So you have been told that you qualify for a home. You are so excited, just thinking about this daily. You finally will own your own home with a piece of property.
You have been told by many to just ask for a 30 year fixed rate. Maybe you don't have much money to work with. Maybe you have 30% to put down on the property. You actually know that this is a starter home and that you will probably only be in the house for 4 to 5 years, because you would also like to have another child. GOALS..... I have mentioned these before. A very good loan officer will ask you what your goals are prior to buying your first home. So much to think about, right? Nothing to worry about if in the hands of a good professional.
Okay, so now what, since there are 100's of programs out there for me to choose from. As long as you can answer these few questions for the loan officer, he or she will be able to help you make your decision. Just giving their professional opinion, but backed with knowledge. Questions : (and your goals)
- How much money do you have to work with?
- How much money would you have available after closing? We call this reserves.
- What kind of payment would you be comfortable with?
- How long do you plan to be in the house? An estimate possibly?
- Do you have children? How many? Do you plan to have more?
- What kind of financial obligations do you have outside the norm, that don't show up on your credit report.
There are a few more to ask, but a lot of it has to do with where the conversation leads to.
LOAN PROGRAMS :
- Full Doc / No Ratio / Stated Income / No Doc
- 100% financing -- This can be used for individuals with little to no money down. But don't let that part fool you, because depending on your goals, it still might work in your favor. Meaning, if you had 10% to put down, you need to out weight your options. A great program under this is the my community program.
- FHA financing -- There are more than a few reasons why FHA might be good for you. One that sticks out is that it allows consumers with less than perfect credit. Another is that it allows for 100% gift from a family member.
- VA financing -- For those that served or that are serving in the military. Check with your VA professional loan adviser to find out more. And just a FYI, you can buy a VA financed home without being a veteran.
- Subprime loans -- There are so many reasons that one might be placed into this type of loan. Most think it is because of bad credit. Yes, this can sometimes be the case. Other reasons might be because of the type of property, that your income can only be proven by bank statements, and many other reasons.
You basically hold your future in your hands. Once deciding what loan program that you will go with, it's up to you to keep your financial obligations in check. Meaning, save money for those small emergencies.
Lastly. if for some reason, you ever find yourself in any trouble, please, NEVER hesitate to contact your current loan holder/servicer. Even if your loan was sold, go back to your loan officer to see if they can help or point the way. Banks & Lenders
don't want to buy your house back. But once you get behind several months, it does become harder to work with you. Please just keep this in mind. NEVER BE AFRAID TO ASK FOR HELP. (And don't wait to do this!!!)
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A good set of guidlines for inexperienced buyers. We see too many times where clients get out in the worng type of loan.l