Mortgage money remains available to qualified buyers at great rates but application process longer

by David Webb

David Webb is a veteran journalist who has written for the mainstream and alternative media for three decades. He is now a freelancer who lives in the Cedar Creek Lake area. He is a regular contributor to cedarcreeklake.com. E-mail story ideas to davidwaynewebb@yahoo.com.

Ron Watterson is branch manager of Prime Lending's Oak Lawn office in Dallas. He began his career in residential real estate sales as an agent for a leading broker in 1983. His interest in the financial aspects of clients' real estate transactions led him to become a mortgage specialist in 1992. His company lends mortgage money for purchasing new homes, remodeling and renovation, purchasing vacation homes and refinancing homes. Watterson owns lakeside property on Cedar Creek Lake.

CedarCreekLake.com: What have been the most striking changes in the mortgage application process in the last few years?

Watterson: The process of obtaining a home loan changed significantly in 2008 with the elimination of the "alt doc" loan types such as stated income, no income/no asset verification loans, and many Jumbo loan products greater than $417,000. Gradually, the jumbo products returned, but now verification of both income and assets are a requirement for all loan types. Many of the new regulations for the appraisal process, additional disclosure requirements and increased documentation from borrowers were cumbersome at first, but have now become business as usual for companies such as PrimeLending, who embraced the changes.

CCL.com: Has it become significantly more difficult to obtain a mortgage and why?

Watterson: It's really no more difficult today than in the past for qualified borrowers to obtain a mortgage, with exception that more thorough documentation is required. The difficulty is for borrowers who many not qualify because they are self-employed and don't report enough income to qualify, or for borrowers who have struggled to pay pills on time due to loss of job or other economic challenges. Many big banks appear to be bogged down with huge pipelines and are taking 45, 60 or even 90 days to close a loan. This gives lenders like PrimeLending an enormous advantage because we are typically able to close loans in two to three weeks.

CCL.com: What types of mortgages are most common today among your customers?

Watterson: PrimeLending offers a wide variety of loan products. FHA, VA and USDA are all extremely popular for the minimum down payment requirements and relaxed credit requirements. We are seeing a very exciting trend in our construction and renovation products, such as the FHA 203k and FNMA Homestyle programs which allow a borrower to purchase or refinance a home and include funds for improvements in the loan. With so many homes on the market that need repairs or updates, these programs are in great demand.

CCL.com: Is there a connection between the number of residential properties available for sale and the requirements for obtaining a mortgage?

Watterson: It's important to remember that real estate is a local story. There is so much press about real estate slump, but the market in Texas and more specifically, North Texas, is much stronger than many parts of the country. Our local economies are healthy and there are homebuyers looking for well-priced homes to buy. We work with many Realtors who indicate their biggest challenge is finding suitable properties for their buyers. They feel that the spring selling season arrived early this year with lots of buyers and not enough quality homes listed for sale.

CCL.com: Is there ample money available for mortgages today?

Watterson: Yes. Mortgage money is available and is being offered at historically low rates to qualified buyers.

CCL.com: What types of changes do you envision occurring in the mortgage industry in coming years?

Watterson: Many experts concur that interest rates will increase in the not-to-distant future as the economy gains steam, although the Federal Reserve indicated just this week that their policy to keep rates low many extend to 2014. It's also likely that even more regulations will be implemented for mortgage lenders, but we are committed to do what's right and to do it well. A consumer's credit history and related score will continue to be a key factor in not only the availability of credit offered, but the interest rate and terms of that credit, whether for a new home loan, car loan or credit card. We continue to increase the types of programs we offer our customers with several new options for jumbo loans expected in the next few months to support our continuing growth and market share.

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