Mortgage Myth Busters: Dear First Time Homebuyer, how many hands in the cookie jar???

Dear First Time Homebuyer, how many hands in the cookie jar???

 

many homebuyers get confused or don't feel good about what they see, yet they seem to get the advice from the wrong peopleFirst homebuyer speaks to a loan officer or a real estate agent. For some reason, they decide to seek a 2nd opinion because of that gut feeling or because they have heard something different.

A buyer called me regarding some mortgage information after speaking to another loan officer. Forward ahead, skipping details of the story. I give them a totally different answer and I see some major read flags. I also have a bad feeling about how this loan officer is explaining things based on the buyers answers to me. This buyer tells me that they will get the documents from her mom and call me the next day. I never heard back from her, so I followed up.  Here is what I received in an e-mail today....

"His mother is still looking it over and is waiting for her other Son to get back from vacation to look it over. She also has a Brother who has purchased numerous homes looking it over. I mentioned to her that maybe she should look to getting a professional second opinion. She however is not going to make a decision without her other sons and brother input. When he returns I will pass on your information and concerns to him."

 

What is wrong with this picture?  As a first time homebuyer, she is gravitating towards advice from family members. But shouldn't they be seeking advice from other like minded professionals? Maybe another mortgage professional?  I know opinions and insights can help some. But if I needed a second opinion on a special type of surgery such as heart surgery, am I going to wait for my son to come home, who has had shoulder surgery and surgery on his gall bladder?  Maybe to get an idea if it was painful or not, but really nothing else. But what else could my son tell me?  Could he in detail explain the exact procedures for such a surgery? What would be right or wrong? Maybe tell me things that he read online?  Even reading things online can be dangerous. Please read these two posts showing the bad information that is out there.

 

 

Too many hands in the cookie jar?  Again, seeking help from family members can some times be helpful when trying to seek a specific direction in life or when dealing with a problem.  But to try and get insightful knowledge about mortgages from family members?  I would rather take my chances with a deadly snake in the amazon. At least if I get bit, it will be a quick death. In regards to the woman above, it could be a slow death, after trying many different answers from her family members. Not unless they deal with mortgages on a daily basis, should this woman be taking strong advice from them. Sorry people, I have seen this back fire more often then none.  I have even seen the old "going with a friend" answer fall apart at the end.  It's easy to give an answer or to promise something, but when it falls apart or doesn't come true?  Then were are all of these people at?

 

Hey, want a cliff notes version of this women's story?  Before I start... Mother pays $800 a month on her house. They will cash-out $220,00 to give to the daughter to buy their new home in cash.  So, bottom line was that this loan officer told them that her mothers new payment would go from $800 to $1,350 a month.  pppssss... mind you, she only has 5 yrs left on her mortgage. But the worst part? The loan officer said that the mother could still pay the $800 monthly and she, a new home owner, could pay her mother the extra $300. And then went on to say, this is great considering that we are talking about 2 homes. Hey loan officer, what about taxes and home owners insurance?  Ah, another $400 a month for the mother and another $500 a month for this first homebuyer who will own the home free and clear.  Rut row, that is another $900 a month that he didn't explain about and the buyer didn't think about this. It gets better.

I told her that he mom could co-sign for her instead of tapping into her mom's house.  Remember, mom only has 5 years left. Secondly, I did some research and found out that the property that they wanted was approved for a USDA loan in New Jersey, for 100% financing. She began to listen, but still needs to talk to family members.

 

Conclusion : First off, it sounds like this other loan officer has no clue and was just telling her what she wanted to hear. Imagine that. Secondly, she seems to want to trust family and not a professional expert. Lastly, will she pick door number 1 or door number 2?  ( ssshhhh, I am behind door #2)  Time will tell and I will keep you posted. 

 

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For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

HUD

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc

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follow Jeff Belonger on Twitter

 

The FHA Expert's fan page on Facebook     Add Jeff Belonger to your network @ LinkedIN

                                                                            FOLLOW ME ON FACEBOOK

 

 

- FHA Loans - USDA Loans - VA Loans -

- Energy Efficient Mortgages - 

- Conventional Loans - 203 k loans -

- FHA Home Loans - Mortgages -

 

Experience & Knowledge at its BEST !!!

 

 

Follow me on:

Mortgage Myth Busters

 

______________________________________________________________________________________________________________

For more information on FHA loans, please go to this link. The FHA Expert

For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!

HUD

 

For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors

 

Copyright © 2011 by Jeff Belonger of Infinity Home Mortgage Company, Inc

Comment balloon 12 commentsJeff Belonger • September 03 2010 10:32PM

Comments

Frankly, I probably wouldn't want to be the realtor working with this buyer.  First of all, no guts, no glory.  And, second, if you need that much hand-holding and don't trust the people you've hired, I really don't have the time. 

 

Posted by Suzanne McLaughlin, Sabinske & Associates, Realtor (Sabinske & Associates, Inc. (Albertville, St. Michael)) about 10 years ago

Hey Jeff I agree with your point . Talk to a professional, don"t ask uncle Jack for a professional opinion.  I struggle with this as a Realtor all the time, "my dad's friend told me to hold off another 2 years befoer putting on the market" and so on and so on.

Posted by Stanley Stepak, Realtor - Avon Lake, Avon, Bay Village, Westlake, (Howard Hanna - Avon Lake, OH) about 10 years ago

Jeff, go out this weekend and buy some good running shoes so you can run as fast as possible from this buyer!  Go find some that want a competent professional such as yourself to help them.

Posted by Damon Gettier, Broker/Owner ABRM, GRI, CDPE (Damon Gettier & Associates, REALTORS- Roanoke Va Short Sale Expert) about 10 years ago

 

SUZANNE.... .  I don't think any will and I will follow up with her one more time... if not, oh well, it sounds like they will get burnt if they use this other loan officer. And yes, they need a lot of hand holding because I educated her on many different things and she stated that the other loan officer didn't go over most of it.

STAN....  well, we all know what she should be doing.... and even the son who has bought real estate before.  He doesn't know the rules about who can help as in cosigners and the qualifications such as income ratios, how high can they go, etc., etc.

DAMON....  not just yet.  I have talked to her only once and followed up with her. I will follow up one more time come Tuesday and then cut the cord... unless she calls me back.  Just how I work at first... If it was a hard core shopper, then yes, I would run... and I wouldn't even need to go out and buy tennis shoes... lol  I would do it in my bare feet. 

 

Posted by Jeff Belonger, The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans ( Social Media - Infinity Home Mortgage Company, Inc) about 10 years ago

Buyers depending on their family members for advice usually become a challenge.  Someone who had bought one or maybe even a few homes is suddenly an expert in the mortgage field. 

Posted by Rodney Mason, VP of Mortgage Lending - AL, FL, GA, SC, & TN (Guaranteed Rate NMLS# 2611) about 10 years ago

Number One, before I read the post, I see you've became a Blogging Madman again.  Good for you, dude.  Onto the context:

Mortgage Info isn't Heart Surgery, but if you take the wrong advice ... it can be damn close.  Comparing Mortgages, Insurance Policies, etc, with your next of kin or next door neighbor can be a big mistake.  The one denominator that I do understand is that of trust.  Doesn't mean they know what they are doing, but they trust their loved ones enough to put those things on the line.  Anyone in the field needs to understand the same thing, Trust.  How can it be earned and how will it be implemented?

And if you do both, I'll tell my family and friends about you.

 

Posted by Jason Sardi, Your Agent for Life (Auto & Home & Life Insurance throughout North Carolina) about 10 years ago

Jeff - While buying a home is usually the largest investment someone makes, it is amazing how few seek the guidance of professionals during the process.  Perhaps that might explain some of our recent problems.

Posted by John Mulkey, Housing Guru (TheHousingGuru.com) about 10 years ago

 

RODNEY.... .  I truly know that it can be a challenge when getting advice from family.  I have done plenty of mortgages for kids who had to listen to their dad and it was like pulling teeth. And yes, there are always those experts after they have done a few.... thanks

 

JASON.... . yea, I was burnt out for a while, because some of my posts can take 2 to 3 hours to do sometimes...   but thanks... 

In regards to mortgage info and heart surgery, no, not the same. I guess I wasn't clear... but someone needing heart surgery would take the advice of someone that got like shoulder surgery or any other kinds of surgery other than heart surgery, wouldn't make them an expert in that field.... like the family member who has bought several houses in the past, and she will listen to him also?  And yes, I know about trust and such... and would have added that in this post, but I didn't want it to be to long.  thanks for stopping by.

 

JOHN..... hey, isn't everyone an expert if they read about it in a book or online?  Just as realtors give mortgage advice... that stuff irks me... and then you have this one seller on Trulia answering mortgage questions by the consumer, because they have sold and bought houses before... that kills me... and yes, part of this did was what got us in trouble... about 10%,,.... thanks

 

Posted by Jeff Belonger, The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans ( Social Media - Infinity Home Mortgage Company, Inc) about 10 years ago

Jeff, all too often in real Estate as well as many other things, friends and family opinions will sway the course of action with little regard to some good analytical research.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) about 10 years ago

Jeff, I agree we have too many cookies in a jar including numerous blogs which are confusing and misleading in some cases!! Best advise you have given is take professional advise. Sit down and work with professional team that knows the market and their products.

Posted by Ritu Desai, Virginia Realtor-Fairfax/Loudoun/PW-703-625-4949 (Samson Properties) about 10 years ago

At some point we all run into this with the family and friends advice being important and those are the ones that make the large mistakes.  If they don't take the professional advice, I would move on at this point because no good will come out of it.

Posted by Stella Barbour, Principal Broker, Serving Virginia and Maryland (NoVa Brokers LLC) about 10 years ago

 

GABE.... . very good statement and I couldn't agree more.  Hey, I can understand seeking advice from family members, but if you put all of their answers in a basket to choose from, it could cost you thousands of dollars.

RITU..... I keep coming across many mortgage blogs that are just plain wrong.  Hey, we all make mistakes, but if you aren't sure of the material that you are putting out there, then don't... not until you validate it from a reliable source. One hard thing is finding a true professional though, even if they say they are or state that they are an expert... that's another post which I have written about.  thanks

STELLA.... I have been doing mortgages for 118 years now and of course I have run into this many times.  And I agree, that we should move on, but I will give them one more chance. The reason being is that I have only talked to her once and have only done one follow up.  I will wait til they consults her family and follow up one last time....  I write about this so other consumers and buyers can read about this and maybe understand the ramifications. thanks for your feedback.

 

Posted by Jeff Belonger, The FHA Expert - FHA Loans - FHA mortgages - USDA loans - VA Loans ( Social Media - Infinity Home Mortgage Company, Inc) about 10 years ago

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