#5.  Child Support: Lending regulations allow it to be “grossed up” 125% of the monthly amount, since it is non-taxable.  For example, if the monthly payment is $1000, the ‘effective income’ is $1250, allowing more income to be used in the calculation of the debt-to-income ratio.

#4.  Second Home purchases:  Lenders are looking more closely than ever at the purchase of a 2^nd home, cleverly disguised, when in reality it is an investment purchase – with borrowers wanting to secure the lower interest rate applicable to 2^nd homes and lower closing costs.  Occupancy certs after closing are becoming more common as well as underwriters searching the internet to see how the property was advertised for sale and if there was a management company involved with the prior ownership.  The purchase of a “one unit property with an ADU (Accessory Dwelling Unit) cannot be made as a 2^nd home unless it is  NOT rented.

#3.  Social Security Income – “Gross Up”:  Lending regulations allow Social Security Income to be “grossed up” (like Child Support), but ONLY to extent that it is NOT taxable.  To find out how much is non-taxable, a review of the borrower’s tax returns is necessary.  By grossing up Social Security income the borrower(s) can expand his/her loan amount and ultimately purchase price.

#2.  VA Loans with 20% Down Payment:  Actually result in a LOWER monthly payment and a BETTER lending program than a Conventional Loan with 20% down payment.  The reason is that the interest rate is lower and the seller has to pay the escrow fee.  Even though the VA funding fee adds a small amount to the loan amount, the lower monthly payment makes it a better deal for borrowers.

#1.  LOWER INTEREST RATES THIS MORNING:  Interest rates are lower at this point this morning than they have been ALL YEAR, due to the geo-political events shaping the world.  Events taking place in Iraq, Syria, Afghanistan, Ukraine, China and with Germany’s investor confidence down, UK inflation declining, Russian economy dropping; most every country in the EU is losing ground while the level of inflation is also falling leading to increased concerns that the region will deflate. Interest rates going lower; the 2 yr note rate the lowest in over a year, the 10 yr note the lowest rate since June 2013. The German 10 yr bund rate at 0.81%, an all-time record low.  All of this is fueling lower interest rates, EVEN THOUGH just a few months ago ALL OF THE “EXPERTS” predicted HIGHER interest rates in October when the U.S. Government ended their purchase of mortgage-backed securities.