Great Time To Buy A Home with FHA, VA and Rural Development

Despite the drop in home sales and the struggling economy, now may actually be a good time to buy your dream home. Prices are low, and it truly is a “buyer’s market,” with more home sellers than buyers.

No matter what is happening with the economy, your life goes on. You may be tired of renting, your family may be growing, or you could be getting transferred to another city. Whatever the case may be, buying a home now could be a very smart long-term investment. There are some really attractive 100% financing options still available that everyone needs to know about and take advantage of.

Even if you don’t have a large down payment or perfect credit, there are several lending opportunities, according to Amerifirst lending expert Scott Hudspeth.

FHA MortgagesThe Federal Housing Administration, a government agency created in 1934, provides insurance on some types of mortgage loans. An FHA-insured loan also allows you to buy a house with a zero down payment, ranging from zero to 3 percent and from a single family up to four units as a primary residence.

Zero to 3 percent down: You can have the seller gift this–better known as the “down payment assistance program”Low closing costs: Seller can pay up to 6 percent

Easy credit qualifying: No credit score needed for this program

FHA mortgages allow you to buy a home, fix it up, and include all the costs in one loan. Or, if you own a home that you want to re-model or repair, you can refinance what you owe and add the cost of repairs - all in one loan.The FHA insures your loan so that lenders can offer you better, more affordable rates. No matter what your family’s living situation is, the FHA can help you:

Purchase a HomeRemodel the Home you currently live in

Make Home Repairs

Make Energy-Efficient Improvements

Refinance up to 97.75% of the value of your home

Pull Cash out up to 95% of the value of your home

Qualification for FHA MortgagesQualifying for a mortgage loan can be hard to do if you do not have a lot of money for a down payment or even the best credit report. The best type of loan for you would be a FHA Loan. There are fewer restrictions for a FHA Loan Qualification as opposed to a standard mortgage loan.

You will need to have 2 years of steady employment. Not necessarily by the same employer but it is preferred. College counts as time on the Job.Your income should be similar or increasing for the past 2 years but not necessary all the time.

If you have declared bankruptcy, then it must be at least 2 years old and you will have to have good credit since then.

Foreclosures will also need to be older than 3 years and have good credit since then.

Compensating factors are allowed to compensate for the lack of any of above, 401k plan, high credit score etc etc.

Non Occupant co borrower is allowed for this program which works great for first time homebuyers that might not have every needed to get approved or are a full time student.

Government Steps in to HelpRural Development Guaranteed Housing is a special mortgage loan program intended to provide rural home financing for first-time homeowners are people who don’t own structurally sound or adequate housing. Besides purchasing a home, the loan also can be used to build, repair or renovate homes. An office of the U.S. Department of Agriculture, the Rural Development organization, underwrites the loans.

The home, new or otherwise, has to be located in a “rural” area, defined as being outside a Standard Metropolitan Statistical Area. It must be single family and owner occupied. The loan amount can be up to 100 percent of the property’s cost or appraised value. It is a true “no money down” transaction for the buyer, as the seller is allowed to pay all of the closing costs.

RD loans set limits on the borrower’s maximum adjusted gross income and also set maximum loan amounts based on the current FHA loan limits.

Advantages:

· No down payment required

· 30-year fixed rate

· 102 percent loan-to-value of appraised value allowed to roll in repairs, closing costs.

· Finance closing costs if appraisal is higher than sales contract

· No Monthly Mortgage Insurance

· No cash contribution required from borrower.

· Unrestricted gifts: no need to document source.

· No maximum loan amount

· New manufacture housing allowed: cannot have been lived in.

· With 620 credit Score, no seasoning on bankruptcy or foreclosure: You can buy as soon as your score is at 620 with established credit. Loan expert Scott Hudpseth specializes in credit restoration and has helped 100’s of families with their credit profile.

· Competitive rates (set by underwriting lenders).

VA Home LoansMore than 27 million veterans and service personnel are eligible for VA financing. Even though many veterans have already used their loan benefits, it may be possible for them to buy homes again with VA financing using remaining or restored loan entitlement.

What is a VA-Guaranteed loan?

These loans are made by a lender, such as a mortgage company, savings and loan, or bank. VA’s guaranty on the loan protects the lender against loss if the payments are not made, and is intended to encourage lenders to offer veterans loans with more favorable terms. The amount of guaranty on the loan depends on the loan amount and whether the veteran used some entitlement previously. With the current maximum guaranty, a veteran who hasn’t previously used the benefit may be able to obtain a VA loan up to $417,000, depending on the borrower’s income level and the appraised value of the property. Your VA Regional Loan Center can provide more details on guaranty and entitlement amounts.

Before arranging for a new mortgage to finance a home purchase, veterans should consider some of the advantages of VA home loans:

No down payment is required in most cases.Loan maximum may be up to 100 percent of the VA-established reasonable value of the property. Due to secondary market requirements, however, loans generally may not exceed $417,000. This figure is subject to change each year.

Flexibility of negotiating interest rates with the lender.

No monthly mortgage insurance premium to pay.

Limitation on buyer’s closing costs allowed from the seller.

An appraisal, which informs the buyer of estimated property value.

Thirty-year loans with a choice of repayment plans.

New homes, which are appraised before or during construction, are inspected to help ensure compliance with the plans and specifications used for the appraisal and with VA minimum property requirements. All new houses, regardless of when appraised, are covered by either a 1-year builder’s warranty or a 10-year insured protection plan.

An assumable mortgage, subject to VA approval of the assumer’s credit.

Right to prepay loan without penalty.

VA performs personal loan servicing and offers financial counseling to help veterans avoid losing their homes during temporary financial difficulties.

. What can a VA loan be used for? To buy a home, a condominium unit in a VA-approved project, or to purchase a unit in a cooperative (co-op).To build a home.

To simultaneously purchase and improve a home.

To improve a home by installing energy-related features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/caulking, storm windows/doors, or other energy efficient improvements approved by the lender and VA. These features may be added to the purchase of an existing dwelling or by refinancing a home owned and occupied by the veteran. A loan can be increased up to $3,000 based on documented costs or up to $6,000 if the increase in the mortgage payment is offset by the expected reduction in utility costs. A refinancing loan may not exceed 90 percent of the appraised value plus the costs of the improvements. Check with a lender or VA for details.

To refinance an existing home loan up to 90 percent of the VA-established reasonable value or to refinance an existing VA loan to reduce the interest rate.

To buy a manufactured home and/or lot