Mortgage · Real Estate

What you may not know about the VA Loan…

The VA home loan is set up so a vet can purchase a home for $0 down. This is possible because VA will allow a vet to get a 100% loan, guaranteed by the government, and will not allow a vet to pay buyer fees. VA loans typically offer veterans excellent interest rates which are often offset by a lender by charging discount points.

What are discount points?
The discount points are prepaid interest that has to be paid to make up for the difference between the FHA/VA rate and the current rate charged on conventional loans. These points cannot be added to loan amount to be paid the vet. Discount points must be paid by the seller or the lender.

Who pays the discount points? Continue reading “What you may not know about the VA Loan…”

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Law/Regulations · Mortgage · News · Real Estate

FHA Financing Changes…

Most of the changes have to do with tightening the regulations on the lenders.  The key changes that directly effect the FHA buyer are:

  • FHA upfront mortgage premium will increase to 2.25% from 1.75%.
  • If a borrower has a credit score below 580 they will be required to have a 10% down payment, while the minimum down payment for all other qualified buyers will be 3.5%.
  • Sellers concessions will be reduced from from 6% to 3%.
  • Feb. 1, 2010 the 90 holding rule on properties is being lifted for 1 year (some restrictions still apply, refer to HUD for more information).

In my opinion, the best loan out there is the VA Home Loan.  If you’re VA eligible, it’s the way to go right now. An eligible vet can purchase a home with ZERO down provided they qualify for the loan (income to debt, credit score, work history, etc.).

There’s still time to take advantage of the tax credit. Let’s talk!

For more info about FHA loans, check out hud.gov.