What is the best mortgage program for me?
When shopping for a mortgage, it can be confusing at times, depending on where you get your information. You should not always base your information on such terms as Expert, Mortgage Expert, FHA Expert, etc, etc. Just because someone says they are an Expert doesn't always mean that they are an expert. There are so many variables to what mortgages are good for a borrower.
How does a borrower determine what is good for them? What things should be important? Make sure ....
-- you understand your finances first, that you are not forcing yourself into the mortgage payment. Have a comfortable mortgage payment in mind.
-- you have some cash reserves after you would go to settlement on your new home. In my opinion, you should always have some type of cushion for many reasons.
-- you have goals for the near future and distant future, prior to speaking to a loan officer. Such goals as having kids, schools, saving money, career changes, etc, etc.
Before you shop for a home, know what you can qualify for. Shopping for a mortgage first can be so critical.
Basic types of mortgage programs
Important Basic Info - If you typically have a credit score of 680 or less and less than 10% down, you are usually better off with a FHA loan. Not unless you fit some of the requirements of the other loans mentioned below. Here is a good example of this : A real comparison with 20% down - FHA loans vs Conventional loans (series of down payments)
Conventional Loans - You need a 620 or higher credit score with typically 5% or more down. Important reminder : You still need to be approved by the PMI companies and not just your lender. (Private Mortgage Insurance)
FHA Loans - Buyers & Sellers, don't always listen to your realtor if they talk negative about FHA mortgages. There are so many good qualities when it comes to FHA loans as opposed to the other types of mortgages out there. Less money down, flexible credit requirements, lower credit scores with less pricing adjustments, etc, etc. One Important Factor : You can still do a manual underwrite on this type of loan. If the lender thinks it is a make sense deal with good compensating factors, then they can put their stamp of approval on this type of loan.
VA Loans - 100% loan program with no monthly mortgage insurance. Important factor : No matter what part of the service, even if in the guard or reserves, as long as you served 3 months in a combat zone, you can be eligible for the VA loan now.
USDA Loans - 100% loan program with no monthly mortgage insurance. This program is area restrictive and has income restrictions. How do you find out if your property qualifies? Property Qualifications Important Reminder : As of now, funding for USDA loans are becoming very low. Please read this announcement. Important USDA funding information. For more basic information on USDA loans, please read : USDA loans
Stated Loans - This type of loan still requires a job, but you just state your income. Word to the wise though - Your income is still suppose to make sense in regards to the job that you have. This loan is more so for those self-employed or who have hard to improve income. And these types of loans usually require higher credit scores and a higher down payment of 25% or more.
No Doc Loans - This is the no questions asked loan. You don't need tp put down any job or income or to verify assets. Important Key Reminder : You usually need credit scores of 680 + and with at least 30% or more down.
Summary : It's very important to speak to a very qualified loan officer and not someone that just sounds nice and or offers you the best rate. Sorry, but anyone can do this. Some important mortgage shopping tips so you aren't caught with your pants down. Mortgage Shopping Tips
Important Reminder : Your loan officer should be interviewing you in detail. These are some important questions that they should be asking you. Jeff Belonger’s top ten questions when qualifying a borrower.
And be careful of what mortgage programs that some loan officers recommend. Sometimes they just give you the program that best suits the loan officer and not the borrower, because it's easier for the loan officer. Sorry, but this is a reality and I have seen it happen.
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- FHA Loans - USDA Loans - VA Loans -
- Energy Efficient Mortgages -
- Conventional Loans - 203 k loans -
- FHA Home Loans - Mortgages -
Experience & Knowledge at its BEST !!!
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For more information on FHA loans, please go to this link. The FHA Expert
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!
Important Information about the First Time Homebuyers Tax Credit
Copyright © 2010 by Jeff Belonger of Infinity Home Mortgage Company, Inc
_____________________________________________________________________________________________________________________________
FOLLOW ME ON FACEBOOK
- FHA Loans - USDA Loans - VA Loans -
- Energy Efficient Mortgages -
- Conventional Loans - 203 k loans -
- FHA Home Loans - Mortgages -
Experience & Knowledge at its BEST !!!
Follow me on:
______________________________________________________________________________________________________________
For more information on FHA loans, please go to this link. The FHA Expert
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags!
For information about FHA myths & FHA rumors, please read : FHA Myths & Rumors
Copyright © 2011 by Jeff Belonger of Infinity Home Mortgage Company, Inc
Getting financing that is in alignment with what their real goals are is key. As you & I both see everyday Jeff, so many borrowers are all over the map with what they are trying to accomplish with their finances.
Jeff - this is a great overview for buyers. I find that many, especailyl new ones, don't have a very good sense of the programs that are out there and which ones make the most sense for them adn their personal financial situation.
Of course with the regulations and requirements changing it makes it difficult, too.
Jeff
I didn't realize No Doc's still existed! I have some buyers who may need one! Are there age limits on the 30 year loans?
Jeff
Thanks for sharing the information.
Good luck and success.
Lou Ludwig
STEVE.... . yes, many borrowers are all over the map and I blame this sometimes on the lending industry. Even realtors that I know value your loan officer just because they give the best rate and close the loan. But if on the wrong program, can that cost the borrower thousands of dollars? You bet it can.... so in that case, is that best rate the best? Not always..thanks for your feedback.
JEFF.... . thanks for the kind words... and as I mentioned to Steve above, I blame a lot of this on the loan officers that are out there. Sometimes they just tell the borrower or give tjem what they ask for, without even previewing that borrower's options. And in several cases, it's done because the loan officer was doing what was easiest for them and not the borrower. thanks
BRIDGET.... . yes, these have existed.... just that the requirements are stricter. You asked.. are there age requirements? Do you mean on how old you have to be? The answer would be no... the major requirements on a loan like this is their credit score and the down payment. Call me some time or e-mail me. thanks
LOU.... . my pleasure and thanks for the warm wishes.
Jeff, I know you see me on your dashboard, so am saying HI.
Just like Attorneys, they don't all practise every type of law, so best to work with a Real Estate Attorney when you need to review.
As always, Jeff, great information. Something the home buying public needs to know.
Jeff, Thanks for this excellent summary. Well done.
Jeff,
Great summary outline. This allows Borrowers to become familiar with the reemergence of some loan products that have been scarce for sometime.
Steve
Jeff if you ever have some time, I'd love to pick your brain on a couple idea's?
thanks
MISSY.... . I actually don't see you on my dashboard because I have hardly been on AR in the last 3 weeks. Just busy and burnt out on blogging and commenting. Trying to get back into it... but thanks for the hello... I will come over and visit. And good point about Attorneys. The same could go with loan officers... but I do pride myself on knowing most loan types and being able to handle them. I could honestly say that I know about 95% of all loan programs very well. In any case, thanks for stopping by.
GABE... my pleasure and thanks...
AL aka Ocean View Realty... . thanks for the polite compliment.
STEVE & JOEL.... . yes, this should allow some borrowers to be aware of some programs that some loan officers might not bring up to the borrower. I am working with a buyer now, doing a USDA loan, and their realtor said they would be better off with a FHA mortgage. And even went as far to tell them that their loan officer said the same thing. YET... this loan officer never even spoke to these borrowers. OMG... it's bad enough that a realtor would say this, but a loan officer? It tells me that the loan officer doesn't feel comfortable with USDA loans or just makes bad assumptions.
TRAVIS.... . you can call me any time or e-mail me. It would not be a problem at all. thanks
Hi Jeff -- Great advice as usual, especially in regards to FHA. My buyers have used this many times over the past several years, to great success, for both the buyer and seller. Closed a FHA 203K loan recently which is a lifeline for many buyers, minimizes their cash outlays, reduces their resale risk by buying foreclosures where the "to be" condition is far superior to competition, etc. I have encountered resistance among old-time agents who aren't in the know on today's FHA.
Jeff, you always seem to have a great reserve of knowledge when it comes to loans. I would think that is the reason for your success. Good luck and thanks for always being willing to share.
Hello Jeff,
Excellent resource and information from you. I have a question regarding FHA loan and I hope that you can give me an answer on this. I have a potential buyer who has co-signed for her daughter back in 2004 to purchase a home, the mortgage payments been made by the daughter and they can provide copy of the cancel checks.
Will this mortgage payment count against my buyer debt's ratio? most of the lender I have spoke to said no, but there is one federal savings said yes. Please advise.
Thanks!
Anne
ANNE... thanks for the compliment. Here is the answer to your question.
Canceled checks and no lates takes it out of the debt ratio - one caveat: the checks "need" to have been made payable to the mortgage servicer. If the checks are made out to the person, you sometimes can get around this.
Question... what state is this potenial borrower buying in? thanks
The property is in Woodbridge, VA.
Thanks!
Anne
Anne.. my pleasure... if you need any help with that borrower, please let me know. thanks, jeff
Jeff
How can I get some more information on no doc loans. Credit score is around 800. Are these available for investment properties also?
Thanks
Aman
Aman... in what state? because I keep in touch with many lenders nationally and not all loan officers can do these in some states... thanks
Jeff
Mainly Northern Virginia and Maryland.
Thanks
Aman
Jeff great information. I have bookmarked and reblogged to share the article with other readers.