Understanding DTI

Mortgage companies often require specific documents to analyze the borrower’s financial situation prior to approval. One of the most important aspects of getting approved for a mortgage is your credit score, which shows how well the borrower can meet their financial obligations. In addition to considering your credit score, lenders look at the borrower’s DTI ratio to determine whether they can monetarily handle a new loan.

DTI stands for Debt-to-Income and is calculated by adding all monthly debt payments together and dividing that by the borrower’s monthly income before taxes. DTI does not account for expenses not listed on credit reports, such as groceries, entertainment, and small purchases.

Lower DTI signifies a healthy balance between debt and income. The lower the DTI, the more likely the borrower can qualify for the loan they want. A DTI of 28 to 36 percent or lower is ideal; however, lenders accept higher DTI ratios depending on the type of loan, credit score, savings, and down payment.

There are two ways to lower your DTI ratio: decrease your debts or increase your income. To drive your debt down, pay off existing debt and do not accrue new debts. Increasing your monthly income can be tricky; try working freelance in your free time or find a better-paying job.

Are you thinking about purchasing a home and have a low DTI? Contact the mortgage experts at EB Mortgage today to get pre-approved for the house of your dreams!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Home Prices Rise Fastest in Four Decades

Prices for homes have been rising for a while now, and a new report indicates that they have been growing fastest since the past four decades. CoreLogic released a new report that outlines how home prices have risen by 18 percent from October 2020 to October 2021. The Federal Housing Finance Agency House Price Index also shows that home prices rose 18.05 percent from the third quarter of 2020 to the third quarter of 2021.

It’s been more than 40 years since growth of this magnitude has been seen. CoreLogic says the 18 percent growth was the highest number ever recorded in the 45-year history of the housing price index report. Despite the gains, CoreLogic noted that the monthly rate of increase had slowed significantly, signaling home prices could slow down in the upcoming months.

Frank Martell, president and CEO of CoreLogic said, “New household formation, investor purchases, and pandemic-related factors driving demand for the limited supply of available for-sale homes continues to propel the upward spiral of U.S. home prices. However, we expect home price growth to moderate over the near term as many buyers take a break for the holidays.”

From October 2021 to October 2022, home price gains are expected to drop to 2.5 percent, predicting the housing frenzy might substantially subside. This could be good news for buyers interested in purchasing a new home.

Are you interested in securing a mortgage for a new home or trying to get pre-approved? Contact the experts at EB Mortgage today to buy the home of your dreams.

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

All About Open Houses

What’s an open house? We’re not talking about graduation parties here; instead, we are referring to homes on the market. Open houses are public, informal events hosted by real estate agents or sellers. Typically lasting between one- to three hours, the doors are quite literally “open” for people to browse the house at their leisure.

Open houses give buyers an opportunity to explore the house, deciding whether it satisfies their wants and needs. With no commitment, open houses are a great way to get an up-close and personal with a potential new home. There’s no pressure to buy and no prerequisites to attend.

If a potential buyer has questions about the house, they will have an opportunity to ask and gain answers. Open house attendees do not need a specific reason behind their visit.

To find open houses, search on an MLS (Multiple Listing Services), a service jam-packed with listings state- or country-wide. Some popular MLS sites include Zillow, Redfin, Realtor.com, etc. You can also drive around your neighborhood to find open house signs. Real estate agents are professionals who can research homes and suggest one that aligns with your wishes.

Open houses are a fantastic way for potential buyers to scan the market and see what’s available. They are also ideal for potential buyers to assess the market and explore their options. In addition, open houses are an excellent way for people – even those not interested in purchasing – to gain ideas for their own houses.

If you found your dream home through an open house, you’ll need a mortgage. The next step to homeownership is to become prequalified. The homeownership process doesn’t need to be overwhelming. If you have questions or are ready to purchase a home, contact EB Wholesale Mortgage to speak with a loan expert today.

EB Wholesale Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

What are No-Doc Loans?

Borrowers looking to get approved for a mortgage and cannot show income verification are perfect candidates for no-doc loans. This type of mortgage loan does not require tax returns or income verification.

To qualify for a no-doc mortgage loan, borrowers have to show adequate credit history, real estate investment experience, and liquid assets, which are all passed through underwriting.

No-doc loans are typically unregulated, so they involve elevated down payments over traditional mortgages. In addition to requiring a higher down payment, no-doc loans generally have higher interest rates as well.

For standard mortgages, borrowers are required to submit proof of income to qualify for a loan. Lenders determine this proof via W2s, pay stubs, employment letters, and/or recent tax returns. Borrowers should be able to prove they can afford loan payments through their source(s) of income. Down payments and credit scores are also relevant.

With no-doc loans, the paperwork load is significantly lighter. All the borrower needs to do is provide a declaration saying they can repay the loan. Generally, those who are self-employed, investment-wealth capitalists, immigrants, real estate agents, or temporary workers apply for these loans.

The Consumer Financial Protection Bureau (CFPB), a regulatory agency established by Dodd-Frank, says, “Your organization must verify the information you rely on using reasonably reliable third-party records. You generally cannot rely on what consumers orally tell you about their income.”

No-doc loan borrowers should have excellent credit scores and high cash reserves for down payments. Down payments are roughly 30 to 50 percent higher than traditional mortgages. The higher the down payment, the easier the borrower can be approved for a loan.

Using bank statements and other paperwork, the borrower can prove their capacity to the lender and qualify for a no-doc loan.

Do you need a no-doc loan? Contact the mortgage experts at EB Mortgage today!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Using Gift Money for a Down Payment

Did you recently receive a monetary gift and want to use it toward a down payment? That extra cash might be helpful when exploring options in making that initial up-front parital payment. Gift money could be the extra boost you need to achieve homeownership.

Gift money can come from relatives, defined as the borrower’s spouse, child, or other dependent; another individual related to the borrower by blood, marriage, adoption, or legal guardianship; or a fiancé fiancée, or domestic partner.

Gifts can also be accepted from non-relatives, including close family friends. Ensure the money is coming from someone you trust and will not create any conflict in the future.

Today’s prospective home buyers generally struggle to save funds due to rising rental costs, student loan debt, and other financial burdens – not to mention the steady rise in housing. Therefore, the quickest path to homeownership is to utilize gift money.

To avoid mortgage insurance on a conventional loan, a 20 percent down payment is required. To overcome this challenge, gift funds or other loan options can offer a more flexible down payment. Sellers, realtors, or brokers are ineligible to gift funds to potential borrowers.

Before accepting the monetary gift, ensure the borrower and gift-giver both fill out a formal document detailing the following information:

  • Borrower’s name
  • Donor’s name
  • Donor’s contact information
  • Donor’s relationship to the borrower
  • Gift amount
  • Address of property being purchased

All parties must sign the letter, and it should state that no repayment is expected or required. Financial records should clearly document the transaction as well.

Are you looking to get approved for a home loan? Contact the experts at EB Mortgage today.

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

What is a Homeowners Association (HOA)?

The term HOA stands for Homeowners Association, which you might have heard in passing conversations or in real estate discussions. HOAs affect homeowners in many ways. If you are looking to purchase a home with an HOA, you might want to brush up on your knowledge to learn how it will affect you.

HOAs are organizations within subdivisions, communities, or condominium complexes. In each housing area, rules are made, and the HOA enforces them. Typically, homeownership comes with the freedom to change your home’s landscaping, exterior, or design on a whim. However, HOA community members often run into limitations doing so.

HOAs are run by a board of directors appointed by the community or within the board itself. These positions are voluntary, meaning they are not paid but are reasonably strict about enforcing HOA rules throughout their jurisdiction. The board members deal with complaints pertaining to issues with homeowners.

If you are looking to purchase a new home and an HOA is involved, be sure to meticulously examine the rules before putting in an offer. HOAs are intended to maintain harmony and appearance throughout the local area. Rules are enforced, which keep unruly residents at bay. Sometimes, HOA boards are required to implement regulations if homeowners do not follow the rules. On the other hand, HOAs help to increase community value and ensure properties do not depreciate over time.

There are some pros and cons of being a member of an HOA. Some pros include amenities, unified appearance, community involvement, and maintenance. Conveniences can consist of a pool, gym, meeting room, and more. Typically, utilities such as trash and water are also covered. Because maintenance is sometimes covered under the HOA, issues with landscaping or infrastructure can easily be fixed.

Cons of HOAs include dues, rules, and a limited amount of freedom to do as you please. Monthly dues are separate from a mortgage payment and are used toward expenses. Prices can vary between communities, and the board can adjust the dues as they deem necessary. Regulations set by the HOA aren’t crystal clear until you move into your new home. Some rules include a specific number of pets, length of grass, types of renovations, paint colors, fences, etc.

Being an HOA member is a choice some homeowners have to make, but it shouldn’t be a flippant decision. The takeaways are vast; before making a decision, research the options heavily.

Have you found a home and are ready for a mortgage? Contact the experts at EB Mortgage today!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Qualifying for a Mortgage While Self-Employed

Self-employed applicants looking to purchase a home will have to fill out the same paperwork as those not self-employed, and lenders look at the same aspects such as credit score, debt, assets, income, etc. So what’s the difference between a self-employed applicant and everyone else? When working for a company or business, lenders will verify the amount – and history – of that income to determine how likely you will continue to earn it.

Lenders are typically looking for the following:

  • Income stability
  • Location and business
  • Financial strength
  • Potential future revenue

To apply for a mortgage while self-employed, you will need to provide a few documents showing a history of uninterrupted income for at least two years. Employment verification will also be examined, which can include:

  • Client lists
  • CPA verification
  • Proof of licensing or other organization
  • Insurance confirmation
  • Doing Business As (DBA) documentation

Income documentation will also need to be ready to go. It’s crucial to show steady, reliable income for the past two years. Mortgage lenders generally look for:

  • Personal tax returns (W2s)
  • Profit and loss forms (Schedule C, K-1, Form 1120S, etc.)

If you have been self-employed for less than two years, to qualify for a mortgage, you’ll need to show that your business has been active for a minimum of 12 consecutive months. Additionally, your non-self-employment history will also be verified. Your training and education might go under the microscope to ensure stability will be gained by your success.

Check your Debt-to-Income Ratio (DTI), ensure your credit score is high, and separate your business expenses as well.

Self-employed and want to apply for a mortgage? Contact the experts at EB Mortgage today!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

Early October is the Perfect Time for Homebuyers

If you have been eyeing a new home or thinking about buying, now is the time. Headlines skim past buyers as the seller’s market has been steaming hot. Bidding wars have been on the rise due to low mortgage rates and price appreciation. Thankfully, there are clear signs that buyer opportunities are increasing during autumn.

According to Realtor.com, the best time to buy a home in 2021, is the beginning of October. In a recent study, housing market trends were analyzed by experts. The past several years of data were looked at and applied to the current market.

Are you looking to cash in on the upcoming golden opportunity? Here’s what to expect:

Expanded housing supply: Total amount of homes for sale should increase. New listings typically come to market the week of October 3rd. A rough estimate stated that 17.6 percent more homes will be available than at the start of the year.

Less bidding wars: As more homes are available, the number of bidding wars will decrease. More options equal less competition and a better chance of securing the property.

Adjusted prices: As winter approaches, prices are tweaked and often reduced. While home prices are still appreciating, some houses will spike lower as owners are eager to sell. Owners might act with more motivation to achieve a sale prior to year-end.

If you are looking to buy a home, now is the ideal time. Your patience will pay off, and the home of your dreams is right around the corner.

Do you need a pre-approval to snag that fab new house? Contact the mortgage experts at

EB Mortgage today!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

How to Increase Your Credit Score Before Applying for a Mortgage

The higher the credit score, the better. This is a general rule of thumb for many aspects of life, especially when applying for a mortgage. If you have found yourself questioning your credit, here are some proactive measures you can take to improve it.

Increase your Credit Card Limit
A simple and effective way to boost your credit score is to increase your available credit. If you have credit cards open, all you have to do is raise the limit on them. In time, your credit scores should increase as your utilization lowers. You can increase your credit card limit over the phone or online through your credit card provider. The company might ask you to enter your gross annual income or housing payment. This process can take a minute or so but will need to be done at least three months prior to applying for a mortgage. Card issuers might need to access your credit report, which could temporarily affect your credit score.

Lower Your Credit Utilization
Credit utilization is the percentage of credit you are using at any time. A lower utilization rate (debt-to-income ratio) is typically what credit bureaus and mortgage lenders look for. With higher credit limits, as long as you are spending less (or the same amount before the limit was raised), your credit score will rise. If your credit card balances are low, your chances of being approved are higher.

Pay Off Existing Balances
Any prior loans or credit card balances that can be paid off or lowered will free up available credit. Since your minimum payment will be reduced in the process, your Debt-to-Income Ratio will decrease, giving your credit scores a boost. Smaller credit balances make way for your income to go toward a mortgage payment.

Work In Advance
Credit limit increases could result in a hard inquiry on your credit report. When these reviews take place, your credit can be slightly lowered. Thankfully, this is temporary, so try to go through with any of the above-mentioned strategies several months before applying for a mortgage. You can also ask your credit company to determine whether the application will result in a hard or soft pull on your credit.

What is your credit score? Learning and knowing this number is one of the first steps in gaining a mortgage. Contact the professionals at EB Mortgage today to walk you through the new home purchase or refinance process.  

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.

The Importance of Cosigners on Mortgages

Buying a home is a huge decision, investment, and can be exciting for first-time homebuyers. Mortgage lenders help buyers with the process, ensuring success in every aspect. From time to time, roadblocks occur, which could postpone the outcome. Even with enough funds to cover a down payment, closing costs, and monthly payments, you could still be denied.

Thankfully, there’s a way around the mortgage denial roadblock: a cosigner. 

Someone who cosigns a mortgage has decided to join with another borrower to purchase a home. A cosigner is bound by a legal obligation to repay the mortgage if the primary borrower can no longer perform their financial responsibilities.

Close family members or friends can cosign mortgages and are generally meant to assist the applicant with funding, build credit, or reduce their financial risk. College students or recent graduates are good examples of those first-time homebuyers who might require assistance from a cosigner. With minimal credit history and zero income, it is challenging for them to get approved. Parents usually help these students or recent graduates by cosigning, as they are not required to live in the home. As long as their income can support the loan qualification, the borrower (student) would be approved.

Cosigners are treated the same as other applicants and should be prepared to fill out loan applications, financial information sheets, and explain their relationship to the borrower. The overall credit score will be averaged between the two borrowers. The cosigner will appear on the mortgage, and their credit will reflect that as well.

Ready to apply for a mortgage with your cosigner? Contact the home loan experts at Concord Mortgage today!

EB Mortgage is a locally-owned mortgage company with experts in new home purchase, refinancing, and commercial loans. Our wholesale rates can’t be beaten. We offer more products, more options, and more solutions. Our “3C” Process is simple: complete our pre-approval request, consider options based on your requirements, and choose the offer that suits your needs best. Call us at 866-246-0516 or e-mail contact@ebwmtg.com today.

Written by the digital marketing staff at Creative Programs & Systems: www.cpsmi.com.