David 's Blog

Federal Trade Commission estimates as many as 9 million Americans have their identities stolen each year.  Some identity victims can resolve their problems quickly, while others spend hundreds of dollars and many years repairing damage to their name and credit.  Some consumers victimized by identity theft may lose out on job opportunities, or be denied loans for education, purchasing a home or a car because of the negative information that has been reported on their credit.

How do thieves steal an identity???                 

• Dumpster Diving - They rummage through trash looking for bills or other paper with your personal information on it.
• Skimming - They steal credit/debit card numbers by using a special storage device when processing your card.
• Phishing - They pretend to be financial institutions or companies and send spam or pop-up messages to get you to reveal your personal information.
• Changing Your Address - They divert your billing statements to another location by completing a change of address form.
• Old-Fashioned Stealing- They steal wallets and purses; mail, including bank and credit card statements; pre-approved credit offers; and new checks or tax information.  They steal personnel records, or bribe employees who have access.
• Pretexting - They use false pretenses to obtain your personal information from financial institutions, telephone companies, and other sources.

How you can protect yourself from the dangers of identity theft???

• Conduct a Credit Check-up - Visit www.annualcreditreport.com to obtain a free credit report every 12 months.  Review all three of your credit reports and look for any suspicious activity, unusual or inaccurate names or addresses, or any inquires that were done without your knowledge.  In many states, you may place a 90-day "Fraud Alert" on your credit report, which further restricts access to your credit information.  Simply call one of the three main credit bureaus to activate the alert. Equifax, 800-525-6285 www.equifax.com; Experian, 888-397-3742 www.experian.com; TransUnion, 800-680-7289 www.transunion.com.
• Dont Give It Up- Avoid falling prey to phishing scams, both over the phone and through email.  In a phishing scam, identity thieves pretend to be someone from your bank or a credit institution and simply ask you for your personal information.  If someone contacts you and requests any personal information, don't give it to them.  Verify who is requesting the data and why, and then call the institution yourself.  One extra phone call could save you a lot of trouble and money.
• Opt-out of Special Offers - Visit www.optoutprescreen.com to cut down on the pre-approved offers from credit card and insurance companies. It's also good idea to opt out prior to the refinancing of your home, as you may become part of a "trigger lead" to the credit bureau's, who sell your information to number of companies. It only takes a few minutes to opt out, but it could spare you a lot of junk mail and could possibly save you from identity theft.
• Protect Your Trash- The items you discard, including credit card offers, ATM receipts, bank statements, credit statements/receipts and utility bills, all contain personal information. With a bit of effort, thieves can collect this information and use it to steal your identity. To minimize this possibility, buy a shredder and use it.  Similarly, when you discard an old credit card, be sure to destroy them completely first.
• Be Careful In What You Carry- Don't carry your social Security card, passport, or birth certificate in your wallet or purse.  Also, only carry as many credit cards that are absolutely necessary.  It has also been suggested that you photocopy everything you carry in your wallet to make canceling things easier in the event that your wallet is stolen.

Being the victim of identity theft can be extremely devastating not only because it's your money being stolen, but your name.  Identity thieves can be very skilled at finding their targets and then exploiting their findings.  For this reason, to protect yourself you need to stay all the more alert and knowledgeable.  Call the Federal Trade Commission toll-free, 877-438-4338, or go to www.consumer.gov/idtheft for a step-by-step advice about what to do if your're a victim of ID theft.

For more information on applying for a home mortgage in Phoenix, please contact The Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com.

So you've decided to purchase a home in Moon Valley and you want to get the best deal on your mortgage.  You get on Google and type in Phoenix Home Mortgage to check rates but all the advertisements have this other rate with the letters APR next to it.  What is APR and why should you be concerned about it when you're financing your home in Moon Valley?

Annual Percentage Rate (APR) is a tool that consumers can use as a starting point to compare loan programs. However, it's important to keep in mind that APR is not a perfect system, and not all lenders calculate APR in the same way. While the Federal Truth-in-Lending Act does require mortgage brokers or lenders to disclose APR to the consumer, there is no rule written in stone for calculating this number that each and every lender agrees upon.

The "nominal rate" is the basic interest rate charged on the money you borrow (the principal). The "annual percentage rate" - or APR - factors in some of the upfront costs that vary from one loan to another (like points, fees and mortgage insurance) and spreads them over the life of the loan. (Other fees - like document preparation and application fees, title insurance, or appraisals - aren't included.)

In theory, you'll pay the same amount for two loans with the same APR - if you stick with that loan for the full 15-year or 30-year term. But few people do; most either refinance their mortgage or sell their house and move on long before their original mortgage is paid off. If you plan to move in a few years, you may want the loan with the lowest upfront costs, regardless of the APR.

How it works

Here's an example of how a comparison of APRs works in the case of two loan offers for a 30-year, fixed-rate loan of $150,000:

Offer A: Quotes an interest rate of 6.5 percent, plus one discount point and an origination fee of 2 percent.

Offer B: Quotes an interest rate of 6.4 percent, but charges two discount points, the same origination fee, and higher closing costs.

While the second loan may carry a lower interest rate and a lower monthly payment, a comparison of the APRs indicates that it is actually slightly more expensive overall because of the higher upfront fees:

Bottom line... be careful and think twice about those advertised low rates when they are accompanied by higher fees.

If you're thinking about refinancing your existing mortgage or buying a new home in the Moon Valley area in Phoenix, contact the Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com.  Get pre-approved before you begin the search for your new home.

All of us are aware of the overwhelming abundance of bank-owned properties flooding the Phoenix area housing market.  The Arizona Department of Housing (ADOH) has developed a new program to help your clients purchase foreclosed properties in Arizona.  The "Your Way Home AZ" program offers a forgivable, zero-percent-interest loan of 22% of the home's purchase price to qualified borrowers purchasing an eligible foreclosed home.  This significantly increases your clients' purchasing power, since eligible borrowers only need to qualify for 75% of the purchase price.  The program is currently available throughout all of Arizona.

It is advantageous for you as Realtors to be aware of the program requirements, as well as the unique benefits available to their clients.  Click Here for a detailed listing of eligibility requirements for borrowers and properties, as well as financing terms and guidelines.

When working with clients that are interested in utilizing this program, there are a few additional steps that need to be taken throughout the purchase process.  Initially the buyer will need to be pre-qualified by a lender as usual.  The buyer would need to obtain from the lender a few items, such as a Loan Status Report indicating the maximum mortgage amount that the applicant qualifies, an AUS Approval, and a Program Eligibility Letter.

The homebuyers will also need to participate in an eight-hour homebuyer counseling program.  The Homebuyer Agency will issue a certificate to the buyer upon completion.  This can be completed while they are searching for a property.  The program website, www.yourwayhomeaz.com, provides a feature that enables you to search for eligible foreclosed properties by county or city.   

Once you have located a property and are ready to place an offer, Realtors are required to include appropriate language within the purchase contract.  Failure to ratify the purchase contract can result in disqualification from the program.  The following is a list of some desired contingencies and conditions to be included within the offer:

1.    Qualifying and obtaining a first mortgage in the necessary amount

2.    Qualifying and obtaining a second mortgage from the Your Way Home AZ Program

3.    Appraised value of the property must be sufficient to ensure that the purchase price is no more than 99% of the current market value

4.    Seller must provide the program's Certificate of Seller to the buyer with the seller's acceptance of offer

5.    Property must meet Minimum Property Standards

6.    Property needs to be eligible for a home warranty policy

7.    Closing date should be at least 45 days after acceptance to allow enough time to process application and meet all program requirements

The sellers are also required to provide a Seller's Certificate indicating that the sales price represents a discount of at least 1% below the appraised market value.

The Homebuyer Agency will then set up a file for your client to be submitted to the ADOH requesting that program funds be reserved for the applicant.  Upon approval from the program, the ADOH will then issue a Commitment reserving the funds.  The transaction is then ready to proceed in the customary fashion.  

Please contact the Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com to answer any questions or to find out if your clients are eligible to qualify for this incentive when looking to purchase a home in Phoenix or surrounding areas.     

The Phoenix area housing market is still being driven by foreclosed homes.  This wave of inventory consisting of bank-owned properties is not likely to decrease any time in the near future.  Now, Arizona residents have an even greater opportunity to take advantage of the affordable home prices and the foreclosure market.  The "Your Way Home Arizona" program was created by the Arizona Department of Housing (ADOH) to help homebuyers purchase foreclosed properties in Arizona.  The ADOH has designated $20 million from HUD's Neighborhood Stabilization Program to fund this program. 

The Your Way Home AZ program offers a forgivable, zero-percent-interest loan of 22% of the home's purchase price to qualified borrowers purchasing an eligible foreclosed home.  This significantly increases Arizona residents' purchasing power, since eligible borrowers only need to qualify for 75% of the purchase price.  The program is currently available throughout Arizona, including Maricopa and Pima counties that were recently added in July 2009.

The following are some of the program specifics and guidelines:

Borrower Qualifications:

• The purchased property must be a primary residence
• The household gross income cannot exceed 120% of the average median income for the county.  Household income for qualification purposes includes the gross income of all persons 18 years and older living in the residence.
• Not required to be a first-time homebuyer
• Must attend an approved Homebuyer Education Class
• Must have two months reserves of PITI
• Down payment requirement is 3% of purchase price.  1% must be provided by the borrower, but 2% can be gifted funds or from other approved sources.

Property Requirements:

• Foreclosed/Bank-Owned properties only.  The property must be vacant at the time of listing.
• Eligible for any one-unit single-family residence, including condominiums, townhomes and permanently installed mobile homes
• Purchase price must be at least 1% less than the appraised market value of the property
• Properties must pass a Minimum Property Standards inspection prior to closing

Financing Terms:

• First mortgage must be a fixed rate fully amortized loan not to exceed 30 years
• The maximum loan amount of the first mortgage cannot exceed 75% of the purchase price
• The first mortgage can be either FHA, VA, USDA or conventional financing
• The ADOH provides a silent-second loan for 22% of the purchase price that has no interest or required payments
• The program loan term is between 5-15 years depending on the loan amount

Under $15,000:                5 years

$15,000 - $40,000:          10 years

Over $40,000:                  15 years

• The program loan is forgiven at the end of the loan term provided the borrower continues to own and occupy the home until such time.  (Loan must be repaid if property is sold during the loan term)
• First mortgage can be refinanced provided the new loan results in a lower monthly housing payment
• Seller's may contribute up to 6% in closing costs and pre-paid expenses

Don't delay, as funds for this program are required by federal regulations to be committed by approximately September 2010 or they will be returned to the government.   

Before you begin your search for a home in Phoenix or surrounding areas, you should contact the Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com to find out if you are eligible to qualify for this incentive.     

Before you decide to throw down your hard earned money to pay for an appraisal, you may want to do some research.  Here are 6 sites that will help you find out how much your home may be worth for the purpose of selling your home, or refinancing your home mortgage.  These property evaluations only provide an estimate of the property value that you are researching.  The list of websites below will help you determine a value range for a home in Phoenix and surrounding areas.

•· http://www.zillow.com/ - Zillow is a free online real estate site where you can research homes values, view recently sold homes, and search for homes currently on the market.

•· http://www.maricopa.gov/ - Maricopa County's website will provide you with closed sales within the last year of similar homes located within the surrounding neighborhood of your search.

•· http://www.eppraisal.com/ -  eppraisal.com provides home values, neighborhood information, and real estate market analysis to consumers.  Homeowners, buyers, and sellers can take the next step by connecting with local real estate professionals, such as Realtors, Home Inspectors, and Appraisers.

•· http://realestate.yahoo.com/Homevalues - Yahoo offers a look at recently sold homes, as well as similar nearby homes for sale. Yahoo will also answer questions regarding home values from people and professionals around the world.

•· http://www.freecompcheck.com/ -FreeCompCheck allows you to perform a variety of different services such as listing your property for sale, searching MLS and, most of all, checking the value of your home and comparing it with top search engines - all on one page.

•· http://www.cyberhomes.com/ - Cyberhome allows you access to the same information that real estate professionals use to evaluate homes.  It also provides first-hand knowledge of surrounding schools, neighborhoods and distressed properties. 

For more information you should contact the Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com.  

Many residents in Phoenix, Arizona have recently decided to either purchase or refinance their dream home only to discover that they have less than perfect credit.  Don't be discouraged.  There are many ways to rehabilitate your credit.  Here are a few key tips to improve your credit score in the quickest and most effective manner.

•1.   Review Your Credit Report For Accuracy - It is advantageous to check your credit report to make sure the credit bureaus have not reported anything in error or that you have not fallen victim of identity theft.  Any identified errors should be corrected immediately. 

You can access this information prior to applying for a mortgage loan by going to http://www.annualcreditreport.com/.  You can receive a free report from each of the three national credit bureaus every 12 months.  This inquiry will not have any impact on your credit score. 

•2.   Examine Your Credit Limits and Balances - To maximize your credit score, the general rule of thumb is to keep you credit card balances below 30 percent of the available credit limit.  Make sure that all credit card companies are reporting your available credit limits.  If there is no limit reported, the credit reporting software will automatically see the account as being "maxed out".  This will have a negative impact on your credit score.  After you have assessed that all of the accounts are reported correctly, your next step is to try to get the balances within the 30 percent threshold.  This can be achieved by either paying down the accounts as much as possible or distributing balances amongst multiple cards in an attempt to keep the balances at lower levels.     

•3.   Pay Past Due Balances - Delinquent accounts are those that report a "Past Due" balance on your credit report.  Your credit score is negatively impacted the most by these accounts.  These amounts should be paid off first, especially if you have limited funds.  This should yield one of the quickest improvements to your score.     

•4.   Pay Recent Charge-Offs and Liens - Charge-offs and liens that have been reported on your report within the last 24 months are causing major damage to your credit score.  These balances should be paid off after the past due balances have been satisfied.  Once paid, make sure the company/lien holder reports the account as PAID to the credit bureaus.  Any charge-offs and liens that are greater than 24 months are no longer causing additional detriment to your score and can be moved down in priority for the time being.    

•5.   Keep Old Credit Cards Open and Active - Do NOT close credit card accounts, especially if they have higher limits and have been open longer than two years.  Not only does your credit score factor your debt balance to available credit limit on a per account basis, but it also analyzes the overall debt ratio as well.  Closing a credit account could reduce your total available credit limit, whereby increasing your overall debt ratio and causing a negative effect on your credit score.   

The age of your credit history can help your score.  It is perceived that the longer you have an account open and in good standing, the less likely you are to default.  However, the account will be deemed inactive and will have no advantage to your score if it is not at least utilized every six months.  It is to your benefit to use these cards and maintain a positive payment history.  To avoid the interest charges, you can simply payoff the entire balance as it becomes due.   

These are just a few of the general ways to begin improving your credit scores in an effective manner.  Before you begin your search for your home in Phoenix, Arizona, you should contact the Krushinsky Team at 623-594-7600 to find out how a mortgage lender will analyze your credit score.  Each individual's credit history is unique and may require a more customary approach.  Our team also works with and can refer you to certified experts that can help you increase your credit score. 

The Krushinsky Team wants to assist you in qualifying for the best possible financing to help you reach your homeownership dreams.  If you have additional questions call 602-695-7575 or david.krushinsky@wjbradley.com.

Are You A Good Neighbor Next Door? Phoenix Loan Program for Firefighters, Police Officers, EMTs and Teachers

Are you a Firefighter, Police Officer, EMT or a K-12 School Teacher?  If so, you may be eligible to purchase a home in Phoenix, AZ using the Good Neighbor Next Door Program.  Under this program, you may qualify for up to a 50% discount off the purchase price for homes located in certain revitalization areas in Phoenix. 

•·         Live Where You Work - If you qualify for this program, you must choose a home that falls in the area where you serve and work. Example: if you serve in Phoenix, and fall under one of the professions, you are eligible only to purchase a HUD repossessed home in the City of Phoenix neighborhood limits, unless you are a law enforcement officer. The live in/serve in rule does not apply to police officers.

•·         Time Limits and Employment - Anyone purchasing a HUD home using the Good Neighbor Next Door Program must agree to reside in the property for at least three years, agreeing to sign a "silent-second" mortgage.  If the property is sold within the first three years the silent-second must be repaid on a pro-rated basis.

•·         Financing - You may finance all closing costs and must be able to make a down payment of at least one-hundred dollars.

It is always advantageous to get pre-qualified, especially when you are looking to purchase your home in the competitive Phoenix market.  Before you begin your search for your home in Phoenix, AZ, you should contact the Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com to find out if you qualify for the Good Neighbor Next Door Program. 

Whether you are a first-time homebuyer or a veteran homeowner, one of the main qualifying requirements involved when mortgaging a home in Phoenix, AZ is your credit score.  However, most of us have no idea what actually makes up our credit score.  Many borrowers have the mindset that making their payments on-time will automatically equate to a high credit score.  While this is an important component, it only accounts for approximately one-third of your overall score.

The following is a breakdown of the five key factors that contribute to your credit score:

•·         Payment History - 35%

•·         Balances Carried - 30%

•·         Credit History - 15%

•·         Mix of Accounts - 10%

•·         Credit Inquires - 10%

Payment History - This is definitely one of the most important elements in determining your credit score.  The highest weight is placed on those balances with the highest pay history, such as mortgages and other large monthly payments.  Accounts that have a history of late payments, charge-offs or collections will all negatively affect your score.  The more recent the delinquencies, especially within the last six months, will have a greater impact.  The one thing that will always improve your credit is time!

Balances Carried - The second most important factor is the proportion of balances held compared to the total credit available.  The primary type of accounts analyzed in this component is your revolving credit.  This includes major credit cards, department store/retail, gas cards, etc.  Mortgage and auto/installment loans are included in this portion, but carry a much lower weighting factor.  The general rule of thumb to maximize your credit score is to keep your balances under 30 percent of the available limit.  For example, if a credit card has an available limit of $10,000 the outstanding balance should not exceed $3,000.  Spreading balances between cards to keep the outstanding balances below 30 percent of the available limit will help to maximize your credit score.

Credit History - This component is directly related to the length of time your accounts have been open.  The longer the account has been open and the longer the account has a history of being paid as agreed, the higher impact it will have on your credit score.  NEVER close credit accounts with a long history that are in good standing.  This will shorten your credit history and have an adverse affect on your score.

Mix of Accounts - This category refers to the type of accounts you have open.  The "ideal" mix is to have a mortgage, auto/installment loan, and 3-5 credit cards/revolving accounts.  You can still have a high credit score without this exact mix.  Therefore, if you have less than three revolving accounts it is good to open a new account, but DO NOT close accounts if you have more than five. 

Credit Inquires - When you apply for credit and give a lender permission to check your credit history and score, this will reflect as an inquiry on your credit report.  Each inquiry averages approximately a 5 point decrease in your credit score.  However, if your credit is pulled multiple times for the same type of inquiry, i.e. mortgage loan, within a 30 day period, it is only counted as one inquiry.  Only the first 10 inquiries within a year have an effect on your credit score.  There are also certain types of inquires that have no hurt your score, such as annual reviews, employment, insurance, promotional offers (pre-approved offers in the mail), and utilities.

It is always advantageous to maximize your credit potential, especially when you are looking to either purchase or refinance your home in Phoenix, AZ.  Before you begin your search for your home in Phoenix, AZ you should contact the Krushinsky Team at 602-695-7575 or david.krushinsky@wjbradley.com to find out how a mortgage lender will analyze your credit score.

Thinking back to the days before being in the mortgage industry, I remember feeling like I didn't have a clue how to get a mortgage when I bought my home in Glendale, AZ.  This was before it was easy to jump online, go to Google, type in Home Mortgage Phoenix and start reading the endless amount of information about financing a home in Glendale, AZ.  I decided to write down a few basic tips that may make it easier for a first-time homebuyer to get through the process when purchasing a home in Glendale, AZ.

1. Go to www.annualcreditreport.com and view your credit report to see if there are any items listed that do not belong on your report.  You may be surprised to find that there are items that may not be yours especially if you have a common name, i.e. John/Jane Smith. You can do this prior to applying for a home loan and it won't affect your credit score.
2. Prepare your financial documentation for your lender prior to meeting with them.  Your lender is going to require you to provide W-2's for the last two years, paystubs, bank statements etc.  You need to make sure that when you get pre-qualified you have all this documentation and provide it upfront.  For a complete list click here.
3. Be proactive!  Call your lender once a week and ask them how things are going or if they need any documents.  Most lenders will call you when they determine they need additional documents but its better to be proactive so you don't miss your closing date due to a delay with your paperwork.
4. Plan on ordering your appraisal as soon as possible.  With all the recent changes in the lending industry with the HVCC and MDIA, it's a good idea to order your appraisal once your purchase contact is ratified.  Home values in the Phoenix metro area seem to be increasing, so you may have a problem with the value of the home if there aren't enough sales that support the purchase price.  If the appraisal comes in low you will have to renegotiate the sales price or pay the difference.
5. Last but not least, set up your hazard insurance policy with your insurance agent at the beginning of the transaction.  This will allow your agent to check the history of claims on the property, also known as a C.L.U.E. report.  Your agent can then tell you how much your policy will cost on an annual basis.  The agents name and contact information should be provided to your mortgage consultant once you determine who will represent you.

For additional questions on how to finance a home in Glendale, AZ contact David Krushinsky at 602-695-7575 or david.krushinsky@wjbradley.com.