8 Best Home Financing Options 2017
Looking for home financing can be a daunting task. Be prepared by taking a look at the 8 best ideas for home financing. The most important factors affecting your purchase power are the down payment and the interest rate. Mortgage rates are at the lowest levels of our lifetimes. There has never been a better time to buy and there probably will never again be rates this low. Look at the history of rates over the last 52 weeks vs the last 52 years.
The first step in the home purchase process is to find the means to buy. For most folks, that means getting a mortgage. Before you go out looking at homes, you’ll want to know what you can afford. There can be a large difference between what you can afford and what you are comfortable with. Your lender can help you sort out your finance options and budget. When you have your pre-approval letter in hand, hire an experienced agent and you are ready to pull the trigger on your new home => Free MLS Access.
Have you heard you can’t buy a home with no money down? Not, true. The United States Dept. of Agriculture guarantees loans to qualified buyers and properties with no down payment. There are income limits, purchase price limits, and location limits. These loans are called Rural Housing loans so it’s easy to see these loans are available in less densely populated areas. Good news is most of New Hampshire qualifies. Your lender can help you sort out those areas.
Speaking Of Lenders
As a licensed NH Realtor, I cannot steer customers to a single lender. In my experience, I have worked with some top lenders and the following professionals are whom I recommend to my clients. If you contact them, please mention me because referrals go both ways, thank you.
Click here to see => Jim Collins of Bluewater Mortgage
Federal Housing Administration 3.5% Down Payment
The FHA guarantees loans to qualified buyers with only a 3.5% down payment. There are income limits and purchase price limits which differ depending on which county you are looking in. Again, your lender can help you determine those limits.
What About Rehab Loans?
When getting a mortgage, not only does the buyer have to qualify but so does the property. If the property is in disrepair, the lenders won’t lend unless the buyer qualifies for a rehab loan. Both the FHA and USDA offer programs whereby buyers can get money added to the purchase price to handle repairs. The programs can also be used for updates and remodeling. The USDA repair program is limited to $10,000 in rehab money and is still a no money down program. The FHA rehab program comes in two models. A Streamline 203K is limited to $35,000 with a property that has no structural issues. A Full 203K can involve structural repairs or even additions and is limited to the maximum mortgage amount per county. The down payment remains 3.5% but is calculated on the purchase price plus the cost of renovations. If purchasing a bank owned home is on your radar, click here for my insight on => How To Buy Foreclosed Homes
New Hampshire Housing Finance Authority
New Hampshire Housing Finance Authority is a self-supporting public benefit corporation. Although established by statute as a public instrument, the Authority is not a state agency and receives no operating funds from the state government. The Authority administers a broad range of programs designed to assist low- and moderate-income persons and families with obtaining decent, safe, and affordable housing.
Conventional Home Financing
Conventional mortgages are mortgages that do not involve any government assistance or guarantees. Most banks and credit unions will provide conventional loans which usually will require a larger down payment. These loans are geared to situations where buyers or the property do not qualify for the government assisted programs.
Owners may choose to finance the purchase of their property and can be an option for buyers who don’t want to use a bank and owners who are willing to take payments instead of a lump sum. Owners are still afforded the same safeties that regular lenders have with respect to non-payment of the mortgage. The terms of the financing should be in writing to make sure both parties to the contract know what their responsibilities and duties include. The terms can be anything the parties agree to in writing.
What About Rent To Own
Rent to own or “Lease Option” programs are as individual as the parties involved and like owner financing, the agreement needs to be in writing. Typically, the arrangement involves a non-refundable deposit which is credited towards the purchase price and a lease term usually less than two years. The tenant or buyer then occupies the house and performs all the duties of an owner such as paying the taxes, utilities, and maintaining the property just as if they already own it. During the lease term a small portion of the rent is credited toward the purchase. This is a great way for folks whose credit scores are a little shy of being able to qualify for a mortgage but can otherwise afford to own a home. The lease term gives them time to work on fixing their credit scores so at the end of the term, they can qualify for a mortgage and close the deal.
What Is A Reverse Mortgage?
Imagine, a senior living in a new home with no monthly payments. If you are 62 years young or more, you may be eligible for a reverse mortgage. Seniors can purchase a first home, a new home, or a second home with a reverse mortgage and never make a monthly mortgage payment. Seniors’ primary care giver is the equity in the home they own or the one they will own. Seniors can get money for living expenses or down payments on new homes with the equity in their current home. If they have a sizable down payment, they can get into a new home and have no monthly payments.