Mortgage planner Jocelyn V. Lopez has been working overtime to help Latino's affected by the current mortgage crisis. She started out as an executive assistant and learned the mortgage business from the ground up. Mrs. Lopez was then promoted to Head of Loan Processing Department for a New York based Mortgage Broker. She recently opened her own Mortgage Branch in the Corona, Queens area of New York where a large amount of Latinos have seen the negative affects of this economic downfall. Here, she shares some pointers on the what caused the current mortgage crisis and how you can avoid being caught in the same trap:
If you’re trying to understand this mortgage crisis and how it can or will affect you there are a couple of basic terms that you should familiarize yourself with. A fixed-rate mortgage charges a set interest rate that does not change throughout the life of the loan. The total payment will remain the same month to month, which makes budgeting easy for homeowners. An adjustable-rate mortgage or ARM will get you an interest that varies over time. The initial interest rate on an ARM is set below the market rate and rises as time goes on, eventually surpassing the going rate for fixed-rate mortgages.
The current crisis was primarily caused by lenders creating loan programs which promised the world to their clients during the housing boom. These subprime adjustable rate loans offered people the opportunity to buy houses and property with little to no money down and a minimum amount of documentation. Lenders were willing to take on these riskier investments with people who were unqualified to borrow such large amounts of money in part because many of these mortgages were offered as adjustable rate loans. Within a year of the housing crash in 2006 mortgage payment rates sky rocketed and many families found they could no longer afford the monthly payments.
This crisis has affected our communities disproportionately because we have not properly educated or informed ourselves to understand the process of homeownership. Many Latinos have a mind set where they don’t think they should question anything a realtor or mortgage advisor says. A sense of fear, language barriers and general ignorance about the housing market are just some reasons why this has had such a harsh affect on our community. Many of us have stayed silent and not asked all the necessary questions to determine what the right choice should be as far as the housing, loan programs, and costs.
The best advice I can give any client is to speak with a mortgage advisor before meeting with a realtor if purchasing a home. This way you will know exactly what you can qualify for and afford. This will narrow the list of homes the realtor will be showing the client and avoid any issues with high priced homes.
When refinancing and purchasing a home it is advised that you get at least 3 different quotes from different mortgage companies IN WRITING! Always work with a broker who speaks your language as well as English and who can offer a wide array of loan programs and services. Be very honest about all of your personal information with the person working on your case and do not be afraid to speak up if you feel uncomfortable or confused.
If you live in the NYC area and want more info. contact Jocelyn at:
Lend-Mor Mortgage Bankers, Corp
Licensed Mortgage Bankers
106-03 Corona Avenue
Corona NY 11368
- Mariela Rosario