Purchasing a home has become more difficult for thousands of first time home-buyers over the past 4 years and will continue to get more difficult over the coming years. Yes, rates are at their historic lows but most people are not qualifying because they can't afford the payments but thier lack of down payment and closing cost assistance. Mortgage Services, Inc. works with Non-Profit Agencies to help borrowers overcome this problem......
But even with overcoming this problem, why is it that it is becoming harder and harder.... it's because the game is constantly changing.... the approval process and the required items needed to qualify are getting more and more difficult.....
Regardless if ones credit scores is 850, if they have outstanding balance let's say on a cell phone that was over 4 years old, as it may not be driving down this borrowes credit scores but being on the credit report most likely will disqualify them from being approved unless it is paid in full.
The other thing most borrowers are not aware of is the governments implementation of "Risk Based Pricing"! Borrowers will not get the low 3.5% interest rates being advertised unless they have over a 740 credit score and are putting down at least 40%. Anyone falling outside of the above referenced criteria will pay drastically higher interest costs on their mortgages.
To make matters worse, the federal government did not extend the mortgage insurance deduction benefit that had been put in place more than four years ago. That means a borrower who is now paying as much as 1.15% annually on FHA mortgage insurance can no longer take this this as a deduction on their schedule "A".
With all these changes and additional ones to come, borrowers need to plan ahead prior to purchasing a home.
Borrowers who are better prepared will ultimately save thousands of dollars on their home purchase in the months and years to come.
Mortgage Services, Inc. has been helping borrowers better prepare for home-ownership for more than 27 years. Working with one borrower at a time.
RonGiannamore is a Managing Loan Specialist with the company for more than 20 years and specializes in all government lending programs.