Norman Calvo's Blog: March 2008

Thursday, March 27, 2008

Welcome to my blog!

About two years ago, I had no idea what a blog was until my kids came home one day and talked excitedly about this new online world of interactivity, connectivity, and dissemination of new ideas. As a veteran of over 26 years now in the mortgage industry, there hasn’t been one second of my career that I haven’t absolutely loved. And now, thanks to my kids and especially my daughter, Adele, I have a new means of connecting, educating, entertaining, and providing the most update mortgage education for all of my trusted friends, business associates and business partners.

I’ve honestly never been more excited about the opportunities that this new electronic media will provide for all of us. In my upcoming blog posts, I will be introducing some exciting new content that I’m sure all of you will love. Here are just a few of the ideas that my daughter and I have been discussing:

· List of weekly open houses with pictures and “insider” info
· Highlights from articles in the news
· Congratulations to our weekly closings.
· Featured Listings
· How-to guides to the mortgage and real estate markets

The list goes on and on.

Since this is meant to be interactive and fully participatory, I encourage all of you to respond to any of the ideas that I address with your comments, feelings and questions. Hopefully this blog will become a community forum for the brownstone Brooklyn neighborhoods and for parts of Manhattan as well. For right now I’ll start by sharing with you a number of my best weekly newsletters and other informative articles about our mutual industries. I hope you enjoy it, and read through it, and I look forward to enhancing the content of this new media with your help.

I look forwarded to "blogging" with you soon,

Tuesday, March 18, 2008

Why mortgage rates are still heading higher

Click on the link to read an interesting article on why long-term fixed-rate mortgages may go up.

Why mortgage rates are still heading higher

FNMA’s New Jumbo - Conforming Loans

Phenomenal news!!! We've finally received, direct from FNMA, the new guidelines for the economic stimulus package that was just signed into law. Mortgage lenders will begin to implement the guidelines in about one to two months, so get ready for the phenomenal boost to sales! For everybody in real estate, this will usher in a tremendous selling season for single family homes and condominiums. With the dramatically increased loan sizes, virtually everyone in the mid price range will now be able to obtain the much lower FNMA rates.

Here are the parameters of the new guidelines:

1) No Coops allowed.
2) No multi-family properties allowed.
3) No cash-out refinances allowed (also can’t combine first and second, even if the second was for purchase money).
4) Only programs offered are 30 yr fixed, 15 yr fixed, 5/1 ARM and 5/1 interest-only.
5) 45% maximum debt to income ratio.
6) Only full doc (no stated income or no income loan).
7) Properties with values over $1 million will require a full appraisal AND a field review if LTV is above 75%.
8) No limited condo review allowed. Must be full review (offering plan, questionnaire, insurance, etc. must be provided).
9) There is a 0.25% hit to pricing for fixed loans and a 0.75% hit to pricing for ARMs.

News Flash: We just heard from JP Morgan Chase and Wells Fargo that they will start accepting loans for this program effective this coming Monday, March 17th.

Please remember that these guidelines are for single family home and condos ONLY. It will NOT apply to co-ops or 2-4 family houses. A few other fine print items to keep in mind: In order to be eligible for the new higher loan amounts, borrowers must be able to prove full income and assets (meaning that the stated or no income loans will not be available). Debt to income levels will be limited to 45%. Secondary financing will NOT be allowed (what this means is that if borrowers wish to obtain 90% financing, we will have to obtain the old fashioned private mortgage insurance for them.

Expect the new guidelines to be available to your clients as early as April 1st (estimated time frame). The new loan level amounts that are eligible for the MUCH LOWER FNMA rates will create a surge in sales activity in the New York area. Much more affordability will be ushered into the marketplace and this, of course, will create more sales. -Norman Calvo

About Me

I've always loved writing, public speaking and education. As a graduate at Princeton University, the art of writing and public speaking became second nature to me. Upon graduating from college, I left the country for six years to travel in Europe and Africa and finally found myself back in the United States at the age of 28 with no job, no money, and no career. I entered the mortgage industry in 1982, and I found it exhilarating and wonderful to be able to use these skills every single day. In those years, I worked for Chase Manhattan Bank as a senior loan officer in Long Island, and I quickly rose up the ranks to become the number 1 loan officer in volume and 2 in dollar amount for Chase in the United States.

Many people in this industry think it's only their selling skills and their interest rates that enable them to close loans month after month─ but it can be anything. Back in 1988, as the market turned and the country began to enter a recession, my wife gave birth to a set of triplets only two years after our 1st son was born. As the country entered the worst time in real estate and mortgages in over thirty years, and as I suddenly had five mouths to feed, the very first transactions came my way because the realtors said to themselves and to me, "We just have to feed 'em babies". Triplets and babies aside, I had to differentiate myself from the average loan officer and try to establish myself in a restricting and almost impossible market. So, I embarked on a path that served me extremely well ever since. I applied my writing and speaking skills to market myself and to successfully get loans done in a way that other loan officers simply could not do. I would take the time to thoroughly understand each transaction and completely and totally research the guidelines and details of each file so that, no matter what, the bank had to approve the file. It was during this period of time that I became one of the most sought out mortgage brokers for much of downtown Manhattan, Brooklyn Heights and Park Slope.

Sensing that the recession was nearly over and have to face economic realities of a much larger family, I decided to open up Universal Mortgage in 1991, and the company has grown by leaps and bounds ever since. The guiding principles that my company uses are the very same ones that I developed as I started out. All of the loan officers in Universal Mortgage pride themselves on knowing details on underwriting guidelines, loan to value ratios, and credit and appraisal standards. Now that we are in the post-subprime epic, these skills are more important than ever. Going forward, especially with the establishment of this blog, it is my goal to clarify and educate the best means of financing during these financially challenging times.

About My Company

Universal Mortgage strives to be the most complete solution for all of your real estate financing needs. We pride ourselves in providing the best customer service in the industry to our clients.
Throughout your experience of working with our firm, you will always be speaking to the same one or two people for the entire transaction, not a random clerk who knows you by your social security number.
The most important part of any relationship is to get to know one another. Please feel free to take a look around this blog to read about our take on current mortgage hot topics, articles from the news and other useful mortgage and financing information.
Hopefully in the near future, we'll have a chance to get to know you as well!

Norman Calvo's Blog