Office: 405-256-5110     Cell: 405-245-9855

What is this MI stuff anyway?

Most people that come into my office usually have heard of PMI but usually don’t know what it is. Mortgage insurance (MI) is an insurance policy taken out that protects the lender in case the borrowers default on the home. Typically, when a borrower defaults, there is a gap between what is owed and the funds the lender is able to recoup when the home is sold as a foreclosure. The lender is reasonably assured that since the borrower could not make their house payment, they probably can’t afford to pay the remaining balance of their mortgage. This is where mortgage insurance kicks in. It pays the remaining balance of the mortgage on behalf of the borrower. Let’s say for example that you owed $100,000 on a home when it went into foreclosure. When the lender sells off the home, let’s say they can only get $80,000 for the home, leaving a $20,000 gap. Mortgage insurance pays the $20,000 gap. Who provides mortgage insurance? It depends on the kind of loan that you have. If you have a conventional loan, mortgage insurance is provided by a private mortgage insurance company (usually called PMI). If you loan is an FHA loan, then the mortgage insurance is provided by the Department of HUD. If the loan is a VA, then the mortgage insurance is provided by the Veterans Administration. The type of loan is actually determined by who provides the mortgage insurance.

Lenders require mortgage insurance on any loan where the down payment is less than 20%. Mortgage insurance companies also have their own set of guidelines regarding credit, loan to value, property types, etc. A borrower must meet both the loan guidelines and the mortgage insurance guidelines.

All in all, mortgage insurance is a good thing. Most borrowers do not have a 20% down payment and it allows many people the opportunity of home ownership that otherwise would not be available.

Visit me at www.loansbyjolynn.com!

It’s just the principal of the thing

After finally coming to terms with my need for glasses, I finally went shopping for a pair over the weekend. This whole coming to terms with glasses was a big thing for me. I had laser surgery in 2003 and had a big problem with here, 8 years later, needing glasses again. It’s just the principal of the thing. My boyfriend Clayton, my sister Janice and I headed out Saturday afternoon. They said they had to come along because, after all, they had an image to uphold and couldn’t afford to have me wearing some dorky frames and bringing them down. I had a coupon for a place that advertises quite a bit on TV and remember buying contacts from them years ago, I won’t mention their name, but you would be very familiar with them. Let’s just call them Eyewwear Store #1. We entered their store and after a couple of minutes a nice lady greeted us and explained their sales. There was a cabinet with 50% off frames and then pointed to the far wall and said those frames were $50 off. I selected a main pair of frames to use with my coupon and then went and looked at the sale wall. I found the PERFECT frames for some OSU sunglasses and took my selections to the counter. I sat down with a gentleman, picked out lenses and was fitted. There I was nickled and dimed for every little charge – scratch coat, polarizing, warranty. Even Clayton made the comment he felt like he was buying a car with all the up charges. I gave him my coupon and we went to pay. He totaled up the primary pair which came to about $170 with my coupon. He then tallied up my second pair of glasses. It came to $189. That didn’t make sense with the $50 off. He then explained that those frames were not “designer” and therefore were not part of the sale. I explained that we found them on the $50 off wall and even showed him the empty slot where they were found. Didn’t matter, they did not budge and wouldn’t honor the discount. Instead of costing $310, the glasses were going to cost $360. So what did I do? I walked out and didn’t buy either pair. It was just the principal of the thing.

We went to Quail Springs Mall and did some shopping and stopped in Eyemasters. There we met the lovely Sasha (an OSU pre-vet student to boot!) who explained the different types of leneses and helped me pick out some frames. Her customer service was just spectacular. And guess what? I spent a little over $400 for two pairs of glasses. I spent more, but was very willing to do so just to receive better service. There was one flat fee for lenses that included everything. The whole process was very simple. If you are in the market for some eyewear, please go to Eyemasters at Quail Springs and ask for Sasha.

In my mortgage business I have always honored my word. I’ve been in the business long enough and learned enough through the years that I don’t have many mistakes anymore. However, if there is a mistake, I do my best to correct it with no cost to the customer. I have honored rates even when they have risen, and in the rare times I have a competitor with lower fees or rates, I’ve met the competition. It’s just the principal of the thing.

So tell me, was I wrong to walk out of Eyewear Store #1? Would you have lost $50 on a sale, just to keep the overall sale? Give me your feedback on your expectations in customer service.

What is today’s rate?

Imagine walking on the lot of a local car dealership and asking “What’s the price of cars today?” or asking a stockbroker “What’s the price of stocks today?”  Initially you would probably get more questions than answers.  It’s the same with mortgage rates.  There are several different products to choose from – conventional, FHA, VA, USDA, Native American, 30 year notes, 15 year notes and so on.  Each of those types of loans have different rates.  Most rates are also based on a borrower’s credit score, the amount of the loan, the amount of the loan versus the value of the home and the term of the loan.  Rates for a 30 year conventional loan are drastically different between a borrower with a 750 credit score and 20 percent equity in their home and another borrower with a 640 credit score and only 5% equity. Rates also vary by region of the country.  The risk in California or New York, because of higher foreclosure rates in those areas, is different than here in Oklahoma, so the rates will be different.  If you see a rate published somewhere, make sure you know what you’re getting.  First, published rates are to be published with a corresponding APR, the date available, and the expiration date of the rate.  Secondly, just as gas prices can fluctuate on a daily basis, mortgage rates are on the same type of market and can fluctuate on a daily, even hourly basis.  Ask questions about fees, points, term, down payments.  Otherwise you may be walking off the lot with a Yugo when you thought you were getting a Cadillac!  Have a very blessed Friday!

Hello world!

Hi there!  I guess I have finally decided to join the masses and begin blogging.  Actually I’m a bit surprised being the opinionated person that I am that I haven’t done this before, but I guess now is as good of time as any to get started!  My goal with the blog is to fill you in on what’s going on in the mortgage world, hopefully some education, and most importantly, your feedback and opinions.  Then of course I’ll throw in some off topic blather just to keep everyone on their toes!  Drop me a line and let me know what you think.  In the meantime – peace, OUT!