Things are moving so quickly in the market with the coronavirus being at the forefront, everyone is feeling hardship across the board.
FHA Loans provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. It is one of the largest insurers of mortgages in the world, insuring more than 46 million mortgages since its inception in 1934 and it's the only government agency that operates from its self-generated income.
Self-generated income which means the Mortgage insurance premiums that is collected from borrowers via lenders are used to operate the program.
FICO scores tells the lender what type of credit risk you are and what your interest rate should be to reflect that risk by utilizing a FICO formula.
The most commonalty used :
Equifax Beacon 5.0
Experian/Fair Isaac Risk Model v2
TransUnion FICO Risk Score 04
We’re seeing what’s “good” for rates can be bad for lenders, and what’s “good” for the market can be bad for home buyers. This tug of war has caused servicers to implement drastic measures to keep up; includes raising the minimum FICO. If you have questions or concerns please contact your lender right away.
Buying a home can be a challenging experience for first-timers. Here are some mortgage tips to help get you started.
It's quite common to put 20% down, but many lenders will now permit a much lesser percentage, and first-time buyers programs allow as little as 3% down. Putting down less than 20% could mean higher costs and paying for mortgage insurance, even a small down payment amount can still be hefty.
Check out the various loan programs:
Making a much higher down payment will mean having a lower monthly mortgage payment.
Many states offer assistance programs for first-time home buyers with perks such as down payment assistance, closing cost assistance, tax credits and discounted interest rates.
You will need to now what's actually within your price range. Find your debt-to-income.
Your credit score (FICO) will be one of the key factors in whether you're approved, and it will help determine your interest rate and loan terms. Speak to an expert about any disputes you may have on your report.
We recommend comparing at least 3 lenders before making a decision. This could save you more money.
As you get closer to buying a home, it’s smart to get a preapproval, where the lender thoroughly examines your finances and confirms in writing how much it's willing to lend you, and under what terms. Having a preapproval letter in hand makes you look much more serious to a seller and can give you an upper hand over buyers who haven’t taken this step.
In a competitive real estate market with limited inventory, it’s likely you’ll bid on houses that get multiple offers so having a preapproval letter will increase your purchasing power.
Purchasing a home is a major milestone that on many people's to-do-lists. You can take control of your home-buying process by understanding what it takes to purchase a home and what you should be asking.
Buying a home can be exciting but, it also can lead to some regret home-buying mistakes and with the housing prices gong up the added stress can confuse the process.
Let's look at some ways to prepare yourself of your first buying experience:
Determining your budget is the number one factor when purchasing a home. Rule of thumb, you should be looking at home \prices that are two to three time your annual income. This helps ensure you're not taking on a larger mortgage commitment that you can afford.
When coming up with the figure, try not to exceed 28% of your monthly gross income, look at your cash reserves saving up a minimum of 20% of your down payment plus another 3% for closing costs and enough savings left over to help pay for any home improvements or miscellaneous moving costs.
It's time to start shopping for a mortgage lender and we've got the right one for you. Valley West Mortgage offers Low Rates and No Obligation Pre-Approvals. Licensed in 18 States. We have a reputation of providing great customer service and timely closings. We will work with you throughout the whole buying process by helping you choose the right mortgage options for your situation.
Totaling up all of your monthly expenses associated with a home purchase can ease the anxiety of not being able to afford a mortgage. It will allow some perspective on your current costs.
Brainstorming a list of must-haves and nice-to-haves allows you to look objectively at what houses you can may to work on or if it's move in ready. Finding what is most important will keep you from paying more for what's not necessary and stay within your budget.
This is the time to decide if you're going to hire a real estate agent, if you haven't already. An agent can provide access to more home options than you'll likely find yourself. Find someone who understands your needs and represents you as the buyer and not the seller. Start viewing as many houses as possible.
Most lenders will require the name of the agency providing you with home insurance. Shop around for a quote. Basic insurance typically covers fire, theft, storm damage and liability should someone get injured on your property and sue you. But you can also add on riders for things like expensive jewelry, furniture and home office equipment, as well as choose to get additional flood insurance if your home is in a flood-prone region.
Let's Make An Offer. You don't want to low-ball your offer, and risk losing the home to another buyer or insult the seller- but you also don't want to pay more than is necessary.
Look at other home sales in the area. If sold for an amount that's comparable to your seller's list price, you should be offering a number close to asking. Consider how long the home has been on the market? What's the market like in the neighborhood?
Pay special attention to contingencies in the contract, it will protect you in cases something goes wrong.
Home inspections can cost typically between $200 and $500. If there are issues, you may be able to ask for a price reduction to help cover the cost of repairs. Read it over carefully.
Before signing, you're entitled to a walk-through to confirm that nothing has changed since the inspection. Make sure the funds required for closing are wired into the correct account. Always, ask for copies.
On closing day, bring your I.D., as well as any paperwork you received throughout the process.