09
Feb
By support
Home Mortgage Tips

Setting the Record Straight: 3 Major Misconceptions About Mortgage Financing

Setting the Record Straight: 3 Major Misconceptions About Mortgage FinancingPurchasing a home is often considered an important step in one’s financial life, no matter what point you arrive at it, but there are things you should know about financing your home purchase before stepping into the fray. If you’re planning on buying a home soon and want to avoid some major missteps, here are a few tips that will set you up for success.

Taking The Lender You’re Offered

In the event that you’ve been pre-qualified for a certain amount, you’ll want to find a lender that will make the process towards a home purchase a little bit smoother. Instead of going with the first option that’s offered, do some research and come up with a shortlist of potential lenders that have good reviews and have been around the industry for a significant amount of time. The process will be a lot more comfortable if there’s someone on your side you know you can trust.

Keeping Your Credit History In The Dark

Without a doubt, the lender will be looking at your financial history in order to determine the amount of financing you will receive, but it’s still important to be prepared on your end so that you know what to expect. Start by acquiring your credit report so that you can correct any inaccuracies on it and be prepared for what this score will say about your financial viability. When it comes to the financing you’ll need down the road, the right information on your credit report will make a difference in the end result.

Forgetting About The Loan Officer

If you’ve already established who your lender will be, it’s still important to meet with the person who will be handling your loan and make sure they’re someone you can trust. Ensure that you are aware of their qualifications and that they have enough previous experience in their back pocket to provide you with insights that may come in handy. While having a reliable lender is certainly a good start, the right individual to handle your loan will be someone who is licensed and involved with a local, professional mortgage association.

All of the things involved with mortgage financing can be quite complicated, but by finding the right lender and preparing yourself for the tough financial questions, it can be a much easier experience. If you’re starting to consider your options for a home purchase, you may want to contact one of our local mortgage professionals for more information.

04
Feb
By support
Home Mortgage Tips

Looking Ahead in 2016: Mortgage Trends That May Affect You

Looking Ahead in 2016: Mortgage Trends That May Affect YouThe housing market is in a constant state of flux, and with the changing shape of real estate there will most definitely be notable trends to watch out for in the next year. Whether you’re approaching the market with caution or are ready to dive in without worry, here are some things to watch out for in 2016.

A Slow Growth Outlook

One of the most worrisome impacts of a slowed economic outlook is how it can affect people’s monthly payments, and this is slated to be a significant concern over the next few years. With the possibility for lowered global gains in 2016 and the job loss that can stem from this, it may be the case that many borrowers end up falling behind on their payments a little more this year. While this doesn’t pose a significant worry in the short term, it may become problematic in the event of a sustained downturn.

Bring On The Millennials

It’s definitely the case that few have struggled to make their way in the economic world as Millennials have over the last few years. However, according to Trulia.com, approximately 80% of those polled between 18-34 want to make a new home purchase before 2018. While many Millennials will be deterred by rising interest rates and will instead stick around their parents’ house a little longer, there definitely stand to be a few more wading into this market with growing savings and better job opportunities.

An Ever-Shifting Market

When it comes to real estate, prices on a day-to-day basis are constantly in a state of flux but that trend is expected to become even more extreme in 2016. While the rent and purchasing price for homes in metropolitan areas will continue to increase with demand, the prices of homes in smaller centers will actually diminish. So, while real estate prices are constantly on the rise and it may be a good time to get into the market, a home in a place a little less popular may provide a bit more bang for your buck in the coming year.

With the real estate market and the world economy experiencing significant fluctuations in the last few months, there are bound to be many ups and downs in the market this year. If you’re considering a new home in 2016 and would like to know more about your options, you may want to contact one of our mortgage professional for more information.

02
Feb
By support
Home Mortgage Tips

Everything You Need to Know About Fannie Mae’s New Home Ready Mortgage

Everything You Need to Know About Fannie Mae's New Home Ready MortgageTraditionally, getting a mortgage requires you to have a level of income appropriate to the size of home that you’re buying. But for a lot of low-income and minority borrowers, a simple measure of one person’s income isn’t an accurate measure of whether or not that person can afford a home.

Now, with the Home Ready mortgage from Fannie Mae, multigenerational and extended households can have easy access to mortgage funds. How does the Home Ready mortgage work? Here’s what you need to know.

Flexible Down Payment Requirements Make Home Ownership More Accessible

Traditional mortgages require you to pay 20% of the home price upfront in the form of a down payment, or 5% if you register for Private Mortgage Insurance. And although 5% is a small down payment, it’s still a significant sum of money for a lot of low-income borrowers. But now, with the Home Ready mortgage, qualified borrowers can access financing with as little as 3% down, making it easier to become a homeowner.

Non-Borrower Household Income Is Now Counted As Income

Another big change that the Home Ready mortgage introduces is that lenders may now count all household income when determining affordability criteria (but not qualifying income). There’s no minimum requirement for funds to come directly from the primary borrower, which means that non-borrower members of the household can have their income counted when determining whether a mortgage is affordable. It’s also possible to use non-occupant borrower income – for instance, the income of a borrower’s parent – to be counted as income.

For extended and multigenerational households, this means mortgages are much more affordable as all household income can now be counted as eligible.

Eligibility Requirements: Who Can Qualify For A Home Ready Mortgage?

Home Ready mortgages come with certain eligibility criteria attached that homeowners will need to meet. In order to be eligible, a household must be below a certain percentage level of area median income (AMI) – that is, a household must fall somewhere in the lower half of their area’s income scale.

For properties that are located in “low-income census tracts”, there is no income limit. For properties in high-minority areas and designated disaster areas, borrowers at or below 100% of AMI can access Home Ready financing. And in all other census areas, borrowers can access financing if their annual household income is no greater than 80% of AMI.

The new Home Ready mortgage from Fannie Mae can make it easier for certain households to qualify for mortgages. Your local mortgage advisor can help you to understand how the program works. For more information, call your mortgage professional today.