6 Ways to Keep Your Home Safe When You Travel

While you are on vacation, if you have to attend a business meeting or make an emergency trip for family matters, one of the last things you need to worry about is your home. Here are some precautions you can take ahead of time.

1. Ask your neighbors to keep tabs on your home while you are away.

2. Call your local police and ask them to drive by every once in a while.

3. Halt the delivery of mail and newspapers.

4. Use variable timers that automatically turn your lights off and one in different rooms throughout your home.

5. Install motion-activated cameras.

6. Hide important papers and valuables – Or put them in a safe or safety deposit.

5 Unique Ways to Use Dryer Sheets around Your Home

You might think that the only use for those dryer sheets is to eliminate static cling and make your clothing, sheets and towels smell amazing. However, there are 5 other ways you can use them to clean around your home. In addition to your laundry area, keep a box of dryer sheets under your kitchen sink.

1. Get Rid of Baked-On Food – Place the dryer sheet in the dish with the baked on food, fill with cold water and soak overnight. The softener in the fabric will break down the food particles, making it easier to clean in the morning.

2. Use as a Mosquito Repellent – Put a dryer sheet in your pockets or tie around your belt loop and it keeps the bugs away.

3. Deodorize your home – Tuck dryer sheets into stinky shoes, luggage, camping gear, gym bags, closets, basements and attics. It will help eliminate those musty smells.

4. Clean up soap scum – Clean glass shower doors by wiping with a damp dryer sheet.
Eliminate Static – Use the sheets to eliminate static from your TV, computer screen and also dust your blinds.

Your Taxpayer Rights if You Ever Get Audited

There are 3 letters that strike fear into the hearts of Americans—I-R-S!
And the very thought of being audited by them—usually turns into
panic.

What you might not know is that back in the 1990’s, Congress passed
the Taxpayer Bill of Rights Law, which places the burden of proof in
tax disputes on the IRA — not the taxpayer.

However, there are some additional rights you have if you ever get
that dreaded “audit notice” in the mail.

• You don’t have to meet with the IRS – You don’t have to meet with them face to face. Instead, you can conduct your “audit” thru the mail. You avoid the stress of a personal meeting, the hassle of taking time off of work, or saying something that might be misconstrued by the auditor.
• You have the right to negotiate penalties – Of course, the IRS is not going to tell you this, but if you’ve filed your tax returns, acted in good faith and have not set out to deceive the IRS or dodge your tax liability, you can ask that any penalties be cancelled.
• You can appeal decisions made by the IRS – If you believe the tax liability and penalties are unfair or incorrect, you have 30 days to file an appeal. However, it could take years before your case is heard, but the “filing” date is the critical part of this process.
• You have the right to “installment” payments – Let’s say you do end up owing additional money, you can set up regular monthly payments with the IRS. Form 433A needs to be filed, listing your income, expenses, assets and liabilities. They will determine the monthly payment you need to make.
• You have the right to challenge IRS notices – Just a little fewer than 50% of all IRS notices, requesting more money from you, are incorrect or incomplete. But they keep sending them because it has been shown that people would rather just pay the money than fight the IRS. Don’t take their word for it.
• You have the right to use a Taxpayer Advocate – If you feel you are getting the run around or no one at the IRS is willing to help you, contact a taxpayer advocate. This is a division of the IRS to help citizens whose tax problems seem to be ignored. Visit the IRS website and you’ll find a link that says “Contact Your Advocate”. The service is free and it’s confidential.
• You have the right to make audio recordings when you meet—yes, you can record the whole meeting but you have to notify the IRS 10 days in advance.
• You have the right to represent yourself at an IRS audit – The tax code is complicated and unless you are fairly competent about the specifics of your tax audit, you might want to hire an expert to help you. If you’ve had your tax returns prepared by a CPA, they will usually help with the audit meeting. If you end up in US Tax Court, hiring a tax expert is highly recommended.

Resource: Loanofficermagazine.

For more on mortgage rates and mortgage tax benefits call 866-955-5655

Don’t Get Hung Up at Closing: Short Sales & the “Arms-Length” Affidavit

Short-sale type transactions seem to be the norm these days but there is a caveat. Most of the time, the lender involved with the short sale will require an Arms-Length Transaction Affidavit to be signed at closing – which basically says that anybody even slightly related to the seller cannot buy the home.

Why is it required? To prevent the seller from selling the home to a friend, relative, boss, ex-spouse , etc., buy it at a lower price, get a new mortgage with a lower loan amount, then live there and/or buy it back at a later date!

Where you get hung up on this type of transaction is at the closing table. The buyer and seller will be signing this affidavit that basically says, and I quote:

No part to this contract involves a family member, friend, business associate/ shares a business interest (1) with the mortgagee. Further, there are no hidden terms or special understanding between the buyer or seller or their agents or the mortgagee (2) that are written or implied that will allow the sellers to remain in the property as a renter (3) or ever regain ownership of said property(4) at any time after the execution of this short sale transactions. None of the parties shall receive any proceeds from this transaction, except the sales commission (5).

(1) Means no friend, relative, acquaintance, spouse (ex), grandparent, brother-in-law, adoptive parent…NO ONE YOU KNOW…period
(2) Like money, kickbacks, gifts, trips, ANYTHING
(3) Everyone who occupies the house now must move out and NEVER EVER move back in again.
(4) Seller cannot buy it back at a later date, be added to the title or live there EVER
(5) No funds, gifts, trips, exchange for services…NO MATTER WHAT

Signing your name on it, as the real estate agent, says that you understand and if you have any knowledge that this is NOT an Arms-Length deal, it’s considered fraud. So if you discover that the buyers and seller know each other — even if it’s a cash deal, cancel the deal. It’s not worth it!

Testimonial

Amber Sky Mortgage Solutions
1 Route 46 West, Suite 1,
Elmwood Park, NJ 07407

Dear Nick Marenoski,

I want to thank you for your help with my refinance. You took the time in helping me and answered all my questions. I know that at times I didn’t understand how things were going, but you went out of your way to explain everything in a way that I could understand. For that I thank you.

Most important thing to me was trust and integrity and you did represent that thru Amber Sky Mortgage.

It was a great pleasure working with you and your company and in the future I will recommend you. Thank you.

Sincerely,

Nella C.

The streamline 203k FHA Mortgage is a perfect program for foreclosed or bank-owned properties in need of repairs!

The streamline 203k FHA mortgage is a perfect program for foreclosed or bank-owned REO properties with minimal repairs.

Did you know you can tell the bank that they will not be responsible for the repairs? WOW! The bottom line not to mention the headaches, just looked a lot better! And the FHA buyer that must get a mortgage to buy, the offer on the home just went from OK to Great!

The FHA 203k Loan allows for the client to finance the cost of repairs needed on a property into their mortgage. The repairs are done after closing so this is an advantage to the seller or bank that owns the property because they aren’t responsible for the repairs. This is a great negotiating tool for your client who may be up against other offers which would require the seller/bank to do the repairs! Are there any foreclosed properties out there in need of repair? We think so! This is perfect for those REO properties that have missing appliances or plumbing and electrical repairs needed!

STREAMLINE 203k for dummies

The Streamline 203k is for limited repairs requiring little expertise to manage therefore there is no consultant required (Although it depends on the extent of the repairs, I may recommend you get one anyway – It’s worth the cost!). It is designed for a “streamlined” project where the home can be occupied immediately after closing, and the contractor will receive a single payment at completion. (Maximum of 3 contractors) The maximum amount that can be financed on top of the sale price for the streamline is $35,000 (which includes some fees/reserve/costs) so assume about 30,000 in actual repairs.

Below are the Eligible and Ineligible repairs for the Streamline K

ELIGIBLE:

1. Repair/replacement of roof, gutters and downspouts

2. Repair/replacement/upgrade of existing HVAC systems

3. Repair/replacement/upgrade of plumbing and electrical

4. Repair/replacement of existing floors

5. Minor remodeling, such as in the kitchen, which does not involve structural repairs

6. Exterior and interior painting – including lead-based pain stabilization.

7. Weatherization: including storm windows and doors, insulation,, weather stripping, etc.

8. repair/replacement/upgrade of appliances (may include free-standing ranges, refrigerators, washer/dryers, and microwaves)

9. Improvements for accessibility for persons with disabilities

10. Repair/Replace/add decks,patios and porches

11. Basement finishing/remodeling/waterproofing (not requiring structural repairs)

12. Window & Door replacements and exterior wall re-siding.

13. Septic and/or well repair or replacement

INELIGIBLE:

1. Major rehabilitation or major remodeling, such as relocation of a load-bearing wall.

2. New construction, including room addition.

3. Repairs of structural damage.

4. Repairs requiring detailed drawings or architectural exhibits

5. Any rehabilitation activities that require more than two payments per specialized contractor

6. Landscaping or similar site amenity improvements

7. Any repair or improvement requiring a work schedule longer than six months

8. Work items that would necessitate a consultant to develop a work write-up

9. Work that would cause the borrower to be displaced from the property for more than 30 days during the time of rehabilitation

10. All items ineligible for the Full Consultant 203k

This works the same way as the Full Consultant 203k program but can be done in less time. We recommend at least 90 days for the Consultant K program and 45 for the streamline.

The banks want to unload their inventory as quick as possible and with the least amount of costs. Educate your clients which INCLUDES the bank about this program and close more deals. This is also a great way to negotiate a short sale if you have a qualified 203k buyer. But just remember -give it the time it needs and set the expectations up front. This is why having a certified FHA 203k Lender with experience with this program is crucial.

This program can also be combined with the Energy Efficient mortgage for those clients that are GOING GREEN!

There are so many options and we would be thrilled to help you find the right program that most people don’t even know exist!

Happy Rehabbing!

Top 10 Mortgage Myths

Top Ten Mortgage Myths you should know before you apply for a mortgage loan (plus look for a few bonus ones soon too!)

1. MYTH: I need a large down payment to buy a home in New Jersey?

FACT: If you are buying a home in New Jersey to occupy as your primary residence, you can purchase a home with as little as 3.5% down payment (which can be a gift for an FHA loan), or as little as zero down if you are a veteran or buying in an area that qualifies for a rural housing loan. You can also negotiate closing costs to be paid by the seller.

2. MYTH: I need perfect credit, something like a 720 fico score to buy a home?

FACT: There are loan programs that will allow for credit scores as low as 600. There are still a few ways to qualify for a loan with a score below 640 but the criteria and rates are stringent and vary from lender to lender. Although some lenders do advertise the ability to close loans with lower credit scores, we suggest buyers first speak to our mortgage consultants for a review copy and analysis of their credit history and qualifications.

3. MYTH: The APR is my interest rate?

FACT: Mortgage Companies are required to disclose the APR which is not your interest rate that your payments will be based on. The APR, which stands for Annual Percentage Rate is a MEASURE of closing costs so that at a glance, you can compare rates and fees quickly. APR is calculated by adding the current interest rate plus certain fees called prepaid finance charges. Get a complete breakdown of rates and fees and compare them on the same date and time if possible.

4. MYTH – I saw a rate published in the paper or on the internet. It’s much cheaper than what my loan officer stated so it must be a better deal.

FACT – There are over 29 variables that go into every rate quote. Though strict guidelines regulate how lenders advertise rates, many lenders are being investigated by Attorney General’s Offices for misleading consumers. Anyone who publishes a rate in the paper or the internet are, at best, quoting rates under the best of all circumstances.

5. MYTH: The bigger the bank the better the interest rates and fees.

FACT: Banks don’t always have the lowest rates and fees. Some banks set their rates once or twice a week instead of when the market changes which means you may not get the lowest rate. Mortgage Brokers and Mortgage Bankers have access to many different investors that they can place your loan with. This means that on a day to day basis, they can shop for the best rate and terms.

6. MYTH- Using the Good Faith Estimate to shop for a mortgage will get you a better deal.

FACT- The Good Faith Estimate (GFE) is a tool to help consumers compare loan and transaction costs. Unfortunately the GFE can actually encourage an ethical lender to over-disclose your costs. Because there are so many third party fees being disclosed, an unethical lender could understate some fees in order to appear more affordable. Furthermore, the GFE does not total your true closing costs or monthly payment. Because it is so easy to manipulate these disclosures we strongly urge you to work with a trusted loan officer.

7. MYTH – If my husband has bad credit but a good job and I have good credit, we should be approved.

FACT – To use the income of any individual that person’s credit needs to qualify as well.

8. MYTH – I have bad credit, but I will have a co-signor that has good credit.

FACT – Each borrower must credit qualify for any mortgage loan. A co-signor is used to add income and strengthen a loan file. A co-signor will never compensate for derogatory or negative credit.

9. Myth- There is no way to avoid monthly private mortgage insurance on an FHA loan.

FACT- With 10% down and a 15 yr term there is NO monthly private mortgage insurance for FHA. This is valuable to know because, unlike conventional loans, FHA does not charge you points or raise your rate for lower credit scores.

10. Myth- I can close a loan in 10 days guaranteed.

FACT- Although the Federal Trade Commission regulates companies that make guarantees, enforcement is lacking. As with quoting interest rates, there are an infinite number of factors that can affect how long it takes to close your loan. Appraisal delays, title problems, inspection issues and many other factors will determine when you close. While many loans can be processed with no unforseen delays and close within 10 business days, it should be considered more of an exception than the rule. A good loan officer will set realistic closing expectations regarding each specific deal. Typical closings are within 30 days.

Taking the Mystery Out of Real Estate Appraisals – Refinance & Purchase

Appraisals are meant to help buyers avoid a potentially bad real estate investment. It’s meant to help the lender determine how much money they will lend (both for purchases and refinancing).
There are other types of appraisals, too—those that
determine the assessed value of your home for property
tax purposes or determine how much replacement
coverage an insurance company will place on your home.

Arriving at an appraisal value is no easy task. For example,
some of the major factors have more to do with the neighborhood, such as:

 Type of area? I.e. Housing development? Acreage? Condo/Townhome?
 Recent sales prices of other homes in the area
 The amount of time between when it’s listed and when it’s sold
 The distance to schools, shopping, fire and police services
 The condition of other homes in the neighborhood

Now, for the home itself. After determining if the home is in good condition (or not), here are some of the factors the appraiser will take into account:

 Total square footage of living space
 Other buildings such as garages, storage barns, etc.
 Age of the home
 Size of the lot or acreage
 Number of bedrooms, baths,
 Unusual features (like 2 kitchens)
 Extras (like fireplaces, sound system, swimming pools, etc.)

And the final step is putting it all together by comparing your home, to OTHER homes that have sold. Since no two homes are EXACTLY alike, the appraiser makes “adjustments”. If your home has 2 bathrooms, and the home down the street has 2-1/2 baths, the appraiser will make a dollar adjustment because you have ½ a bath less than the other property.

That’s where local knowledge, understanding of value adjustments, and unbiased judgment by the appraiser makes the difference. And yes, tax assessors basically use the same criteria when determining the value for tax purposes.

The cost of the appraisal varies, depending upon how complex it is. If you are thinking of refinancing, call us and we can show you the best route to take for both lender and appraisal management company.

How to Raise Your Credit Score 100 Points in 45 Days

GET RID OF YOUR COLLECTION ACCOUNTS.
Did you know that paying a collection account can actually reduce your score? Here’s why: credit scoring software reviews credit reports for each account’s date of last activity to determine the impact it will have on the overall credit score. When payment is made on a collection account, collection agencies update credit bureaus to reflect the account status as “Paid Collection”. When this happens, the date of last activity becomes more recent. Since the guideline for credit scoring software is the date of last activity, recent payment on a collection account damages the credit score more severely. This method of credit scoring may seem unfair, but it is something that must be worked around when trying to maximize your score. How is it possible to pay a collection and maximize your score? The best way to handle this credit scoring dilemma is to contact the collection agency and explain that you are willing to pay off the collection account under the
condition that the all reporting is withdrawn from credit bureaus. Request a letter from the collector that explicitly states their agreement to delete the account upon receipt/clearance of your payment. Although not all collection agencies will delete reporting, removing all references to a collection account completely will increase your score and is certainly worth the involved effort.

GET RID OF YOUR PAST DUE ACCOUNTS.
Within the delinquent accounts on your credit report, there is a column called “Past Due”. Credit score software penalizes you for keeping accounts past due, so Past Dues destroy a credit score. If you see an amount in this column, pay the creditor the past due amount reported.

GET RID OF YOUR CHARGEOFFS AND LIENS.
Chargeoffs and liens do not affect your credit score when older than 24 months. Therefore, paying an older chargeoff or a lien will neither help nor damage your credit score. Chargeoffs
and liens within the past 24 months severely damage your credit score. Paying the past due balance, in this case, is very important. In fact, if you have both chargedoff accounts and
collection accounts, but limited funds available, pay the past due balances first, then pay collection agencies that agree to remove all references to credit bureaus second.

GET RID OF YOUR LATE PAYMENTS.
Contact all creditors that report late payments on your credit and request a good faith adjustment that removes the late payments reported on your account. Be persistent if they refuse to remove the late payments at first, and remind them that you have been a good customer that would deeply appreciate their help. Since most creditors receive calls within a call center, if the representative refuses to make a courtesy adjustment on your account, call back and try again
with someone else. Persistence and politeness pays off in this scenario. If you are frustrated, rude, and unclear with your request, you are making it very difficult for them to help you.

CHECK YOUR CREDIT LIMIT(S) AND EVENLY DISTRIBUTE THE BALANCES YOU ARE CARRYING.
Make sure creditors report your credit limits to bureaus. When no limit is reported, credit scoring software scores the account as though your current balance is “maxedout”.
For example, if you know that you have a $10,000 limit on your credit card, make sure that the limit appears on the
credit report. Otherwise, your score will be damaged as severely as if you were carrying a balance of the entire available credit. Credit scoring software likes to see you carry credit card
balances as close to zero as possible. If it is difficult for you to pay down your balances, read the following guidelines to maximize your score as much as possible under the circumstances:
• There are different degrees that scoring software can impact your score when carrying credit card balances.
• Balances over 70% of your total credit limit on any card damages your score the most. The next level is 50% of your balance, then 30% of your balance.
• In order to maximize your score without having to pay down your balances, evenly distribute your credit card balances among all of your credit cards, rather than carry a large balance on one credit card. For example, if you are carrying a $9000 balance on a credit card with a $10000 limit, and you have two other credit cards with a $3000 and $5000 limit, transfer your balances so that you have a $1500 balance on the $3000 limit card, a $2500 balance on the $5000 limit card and a $5000 balance on the $10000 limit card. Evenly distributing your balances will maximize your score.

DO NOT CLOSE YOUR CREDIT CARDS.
Closing a credit card can hurt your credit score, since doing so effects your debt to available credit ratio. For example, if you owe a total credit card debt of $10,000 and your total credit
available is $20,000, you are using 50% of your total credit. If you close a credit card with a $5,000 credit limit, you will reduce your credit available to $15,000 and change your ratio to using
66% of your credit. There are caveats to this rule: if the account was opened within the past two years or if you have over six credit cards. The magic number of credit card accounts to have in order to maximize your score is between 3 and 5 (although having more will not significantly damage your score). For example, if a card was opened within the past two years and you have over six credit cards, you may close that account. If you have more than six department store cards, close the newest accounts. Otherwise, do not close any at all.

KEEP YOUR OLD CREDIT CARDS ACTIVE.
15% of your credit score is determined by the age of the credit file. Fair Isaac’s credit scoring software assumes people who have had credit for a longer time are at less risk of defaulting on
payments. Therefore, even if your old credit cards have horrible interest rates, closing those cards will decrease the average length of time you’ve had credit. Use the old card at least once
every six months to avoid the account rating to change to “Inactive”. Keeping the card active is as simple as pumping gas or purchasing groceries every few months, then paying the balance down.
An inactive account is ignored by Fair Isaac’s credit scoring software, so you won’t get the benefit of the positive payment history and low balance that card may have. The one thing all credit
reports with scores over 800 have in common is a credit card that is twenty years old or older. Hold onto those old cards. Preparing credit is a slow and time consuming process. Full knowledge of your credit profile and how it represents you to creditors and credit bureaus is pivotal to full credit restoration success.

NJ Mortgage Rates Hit Another Record Low!

Mortgage rates fell to the lowest level in decades for the ninth time in 10 weeks, as concerns grow that the economy is weakening.

Amber Sky Mortgage Solutions provides rates that are lower than the average rates because we have relationships with the best banks in the country and allow them to compete for our client’s business using wholesale rates.

Rates vary by program, qualifications, and by lender so Amber Sky is the solution to compare a homeowner’s specific situation between lenders to ensure the lowest rate and fees as well as the fastest service.