Lessons from Grandpa

Remember the days when you knew every single person in town by name? The days when you knew their family and what they did for a living? You knew what they stood for and how they raised their children?

Grandpa Gary
I grew up in a very small, country town outside Stowe, Vt., called Underhill, where this type of living was the norm among the population of only 650 or so. As my Grandpa Gary Smith says, it was just “good old fashion living.” Often it seems those days are long gone, but are they really? I would present the thought that perhaps it’s not the times changing, but it’s simply how we have changed the way we handle our relationships – both personally and professionally.

Case in point: I was sitting around the house this past weekend, minding my own business, watching some football, when all of a sudden there it was – a water leak and wet spot on the living room ceiling. 


Great. Fantastic. Terrific. 

Upon further inspection, I found out the washer upstairs had sprung a very slow leak and had been dripping water into the washroom on the second floor. After inspecting the leak, I did what any normal fearless leader of the household would do: I went and searched Google. 

Then something interesting immediately happened as I sat at the computer with my dumb Google idea. I thought to myself, “What would Grandpa Gary do?”  I know exactly what he would do. If he was unable to fix it himself, he would probably call someone down the road or someone the family knew and could trust. 

Being a mortgage banker for 12 years, plumbing is not my chosen profession or trade, so I did the next best thing; I started looking for a referral from some people I trust.  Several of my Realtor partners gave me names of people they know, like and trust to help in situations like these – a referral! 


Well fast forward a week, and we have had a completely stellar experience with our plumber who could not have been better.  The leak is fixed, the initial price quoted was exact (no haggling or additional expenditures) and the best part is it was completed on time as promised. It is clear why this Realtor refers out this exact plumber – his professionalism and integrity made her look like a complete superstar.

A recent study I read from the Learning Institute stated that more than 88 percent of people buy professional services based on who they “know, like and most of all, trust.” If that percentage is so high, why don’t websites have a virtual trust ranking or integrity meter?  A good idea may be a webcam where you can look the person dead in the eyes you are buying from.  But that’s probably not going to happen.

So why do we trust some of life’s biggest choices in our lives like buying a home or getting a mortgage to the World Wide Web? Could I have searched Google and been quoted a cheaper price by someone? Probably. Could I have searched Google and found someone that stated they could do it faster? Maybe. On the other hand, I could have just been told what I wanted to hear, ended up with a mess or major delay, and in turn, costing us way more than what I was actually “searching” for. 


Honesty, commitment and integrity may be old fashion, but one thing is for sure, it will never go out of fashion. 


About the Author
Shawn Kaplan is an active, 50 state Licensed loan officer with Access National Mortgage. Email Shawn at skaplan@accessnational.com or call 615-426-3182.

Bonus: Click to get a free, no-obligation rate quote. I love to work with my readers!

No Fooling! FHA Mortgage Insurance going up again April 9th

FHA Annual MIP & Up-Front MIP changes April 2012


HUD has issued Mortgagee Letter 12-4 announcing changes to the FHA Single Family Annual Mortgage Insurance Premium (Annual MIP) and Up-front Mortgage Insurance Premium (UFMIP).  If you don’t want to read the detailed guidelines below the bottom line is that it is going to cost you more to get an FHA loan to buy a home. 

So what does this mean?  Here is a simple way to look at it.  The above increases will impact all newly originated FHA mortgages for purchase and refinances, unless the home owner qualifies for the new reduced mortgage insurance rates with an FHA streamlined refinance.  The cost of getting an FHA loan just increased again for what seems like the umpteenth time since 2010.  According to FHA, “the monthly payment for an average loan…will increase by approximately $30.” For people living paycheck to paycheck, $30 is significant. Looked at another way, for every $25,000 in a person’s loan, the monthly payment will increase $5.21. A potential homeowner applying for a $200,000 FHA mortgage will now pay roughly $42 more per month. If you are currently searching for a home and pre-approved for an FHA mortgage, it is time to go back to your loan officer and make sure this increase does not affect your pre-approval.  If your loan officer is unaware of this change or you don’t have a loan officer, I highly recommend you read “How To Pick Your Lender” Then call me!

If you want the exact details, check them out here:

1st Part – The Monthly MIP:
 Annual MIP increasing by 10 bps (basis points)
·                                     Loan amounts ≤ $625,500
·                                     Mortgages with terms ≤15 years and LTV ≤78% remain exempt from the Annual MIP (ML 11-35)
·                                     Effective date:  Case number assignment date April 9, 2012

 Annual MIP increasing by 25 bps
·                                     Loan amounts > $625,500
·                                     Mortgages with terms ≤15 years and LTV ≤78% remain exempt from the Annual MIP (ML 11-35)
·                                     Effective date:  Case number assignment date June 11, 2012

 Annual MIP decreasing to 55 bps – Streamline Refinances
 Effective date:  Case number assignment date June 11, 2012
·                                     Streamlined Refinances endorsed on or before May 31, 2009
·                                     Endorsement date is on the Case Query screen in FHA Connection 

2nd Part – The Upfront MIP:
UFMIP increasing to 1.75% of base loan amount    
·                       Regardless of loan amount, term or LTV
·                       Currently the rate is 1% of the loan amount
·                       FHA will continue to permit financing of this charge into the mortgage and will continue to calculate actual premium changes against the base loan amount before adding any financed UFMIP
·                       Fortunately, the upfront MIP can be financed and amortized over the life of the loan.
·                       Effective date:  Case number assignment date April 9, 2012

UFMIP decreasing to 0.01% -  Streamline Refinances
Effective Date:  Case number assignment date June 11, 2012
·                                     Streamlined Refinances endorsed on or before May 31, 2009
·                                     Endorsement date is on the Case Query screen in FHA Connection

If you are currently searching for a home and pre-approved for an FHA mortgage, it is time to go back to your loan officer and make sure this increase does not affect your pre-approval.  If your loan officer is unaware of this change or you don’t have a loan officer, I highly recommend you read “How To Pick Your Lender” Then call me!

About the Author
Shawn Kaplan is an active, 50 state Licensed loan officer with Access National Mortgage. Email Shawn at skaplan@accessnational.com or call 615-426-3182.

Bonus: Click to get a free, no-obligation rate quote. I love to work with my readers!