Ohio Mortgage Questions & Answers

Search engines are pretty amazing aren’t they?  Many visitors have found this website by typing mortgage related questions into a search engine.  Thanks to Google Analytics, I can see exactly what keywords visitors searched to end up here.

After reviewing the last 200 “keyword” internet searches (Google, Yahoo, Bing, etc.) that drew visitors to this site I can estimate that 5% definitely, without question, found what they were looking for (searches for “Todd Lipps mortgage”, it’s a pretty safe assumption) and about 35% probably found exactly what they were looking for.

But as far as I can tell, about 60% might still have questions.

For those who found this site via online search there is really good chance you that still have some questions. If you fall into this majority, please send me an email or call at 440-666-6069 if I can answer anything for you.

Some of the queries that brought folks to this site follow below. Although they didn’t ask me directly, I have decided to address their searches, by adding my comments below the “searched terms”.

Mortgage questions related to assets

“Mortgage approval and recent checking deposits”
Anything that is not a normal, recurring deposit into your checking account will need to be documented. The underwriter must provide indisputable proof of what the source of the money is, in order for the loan to be saleable to the investor.

“Are checking account details necessary for mortgage loan approval?”
Yes, the two most recent asset statements will be required to obtain a loan commitment.

“5% assets in bank account for mortgage approval”
Conventional loans can be approved with as little as 5% down. It is necessary for a borrower to have at least 5% of your own verified funds in an account for the past 60 days.

“Acceptable proof of assets for mortgage approval”
Generally speaking, acceptable proof of assets requires all pages of your two most recent asset statements. All deposits are required to be sourced, which means that you have to prove that it came from acceptable source.

“How to properly document assets for loan approval”
You will need to provide your 2 most recent asset account statements, ALL PAGES. Be ready to explain and document any deposits that aren’t part of your normal income or activity. Cash deposited generally will be omitted.

“Do bank underwriters accept a letter of explanation for sourcing?”
If you are required to source assets deposited into an account you will need to document proof of where the funds came from. Cash on hand is, in nature, impossible to document. You can write a letter to explain the deposit, but it will not “count” as verified funds.

Questions about mortgage rates, lending fees and other closing costs 

“How do you calculate closing costs involved in an Ohio mortgage?”
I recommend that you have a couple different lenders do it for you. The best way to do that is to request a custom quote, by sharing the details of your transaction. Your closing costs could vary anywhere from $0 to $10,000. Mortgage closing costs for loans over 125k can be zero. .. or they could be up to $7,000, and the corresponding interest rates between those 2 options would vary by as much as 1 percent… for example $0 closing costs for a 5% rate, and $7,000 for a 4% rate. There are over 10 factors that will determine your rate and costs associated with that rate.

“How to get help with closing costs in Ohio?”
Write your purchase offer with a seller contribution. I can help with this.

“Mortgage filing fees Ohio”
These vary from lender to lender, and are paid to your county courthouse. Usually filing fees are around $200, but the title company over-charges and returns the actual cost after the deed and mortgage are filed.

“Mortgage lender fees in Ohio / How much are closing costs in Ohio in 2011?”
My company’s fees are anywhere from $0 (PLUS a credit to pay the third party fees) up to $996 plus 1% of the loan amount. The cost is dictated by the rate you choose. Every loan I do is structured to your specific plans, preferences, and financial goals.
Total closing costs will depend greatly on your loan size, and the interest rate you want. If your loan is greater than $140,000 your closing costs can be zero. Every loan I do is a la carte. The average I have found online is $4,200, but this number is increasing every month due to government involvement in the mortgage process, licensing requirements, increased asset requirements, increased documentation, increased turn times, and the increased number of declined loans.

“Mortgage companies in Ohio with no closing costs or points”
Generally speaking, owner occupied mortgage loans in excess of 140k can be executed without any closing costs. Loans amounts between 75k and 140k can be done with no lender fees, and some credit towards a majority of the closing costs. The higher the loan amount the easier a no closing cost loan will be to complete.

“Who pays for the deed preparation and title fees in Ohio?”
It is standard practice for the buyer to pay this closing cost, however this and all other closing costs can be paid by the seller if it is negotiated and written into a purchase contract.

“Standard Ohio closing costs”
If a buyer does not request a seller contribution towards closing costs within their written purchase contract, they will be paying closing costs. Certain title fees are split by the buyer and seller, some paid by the seller, and others are paid by the buyer. In Ohio, it is standard practice, and it is part of boiler plate contracts that the seller pays for the title exam and the county conveyance fee (transfer tax). It is standard practice in Ohio for the buyer and seller to both pay an escrow fee (normally $350), and the seller and buyer split the owners title insurance policy.

“What is the average appraisal fee in Ohio?”
This depends on quite a few factors, but a single family home is right around $400. Luxury homes valued over 1 million carry higher fees, as do investment properties and multi-family properties.

“Paying closing cost for making home affordable mortgages in Ohio”
With Fannie Mae loans closing costs can be rolled into the new loan, provided you remain within any loan-to-value restrictions. Freddie Mac’s program allows a maximum increase of $5000 from the current loan payoff.

“Paying points on an Ohio FHA loan”
This is an option which I rarely recommend. Life is usually too unpredictable to pay excessive costs for a lower rate, which could easily end up wasting the money spent to get a lower rate.

“Survey required on FHA in Ohio”
Yes every home with a mortgage will require a survey.

“Typical title company closing costs Ohio and who pays?”
Escrow /closing $350 – both buyer and seller
Title insurance binder- $100 buyer
Title exam – $350 typically seller
Owners title insurance policy $575 on the first 150k, and reduced amounts after 150k. Split equally between buyer and seller.
Endorsements to title policy $275 – buyer
Lenders title policy -$100 – buyer
Misc. – wire, title update, courier, doc prep -$175 – buyer

“What are current Ohio mortgage lender fees in 2011?”
Typical are fees $926 plus 1% origination, or $926 with .25% higher rate.

“What are the current average closing costs on an FHA loan in Ohio?”
The average closing costs early in 2011 were approximately $3740. In addition, for FHA loans HUD charges a 1% upfront mortgage insurance fee which is financed into your loan.

“Who pays mortgage closing costs in Ohio?”
Buyers and sellers both pay closing costs. Unless you write in your purchase contract that seller is paying all of them (if that is possible, there are maximums that the seller can pay FHA 6% of purchase price, Conventional 3%-9%, depending upon the amount of your down payment).

“Who pays lender closing protection?”
The $35 closing protection coverage is charged to the buyer of the house.

Credit Questions

“Ohio FHA minimum credit scores”
As low as a 600 middle credit score can be used to approve a borrower with me and my employer, American Midwest Mortgage Corporation. Per HUD, the lowest possible score to obtain an FHA loan is 500 with 10% down, 500 – 580 with 5% down, and 3.5% down for scores above 580. The only problem is that very few lenders allow approvals below 640. We are one of the few lenders that can arrange loans for borrowers at 600. I am very well informed about credit and credit repair issues.

“Bad credit home equity loans in Ohio with bad credit.”
It is very unlikely you will find a bank to do this. It probably depends upon your definition of “bad”, the reasons for the bad credit. The most likely answer to your search is to consider reading up on my credit section here, and visiting www.crr760.com

“Will credit be pulled after clear to close is issued?”
Typically no, but if the credit bureau is more than 120 days old prior to closing, it would be required.

Questions about mortgage documentation

“Documents needed for a mortgage approval in 2011 for someone with a new job”
Most lenders will require at least 30 days worth of earnings on a new job before they will issue an approval and sign off on your wages.

“Why bank statements are necessary for mortgage approval?”
Because you have to prove that the money in your account was earned by you or given as a gift from someone. They are looking to see if you have borrowed money from somewhere. You are not allowed to borrow money to buy a house, with the exception (with FHA) of a loan being secured by an asset.

“Documents needed for an Ohio mortgage quote”
No documents should be needed to quote. Just details of your transaction and your accurate credit score.

“Mortgage broker in Ohio requiring minimal documentation for approval”
With the exception of private investors all loans are underwritten with full documentation at this time. Government and conventional loan do not offer any reduced document, low doc, or no doc loans. If you find an investor that does a no doc or low doc loan, I highly advise the expertise of a real estate attorney before entering any contracts with such a lender.

Questions about the mortgage loan approval process

“Ohio mortgage pre-approval”
I offer these without costs and without any commitment on your part.

“What is the processing stage of FHA mortgage loan?”
Well, pretty much the entire process is a process… From the moment you sign your application and submit all of the documentation to your loan officer until the day the loan closes it is in some stage of processing.

“What happens once you have met all conditions for a mortgage loan?”
That depends on how your lender operates. If all conditions have been met and signed off on…you are ready to sign!

“When does verbal employment verification take place during the mortgage approval process?”
Verbal verification of employment occurs within 48 hours of closing.

“How do you clear final conditions on a mortgage?”
Ask your loan officer to go over the conditions with you. Make sure you know which ones are your responsibilities, and see if any of the conditions could be held up by a third party.

“Firm approval for the house loan, what now?”
Your lender/ loan officer should tell you exactly what needs to happen.
“I have a conditional loan approval, how long before I get a clear to close?”
Ask your loan officer. It will depend on what the conditions are, but generally speaking you should be signing within a week.

“How long does it take to clear to close on an Ohio mortgage loan 2011?”
FHA and conventional loans should take approximately 30 days. Your lender should let you know if it will take any longer than that.

“Loan approval vs. clear to close”
Loan commitment or loan approval means that an underwriter has issued a commitment to lend a borrower the money they applied for. A clear to close does not occur until all conditions have been collected and cleared.

Underwriting

“If a borrower is self employed and he has mortgages in the business name under an LLC and he guarantees them do you have to count the payment against him for mortgage underwriting?”
In short yes, however the length of time you have owned the LLC will likely need to be 2 years.
LLC tax returns for the last 2 years, lease agreements, cancelled checks of your mortgage payments,
and will need to be provided to determine the debt to income on your personal return. In essence, profit or loss from the LLC will be used for (or against) any other income you have.

“Mortgage approval k-1”
Underwriters will require k-1 forms if they are filed with your s-corp or partnership.
The s-corp files an 1120S with a schedule K-1 for each shareholder. A partnership files a 1065 with a schedule K-1 for each partner. An LLC doesn’t have a special tax form. It’s a disregarded entity and files as a sole proprietor, partnership, s-corp or c-corp. A sole proprietorship does not file a K-1, and a c-corp files an 1120 and distributes income via dividends.

“On day of close does the underwriter check bank statement?”
My company would not, unless we were waiting to see something as a final condition. If this were the case, you would know that it is going to be happening.

“Parents buy house because daughter needs a separation agreement to qualify for mortgage loan.”
If she will be on the loan, you could be a co-signor on an FHA loan. If you want to buy the house for her, then it would be considered investment property.

“2011 underwriting for OHFA loan”
OHFA does not underwrite these loans. They are underwritten under the same guidelines as a non OHFA loan. OHFA simply validates 3 years tax returns, and that the borrower qualifies as a first time home buyer.

Appraisal value below purchase agreement
Your loan will be approved by determining the lower of the purchase price or appraised value. If you agree to move forward with the purchase you may be required to put down more money to get the same terms, you were quoted. If the appraisal comes in low, it is a great opportunity to negotiate getting the house for a lower price.

FHA 203k loans

“FHA 203k rehab loan guidelines length of time to close”
These loans should be complete within 45 days. If you have met with your contractor and you know everything that needs to be done and you have had it priced out, and you provide your lender with all of the documentation needed at the time of application, there is no reason that the loan wouldn’t close within 45 days.

“Proper FHA 203k contactor bid format”
Obtain written bids and estimates with all costs broken down by labor and materials, on company letterhead, signed and dated by the contractor.

“Ohio FHA 203k rehab contractor minimum liability coverage”
The minimum liability coverage for contractors is $1,000,000

“FHA 203k rehab guidelines for general contractors”
• Copy of contractor’s liability Insurance
• Copy of contractor’s license
• Copy of business card
• Copy of detailed bids, signed by homeowner and contractor
• Signed homeowner/contractor agreement (borrower will be provided with by lender)
• Completed Contractor profile sheet (provided by borrower from lender)
• Completed W-9
For more information about the contractor requirements visit the 203k tab on the home page

“FHA 203k rehab home loan material payout”
A draw for materials can be requested immediately after loan closing. The process of a contractor receiving the funds can take up to 30 days after close. For this reason, it is a demanded that you work with contractors who are reputable, financially stable and credit worthy.

“FHA 203k rehab homeowner contractor agreement form”
A sample of this form can be found on the 203k tab on the home page

“FHA 203k rehab loan 10% contingency”
There is a mandatory 10% contingency required on all 203K Streamline loans, and 15% no utilities or HUD properties. The purpose of the contingency is to help account for over-runs in the project, but can be used to make additional improvements after all work has been completed at the agreed price. This contingency is held until final disbursement. If the contingency is not used it will be applied to the principal mortgage balance.

For additional information about the 10% contingency, visit the 203k tab on the home page

“FHA 203k rehab loan change order guidelines”
Changes in the Contract – The owner may order changes, additions or modifications (using HUD form HUD-92577) without invalidating the contract. Such changes must be In writing, Signed by the owner, and accepted by the lender. Not all change order requests may be accepted by the lender; therefore, the contractor proceeds at his/her own risk if work is completed without an accepted change order. If a change is approved, a corresponding item in the repair category must be deleted. The new repair item must also be included in the allowable repair items.

“FHA 203k rehab loan unused contingency funds”
Can be used to make further improvements after all initial work has been completed, or is applied to the loan’s principle balance.

“Ohio FHA 203k rehab loan bid breakdown”
A quote from a contractor should be broken down by material cost and labor cost.

“Appraisal guidelines for FHA 203k rehab loans in Ohio”
Appraisals for the 203k loan are completed based on the “after repair value” of the property. This should be about $550. It is approximately $400 for initial appraisal, and $150 for the final inspection once the work is complete. The appraiser is supplied with contractor bids for the work that is being done.

“Are FHA 203k rehab loan funds included in 417k maximum?”
If that is your county’s FHA loan limit, then yes. The maximum FHA 203k loan is determined by county limits. To find out what the maximum FHA loan is in your county, you can visit this link, https://entp.hud.gov/idapp/html/hicostlook.cfm . 417k is the maximum loan amount for Fannie Mae and Freddie Mac conventional loans, not FHA loans.

“FHA 203k rehab loan rates in Ohio”
The interest rate for FHA 203k in Ohio loans varies from lender to lender. For my current FHA 203k rate, add .25% to the posted “regular” FHA rate.

“Ohio FHA 203k rehab loan with self help”
My company and the lenders we use do not allow self help. It is likely there are lenders who permit this, but at this time I cannot recommend any.

“Ohio FHA 203k rehab loan down payment”
Your minimum down payment is 3.5% of the purchase price plus 3.5% of the rehabilitation costs.

“What is the minimum credit required for approval of a FHA 203k rehab loan in Ohio?”
The minimum score required varies from lender to lender. I can offer approvals for borrowers who are above a 600 score.

“Why title updates are required on FHA 203k rehab loans?”
Title updates are required to assure that there are no mechanics liens placed on the property, during the rehabilitation process.

Miscellaneous

“Need an Ohio fast mortgage application approval.”
I can help you get pre-approved by spending about 15 minutes on the phone on the phone with you and pulling a credit bureau. Please give me a call at 440-666-6069.

“Escrow account with more than 20% equity in the house in Ohio”
This is allowed. Lenders will normally charge a ¼ point fee (.0025% of your loan amount) to waive escrows, which is paid one time at closing.

“Can you transfer an FHA mortgage to a family member?”
Yes an FHA loan is assumable between family members, for the loan to be assumed, the borrower must qualify for the loan. Contact your current mortgage servicer for additional details.

“How will a mortgage loan originator get paid by broker after April 1st?”
They will be paid a fixed amount per loan, as a percentage of the loan amount (basis points), or a straight salary.

If there is anything I can do to help you, please contact me .