I think the best thing people can do is make sure that they save their money for a down payment, and to make sure their credit is clean and up to date. People should probably be looking at their credit a little more often just to make sure they’re not getting dinged for things. To be considered top-quality nowadays, your credit score needs to be 740. Just a couple years ago it was 680, so there’s been a significant jump with that. Even though HUD doesn’t require a minimum credit score, a lot of the investors that loans get sold to are requiring anywhere from 620 to 660 on an FHA.
But most importantly, buyers need to make sure they’re dealing with a reputable mortgage company or mortgage agent who understands all the changes we’ve seen and all the guidelines we face, someone who can coach them on what they need to do to get everything in order. Talk to your Realtors about lenders, or talk to a bank loan officer. Things have gotten pretty vanilla as far as the types of loans that we can do, so do a little background check. There are a lot of officers out there still who basically were only sub-prime officers, and they don’t really have a good grasp on how to do A Paper loans. So do an interview and ask some pertinent questions. Ask your loan officer how long he’s been in the business, what types of loans he’s written in the past, who have you worked for – there are a lot of fly-by night companies out there, especially if you live in Chicago, where there are banks all over.
– Frank Binetti, vice president of residential mortgage lending at Lincoln Park Savings Bank and president of the Illinois Mortgage Bankers Association, giving YoChicago his best piece of advice for any buyer looking for a loan in today’s market.
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