ADU and IRA home loans are hot topics – Orange County Register


There is nothing quite like writing a mortgage column for a major city newspaper. Can you believe it’s been 10 years?

In addition to my weekly worry about whether my editors (and you) will like what I offer, I get plenty of reader comments on my columns. It’s usually something like “Thank you. I had no idea about it. Or it’s “You got your head up high your -ss. You don’t know what you’re talking about. I am grateful to receive more of the first comments than the last. But I get both.

Below, I share my 10 biggest takeaways since this column started in August 2011.

1) Fannie Mae has developed an automated valuation underwriter system called Collateral Underwriter. It was launched in 2015, and I think it’s an exceptional invention.

Automatic The system (with loan guarantee advisor Freddie Mac) speeds up appraisal decision making and saves borrowers around $ 600 in appraisal fees, if a property inspection waiver is issued . It’s also great property value and a quality checker on human-made appraisals.

My two cents: why can’t Fannie and Freddie come up with an automated process for forgoing a borrower’s income documentation? Data giants can easily and precisely peg most people’s salaries. Agencies could combine immediate income with an equity / down payment measure. The result would be a precision low income bar for borrowers with higher equity. For the sake of peace, this could speed up the loan approval process. No one leaves this property with, for example, a 30% deposit.

2) An ah-ha moment for me was learning what you could do with the IRA funds. Yes, you can buy rentals with IRA funds for the down payment. There are lenders who are prepared to provide mortgages to your IRA, not to you directly. Many readers have told me that they set up this funding mechanism because they did not have enough cash outside of their retirement accounts.

3) Sometimes people in the mortgage industry, government officials and even consumers lie to me. A senior executive from a large mortgage lender wanted to advertise his company for a specific loan program. He explained that his company managed to strike an exclusive deal with Fannie and Freddie that no one else got. Neither Fan nor Fred confirmed the deal. History never ran.

My newspaper bosses have always told me, “If your mom says she loves you, look at this.

4) The Grandma’s Apartment or Secondary Suite Act 2020 was probably the most well-received column series I have written. (These chronicles published in December 2019). In short, California state law has removed a bunch of red tape for people to add living spaces to their properties. It is a very good answer to alleviate the housing shortage.

The law also provides a way for landlords to facilitate housing for their families or to provide rent as additional income. To this day, I get calls from people wanting to know more about the ADU building process.

5) I love the advice. I wrote many columns thanks to people who made me discover a story. The best I have ever received was from an industry peer about a lender with an almost 10 year monopoly on cooperative mortgages in Laguna Woods Village. Even with all the noise made by the owners of the Laguna Woods Co-operative, there is still only one Co-operative Lender in Laguna Woods today.

6) In 2011, in the days following the Great Recession, mortgage brokers‘ market share was less than 5% of home loans and refinancing. (Full disclosure: I’m a mortgage broker.) Brokers have been largely blamed for the mortgage crisis. Can you say “scarlet letter?” “

According to a consumer survey released jointly last week by the Consumer Financial Protection Bureau and the Federal Housing Finance Agency, 46% of consumers requested a home purchase through mortgage brokers in 2019 And 38% applied with brokers when refinancing. Talk about coming back from the dead!

7) Nothing makes a column better than subject matter experts. I have several names on my Rolodexes. (Yes, Mr. Old School has two sitting on his desk).

Dave Stevens, former FHA commissioner and retired Mortgage Brokers Association president, is the bionic brain of the subject matter experts. He understands issues and knows politics like no one else. Articulate and thoughtful, he is.

Real estate attorney Mike Hensley, along with CPAs Jeff Hipshman, Warren Hennagin and Marcelo Sroka, have been great resources in educating me and you. And they are generous. Every week, readers call or email me with thorny questions related to the topic. Countless questions have been answered by these good people, for free.

No one ever thinks much about title issues until there is a problem. Glenn Awerkamp, ​​Vice President of Lawyers Title Insurance, has been cited in these columns for years. And he was the walking encyclopedia of information for readers – always digging in to solve their complex title problems. I am sad to say that Awerkamp passed away suddenly and unexpectedly last weekend.

8) Being on the corporate side of media relations can be tricky. The bravest, toughest, and most professional press person I’ve ever dealt with is Tom Goyda, senior vice president of media relations at Wells Fargo Bank. Perhaps more than any other banker, I have asked Tom many tough questions over the years about various Wells Fargo practices and customer concerns. He’s a pro.

Goyda was always so quick to research and respond to inconvenience when I asked Wells officials about hot topics. He’s still as calm as a cucumber.

9) Forecasting house prices, interest rates, etc. takes a lot of thought. Articulating everything in simple English can be even more difficult. My favorite expert sources are Dr Raymond Sfeir of Chapman University, Jordan Levine, chief economist of the California Association of Realtors, and Tendayi Kapfidze, chief economist of Lending Tree.

Separately, but in the same field, data companies Attom Data Solutions, Black Knight and Steven Thomas of Reports on Housing also offer incredible insight into the housing and mortgage markets.

10) Mortgage conventions and conferences offer a lot of action and a lot of food for the columns. To my surprise, Angelo Mozilo, the former CEO of Countrywide Financial (think of the mortgage crisis days) was invited to speak at a mortgage conference a few years ago. He received a standing ovation from most of the crowd. Boy, was this a fun column to write.

Freddie Mac Rate News

The 30-year fixed rate averaged 2.77%, 3 basis points lower than last week. The 15-year fixed rate averaged 2.1%, unchanged from last week’s all-time low.

The Mortgage Bankers Association reported a 1.7% drop in mortgage application volume from the previous week.

At the end of the line : Assuming a borrower gets the 30-year average fixed rate on a compliant loan of $ 548,250, last year’s payment was $ 32 more than this week’s payment of $ 2,244.

What I see: Locally, well-qualified borrowers can obtain the following fixed rate mortgages with a cost of one point: a 30-year FHA at 2.125%, a 15-year conventional at 1.875%, a 30-year conventional at 2.375%, a 15-year conventional high-balance contract ($ 548,251 to $ 822,375) at 1.875%, a conventional 30-year high-balance at 2.625% and a fixed 30-year jumbo at 2.75%.

Eye-catching loan of the week: A 15-year fixed mortgage at 2.375% with no closing costs.

Jeff Lazerson is a mortgage broker. He can be reached at 949-334-2424 or [email protected] Its website is


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