New Mortgage Guidelines

Nothing dramatically will change. Both applicants' credit reports will be scrutinized, both applicants' wages will be verified. Doesn't ,atter one way or another if the two are married to each other or not.

 

Not quite the way it can work. Assuming A has great credit and B has bad credit or no credit, the A credit can be used as the responsible party without consideration of the B credit. B can be on the mortgage but not on the note. The note is the negotiable instrument and the mortgage is the security for the note. There are many potential traps or pitfalls in the process that borrowers need to be wary of. Firs t of all, one or both parties should attend all meetings with brokers, lenders or anything to do with the process and both should be carrying digital voice recorders. Borrowers should always stay away from any kind of Adjustable Rate Mortgages better known as ARM type loans. ARM loans will always keep on costing more and more each month, often ending up with the monthly payments being two, three, even four times wha/>he loan started out costing. ARM loans are nothing more than a foreclosure waiting to happen.

Borrowers should steer clear of notes which contain any reference to a company named MERS or Mortgage Electronic Registration Systems. Borrowers are usually told that MERS is nothing but a data base for the storage of notes and mortgages but the truth is that they are also designated as the servicer of the note and ostensibly have the power to foreclose in lieu of the true lender who probably won't be the lender in fact. The final true lender is seldom if ever revealed or even known to the present lender who normally holds the note for a short period of time, often less than a month.

Once a lender has a sufficient number of outstanding notes in hand they are all bundled up and sold to a larger lender while the present lender remains the true servicing agent and the unsuspecting borrower continues to make his payments to the original lender. The note will eventually be sold on the securities and exchange markets to investors world wide who will each buy a tranche (piece of the original loan) Tranches are usually sold in amounts of $25,000 each so that if a note is worth $100,000 there might actually be four investors each owning one tranche. At the time of securitization the note and the mortgage are actually separated.

It is imperative that the borrowers understand as much of the loan process as possible so an attorney who is knowledgeable about notes and mortgages should always be hired to review the paperwork before signing. If at all possible one should hire an attorney who is also a mortgage fraud investigator. I would recommend Norm Bradford of Maryland or Neil Garfield of California. There are many more good ones out there and they are not very difficult to find if one searches for them but the important part is that whomever is hired should be both an attorney and a recognized mortgage fraud investigator. They won't be cheap, usually costing from about $500 to about $1,000 but are well worth it. If that is not affordable then borrowers should be well familiar with such things as the right to recession and the fact that both borrowers must be provided with written notice of their right to rescind the note within 3 days of the signing. If that condition is not met the right to rescind never expires.

Be very, very careful about buying a home at this time. The house you pay $250,000 for today will probably be worth much less than $100,000 next year. The housing bubble has burst and Obama isn't going to fix that. He will only throw more and more money at the problems thereby making the final economic crash much worse than it would have been had he not meddled with it.