What is CLTV?

What is CLTV?
I know about all the bad hype from the media about the
mortgage market. And, of course I have heard each of our
presidential candidates run down the economy over and over
again. This happens every election year.

Unfortunately people with very busy lives hear and read all
of this and begin to think it is true. We have all heard
this: "If you tell a lie often enough people will believe
it is true". There you go!

Is our economy a little slow right now? Yes, but it is not
in the dumpster.

Are independent mortgage brokers and appraisers the cause
of the mortgage scandals? Absolutely NOT. In fact, it is
their integrity and concern for their client's well being
that helped to fulfill the American Dream.

The real scoundrels are the large corporations, and giant
lenders. Don't let me forget to mention the politicians
like the New York Attorney General, Andrew Cuomo, who is
using the situation to his benefit by "saving the consumer"
with new laws that will only hurt the consumer by putting
the independent appraiser and broker out of business. But
of course he is making a name for himself. What does he
care. Guess who wants to run for president in 2012?

Well, enough of that! I received a very simple question
yesterday and I am writing about it here for a few reasons
I think you will understand afterwards.

The question I was asked is: "What is CLTV and LP?"

The answer is CLTV stands for Combined Loan To Value. This
is used when there is more than one loan on a property. As
an example, if the first mortgage is 80% of the appraised
value and there is a 2nd loan of 15% of the value, the CLTV
is 95%. In the industry we call these Combination Loans.

LP is a term for Loan Prospector. Loan Prospector is a
computerised program that reviews and approves or
disapproves an FHA, VA, or Freddie Mac loan. DU, DeskTop
Underwriting, is a similar program used for Fannie Mae,
FHA, or VA loans. When an application is put through these
programs, basically, ... sort of, the live underwriter then
only has to verify the documentation because the computer
has given an approval. If a loan isn't approved because of
an unusual circumstance, a lender can chose to do a manual
underwriting in which case the loan may still be approved.

My first reason for writing about this is to let you know
that Lenders ARE lending money. The mortgage industry is
alive and well in spite of the media and presidential
candidates.

As a consumer you should take full advantage of these
unbelievably low interest rates. Refinancing to lower your
interest rate will save you a ton of money.

In the case above, combining a 1st and 2nd mortgage is a
very smart financial move and will also lower your payments.

If you are thinking about buying a home there is no better
time than now. I really mean like, ... NOW. As soon as a
new president is elected, and it doesn't matter which one,
the rates will go back up. I promise you this will happen.
It happens EVERY election year.

Just make sure you go to a reputable broker and don't buy
more house than you can afford.

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Connie Sanders owns http://www.mortgageunderwriters.com and
receives questions everyday from borrowers and industry
professionals. The ones with issues she posts on her blog:
http://mortgageguidelines.blogspot.com Visit today, your
comments are welcome.