Market Niches Priced on Line

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Comments by Mortgage Professor Loan Programs Priced On-Line by LENDER X
Fixed-rate programs are usually identified by their term. Fixed-Rate Programs  
 40-years  
 30-years X
 25-years  
 20-years  
 15-years X
 10-years  
Balloon-loan programs are identified by the period for which the quoted rate holds. The balance is due at the end of that period. Balloon-Loan Programs  
   5-year  
   7-year  
The first figure is the initial rate period, the second figure is the rate adjustment period after the initial rate period ends. ARM programs are also identified by the interest rate index that they use, and other features. See Requirement 4. Adjustable-Rate Programs  
1 month/1 month  
3 month/3 month  
6 month/6 month X
 1 year/1 year X
3 years/1 year X
5 year/1 year X
7 years/1 year X
10 years/1 year X
3 years/3 years  
 5 years/5 years  
  FHA Programs  
   VA Programs  
  Second Mortgage Fixed-Rate Programs X
  Second Mortgage Adjustable-Rate Programs  
  State Coverage  
Not all lenders operate in every state. All states except Alaska and Hawaii  
  Property Types  
Few lenders make loans on all types of properties Single-family X
2-4 family homes X
Condo, less than 5 stories X
Condo, more than 5 stories X
Co-ops  
Manufactured homes  
Land  
In a planned unit development (PUD)  
Farms  
Commercial  
  Alternative Documentation  
The precise details of alternative documentation requirements may differ a little from one lender to another. “ Stated income”, “stated assets”, or both: income and/or assets are disclosed but not verified by lender.  
“No ratio”: maximum ratios of housing expense and total expense to income are ignored by lender.  
“No income”, “no assets”, or both: income and/or assets are not disclosed.  
  Options  
 Shoppers should expect to pay more for a waiver of escrows or a float-down, less for accepting a prepayment penalty. A float-down is a lock plus the right to a lower rate if market rates decline. Waive escrow of taxes and insurance X
Prepayment penalty X
Float-down  
Interest-only X
Temporary buydown  
  Special Loan Purposes  
All of these cost more than loans taken out to purchase a home for permanent occupancy, or to refinance with no cash out. Cash-out refinance X
Use house as vacation or second home X
Rent out house X
Borrower a non-resident alien  
Construction loan  
Bridge loan  
  Maximums and Minimums Across All Programs   Max & Min of Lender X
Warning! The maximums and minimums vary for different programs. For example, the longest lock might be available for ARMs but not FRMs. Further, the stated maximums and minimums are not likely to be available on the same loan. Don’t expect to get a 107% loan, for example, if you have a 540 credit score. (Note: you can get your credit score on www.myfico.com) Housing expense is the sum of the mortgage payment, property taxes and homeowners insurance. Maximum ratio of loan to value 107%
Minimum credit score 540
Maximum loan size $4 million
Minimum loan size $10,000
Maximum ratio of housing expense to income before taxes 65%
Maximum ratio of housing expense plus other debt payments to income before taxes 65%
Longest lock period available 60 days

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