March 26th, 2012
• I am interested in buying a home. We do not have much money to put down, what are our options? If you have 3.5% to put down, we can look at FHA. But if, you might be able to put 5% down, we would then look at conventional lending. FHA, effective in April, will be increasing their up-front mortgage insurance premium as well as their monthly mortgage insurance. Depending upon your credit scenario, you may obtain mortgage insurance that is less expensive by looking at conventional lending at 95%.
• I am purchasing an investment property. It is a great deal, and I do not want to let it get away. What are my options for financing? You may purchase an investment property with 20% down. If the property is possibly a second home, you may only need 10% down. If you intend to use the property for 10 days, standard IRS code indicates the property would be a second home. This would allow you more options in financing.
• I am selling my home. I would like to purchase another property and have VA eligibility. In order for us to sell our home, we will have to bring cash to closing, we can, but I do not want to use all of our savings. Do we have any other option? VA will allow the seller to pay up to 4% in debt reduction. If you have the ability to borrow money to cover some of your shortfall. When you purchase a new home, you could ask for 4% to reduce debt and pay the loan you used to close on your sold home. In doing this, you have effectively reduced the amount of savings you need to bring to closing and thereby not depleted all of your savings.
• I believe we need an FHA loan. We are looking at purchasing a home that is $450,000. Is this possible? In Hampton Roads, the max loan amount is 458,850. So, you can borrow 96.5% of the purchase price, but you may need two appraisals.
- Jennifer Keenan, Senior Mortgage Consultant, NMLS# 101837, Tidewater Home Funding 757-366-8690