Tuesday, June 29th, 2010 at
10:35 am
What kinds of government approved mortgage loan programs are available for the lender today? There are actually more programs available today than any other time in recorded mortgage history; and the ability to qualify for these programs is an all-time high.
In this article were going to take a look at FHA, VA, Fannie Mae, Freddie Mac, the HECM, and the SNAP programs available thanks to government regulation of funding.
And FHA mortgage is the term used to describe a direct primary market lending product. What are FHA loans and how do you apply? Your options for application now are through an approved lender, or via the Internet.
FHA, or the Federal Housing Authority was established in 1934 as a part of Franklin D. Roosevelt’s ‘New Deal’. It was the president’s plan to help the country get back on its feet at the end of the Great Depression. FHA loans with a way to provide the funds needed to construct low income housing and provide Americans with the dream of home ownership.
It worked, tremendously well and in 1965, the FHA became a part of the Department of Housing and Urban Development. In the decade since its inception, the FHA has become the largest insurer of home mortgages and has allowed more Americans to live the dream of home ownership at a rate that is in comparable to that of any other country.
The VA loan is simply a spin-off of the FHA loan open only to veterans having served in the Armed Forces. The VA loan was conceived in order to provide returning veterans with the opportunity to purchase homes and start their lives again.
Fannie Mae, or the Federal National Mortgage Association, was established to provide a secondary market for the FHA mortgage loans. In 1938, when President Roosevelt established the Federal National Mortgage Association it was intended to provide a secondary market for lenders to sell mortgages in order to originate new ones.
Freddie Mac, followed in a few years, and was implemented to serve a broader base of mortgages. Although Fannie Mae and Freddie Mac are not direct lenders, our current mortgage system would not be in operation nor would we have experienced the success with homeownership we enjoy today.
The home equity conversion mortgage or HECM is a HUD supervised program that works with FHA homeowners who are over the age of 62 to remain in their homes by allowing them to access their home’s equity, sometimes referred to as the reverse mortgage.
The safe neighbourhood action plan or SNAP is an FHA supervised effort to improve urban communities. The problem focuses own illuminating drug abuse and cry him in urban areas by providing education, school activities, and assistance for project residents.
Now that we’ve covered all the government approved mortgage loan programs, let’s take a look at the FHA mortgage options available. FHA offers adjustable rate mortgages, fixed rate mortgages, energy-efficient mortgages, graduated payment mortgages, mortgages for condominium units and growing equity mortgages.
The more commonly used mortgage products by the individual residential homeowner are the adjustable rate mortgage the fixed rate mortgage and the energy-efficient mortgages.
As we move closer to a more energy efficient energy conscious nation, I believe we will see an increase in the energy-efficient mortgages at a greater concern on the part of HUD that will make room for an increase in energy-efficient mortgages.
The graduated payment mortgage is an option for FHA homeowners who currently have low to moderate incomes but expected to increase substantially over the next few years; this can be compared to a balloon note or the adjustable rate mortgages in use today.
As you can see, the government has played a tremendous role in making possible the dream of homeownership in this country.
Yes, I believe we can say today more Americans live the dream of home ownership than any other nation in the world thanks in great part to the fact that President Roosevelt stepped in at the end of the Great Depression and provided a way to restore faith in the American way of life.
By: Uchenna Ani-Okoye
Related Posts:
Sunday, June 27th, 2010 at
8:08 am
Mailing Lists make a difference with Mortgage Marketing
When it comes to using direct mail for mortgage prospecting, targeting the right audience can make the difference between success and failure. In today’s market, you not only want to reach a responsive audience, but also one that will ultimately qualify for the loan. Below are some of the choices available for the savvy mortgage marketer.
The Property Mortgage Database allows you to pinpoint households by filtering property and mortgage loan related elements, such as property type, home assessed value, loan origination date, and the original loan amount. Estimated home value is also available on this file, which allows you to predict the LTV or equity position. This database is compiled from the County Courthouse records department and is only as accurate as the county records are kept.
The Credit Bureau Database allows you to pinpoint households by filtering the credit worthiness of the potential borrower. Some of the selects are actual credit score, loan balance, revolving credit card amount and loan origination date. Estimated home value is also appended to this file, which allows you to predict the LTV or equity position. This database is compiled from the credit bureau and is considered to be very accurate. Since the FTC governs access to this type of data, a firm offer of credit must be made in order to be compliant.
The ARM Reset Database allows you to pinpoint households by filtering the actual day in which the adjustable rate mortgage holder will experience an interest rate change on their mortgage, and therefore, a payment increase as well. Some of the filters are month of initial reset, property type, interest rate, estimated (combined) LTV and loan amount. This database is compiled from the ARM Riders in the loan documentation at the County Courthouse.
The more you know about the people on your mailing list, the better you can communicate to them. The ideal scenario is to identify clusters of potential prospects within the mailing list and version your message differently to each one. It’s been proven, time and time again, that message versioning to the right audience will typically give significant lift in your response rate.
For more information on targeted mailing lists for the mortgage marketer, you can reach Jerrad Jordan with BB Direct, Inc at (866) 501-6273. You can also find more information one of their websites at www.armresetleads.com, www.triggerleadsdirect.com, or www.bbdirect.com.
Mortgage Marketing in a Down Market
Times are tough in the mortgage industry. Over the past several years, many lenders have extended more money to sub-prime borrowers. Additionally, an over-built America has caused the price of new home sales to slump, eating away at the equity of many homeowners who have been depending on that savings for retirement. The outcome is a very finite amount of quality prospects from which to offer your loan products.
So what’s a mortgage broker to do in a down market?
Get back to the basics.
Focus on your referral agents by keeping them informed with the changes in the market and how these changes might affect people they know.
Reach out to the builders needing help selling their inventory.
Sit down with these builders and listen to them. Get a full understanding of how many properties they will have available in the next 6 to 12 months and what they expect to sell. How many homes are reserve high-end homes, second homes and starter homes? Put together definitive solutions for meeting your builders’ lending goals.
Get a firm grasp of who you can loan to and focus solely on these individuals.
It’s been said that the FHA is the new sub-prime loan. Managing your lender relationships is just as important as managing your customer pipeline. Take inventory of specifically what you can and cannot do, and hunt for clients that fit within those guidelines.
Never stop marketing.
It’s vitally important to keep your name in front of your prospects. It’s even more important when the market is lean and mean. With fewer brokers vying for the same business, your message has a greater chance of getting attention and making a lasting impression.
Never do lunch alone.
If you’re plan is to build your mortgage business, you must develop your ability to invite people to lunch, and be able to tactfully engage in a productive dialog. Ask questions and get to the heart of who they know and how to move forward. Connecting with people on a personal level is important to many business professions, but is vital to the mortgage broker. If you don’t have this gift, develop it or find a new career-your livelihood is depending on it.
If you would like to learn more about mortgage marketing, you can reach Jerrad Jordan with BB Direct at (866) 501-6273 or find them on the web at one of their websites: www.BBDirect.com, www.ARMResetLeads.com, or www.TriggerLeadsDirect.com.
By: Brian Berg
Related Posts:
Saturday, June 26th, 2010 at
3:34 am
If you want to promote a mortgage program, be prepared to pay a pretty penny if you try to utilize online advertising methods such as Google Adwords. Currently, in order to grab the keyword ‘mortgage’ you will have to pay at least $10.95 per click. This means if you get 1,000 clicks to your mortgage program, you will have to pay $10,950. And with the average conversion rate being just 1 percent, that means you’ll only be getting 10 sales. Now, maybe if you’re a mortgage company you can afford to pay $10,950 for 10 sales, since you’ll be making hundreds of thousands more. But if you’re an affiliate promoting a mortgage program, you should consider a better alternative… mortgage leads.
What are mortgage leads? Mortgage leads are a collection of data pertaining to individuals that would be interested in a mortgage or refinancing loan. They are gathered by marketing companies who use a variety of methods both online and offline to collect them. Some of these methods involve extracting data from public records. Others use methods that make it easier to acquire more personal information. For example, a marketing company could conduct an online survey of a group of individuals. Or, maybe they get the data from realtors, banks or other entities having access to such information. Either way, most mortgage leads will contain enough information to allow for a direct mail campaign. This means at the very least, a basic package of mortgage leads will provide you with a person’s name and address and whether or not they own a home.
There are also more specific mortgage leads. These are known as mortgage trigger leads or exclusive mortgage leads. Mortgage trigger leads collect data based on a person’s credit report. Usually, with mortgage trigger leads, the person had just made an inquiry, indicating they are obviously interested in a mortgage loan. Mortgage trigger leads are a bit more expensive, because they target a niche of people that are very interested in getting a loan. This translates into a better conversion rate.
Then there are exclusive mortgage leads, another type of more specialized mortgage leads. They do not target highly-convertible leads like mortgage trigger leads do, but they offer another invaluable advantage… exclusivity. Just as their namesake indicates, with exclusive mortgage leads, your list is sold only to you. This means that you don’t have to worry about other marketers or mortgage companies trying to reach the clients that you are also trying to advertise to. But, just like mortgage trigger leads, expect to pay a little bit more for the exclusivity.
Price-wise, the fees associated with mortgage leads will depend on the company you decide to work with. But generally, they will range from a few cents to a few dollars. If you’re low on funds, it’s best that you just order the minimal amount of mortgage leads, like maybe 1,000 or so. From there you need to decide how you’re going to do your direct mail campaign. Believe it or not it doesn’t have to be fancy. There are plenty of marketers that use regular stamps and Microsoft Office-created flyers to advertise to their mortgage leads. In fact, doing things this way is a great method to affordably determine if your mortgage leads will convert. All you have to do is get a pack of 100 stamps, (which are available from USPS for just $41), a color cartridge, a pack of paper and envelopes. All together these things should cost less than $100. From there, you can test your market, mailing out flyers to 100 mortgage leads at a time. You’ll want to aim for a 10 percent conversion rate, which means 10 sales. If you’re not getting the sales you’re looking for, you can consider changing your flyer or even thinking about whether your mortgage leads were worthwhile to begin with.
Disclaimer:This blog or article is for information purpose only, and should not be treated a professional advise or price protection guarantee. This blog is mainly used for search engine optimization and other commercial purposes and it is advised that readers seek professional consultation in the field of interest for more information.
By: Black Book Data
Related Posts:
