Home Values Are Going Up BUT NOT TOO FAST!

Where is the Real Estate Market Trending or Heading? 

Ok.. were back. Values are sky rocketing and prices are increase at a trend rate that is almost straight up!
The (Im going to get technical here with math) slope of the trend graph for some of the major metro area like Tampa, Los Angles, San Diego and Phoenix is very large number. This growth straight up! Get ready, for lotteries, lines and no homes. Of course you must have been sleeping if you are in the industry have not seen this yet

To look forward, we must look at where we were in the past. See the following graph.  (For a high resolution PDF version click here.)

It appears from the graph of Phoenix House Values below, that the real estate market in the Phoenix area is heading up.   Is it time to buy real estate again?  How long will it take to come back to normal?  Should I get out of the market and wait?  These are hard questions to answer but here are Big Daddy Dennis’s predictions and recommendations:

ü  Home values will not return to the trend line for another 1-2 years. Latest trend shows Phoenix back to the highs starting July 2015!

ü  The upturn in values are due to LACK OF INVENTORY AND RECORD LOW INTEREST RATES.

ü  Keep your home if possible.  Do whatever it takes to keep the current home. 

ü  Do a loan modification?  Its possible but there are very few who are successful. 

ü  If you ‘bail out’ and let the bank foreclose, you will not be able to purchase a home for 5-7 years, maybe even never again!

ü  Inflation will come back and the value of the dollar will drop dramatically.  (This could change if the USA will cut spending and raise taxes, cut medical/social security, and increase the tax rate by 45%. I don't think this will happen.)

ü  The amount of debt in the USA will continue to grow. The amount is very frightening to view it click here.

ü  In 5-7 years, it will cost $10 to buy a loaf of bread.  Gasoline will cost $25/gallon. And the average starter home price will be $600,000.

ü  Get out of debt; get rid of the credit cards and pay them off.  Purchase only if you have the cash.  Do not get into any debt.  (I sound like your mother here, but she was correct.)

ü  Start a side business.  It’s too difficult to explain here why, but the best reason is the potential tax advantage and the possible income.  Your own side business is the LAST area the government has yet to attack.  Make it simple and get going.  An extra $400 per month really helps.

ü  If you are able, purchase quality single family homes in a good area and turn them into rental units. (Your side business?)

I’ve talked to a lot of people who feel that they can ‘let their home go and rent for awhile’.  Rental rates are lower than their mortgage rates. Yes, they are!  ‘We can save a lot of money by renting vs. paying the mortgage, and in 2 years we can purchase again and have a good down payment.’  Well, it’s actually going to be 5-7 years before your credit report looks good to purchase a home again.  And can you really save the money?  Most people will spend the money on toys.  If hyper inflation hits, like some economist predict, then you’ll be priced out of the market. Do you want to take the chance?  Keep your home, do a HARP 2 loan modification, and hang on – the next 5-7 years are going to be enjoyable.

With low inventory and too many buyers, the Phoenix Real Estate Market is on the verge of a new boom in real estate values.

With low inventory and too many buyers the Phoenix Real Estate Market is on the verge of a new boom in real estate values.

'This boom is going to be different,' according to Dennis Dahlberg, Level 4 Funding   Hard Money Lender . 'The last boom was fueled on greed of the consumer; this time it's going to be a supply problem. Over the past 6 years there was little construction or movement of dirt, leaving the Phoenix housing market starving for new homes. Additionally, home values are raising dramatically, and once the current home owners get above water (have equity) they are going to want to move up. We're going to have a trifecta or the perfect storm-no homes, pent-up demand, and record low interest rates. And if you throw a little inflation on top of the mix -- watch out! Bam! its going to be a wild ride -- a wild west ride!

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917

www.level4funding.com
NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Using Adjustable Rate Mortgages and Other Subprime Loans to Your Advantage

Having bad credit can make it almost impossible to get a home loan but there are lenders that offer programs for a bad credit mortgage Arizona. There are different options available to help subprime borrowers that can also be taken advantage of by borrowers with good credit.

Close to 42 million Americans have bad credit, which is approximately one quarter of all individuals with active credit accounts. This is defined as a score of less than 640 and can make it difficult to qualify for a car loan, home loan, credit cards, and even store accounts. For many individuals with bad credit, buying a home seems impossible. However, many mortgage brokers offer bad credit mortgage Arizona programs to help Arizona residents qualify for home loans.

One type of loan that is available for people with bad credit is an adjustable rate mortgage or ARM. An ARM is offered to subprime borrowers who would not qualify for a traditional loan. It offers a low interest rate at first but then resets to a high interest rate after a specified period, usually 1 to 7 years. Once the rate adjusts your mortgage payment will increase due to the higher interest rate. This can be a good option if you only plan on owning the property short term or if you know you will be able to qualify to refinance your loan at the end of your low rate period. Although an ARM is a type of bad credit mortgage Arizona, it can also be beneficial for borrowers with good credit.

A second type of loan is a type of FHA loan. An FHA loan is backed by the government and will allow you to borrow about 96.5% of the value of the home you are purchasing. This means that you won’t have to come up with a large chunk for a down payment. In addition, the government backing means that you will be more likely to qualify, even with less than stellar credit. You will pay monthly insurance on your loan. In addition to you principle and interest payments, you will also pay a PMI insurance payment. This will increase the amount of your monthly mortgage payments until you pay off 20% of the loan amount. You can also couple FHA loans with different federal programs that offer down payment assistance or cash back at closing like Home in 5. These programs are constantly evolving and changing, so make sure to talk with a mortgage broker about what you may qualify for.

 A third type of bad credit mortgage Arizona that is available is a hard money loan. A hard money loan is secured through a mortgage broker but is backed by investors instead of a bank. This is especially beneficial for people looking to do a fix and flip or short term purchase. Depending on the merit of the property you are purchasing as well as potential for income, investors will often invest capital, even if your credit score is lower than what is ideal. It should be noted that hard money loans are short term loans only. They cannot be used to purchase a home you plan to live in for any significant amount of time. These are designed primarily for real estate investors.

When Does a Bad Credit Mortgage Make Good Financial Sense?

For some borrowers, a bad credit mortgage Arizona  is the only option they have to purchase a home. However, some of these bad credit loans can benefit traditional borrowers as well. Specifically, an adjustable rate mortgage. An ARM can save you thousands of dollars in interest over the life of your loan and makes sense in certain lending situations. Here are five situations that could benefit from an adjustable rate mortgage:

1.       You plan to sell your home prior to the rate raise. If you only plan on living in your home for a short period of time, an adjustable rate can save you money. If you sell before the rate raises you will never have to pay the higher interest rate.

2.       You have bad credit, but you are working on it. An ARM is a fantastic option to help rebuild your credit score. If you know you will be able to qualify to refinance before the rate adjusts, it is a good way to get into a home and start rebuilding your credit score.

3.       You expect a windfall. You know you will be able to pay the home off early due to an inheritance. Then the ARM can save you interest while you wait to pay off the home.

4.       You expect your income to increase. If the loan resets, you will be able to pay the higher interest payments because you will be earning more money.

5.       You plan to fix up the home and sell it for a profit. If you are not planning a long term investment, an ARM can save you money while you are renovating.

Talk with a mortgage broker to determine if an ARM or other bad credit loan is right for you.

Whether you need to rebuild your credit or are in a situation where you could benefit by taking advantage of a bad credit loan, a mortgage broker can help you determine the right product for you.

Dennis Dahlberg
Broker/RI/CEO/MLO

Level 4 Funding LLC
Tel:  (623) 582-4444 | Fax: (888) 279-6917

www.level4funding.com
NMLS 1057378 | AZMB 0923961 | MLO 1057378
23335 N 18th Drive Suite 120
Phoenix AZ 85027

Stated Income Mortgage in Arizona

A stated income mortgage can be a helpful tool in qualifying for a mortgage if you are self-employed or have income that is difficult to verify. Learn what a stated income mortgage is and see if one is a good fit for your home loan needs.

In a traditional mortgage qualification process, the borrower is asked to provide a variety of documentation. Key among these documents are income verification documents. These include W-2s, tax returns for two years, pay stubs, and bank statements. Any additional deposits into a bank account that cannot be verified by paystubs must also be accounted for. Basically the financial assets of the borrower are gone over with a fine tooth comb. This system works well for people who hold traditional jobs with stable income. However, for borrowers who are self-employed, investors, or have a different non-traditional income situation, income verification can be almost impossible.

For borrowers who are unable to furnish proof of income, earn money in a non-traditional way, or who may have a higher than permissible debt to income ratio, a Arizona stated income mortgage can be a solution. A stated income mortgage is a home loan where the lender does not verify the borrower’s income via W-2’s or tax returns. The borrower is asked to state their income and then taken at their word.

Stated income mortgages have been given a bit of a bad reputation because they are easy to use to commit fraud. One less than flattering nickname for the loans is “liar’s loans.” This nickname came about because a study of IRS tax records found that in nearly 60% of all stated income mortgages the borrower actually made less than he/she declared as income to obtain the loan. Some politicians are trying to limit access to stated income loans based on the assertion that they could be used for fraudulent purposes.

When Does a Stated Income Mortgage Make Sense?

Despite its less than flattering nickname and somewhat checkered past, there are certain situations when a stated income mortgage is the best home loan option. For many borrowers this type of home loan is the only loan that will give them the capital they need to buy the home they can afford. There are a few situations where a stated income mortgage makes sense.

The first case in which a stated income mortgage is a smart choice is self-employment. This is actually the income situation that the mortgage type was designed for. For many small business owners, independent contractors, consultants, and other self-employed business people, it can be difficult to furnish proof of income to the bank’s satisfaction. Income sources may be considered unstable or there may simply not be a traditional W-2 or pay stub that can be provided. A stated income mortgage allows the business owner to state his/her income and qualify for a mortgage based on that statement.

Another case in which a stated income mortgage is a good option, is for someone who makes his or her living from investments. Take a real estate investor who owns multiple properties all with loans. Even if this investor makes $100,000 a year in disposable income and has the mortgage on each property covered by rent, his/her debt to income ratio might be too high on paper to be given an additional home loan. A stated income mortgage accounts for the actual disposable income this individual has to spend each month, rather than just what the financial situation looks like on paper.

A third situation that would benefit from a Arizona stated income mortgage would be in the case of a freelancer or consultant. People who are employed in these fields generally tend to work for more than one company. Their work is also often seasonal or may vary from month to month. During the mortgage qualification process, banks look at 2 months of pay stubs. If it is a slow month, the amount of pay may not reflect the actual amount that borrower earned and therefore he/she may not qualify for a high enough amount, if at all. In addition, banks require that a borrower works for a company for a year or more before that income source is considered valid. A freelancer or consultant often works for many different companies but only one or two on a permanent basis. Therefore the actual income of the borrower could be $200,000 but only $50,000 is counted as income by the bank. A stated income mortgage allows the borrower to use their actual income amount to qualify for a mortgage.

If you are in an employment situation where a stated income mortgage makes sense, find a broker to get started.

Most traditional banks do not offer Arizona stated income mortgages as they are considered higher risk loans. Brokerage firms and smaller banks often have programs that will work with borrowers who need a stated income mortgage.

Level 4 Funding LLC

Dennis Dahlberg, Broker/RI/CEO

NMLS 1058389 AZMB 0923961

23335 N 18^th Drive Suite 120

Phoenix AZ 85027

623-582-4444

www.Level4Funding.com

What is Trust Deed Investing aka Investing in Deeds of Trust

Are you Investing in Deeds of Trust? 

Hello, Dennis here, have you ever considered investing in Deeds of Trust or Trust Deeds. And what exactly is a Trust Deed investment? Well, let me explain. 

Today there are many ways in which you can invest your money, such as the stock market, bonds, or even depositing the money into a bank. It's time to add one more to that list: Investing in Deeds of Trust.

This is a great investment for you - when you invest in Deeds of Trust, you become the bank. 

Investing in deeds of trust means that you are loaning your money directly to a borrower who is then purchasing real estate and giving you a Deed of Trust as security for the loan. 

You will receive payments from the borrower monthly, and at a very high interest rate; these rates vary from 10 to 29% for 6 to 24 months with very good loan to value ratios, typically 70% or less. 

Also, your money is secured by the real estate. 

This means that if the borrower fails to make good on the terms of the loan, you, as the lender, take back the real estate. You are then free to sell the home to recover your investment, past due interest, and fees. 

This is much more secure in comparison to stocks, whose value can rapidly decrease or simply vanish if the company goes out of business. When that happens you lose your investment and you are not able to recover it.

When compared to the bank, you are getting a higher rate of return on your investment, typically 10 to 29%. You can even drive by and look at the home in which you wish to invest. Next time you give your money to the bank for little or no interest, ask them if you can see where your money went. 

Trust Deed investments offer security on your money, a high rate of return, and best of all, it's backed up by the property.

If you are looking to invest in deeds of trust, see us at http://www.setabayloan.com or give us a call at six two three five eight two four four four four.

SetabayLoans

23335 N 18th Drive Suite 120

Phoenix AZ 85027

623-582-4444

Family Carnival for Safe Families for Children and Collective Hope

Orphan Care Carnival Benefiting Safe Families for Children and Collective 

Discovery Pointe Orphan Care Carnival
Saturday, October 25th at 4:00-6:30pm

Discovery Pointe Church

9812 W. Yearling Rd Peoria, AZ 85383

Silent Auction, Carnival Games and Dinner

All proceeds will benefit Safe Families Ministry, Collective Hope Ministry and local orphan care efforts within our own community.

What is Safe Families Ministry?

Since 2005, Safe Families for Children has offered sanctuary to thousands of children, minimizing the risk for abuse or neglect and giving parents the time and tools they need to help their families thrive. The ultimate goal is to strengthen and support parents so they can become Safe Families for their own children.  For More Information about Safe Families Ministry.

What is Collective Hope Ministry?

Our Vision:

To keep hope alive by serving the orphaned and marginalized children of Nepal.

Our Mission:

Our mission has two components:

1.  Through the establishment of a Collective Hope Home.  This would mean that Collective Hope would establish a home for orphaned and abandoned children in the Kathmandu area.  The purpose would be to provide a loving and safe environment for children as well as meeting the physical, emotional, spiritual and educational needs of the children.

2.  Through a system of Foster Care.  This would mean that Collective Hope would serve and support family members of children who have been orphaned or find themselves in a marginalized situation.  Collective Hope would come along side a family member of the child to assist them in caring for the child.

Supported by

23335 N 18th Drive Suite 120
Phoenix AZ 85027

What is a Sub Prime or Bad Credit Mortgage?

Sub Prime Mortgages are back (they really never went away).  But what is a Sub Prime Mortgage?

It’s a home mortgage loan for borrowers who have a credit issue giving them a low credit score.  Typically a credit score below 550.  Bad credit sub prime mortgages are easier to qualify, since the lender is focusing more on the asset value and loan to value rations.  They lenders are more flexible in the lending criteria. 

Bad credit mortgage loans have higher interest rates and higher down payments than regular mortgage loans. Typical rates as of today start at 8% with a 30% down payment. 

If mortgage is for an owner occupied home, then the lender will have to determine if the borrower can afford the payment on the loan.  This is called Debt to Income Ratio, or DTI.  The ratios are typically 35/50%.

In the mortgage world, there is a loan for everyone.

It just depends on down payment and interest rate.

However there are some items that will stop a deal dead in its tracks, even for a Bad Credit Mortgage.  Typically the lender will not loan if the borrower has outstanding judgments, IRS Tax Liens, or is involved in a law suit or criminal charges.

Most people prefer to use a bad credit mortgage loan simply to get into a home and help rebuild credit.

Bad credit (or sub prime) mortgage loans are specialized mortgage loans designed for borrowers with credit issues. Bad credit mortgage tend to have higher interest rates and higher down payment requirements than regular mortgage loans. The higher interest rates mean that bad credit mortgage loans also tend to have higher monthly payments than regular mortgage loans.

Level 4 Funding LLC
23335 N 18^th Drive Suite 120

Phoenix AZ 85027

www.Level4Funding.com

623-582-4444

Arizona Mortgage Loan Originator - Making A Lot of Money

PRIMARY OBJECTIVE:
Level 4 Funding LLC specializes in the Sub Prime and Private Money Lending Environment. 

You will:
Obtain and analyze customer financial and credit data.

Manage your personal loan pipeline.

Serve as the primary liaison with bowers and outside entities (realtors, title and escrow officers, etc.) and other company employees to facilitate a prompt and efficient loan closing

Negotiate terms and conditions of loan programs with borrowers.

And you will make a lot of money.

What we provide for you:
Percentage  1.5% of each deal.

In house leads. We are number #1 on Google.

Employee Benefits:
Sorry no benefits, you just make a lot of money.

You will have an office, but you can work independently away from the office.

Required Skills and Qualifications:

Must be licensed as a Mortgage Loan Originator (MLO) in Arizona

Must be able to close the deal.

Prior Loan Origination Experience

About Us:
Level 4 Funding is a Mortgage Broker Company with an array of in house investors and wholesale lenders.  We are in a niche market specializing in Sub Prime loans and Private Hard Money Loans.  FHA/VA – Sorry we don’t do them-- go work for Quicken.

We use:

Point Central, Caylix.

Level 4 Funding LLC

23335 N 18th Drive Suite 120

Phoenix AZ 85027

www.Level4Funding.com

602-580-0611