theory and practice: Real Estate Practice : Lesson 3715 - 09/22/14 02:48 AM

When your loan application has been received by the lender they'll start the loan approval process right away.
This will involve verifying :
1. Your Credit history
2. Your Employment history
3. Your assets which include your bank accounts, stocks, mutual funds and retirement accounts
4. Your Property value 
 
Whatever your situation, additional documentation or verification may be required.
All of this information is required and should be included in detail, with as much accuracy as you can provide your lender. When something is left out of the loan application, which is required by the lender, you might get left out of the loan … (4 comments)

theory and practice: Real Estate Practice : Lesson 3714 - 09/22/14 02:47 AM

If you say that your living at the Waldorf-Astoria but your actually living in a trailer, with your boyfriend, mother or in your car, there's going to be a problem.
When you apply for a big ticket item, the house or car, the lender wants to know where you live and so does the credit bureau or the bank that's putting the big money on the line for your deal.
The lender does not want you to have a good time at their expense, and not be able to track you down with the credit bloodhounds in case you decide to vamoose. … (2 comments)

theory and practice: Real Estate Practice : Lesson 3713 - 09/22/14 02:46 AM

This is an easy one. 
You could be turned down for the loan if you say you've been in the house for seven years and it shows on the deed of trust that you bought the home five years ago.
Maybe your landlords lease says that you signed the lease for the apartment six years ago, but you've reported on the loan application that it was eight years ago
Somebody's going to start asking you some questions.
I've heard it said that one of the most frequent misrepresentations on the loan document is the length of residency.
Don't forget !
Along with verifying your:
Credit … (2 comments)

theory and practice: Real Estate Practice : Lesson 3712 - 09/22/14 02:45 AM

We all know that having a credit card is kind of like having a small personal loan that gives you a credit rating.
By demonstrating that you can pay off small amounts of credit over time, on time, demonstrates to lenders that you're responsible with the loan they've given you and that you're capable of managing your credit. When you get ready to make a purchase like a car or a house this unsecured credit history enables a lender to see that you're either reliable or uncreditworthy.
Well, if lots of these "little loans" show up in the Equifax, Trans Union, or Experian credit reports to your lenders they're going to … (0 comments)

theory and practice: Real Estate Practice : Lesson 3711 - 09/22/14 02:44 AM
        
You could compare insufficient equity in your property to having insufficient funds in your checking account, in a way
If you write a check on that checking account and it bounces, gets sent back, and you get slammed with overdraft fees, the banks not going to be happy, and neither are you
In the case of a home with insufficient equity, your house won't be worth enough money to cover the cost of the loan, which might include all of the associative fees of the loan that may be considered in processing it.      
If the market value of your home is less than what you … (2 comments)

theory and practice: Real Estate Practice : Lesson 3710 - 09/22/14 02:42 AM

Come on !
If the house isn't worth the amount of money your asking the lender to loan you, forget it !
The home might need lots of repairs.
The home might be in negative amortization, meaning that you owe more money on the home that it's worth.
The neighborhood might be stigmatized, have high crime, be obsolescent or the prices on the homes capsizing.
If single-family residences where the combined loans frequently exceed the market value of the home, in some cases by as much as 25 to 50 percent, the lender's got a red flag waving in front of them.
(2 comments)

theory and practice: Real Estate Practice : Lesson 3709 - 09/22/14 02:40 AM

The banks and the lenders have specific guidelines under which they'll approve or deny a loan applicant.
Remember that lenders and banks have different policies in relation to the way they will or will not make a loan.
You should be absolutely clear with your lender about the purpose of your loan application, what it's intended for, how the funds will be used, and provide all of the information requested by your lender.
Some items involved in the loan process may not be elgible for the loan proceeds your applying for, such as certain repairs or some cosmetic needs for … (0 comments)

theory and practice: Real Estate Practice : Lesson 3708 - 09/22/14 02:39 AM

A history of not paying your debts or not paying them on time will blow your credit ship out of the water and sink your chances for obtaining a loan.
Lenders just won't buy a bad debt history !
Occasionally they'll stretch the debt to income ratio limit (which is usually a bad decision because it puts a strain on what you can afford) to try to help you out.
Not much needs to said here, but common sense will tell you that if you pay your bills on time, and stay current with your creditors, things are going to … (2 comments)

theory and practice: Real Estate Practice : Lesson 3707 - 09/22/14 02:37 AM

Simple process here that either confirms or abnegates your statement to the lender.
Your lender will attempt to determine if the information that you provide on the employment application is verifiable.
The lender will contact the employer, or employers provided, on the loan application and attempt to match up the information that you've provided them with. They'll compare the statements from the employers, that you've included in the application, with the information that you've provided about your employment history.
Remember:
If Verified:

A call will be placed to the references listed by the applicant. A form may also be forwarded to the employer. The lender will have asserted … (2 comments)

theory and practice: Real Estate Practice : Lesson 3706 - 09/22/14 02:36 AM

When you tell your lender that you've only been on your job at the car wash for two weeks it might not look too good for you at loan decision time.
In addition to the necessity of verifying your assets, the lender will want to verify the employment information that you provide them with on the loan application. This is in addition to the verification process that's also undertaken to verify details related to the information you provide regarding your bank accounts, including your savings and checking accounts. The lender will notify your employer that you're applying for a loan, possibly forward forms to the employer, and request … (2 comments)

theory and practice: Real Estate Practice : Lesson 3705 - 09/22/14 02:35 AM

If your don't have any experience with credit, the chances are your not going to be approved for a big ticket loan such as a house or a car.
So, in a nutshell, there's not enough data in your credit history for the lender to make a decision as to whether or not they should grant you the credit.
The credit file is your credit history, and if it's a recent one, or doesn't go back far enough for the lender, or have few accounts on it, the lender won't have enough data available to make a proper decision on your behalf. 
So, the best defense, when … (2 comments)

theory and practice: Real Estate Practice : Lesson 3704 - 09/22/14 02:33 AM

One sure way to lower have your credit score lowered and louse up your chances of getting a loan is from excessive inquiries on your credit reports.
Every time you apply for credit or a new loan an inquiry is performed and your credit history is pulled by the lender. All of the lenders that have pulled your credit report recently will show up on the credit report.
This is information that will stay on your credit history for two years.
You can dispute the information regarding the inquiries and ask the credit bureaus to verify all of the names … (2 comments)

theory and practice: Real Estate Practice : Lesson 3703 - 09/22/14 02:32 AM


Excessive credit obligations will slam your efforts to get a loan in the dirt ! When a borrower assumes a loan or a revolving line of credit they've taken on some serious credit responsibility and they need to assure that their payments are made on time to their creditors.
When a borrower makes a late payment it shows up on on their credit history when it's reported to the credit bureaus. When they default on a loan they're not only placing their credit at risk, but they might also be setting themselves up for legal consequences that could have a devastating effect on their lives, now and in the future.
Don't forget, garnishments and bankruptcies stay … (2 comments)

theory and practice: Real Estate Practice : Lesson 3702 - 09/22/14 02:30 AM

If you have insufficient income or insufficient funds for a down payment, your loan application will be rejected because your income is insufficient in relation to the price of the house, or you have insufficient funds for the closing costs or the down payment.
You could always consider a loan program for low-to moderate-income borrowers that have lower down payment requirements allowing you to afford a home within your budgetary restrictions.
Don't give up !
Find a lender that will work with you to put together a plan that will work, won't stress a borrowers income, and won't place the borrower in danger of default by pushing debt to income … (0 comments)

theory and practice: Real Estate Practice : Lesson 3701 - 09/22/14 02:28 AM

If you're not paying your bills, your in danger of having your creditor get a court judgment against you and garnishing your wages or property.

If a creditor goes to court and wins the case against you will receive a court ordered judgement against you which is a court order explaining how much you owe the creditor and the interest rate you'll be responsible for paying on the unpaid amount you owe. All of this is explained in detail in the judgement.
The attorney representing the creditor can get a court order ordering you to appear at what's is referred to as "supplemental proceedings", to answer … (0 comments)

theory and practice: Real Estate Practice : Lesson 3700 - 09/22/14 02:27 AM

Bankruptcy is a nasty thing.
It destroys families, causes divorce, illness, depression, cripples your creditworthiness, and can put you on the street.
Everyone loses in a bankruptcy:
The lender because the credit that they extended will not be repaid, and you because your credit is destroyed, at least for a few years until you're able to rebuild your creditworthiness, if your lucky enough to do so.
There are several types of bankruptcy, but for our purposes let's look at two of them:

1. Chapter 7 Bankruptcy, which is total bankruptcy, stays on your credit report for 10 years.
2. Chapter … (0 comments)

theory and practice: Real Estate Practice : Lesson 3699 - 09/22/14 02:26 AM

Applying for, being approved for and responsibly meeting your debt obligations are the earmarks of integrity when it comes to the privilege of having credit.
The lender wants to see, in the bureau reports, in the requests for information about your accounts, how you manage money.
If there are no records demonstrating how you manage money than it stands to reason that the lender has no frame of reference to go by which will serve as an indication of your creditworthiness, and will deny your loan requests when it comes to the big ticket items, such as an automobile or a home.
(0 comments)

theory and practice: Real Estate Practice : Lesson 3698 - 09/22/14 02:10 AM
 
Delinquent credit, in a nutshell, is the failure to make payments on any financial obligation when the lender or creditor says that it's due.
When your credit is delinquent it's usually stated in terms of being past due either thirty, sixty, or ninety days on the creditor's books, and the will include number of times for each delinquent occurrence.
Delinquent credit will slam your credit report into the dirt and negatively affect your credit score.
The more recent the delinquency is on the report and the more frequently a borrower becomes past due with their payments, the less likely it wll be … (0 comments)

theory and practice: Real Estate Practice : Lesson 3697 - 09/22/14 02:08 AM

Repairs are an issue that not only have to meet the satisfaction of both the buyer in the seller during the negotiation process, but, in some cases, the repairs may also be required by the lender.
An example of a lender required repair is an FHA loan that might require a guard rail on the front porch stairs to make the front of the home accessible and meet the requirements of the Americans With Disabilities Act. A loan could be denied if these requirements aren't satisfied.
Review your documents carefully to determine what is actually required before you go the closing table. Insure … (0 comments)

theory and practice: Real Estate Practice : Lesson 3696 - 09/22/14 02:07 AM

It's time to establish value. The lender wants to know if the house the buyer is signing for is actually worth the dough that their about to lay on the line. That's why the lender wants an appraisal. And the lender wants an appraisal from someone who is licensed to perform an appraisal and not someone that has ANY INTEREST IN THE SALE OF THE HOME. And your buyer wants to know how much the home is worth based on the three approaches to value that the appraiser will commonly use, which include :
The Cost Approach 
The Sales Comparison Approach 
The Income … (0 comments)

 
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David Saks

Memphis, Tennessee

Memphis, TN

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The Real Estate Mart of Tennessee, Inc.

Address: 4040 North Watkins, Suite #4, Memphis, TN, 38127

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