Q&A with a Home Loan Lender

I had coffee recently with a friend of mine who works in mortgages. We call these professionals loan officers or loan originators. Your lender is just as important as your Realtor when you’re buying a home. Kayla Enriquez is with Vandyk Mortgage and has been in the lending sector for many years now. Let’s ask her some questions!

Question: You absolutely blew my mind with some of the creative ways you talked about getting a buyer approved. How is it you can qualify a buyer with no credit or a bankruptcy?

Answer: A borrower with no credit can qualify for a FHA mortgage as long as they have 3 accounts they have been paying monthly for the last 12 months, whether it be rent, utilities, phone bill, car insurance, or even a gym membership! With USDA, you can qualify with no credit score if you have two accounts.
Now, with a bankruptcy, each loan type will allow for a borrower to qualify depending on the amount of time that has passed since their bankruptcy. I’ll be attaching a chart that shows that length of time.

Question: Why do you feel like buyers need to be preapproved before looking at houses?

Answer: A buyer should be pre-approved before looking at homes because before they even walk into a potential home of their choosing, they’ll already know how much they are qualified for in purchase price, what their monthly payment will potentially be, and what down payment and closing costs they will have to pay at closing. It is necessary to be pre-approved before submitting an offer, so if an individual is highly interested in a certain property it is beneficial to already have their pre-approval ready so they can submit an offer that day with their realtor.

Question: We keep hearing the word “points” in the news when talking about mortgage rates. What’s a point, and how does it help or hurt a buyer looking to buy some?

Answer: Points, or discount points, are a form of prepaid interest, each point is 1% of the loan amount. A borrower can pay for “points” in order to buy down their interest rate over the lifetime of the loan. Each point however is not directly related to each percentage of interest. The amount of points needed to get to a certain interest rate will depending on each lender’s mortgage pricing.

Question: Why do you feel it is important for buyers to have a preapproval in hand before looking at houses?

Answer: The pre-approval process can differ depending on the lender an individual decides to go with but with me the process typically goes as follows:

    1. A potential borrower and I will have a quick pre-qualifying chat so that I know before I pull their credit that they meet the necessary basic requirements for all loan types, which is usually “Do you know what your credit is? Have you used a platform such as freecreditreport.com to check your credit recently? Have you been within the same kind of job position for more than 2 years or have you recently graduated and have a job offer in your field of study? Do you have money in order to pay for your potential down payment and closing costs”
    2. Next, if the pre-qualifying chat goes well, I move to the next step of the process while on the phone with them. The application. We go over their personal information, their income and job history, their assets and liabilities, and their demographic information.
    3. After the application, I have the potential borrower send me their necessary documents which is usually the following:
        1. 2 years tax returns and W2s
        2. Copy of drivers license and social security card
        3. Current month’s paystubs
        4. Last 60 day bank statements for all accounts
        5. Certificate of eligibility and DD214 if using a VA loan
        6. Last 2 years 1099s, Profit and Loss statements, Business records, associated tax schedules
    4. Then if everything aligns and the potential borrower is able to qualify, I send them their pre-approval letter which states their loan type, the amount they qualify for, and their potential interest rate. I also send a copy to their realtor so they are prepared to show them homes within their criteria and loan amounts. Then the realtor can use the pre-approval letter to send an offer if the borrower decides a certain home is right for them.

Question: What is a “2 for 1” buydown? How does it work?

Answer: Buydowns are arrangements that allow borrowers some relief during the first two years of their loan from a high interest rate. A 2/1 buydown is a temporary decrease that lasts for two years and gives buyers time to save money with a lower monthly payment. Although the interest rate starts low, it increases over two years until it reaches its final rate in the third year. I see this working in particular circumstances where a borrower is pregnant and needs extra money the first two years but will still be able to afford the payment after that period. Or another circumstance may be that a borrower needs to buy their child’s college tuition for the next two years and could use that extra money, this may be a great method to do that.

Question: Realistically, how long are you seeing it take for buyers to find a home once they’re preapproved in our area?

Answer: Honestly, it is across the board, but some of clients have found homes in a matter of days, some it takes a week or two, and some even up to a month. I will say the lower the purchase price, the longer I’m seeing it take my clients to go under contract due to competition amongst buyers.

Question: What trends are you seeing in the mortgage market? Based on your experience, where do you anticipate our market to stand as we move into the busiest time of our year?

Answer:  I have noticed the market becoming hot again. Especially, with Spring being here and Summer around the corner. People are wanting new homes before school starts in August and Spring is prime PCS season for the military. Homes are receiving multiple offers, and there’s now more competition for buyers. I predict that interest rates may stay the same for the next few months, if not the next year, and the housing market stabilizing for both buyers and sellers. 

If you’re new here, hi! I’m Hope, I am a Georgia native and live in Houston County, GA with my husband, 2 kids, and 3 dogs. I offer over a decade of experience in listing, selling, renting, and investing, and I strive to protect all my clients (including tenants) from predatory practices in real estate. When I’m not selling homes, you’ll find me spending time with my family, reading, listening to music, or playing with the dogs.

I’m a Realtor, an Accredited Buyer’s Representative, and a Military Relocation Professional. I love learning and problem solving… it’s why I love what I do! I inform my clients so that they’re able to make well-informed decisions with fewer regrets.  I’ve worked in real estate since 2012 and was raised in a construction family, so it’s what I know best. If you have any questions about real estate in general or about buying, renting, or selling a property, let’s chat!

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