Are you stashing money under the mattress, in a home safe, or even in a security deposit box? And are you a person who customarily uses cash for expenses? If so, there is great news for you when it comes to buying a home. Through the Fannie Mae HomeReady program cash-on-hand is an acceptable source of funds for a borrower’s down payment, funds for closing costs, and prepaid items like insurance and property taxes. This means you can use that rainy day fund to buy a home without the illuminati knocking on your door. Of course, you won’t have any money left over for the apocalypse but if that happens we’ll be back to trading furs and bullets anyway. This could especially be good for those first-time home buyers with minimal funds available for down payment. Some other great features of this loan program include: Up to 95% financing with non-occupant co-borrower Up to 105% financing w/o non-occupant co-borrower Not required to be a first-time home buyer Gift funds, grants, and down payment assistance programs are all eligible sources of funds. There are even more enhancements to this program that could benefit you so to find out more click here to contact me and reference “Cash-on-hand” in the subject line. By David Hughson Mortgage Planner david@greenmeansgrow.com 858-863-
Worried that housing prices are too high? Worried that if the market drops you’ll lose any $ you put into your down payment? You may want to take a look at Down Payment Protection. Down Payment Protection: When speaking with new buyers I often hear that they are concerned that they might be buying in a high priced market. What if the prices fall like they did before? Well, there is a new product that protects buyers from this. It’s called Down Payment Protection. We have a few lenders that are offering this now. At least one of them offers it for free on certain loan products. Here’s and example of how it works. You buy a home and put 60k down down, 5 years later the market is down and you need to sell for less than you bought it for. What would have been a loss of some of your down payment is now potentially covered and reimbursed to you! It’s important to note that a there are many different types of this insurance and the details of how they work and how much it costs you can vary quite a bit. So it’s best to discuss your particular scenario to determine what’s right for you. If you’d like to learn more about these options feel free to contact me for more info. You can email by clicking
The Best Time to Buy or Sell a Home depends on where you live. But, here in San Diego, we don’t suffer pronounced slow down in the market like many other areas in the country. And I have found that November is a great month to buy a home and get some good deals. And if you are selling a home, you will be dealing with a lot of SERIOUS buyers. There are many homes on the market that didn’t sell during the summer months, either because they were priced to high, or they may need more renovation work than buyers wanted to take on. With effective and skilled negotiations, these properties can be picked up for a great price. Please call me for more information, I would love to help you get a deal or sell your home. Craig Sutliff Real Estate Consultant & Mortgage Planner Email: Craig@GreenMeansGrow.com Cell: 619-857-
One Thing You NEED To Know Before Pursuing Down Payment Assistance Down Payment Assistance programs (or DPA’s) are similar to a lot of great ideas, they sound great in theory but as you start to dive into the details they may start to become less and less attractive or feasible… that is, if you have a Mortgage Planner who is looking out for you. Many times when we have people reach out to us in search of Down Payment Assistance Programs, we are able to determine what is most important to clients, and often, even in low down payment scenarios, we have found that there are other programs that better suit clients needs. For example we did a side by side comparison for FHA to The GSFA 5% grant program with 3% Down (Follow the link here for GSFA Income Limits), and found that the benefits of the slightly lower overall contribution, is negated by the savings of the FHA program in only two years! Now, if you have goals with your home that are longer than two years, this becomes a very compelling conversation. However, not all lenders are created equal, and to be honest if you qualify for a DPA program, it’s easier to just give someone what they ask for than doing a full analysis of what is actually truly best for them. If you feel like
Source: Down Payment Resource Did you know the average down payment assistance benefit is more than $8,000? That could be a major jump start to buying your first (or next!) home. And, who wouldn’t want a boost to their down payment savings? Homeownership programs can help you get in a house much more quickly and give you a valuable cash cushion for those other expenses, like the home inspection and home repairs. You could save on save on your down payment and closing costs, or even get ongoing tax credits. But, who qualifies for down payment assistance? First, it’s important to know that there are actually two components—both you and the the home you are buying must meet certain criteria, which vary by program. Our Down Payment Resource program search gives you the opportunity to answer a few simple questions to determine if you (and the home you want to buy) may meet the basic qualifications for a program. What are the criteria for the buyer? Family finances matter. There are household income thresholds, credit score minimums and cash reserve requirements. Income thresholds are based on the area median income—up to 120 percent in high cost markets. Income limits are almost always based on household size, so limits for a family of five are significantly higher than for a single person. Most programs will require some money down from the homebuyer, as well as homebuyer
Blog Source: Down Payment Resource – downpaymentresource.com – February 2, 2017 While the total number of programs remained consistent, the HPI saw an increase in Mortgage Credit Certificates (MCCs) across the country, representing more than 8 percent of all programs. Between 2010 and 2015, state housing finance agencies increased MCC issuances to homebuyers by more than 400 percent, according to preliminary data from National Council of State Housing Agencies (NCSHA). The MCC is a tax credit program that allows eligible homebuyers to claim a percentage of the mortgage interest they paid as a tax credit on their federal income tax return. The percentage of mortgage credit allowed varies depending on the state or local housing agency that issues the certificates, but the credit itself is capped at a maximum of $2,000 per year by the IRS. The buyer may continue to receive an annual tax credit for as long as they live in the home and retain the original mortgage. “The mortgage interest rate tax deduction has long been a core homebuyer benefit, but most homebuyers are unaware of Mortgage Credit Certificates. This credit directly impacts a homebuyer’s bottom line by reducing their annual tax bill,” said Chrane. “We see more lenders adding MCCs to their product offerings.” Qualifying homebuyers are permitted to use an MCC alongside another type of down payment assistance program, such as a grant or forgivable
By Rob Chrane – CEO of Down Payment Resource The election has left Republicans in control of the House, Senate and White House for the first time in over a decade. The new alignment provides a viable path to far-reaching changes in federal housing policies affecting housing finance and housing markets. Increasing homeownership is at the top of the agenda for the new Congress and Administration. Changes may be in store for the Dodd-Frank Act, including restructuring or terminating the Consumer Financial Protection Bureau and raising the threshold for tougher bank regulation above its current $50 billion asset level. President-elect Trump has promised to reduce regulations, across the board, and financial institutions are likely to embrace his deregulatory stance. In housing finance, policy-makers may focus on reducing risk. Programs like FHA may see major changes and the role of GSEs will continue to evolve. The role of government in housing markets and housing finance could change dramatically. If so, it will take at least a couple of years, but it’s too early to tell because this wasn’t addressed in detail during the campaign. Only by increasing the numbers of first-time buyers can we reverse the multi-year decline in homeownership. Saving for a down payment continues to be the greatest single barrier keeping first-time buyers from becoming homeowners. Low down payment programs and down payment assistance are effective and critical strategies
Scariest Situations for Home Buyers & Sellers – Part 3 Thanks for checking in with me. This is Part 3 of a 4-part series, so I invite you to check out the other videos, I know you will find them informative. So, in the scenario we are talking about, we are already in contract, we have conducted the general home inspection and after some anxious anticipation, the appraisal report comes in! And……it is UNDER value! Ouch! No scarier situation than that, especially for a first time home buyer or first time home seller. So what now? Well now we have a few options, as a buyer, we will try to negotiate the contracted price DOWN to the appraised value. As a home seller, we would negotiate hard to hold to the contracted sales price and have the buyer come in with the difference. Now, how this goes depends on many variables, how much the buyer has for a down payment, if it is a 100% LTV VA-buyer, no much chance the buyer can come up off of the lower appraised value, and as a seller, if there were multiple offers, we can always cancel the contract, if the buyer doesn’t want to come up with the difference, and go back to the market for another offer. If you are looking for someone who will treat your money like I was
As consumer demand continues to peck away at the tight lending guidelines Freddie Mac announced an important minimum borrower contribution reduction that I’d like to highlight this week. Freddie Mac is no longer requiring a 5% contribution from borrower’s personal funds for mortgages with loan-to-values greater than 80% that are secured by primary residences and for which a gift or gift of equity from a related person is used as a source of funds. This is a really nice lending enhancement because Freddie Mac’s debt ratio guidelines allow higher limits than Fannie Mae which means a person’s purchase power was just boosted. For example, let’s say you were pre-approved for a Fannie Mae loan with 5% down and your max purchase price is 300k. Switching to a Freddie mac loan with 5% down now means your purchase power jumped to 350k. How did this happen? To find out how your purchase power can be boosted using this strategy click this link. By David Hughson Mortgage Planner 858-863-
If you are a home buyer and are receiving help financially from a family member let me first say, you should consider yourself very lucky! I’d almost go so far as to recommend buying a place with a guest room at the very least, if not that “mother-in-law” apartment over the garage. What I’m getting at, is a little something call, Expectations. Before the process of the home search even begins, I advise you to have a really serious talk about who going to be the real decision maker. In my experience, parents are often very willing to gift their children funds to buy a home but then with that can come many desires of their own. Other times, rich “Uncle Joe,” gifts some money and never even sees the place that is purchased. While both scenarios are perfectly acceptable, what doesn’t work is the home buyer’ misinterpretation of what the money really means when it comes to making decisions. So, before accepting and money it’s best to have an honest conversation about the involvement of the gift giver. If they have the final say, it’s best to include them in the entire process. From looking at homes, to writing offers, to attending the home inspection. Not only will this save many hours for everyone, it will ensure there are no surprises that occur after a lot of time and
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