As explained on the page about writing your offer, financing is typically a contingency in an offer to purchase. Unless you are writing a cash offer, it is a very important contingency.
With the recent upheavals in the real estate and banking industry, understanding the mortgage process is more important than ever.
The first step- STOP LISTENING TO THE NEWS!
Contrary to what we are hearing from the media, the sky IS NOT FALLING! There is mortgage money available. And the banks are NOT requiring DNA samples in order to lend the money.
There have been changes over the past year. And there will be more changes in the mortgage industry. But the bottom line is if you have decent credit, have had the same job for the past couple years, and 10% down you will be able to get a mortgage. If you don't have the 10% down, you can still probably get a mortgage. FHA mortgages are still a great program that has been around forever and is sticking around for the foreseeable future and requires 3 1/2% of your own money (or a gift or loan from a close relative). You can still ask the seller to cover the rest of your closing costs on an FHA loan. (soon that will be limited to 3% max. in seller concessions).
There is still 100% financing available through the rural development program, but there are restrictions on your income and location of the house. Your income is capped and the amount is determined by the size of your household and county the property is located in. Don't take the name of the mortgage literally. The loan is not limited to rural properties. Oxford, Brandon/Ortonville, Holly for example are eligible areas for rural development financing. That includes subdivision houses. Lakefront houses. Even site condo developments and condominiums.
One other form of 100% financing is good ole tried and true VA loan. If you are a veteran you probably qualify for a VA mortgage. If you qualify for other types of financing, you will probably want to opt for that (as opposed to the VA loan). There are some problems involved with VA financing- mostly the appraisal process. The appraisal is basically to protect the lender; it's supposed to make sure the property is worth what the lender is lending. The problem with the VA appraisal is, to be blunt- screwed up. The lender gets an appraiser off a VA approved list. The last time I had a listing sell VA the appraiser didn't belong to either multiple listing service for the county the house was in. But the lender couldn't request another appraiser and the sale almost didn't close. But if a VA mortgage is the best fit for you, I am experienced with the process and know how to navigate through all the red tape.
For more information about financing or for help getting started with your pre-approval please feel free to contact me anytime.
|