreclose on you should the short sale negotiation fail or take longer than anticipated. It is a good idea to have attorneys negotiate the short sale.

Three things to think about as you move forward with the possibility of a short sale. 1) Do you have a goal to own a home again? 2) Are you being advised to miss payments? 3) Do you have a real estate attorney that can give you advise on legal ramifications of a short sale(Realtors provide real estate advise)?

For more information for financing a home after a short sale please contact:

Thanks,
Troy Schuricht
CFS Mortgage Corporation
7720 N 16th st Suite 325
Phoenix, AZ 85020
602-354-0537- office
602-241-9912 - fax
http://www.bankeradvantage.com/

Qualifying Your Renter

2008-10-08T15:51:00.000-07:00

Author: Troy Schuricht
URL: http://www.communityfirstfinancial.com
October 8th, 2008

What Make A Good Renter?
Is a good renter someone with great credit, or large deposit or maybe high income? The approach landlords take in qualifying their renter could be changing because of the housing crisis and the large number of foreclosures.

The main objective of renting your home should be to have a qualified renter that will pay rent on time and take care of the home to some degree. Large deposits can maximize renter’s responsibilities to the care of your home, but what can be done to help minimize renter’s late pay or simple nonpayment and evictions.

The qualifying approach I encourage landlords to take is one similar to underwriting a loan. The question that everyone should ask themselves before renting their home. Can my renter make the payment on a consistent basis and how? This question is always answered by employment. There are a number of ways to increase the odds of finding a good renter just by looking at their employment.

Time on the job- The length time at the current employer is the first thing you should look at. If a potential renter has been employed for a number years this helps build a case that consistent income can help provide for timely rental payments.

Proof of income - Not only knowing where your renter works, but knowing exactly how much he makes is very important. It is not out of the question to ask for the last two paystubs and last year’s W2’s. While this may seem extreme, you have answered two critical questions. Does your renter really work and how much do they make.

Debt to Income Ratio - While pulling credit can give you an idea of credit score repayment history, how are you going to judge individuals that have gone through foreclosures and bankruptcies? Sometimes a bad borrower is a bad borrower and you need to decline them for your rental, but in today’s market place you will find more good renters with bad credit than ever before. My suggestion is to look at credit, income and employment and determined a debt to income ratio. This will illustrate whether they have sufficient income to cover their rent and debts.

This process is very similar to qualifying for a home mortgage. It is up to the landlord to develop their own guidelines as to what is acceptable to their market place. This is a very simple process to help increase the odds of a good renter - check employment, have proof of income, and determined debt ratio.

Five Reasons Start Investing in Real Estate Again

2008-10-08T15:44:00.000-07:00

Just like any other financial market real estate continually cycles through its highs and lows. There can be great debate on whether the market as a whole is at its bottom, but there is a growing consensus that many markets have hit bottom and now is a great time to start investing in real estate.

Here are five fundamental reasons to start investing today.

1.Price: The sales price in almost every market has dropped substantially. When your combine the effects of short sales, foreclosures and bank owned properties with an already saturated market this makes for a real steal for those that have a good game plan and care due diligence.

2.Inventory: Inventory is at an all time high in most markets, which only contribute to the falling prices, but also helps with selection. Investors should not only look at the sale price and appraised value, but they should look very care full at the rental market in which they are selecting a home from. Some times passing on a little equity to capitalize on a strong rental market can have both short term and long term benefits, also known as cash follow.

3.Interest Rates: Current economy conditions have pushed interest rate down to historical lows. Investors that are considering long term holds will benefit the most as interest rates and inflation increase over the next few years so will the rents.

4.Seller Expectations: Most sellers including banks are now working hard than ever to move their properties. This not only translates into lower sells price, but more concessions. Sellers are now willing to pay closing cost, pay to help buy down the rate, or help pay for repairs.

5.Renters: As more and more individuals foreclose on their home the rental market will continue to increase. There are a number of individuals bought the wrong home at the wrong time for the wrong amount and that led them to be upside down on their house. Many of these home owners have and will continue simply foreclose. These new renters that have great income can and will be able to afford larger rental amounts.

Keep in mind every market has a bottom; it is up to you to do the due diligence that leads to a successful real estate transaction.

Model Home Center Realty Agent Joins Forces with Teacher A+

2008-07-24T18:30:00.000-07:00

Kim Pickens and Model Home Center Realty team up with Community First Financial and Teacher A Plus Home Buying Program adding more value and creating support for our teachers.

Kim's niche is working with homeowners who may be potentially over leveraged and behind on payments and have exhausted all options of keeping their home. You may possibly be facing a Foreclosure situation and may have lots of questions and don't know who to turn to. So let me help by answering those questions with a no obligation consultation in my office.I specialize in helping those clients with a Short Sale Listing. Each situation is unique. I would market your home as usual while asking the lender to take less than what is owed on your property and I wold prepare a short sale packet to submit to your lender so we can find you a buyer and be able to sell your home even if you can't afford commissions and closing costs.
We look forward to her support and advisment of teacherson short sales and other real estate transactions.

Go to www.teacheraplus.ning.com for more information.

Teacher A+ Home Buying Program

2008-07-18T19:17:00.000-07:00

Community First Financial, LLC is proud to announce our new home loan program that assists educators and their families with the proper education and guidance to purchasing a home.

How is this loan different?
· Visit http://www.teacheraplus.com/ and http://www.teacheraplus.ning.com/
· Only for qualified Educators and families
· Community partners to assist you
· Access to foreclosures and short sales
· Teacher A+ Home Loan Program
Low down payment options
Reduced interest rates
Discounted closing costs

What educational tools are available?
· Our unique presentation of the home buying process
· Teacher A+ lesson plan for home buying
· Free home buying seminars
· Rich Dad’s Real Estate Advantages Book
by Sharon Lechter and Garrett Sutton – Free with application and loan approval

How does this loan program help?
· Educates you on why buying a home is important
· Helps you choose the loan that is best suited for you today and the future
· Continue education in building wealth with real estate

Community First Financial, LLC understands that very few people can explain the entire home buying process along with the tools to help you with your decision.

Let us teach you the home loan process, options and real estate possibilities.Call 480-305-8905 today to get started!Visit us at http://www.teacheraplus.com/ for more information. Or email troy@cffinfo.com for more information by email.

Those that know me know I belong to a family of educators. I hold them and all teachers in high regard. Please forward this email to anyone you know in the educational field.

Troy Schuricht
Office: 480-305-8905
Toll free: 888-542-2288
7575 E Redfield Rd. Ste 235
Scottsdale, AZ 85260

The Best Real Estate News in 2008 is...

2008-01-15T18:25:00.000-08:00

Interest Rates are at the lowest level we have all seen a long time. Purchases and Refinancing is about to become popular again.

Despite all of the recent well reported real estate related woes, I have great news for everybody. RATES ARE DOWN! And truth be told, rates are actually way down. Rates are currently better than anything we have seen in the last 3 years, and by the time you read this, they could be at an all time low for the last 10+ years!

The reason they are so good today is really difficult to pinpoint. There are really dozens of reasons, but my market advisors are saying that these low rates are influenced from the speculation that the Fed will continue to lower prime (which is a good guess).
Here are my rates on Jan 15th. These rates assume that you qualify. Qualifying has never been easier; the streamline process has reduced the documentation and time to refinance.

30 year fixed 5.375%
15 year fixed 4.875%
5 year ARM 5.175%
5 year ARM 4.75%

Please give me a call (or email) to explore if this is a good time to refinance or purcahse. Aside from the many that will refinance during this rate spike, this is a fantastic time to purchase investment property.

Troy Schuricht
7575 E Redfield Rd Suite 235Scottsdale, AZ 85260
480-305-8905 - office
troy@cffinfo.com
http://www.communityfirstfinancial.com/
http://www.yourlendertroy.blogspot.com/
click to: Google Troy Schuricht!

Construction Loans? When And Why To Use Them

2008-01-15T17:57:00.000-08:00

Why use a Construction Loan?
Building your dream home, though exciting, may present many challenges. Although you may be familiar with the traditional mortgage process, a construction loan includes additional elements of risk. In a typical construction project, the contractor will request funds when work is completed. Many times a homeowner will build their dream home without the use of financial institution funds. There are various ways to pay your contractor, many people feel they should pay cash, use a home equity line of credit from another property or cash out an investment.
This presents unique challenges for the homeowner. The homeowner must manage the additional responsibility of ensuring all subcontractors and suppliers are paid in a timely fashion. The homeowner must also understand the statutory documentation requirements in their state. If the draw process is not properly managed and the contractor does not pay the subcontractors and suppliers, the homeowner may be subject to mechanics liens. To mitigate your risk throughout the fund control process, consider the benefits of a construction loan and the process. The construction process is a complicated one and the construction draw process will ensure all subcontractors and suppliers are paid so that you don't have to pay the bill twice.
A construction loan is a check and balance of the funds that are dispersed throughout the build of a new home. With the help of the lender(s), inspectors and draw processing staff your funds are reasonable protected.

Understanding the Costs Involved
As you begin the process of building a new home, you'll want to understand the costs associated with your construction and permanent loans. You'll also need to know when the expenses occur so that you can prepare an accurate budget.
• You can begin construction with as little as a 10% down payment or 10% equity in the total cost to acquire your lot and build your new home. If you don't own your lot, the first draw of your construction loan may be used to pay off your lot. There are instances that a borrower will not be required to have any money down.
• The interest rate on your construction loan is typically tied to the Prime Rate. You will be billed monthly for interest only, and your payments will be based on the current balance of it at the current interest rate for the previous 30 days. Borrowers can build in an interest reserve account to pay the interest payment during construction.
• When you finish building your new home, we will modify your construction loan to a permanent loan of your choice. Various options for locking in your rate are available depending on the product selected.

Total Project Costs
This is the cost to complete the home and consists of soft costs, hard costs, land value, closing costs, contingency and interest reserves.
Soft costs: Permit fees, engineering fees, architectural fees and other costs associated with building the home but not directly a part of the actual construction costs. Many times the borrower has already paid some of these costs. To consider these paid items as "equity," the borrower must document the cost with a bill and a canceled check or a paid receipt.
Hard costs: The actual cost of construction covering all materials and labor associated with the building of the home. Typically the borrower will enter into a contract with a contractor to build the property. Like a purchase contract for an existing home, this contract will set forth the work to be done and the costs associated with that work. All contracts must be for a fixed price; "Cost Plus" contracts are not acceptable. To support this cost, we require a signed and dated copy of the contract along with a detailed Line Item Cost Breakdown prepared by the contractor. All contracts and budgets must be reviewed by, and contain terms acceptable, to standard lending guidelines.
Closing Costs: Costs associated with the closing of the loan (e.g., title costs, loan fees, discount fees, inspection fees, appraisals, etc.)
Contingency: In certain circumstances a reserve account will be needed to cover unforeseen cost overruns in the construction of the home. A required 5% of the hard costs will be established in the Contingency Account (Contractors may hold a reserve other than what usually required by the Lender.)
Interest Reserve: At loan closing, an account is established to pay the estimated interest costs during the construction of the home. Since the borrower is only charged interest on the amount of funds disbursed, an estimate of the average disbursed amount is made. Our construction specialists will estimate that, on average, 60% of the loan amount will be disbursed during the term of the construction period. This interest reserve account is paid up front and is held to pay the interest during the time of construction.

Troy Schuricht

7575 E Redfield Rd Suite 235Scottsdale, AZ 85260

480-305-8905 - office

troy@cffinfo.com

http://www.communityfirstfinancial.com/

http://www.yourlendertroy.blogspot.com/

click to: Google Troy Schuricht!

Log Home Construction Loans

2008-01-08T12:06:00.000-08:00

The all inclusive, one-time close, Log Home Construction Loan program will insure that building your log home is a simple and rewarding experience. The log construction loan program will work hand in hand with the Log Home Company of your choice. These programs are specifically designed to provide the funding necessary for your Log Home order to be placed and also for the delivery of your Log Home to your construction site. The one-time close feature of the log construction loan, combines three loans into one, encompassing your land purchase, (if necessary), your log home and construction costs, and your choice of permanent financing, with just one closing.

- Flexible, Up-Front Funding Options. Providing deposits, up-front, to your Log Home Company in order to insure your log order placement is secure. Funding options for the logs upon delivery are also available. - Your permanent mortgage note can be in place before you ever break ground. - 100% financing. No downpayment and low to no out of pocket closing cost programs.- Owner/Builder programs and Stated Income Documentation programs.

Troy Schuricht

7575 E Redfield Rd Suite 235
Scottsdale, AZ 85260
480-305-8905 - office
480-393-8801 - fax
http://www.communityfirstfinancial.com/
http://www.yourlendertroy.blogspot.com/

click to: Google Troy Schuricht!

Why use a construction Loan?

2008-01-08T11:55:00.000-08:00

Building your dream home, though exciting, presents many challenges. Although you may be familiar with the traditional mortgage process, a construction loan includes additional elements of risk. In a typical construction project, the contractor will request funds when work is completed.
Many times a homeowner will build their dream home without the use of financial institution funds. There are various ways to pay your contractor, many people feel they should pay cash, use a home equity line of credit from another property or cash out an investment.
This presents unique challenges for the homeowner. The homeowner must manage the additional responsibility of ensuring all subcontractors and suppliers are paid in a timely fashion. The homeowner must also understand the statutory documentation requirements in their state. If the draw process is not properly managed and the contractor does not pay the subcontractors and suppliers, the homeowner may be subject to mechanics liens. To mitigate your risk throughout the fund control process, consider the benefits of a construction loan and the process. The construction process is a complicated one and the construction draw process will ensure all subcontractors and suppliers are paid so that you don't have to pay the bill twice.
Construction loan is a check and balance of the funds that are dispersed throughout the build of a new home. With the help of a lenders, inspectors and draw processing staff your construction loan funds are reasonable protected.

Troy Schuricht
7575 E Redfield Rd Suite 235
Scottsdale, AZ 85260
480-305-8905 - office
480-393-8801 - fax
http://www.communityfirstfinancial.com/
http://www.yourlendertroy.blogspot.com/

click to: Google Troy Schuricht!

How to select a Builder

2007-10-25T12:41:00.000-07:00

Choosing the right builder is just as important as choosing the right lender. Your builder needs to be an experienced professional with a proven history of delivering a high-quality product on time and on budget.

Where do you find a builder?

Begin your search with family and friends who know people who have recently built homes. Professional organizations like your local Home Builder Association are also good sources of builders in your area. Ask a local real estate agent familiar with new home construction in your area. Drive around and note the builder's name on a project that appeals to you. Once you narrow down your selection, ask for references and estimates. Just remember that the lowest estimate is not always the best deal. If licensing is required in your state, be sure to select a licensed general contractor.

How do you know who is a custom home builder?

There are two types of home builders-custom builders and production builders. Unless you decide to purchase a home in a new housing tract where the homes are built from a single, large volume production builder, you'll want to work with a custom builder.

Custom builders:
Typically build on land you own
Specialize in one-of-a-kind homes from plans designed by an architect or designer
Build single-family homes, both primary residences and second homes
Typically build fewer than 25 homes a year
Tend to build luxury, high end homes

Happy building,
Troy Schuricht
troy@cffinfo.com
480-305-8905
http://www.communityfirstfinancial.com/

Major Home Renovation Loan (Rehab Loan)

2007-10-05T12:39:00.000-07:00

Rehab and Renovation
Maybe you like the location, but not the home. Maybe you like the house, but not the kitchen. Maybe you like the home you live in, but want a bigger one. Use of a construction loan can help you build, rebuild, remodel or rehab any home you choose. Most work can be completed cheaper than you would think.
Heres how it works:
The loan is based on the value of your home AFTER the renovations are finished. This gives you the flexibility to make your home into more than you could with just your current home equity. During construction, the loan is a line of credit with interest-only payments due on the outstanding balance. When the renovations are complete, the loan converts to a conventional mortgage. If you need to move out while your home is being renovated, we have a "no-payment option" during the construction period to help you afford the increased housing expense.
Other great features of a Major Renovation Loan include:
A contingency reserve to cover plan changes or unforeseen circumstances. A single loan structure with only one settlement- a feature that could save you hundreds of dollars in settlement costs.

Happy Buildling,
Troy Schuricht
COMMUNITY FIRST FINANCIAL, LLC
7575 E Redfield Rd Suite 235
Scottsdale, AZ 85260
480-305-8900 - office
480-393-8801 - fax
http://www.communityfirstfinancial.com/
http://www.yourlendertroy.blogspot.com/
http://activerain.com/tschuricht

How to Help Your Customer Feel More Comfortable With Construction Loans

2007-10-03T08:25:00.001-07:00

What are the reasons people buy resale homes over building thier own custom home?
Tangible product. They can see, smell, touch the new home they wish to buy.
Time line. Most resale homes are available with in 45-60 days.
Inventory. Easier to find an existing home rather than a vacant lot.
Variables. Building requires: Realtor, land, builder, plans, options, time, patients, vision, trust, etc....
Education. Many home customers that build homes invest more time into their "purchase" and at the same time have to educate themselves with land, building and builder.
This list can go on all day long, but the theme of the idea is HOW DO WE HELP OUR CUSTOMER FEEL MORE COMFORTABLE WITH THE CONSTRUCTION PROCESS AND THE CONSTRUCTION LOAN?
This idea is geared towards custom homes. Production builders actually do a fine job at this and custom builders and their customers can learn a lot from their presentation of information. Only if there was time, money and resources to emulate their marketing. So what can you do?
What can be done is education. If you are a builder, developer, or Realtor here are a few ideas:
Make sure that prior homes built can be used as sells tools for your future customers. I own a lot today because I walked in to a spec home that the builder was working on and fell in love with the home. The General Contractor happen to own the lot next door, now I do.
Use the web. Show case every home you have ever built. People love pictures. Remember you have no models to show case like production builders.
Choose the advisers you and your customers use carefully. Make sure your Realtor is a pro with the custom home building process, same with your loan officer, architect, and any other support. The very best advisor's have experience and know how.
Make sure your advisors are web based. Meaning, If I tell a customer AHK Contracting is great. My customer can actually go their website and get some level of comfort with their experience. I will use myself as an example too. I am a construction loan specialist. I can help you be more comfortable with this by my websites: http://www.communityfirstfinancial.com/, http://www.cffinfo.com/, http://www.yourlendertroy.blogspot.com/, http://activerain.com/troyschuricht. These websites share testimonials, credibility and education specifically on construction loans. Everything matters in the technology based society we live in. And people love to research things they do not know, especially things like construction loans.
Referrals, testimonials and past clients. Gather as many other peoples opinions, ideas, and experiences. We all love stories and we should try and share them.
Many custom home customers repeat the process, because they feel comfortable with the process, see the value , and love the feeling of building a vision.
My formula for success: EDUCATION+ADVISOR'S=COMFORT
Happy building,
Troy Schuricht

Is hard money a good source for construction loans?

2007-10-03T08:24:00.000-07:00

Is hard money a good source for construction loans?
In my opinion using other peoples money to finance real estate is an aged old tradition. And it is true for construction loans as well. There is a great book written by Michael Lechter, my business partners father, called OPM "other peoples money". http://www.mlechter.com/ Keep in mind that when you spend other peoples money there are costs to that transaction. Hard money on the surface seems to come at a greater cost in both fees and interest rate. But if used properly, hard money can keep your own money in your pocket or in other projects. I am interested in hearing from a few hard money lenders. I may have customers for OPM.
A hard money loan is a specific type of financing in which a borrower receives funds based on the value of a specific parcel of real estate. Hard money loans are typically issued at much higher interest rates than conventional commercial or residential property loans and are almost never issued by a commercial bank or other deposit institution. Hard money is similar to a bridge loan which usually has similar criteria for lending as well as cost to the borrowers. The primary difference is that a bridge loan often refers to a commercial property or investment property that may be in transition and not yet qualifying for traditional financing. Whereas hard money often refers to not only an asset-based loan with a high interest rate, but can signify a distressed financial situation such as arrears on the existing mortgage or bankruptcy and foreclosure proceedings are occurring. Source: Wikipedia®

Best of Luck,
Troy Schruicht

How Long is the Construction Loan Process?

2007-10-03T08:22:00.000-07:00

How long is the construction loan process is a question I get a lot. To answer this question a person has to first figure out when the construction loan process actually begins. Construction projects can literally take a year to develop. Finding land, creating plans for the build, choosing a general contractor, filing for permits, etc..., are all item out side the construction loan process and actually need to be figured out before you start the construction loan. Of course at some point during the initial phase you should secure an experienced loan officer that has completed no less than 25 projects. This kind of experience saves time during the loan process and can help guide you through the numerous questions during pre-loan phases.
Back to the question how long???? 30 to 45 days, tops
Here is what you need to prepare in order to have success:
Plans and Specs
Contract between you and the General Contractor
Know about your insurance responsibilities (contact insurance agent)
Have Asset statements together (last two months)
Documentation for all items paid during initial phase (architect bill, permit receipt, etc...)
W2's, Tax returns, Business license, financial statements (Documentation to prove income)
No doc loans available (at a premium to rate and cost)
Cost break down of build
Signed good faith estimate (know what loan you are getting into)
This list could probably go on, but with these items a qualified individual can get your loan into processing with in a couple of days and should have everything in line to close within 30 days.
For the record:
My quickest close, 8 business days on a construction loan.
Keep in mind there can be headaches for projects that are trying to be done at a 100% financing. Every loans is a little different so be prepared.

Best of Luck,
Troy Schuricht
wwww.communityfirstfinancial.com

Construction to Permanent vs. Construction Only

2007-10-03T08:19:00.001-07:00

What is the difference between "Construction-to-Permanent" and "Construction Only" loan programs?
A C/P or Construction-to-Permanent, also called "One Time Close" is a type of construction loan that rolls directly into your permanent financing once your home has received its Certificate of Occupancy. Typically, the borrower qualifies for the loan to the guidelines of the permanent loan. The borrower can select whatever end loan program that a lender may have in their portfolio (ie. 30 year fix; 3/1, 5/1, 7/1 ARMs, Interest Only, 15 year fix, etc.). The construction period is the riskiest part of the loan. Thus, lenders will charge a little more in fees to administer the loan and a higher interest rate during this period. Once the home is complete, then what has been actually used from the construction loan will convert into the principal amount of the permanent financing. Lenders who offer a CTP program typically do so because they want your permanent loan. Once the home is built, the lender now has a secured asset for their loan.
A Construction Only loan is obviously a construction loan only for the purpose to build the home. Once the home has been completed, the borrower is responsible to find a permanent loan to payoff the construction loan. In today's market, the construction only loan is mostly used by builders who build a home with the purpose to sell and owner occupied borrowers who have credit challenges.
Why would someone want to use the "Construction-to-Permanent" loan?
One set of fees. With the C/P loan, the lender will charge only one set of fees for the loan.
No worries about pre-qualifying for a permanent. When you are approved for the construction loan, you have been approved for the permanent loan.
Competitive pricing. Those lenders in the C/P market want your business. Thus, the lenders are trying their best to make their programs competitive.
Why would someone want to use the "Construction Only" loan?
Planning to sell the home during or immediately following completion. These loans are designed to be reimbursed by either a mortgage from a buyer of the home or a refinance.
Experiencing credit challenges. Typically, borrowers who have a mid-FICO (credit) score of 620 or below will not qualify for a CTP loan and must look to the Construction Only products.
You want a specialized permanent loan. Sometimes lenders who offer C/P programs do not carry the type of permanent loan that you desire. If this is the case, the borrower may have to go to another lender for the specific loan program that they desire.
If you have any further questions regarding this topic, please feel free to call us at 480-305-8905.
Troy Schuricht-Construction Loan Specialist

Troy Schuricht
COMMUNITY FIRST FINANCIAL
7575 E Redfield Rd Suite 235
Scottsdale, AZ 85260
480-305-8900 - office
480-393-8801 - fax

GO TO: http://www.communityfirstfinancial.com/

Q & A for Construction Loans:

2007-08-21T14:35:00.000-07:00

The format for discussion is very simple. Ask a question concerning the construction loan process and get the answer.

This format is great for Builders, General Contractors, Realtors and Borrowers to get immediate feed back on their direct construction question.

Examples of questions:

Q: John LotOwner - I own a lot free and clear. Is there a loan that allows me to take cash out?
A: There are two types of loans that might be able to help. There are lot loans that allow you to refinance and take cash out. You could also do a construction loans and get cash in hand at closing of the loan.

Q: Suzie HomeBuilder – Will stated income loans be offered in 2008?
A: YES, YES, YES 2007 has not be a good year for stated income loans, but most local lenders and banks remain strong with stated income. Look for borrowers to document more assets.

Home Loans - Back to Basics

2007-08-13T11:31:00.000-07:00

A lot of the national headlines of the mortgage industry can give a person a very empty feeling. With the count of lenders that have closed reaching 115, see http://www.lendersimplode.com/, a majority of the public believes the mortgage industry is on the brink of collaspe. They believe this because they read headlines. Log on to your computer, open your news paper, ask your neighbor, all accounts point to failure in the mortgage market. American Home Mortgage just shut down, 10th largest mortgage company in the country, over 7000 employees with no jobs. There are up to a 114 companies just like AHM. I ask the question as to why? And is this really a problem?

Why are companies closing down?
1. Greed. Most companies leveraged themselves to try and take advantage of the profitable mortgage business, and when the investors said no thanks companies are left holding the bags, out of business.
2. Greed. A number of these companies disregarded the fundamentals of mortgage underwriting and where faced with buying back loans underwritten on their wholesales lending lines of credit.
3. Greed. When you put a customer in a home with no money down, that home is losing value, the customers credit worthiness is in question, it makes for a dangerous combination. This was done time and time again over the last few years. The companies doing these loans, see lenderimplode.com

Is this a real problem?
1. Yes- In the short term, 1-2 years, people will loose the money they had invested in the AHM's, jobs will be lost, peoples will not be able to keep there homes, and others will not qualify under new guidelines for future home purchases.
2. NO - Those new guidelines I just mentioned are actually the guidelines from 5 years ago. The guidelines before too many companies got carried away with GREED.
3. NO - It is back to basics for all of us.

My business partner, Phil Lechter, worked at the Rich Dad company for 7 year before we created Community First Financial. If you know anything about the Rich Dad company and the books they have written you understand what basics are, but let me brief them for you.

What are Basics?
Educate your self about the process of buying real estate.
Build your team of advisor's to help you with the process.
Identify the correct properties at the correct prices
Have yourself ready to buy- financially, emotionally, and physically.
Continue your education of real estate

Best of luck in your real estate adventures.

Troy Schuricht
http://www.communityfirstfinancial.com/

The Challenges of a Construction Loan

2007-07-18T15:28:00.000-07:00

People often ask me why construction loans are so difficult? One would think this is a question a potential client, building their first home, or maybe a Realtor new to the construction arena would ask. Unfortunately this question I get asked most by colleagues in my profession. Loan officers, processors, and senior loan managers are just a few that are confused by construction loans.
Let me give a little insight to why construction loans are very difficult to figure out (even for those in the mortgage profession).
There are more variables to consider.
Is the land already owned? If so when was it bought, how much, and what is the value?
What are the soft construction costs?
What are the hard construction costs?
Have any items been prepaid?
Do you have a General Contractor?
Is he approved to business with the lender?
Do you have plans?
Permits?
Any work started?
Do you have working capital?
Do you need an interest reserve account?
Do you need anything refunded at close?
Do you know how many draws you need?
This list could go on and on. My point is the amount of additional work that a construction loan requires is much greater than your last purchase or refinance. Keep in mind the mortgage a typically person completes has close to 35 people touching that transaction. With a construction loan there are even more associated with your file.
If any of this has you scratching your head you are not alone. Construction loans are dominated by a few select individuals because they are a special transaction. If anyone needs any more insight to my comment please let me know.
Best of Luck,
Troy Schuricht
http://www.communityfirstfinancial.com/

How to choose a Construction Loan Specialist

2007-07-10T11:57:00.000-07:00

How to choose a Construction Loan Specialist
How special are construction loans? In a report from Countrywide Home Loans, only 1 in 10 loan officers do more than 1 construction loan per year. So less than 10% do more than one loan per year, this makes finding a loan officer that is experienced with construction loans very difficult. Like all advisor's associated with real estate, loan officers should be interviewed by potential clients. Here are a few questions that individuals seeking a construction loan should ask their future loan officer candidate:
1. How many CONSTRUCTION loans do you close PER MONTH? - Experience is everything.
2. How many sources do you have for construction loans? - More sources = more options.
3. Can you provide testimonials and references? - Word of mouth from someone else.
4. Go on-line and do a little digging. - The Internet is a great tool for information.
5. Be-careful about on-line applications for construction loans. - Most sites are lead sites and not actual mortgage companies that specialize in construction loans. Your information is collected and SOLD.
Feel free to ask any question any time.
http://www.communityfirstfinancial.com/
http://yourlendertroy.blogspot.com/
troy@yourlendertroy.com
Best of Luck,
Troy Schuricht

Competing vs. Colaborating

2007-07-10T10:17:00.000-07:00

This has been a great lesson for me. I realized that I have grown in an environment that promoted competition instead of collaboration. One of the great opportunities that was presented to me recently required some initial hard money capital. Yet I am not a hard money lender and in the past I probably would have passed on this deal.

Well, I was talking with my neighbor (of all people) the other day to realize that he is a hard money lender. We are working together on how to best structure this deal where he can do the initial financing, and I can finance my neighbor out when construction is done. This is a win/win/win for everyone.

Who is the 3rd win for.....the customer as we may be able to do this with no money out of their pocket where in a 'conventional' sense they would have had to put down a minimum of 20%.

It is amazing how everyone can win if you are open to it.