In January 2014, the Dodd-Frank Mortgage Reform goes into effect. What could that mean to you as a home Buyer, or Seller? There are 8 main points to consider as a Buyer: 1) You will need enough income or assets to cover your mortgage payments. This one is kind of a "no brainer", but effects Stated Income Loans.2) You have to prove employment, or income from being self-employed. Another obvious item that is really basic.3) You will have to factor in the amount you pay on any additional mortgages. Believe it or not, some lenders were not doing this one.4) You need to provide full disclosure on any and all additional properties you own. This relates to item #3 above, again full disclosure.5) If you pay child support, that has to be factored in also. So if you pay alimony, and / or child support, it is factored in like a mortgage payment.6) You will need a debt-to-income ratio that is lower than 38 percent. Currently, this ratio is 38-41 percent at many lenders.7) You will need a clean credit history, and good credit score.8) You will need to prove you can afford to pay property taxes and home owner insurance. I realize none of these sound different to many people, but the effects will be felt by the lenders and how they conduct business. That, in turn, leads to how it will effect home Sellers. If you, or someone you know, have any questions, please contact me.
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