Financing a Home is Not Difficult!
One thing that I honestly can say is holding back the housing market is the overwhelming belief that buyers cannot get financing.
The consensus seems to be that only large down payments are required along with very high credit scores. Even then the belief is that the underwriting is so stringent that most buyers don't want to apply for fear of having their loan rejected.
What would really help and could make a difference is for agents to let their clients know that these misnomers could not be any father from the truth. Agents can post information on websites, send information to data bases and even blog to get the word out. The fact is, while lending is not the free-for-all it was five years ago, common sense has come back full swing. Meaning, down payments now are smaller on higher loan amounts than have been in place for years. The government agencies feel the worst of the home price decline is behind us allowing more leniencies. In addition, underwriting documentation requirements have eased because the economy has stabilized and shown signs of improvement so less risk is at stake.
In Orange and Los Angeles Counties, borrowers are able to secure a home loan in the amount of $729,750 with only 3.5% down payment. That equates to buying a home for $756,250 and only needing a down payment of $26,500. The down payment can be a gift from family members as well. The credit score can be as low as 640.
With 10% down payment, a borrower can obtain financing for their home with a maximum loan of $875,500. With 20% down payment the maximum loan is $2,000,000. From there the down payments increase the higher the loan amount requested. Please find attached additional programs that include Foreign National, Pledged Assets and Asset Depletion loans. Yes, there is now financing available other then Fannie Mae, Freddie Mac, FHA and VA.
Please keep in mind it is best for buyers to be preapproved with a lender before shopping for a home so any specific nuances in their case can be worked out prior to entering escrow. However, there really isn't any reason for buyers to be fearful when applying for a home loan. If they can really afford to make the payment, have reasonable credit and can substantiate their income then it is reasonable to expect they will be approved.