Mortgage Lenders are getting VERY, VERY serious in order to stabilize the marketplace!

This could possibly be one of the most important messages I will be sending to you. It's equally important to both buyers and sellers.
Please read this in it's entirety.

Mortgage Lenders are getting VERY, VERY serious in order to stabilize the marketplace!

Freddie Mac and Fannie Mae have recently adopted "Risk Based Pricing" for Mortgage interest rates and it is NOW in effect. Strict guidelines, within the conforming mortgage range (non-Jumbo for right now) will require that lenders use the FICO scores (credit scores) to calculate the interest rate surcharge for higher risk loans (scores less than 680). The surcharge for a low FICO score is up to 2% in additional points! If you don’t want to pay the points, it would equate to a 1% INCREASE in the Mortgage Interest Rate!

For potential buyers, it is now EXTREMELY IMPORTANT to make sure that the Mortgage company you are thinking of using specifies on any pre-approval that you are approved at $X and the approval is based upon all normal criteria INCLUDING the FICO score. Depending on your credit score and price range this surcharge could be 10's of $1,000 of dollars thus reducing your buying power.

Freddie and Fannie have strict cut-offs. For example a 679 score versus 680 will be charged 3/4 of a point MORE! If your loan officer is NOT aware of this across the board policy, have them do their homework. This FICO basis is becoming widely used, including homeowners and car insurance policies and is now in the Mortgage industry.

For sellers it is extremely important to make sure that all offers with a Pre-Approval indicate that the FICO scores have been evaluated. It would be a MAJOR ISSUE if, upon the time of Mortgage Commitment, the potential buyer can not qualify for the mortgage amount due to a few less credit score points and the monthly added cost of the corresponding increase in rate.

In order to assist both buyers and sellers Princeton Mortgage will:
1.) perform a sanity check on all Pre-Approvals for sellers if requested
2.) guide buyers, on how to perform some relatively "quick fixes" to their scores through the use of a NEW "what if" program as an added value service to our customers(see below)
3.) work with buyers to improve their FICO scores (there may be fees passed along that are imposed by the 3 major indices)
4.) offer a "Mortgage Commitment" at the beginning of the looking/buying process contingent upon a contract for your new home and postpone the application fee until that time.
This early mortgage commitment is a powerful tool for buyers who may compete with a buyer with ONLY a pre-qualification, and can be worth thousands in the negotiation process. Sellers will know that the buyer (and they) will not have a nightmare surprise late in the game.

Let me know how I and Princeton Mortgage can help.

The "what if" scenario.Princeton Mortgage will consult with a potential buyer and evaluate how to best improve their score. "What if" you applied a certain amount of money to a credit card that is close to the maximum; how many points will your score improve? "What if" an error occurred on your score or a disputed charge is still unresolved; how many points will your score improve? "What if" you paid off a few low amount charges; how many points will your score improve? Will these items move the scores up to a better plateau, and what will that equate to in point savings and/or monthly payments?