finding the lowest payment (with little or no money down)

By
Mortgage and Lending with Fairway Independent Mortgage Company 385907

Okay, have you ever wondered, or have you ever compared the programs available to see who's got the lowest payment?

especially if you're a first time homebuyer

I'm going to use as a basis a purchase price of $125,000 and an interest rate of 4.75% for all examples

let's start with

VA

there's 3 different VA categories I will address;

if you're using your eligibility for the first time it's 2.15% for the funding fee

so with the funding fee the mortgage is $127,687 and the P&I is   $666.08

 if you have used your eligibility previously the funding fee is 3.3%

so with the funding fee the mortgage is $129, 125 and the P&I is  $673.58

if you have a VA related disability the funding fee may be waved

so with no funding fee the mortgage is $125,000 and the P&I is    $652.08

(that could be it-the lowest payment-we'll see)

next

FHA

this alters the comparisons a bit in that FHA requires a 3.5% down payment, in this case $4375.

so the base mortgage amount is $120,625 but

the mortgage amount with the upfront MIP is $122,735 and the P&I is   $640.24

AND to this example we need to add the annual MI

 the annual MI for this example, based on a rate of 1.35% is                   $138.08

so the total payment is                                                                                 $778.32

my final example is

USDA/Rural Housing

the upfront guarantee fee is 2% and the annual fee is .4%

so I'll use a mortgage amount of $127,500 and the P&I is                        $665.10

and the annual/monthly fee is                                                                       $42.50

so the total payment is                                                                                 $707.60

so what's the conclusions;

we have got to be asking potential homebuyers if they are Veterans because their options are outstanding, particularly if they have a VA related disability, and may qualify for 100% financing, with no funding fee or MI of any type

 

we cannot discount or ignore the USDA/Rural Housing option (where available) as in this example the payment is $70 ish less than FHA.

and finally while FHA may generate the highest payment it has guidelines which are helpful to the buyers, particularly it's acceptance of down payment and closing cost assistance programs.

 

 VA...alriiiiiight!

 

close

Re-Blogged 2 times:

Re-Blogged By Re-Blogged At
  1. John McCormack 07/07/2013 02:02 AM
  2. Joe Pryor 07/07/2013 04:05 AM
Topic:
Mortgage / Finance
Location:
Florida St Lucie County
Groups:
Active Rain Newbies
Keller Williams 'Rainers
RE/MAX Active Rain Bloggers
1st Time Buyers
Posts to Localism
Tags:
indian river county mortgages
vero beach loan officer
port st lucie loan officer
st lucie county mortgages
martin county mortgages

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Ambassador
1,611,302
Harry F. D'Elia
Real Estate and Beyond, LLC - Phoenix, AZ
Investor , Mentor, GRI, Radio, CIPS, REOs, ABR

The VA loan is my favorite loan when it comes to buying a home

Jul 07, 2013 12:49 AM #7
Rainmaker
1,861,329
Andrew Mooers | 207.532.6573
MOOERS REALTY - Houlton, ME
Northern Maine Real Estate-Aroostook County Broker

Simple, easy peasy helpful blog post.

Jul 07, 2013 01:03 AM #8
Rainmaker
275,477
Jay Beckingham
Fairway Independent Mortgage Company - Delray Beach, FL
"I love first time homebuyers"

Elise,

you're welcome.

interesting #'s, don't you think?

Michael,

and in the best interest of the homebuyer

Harry,

it's an earned benefit, and a great tool.

Andrew,

I like simple

and you maine guys got a way with words

thanks all

jay

Jul 07, 2013 01:20 AM #9
Rainer
81,271
David Opoka
Gilbert, AZ

That is great information but I am finding buyers are getting caut up with to many plans.

Jul 07, 2013 01:30 AM #10
Ambassador
3,923,026
Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Jay, working with right professional makes all the difference as your example shows - a VA loan end up with different payments and may save money if done right!

Jul 07, 2013 01:46 AM #11
Rainmaker
1,282,180
Edward & Celia Maddox
The Celtic Connection Realty - Queen Creek, AZ
EXPERIENCE & INTEGRITY - WE TAKE THE HIGH ROAD

Jay, some very good statistics on loans to provide clients.  Thanks for sharing.

Jul 07, 2013 02:28 AM #12
Rainmaker
275,477
Jay Beckingham
Fairway Independent Mortgage Company - Delray Beach, FL
"I love first time homebuyers"

David,

I always ask if the homebuyer is a Veteran, so that's a good starting point. for you hook up with a good loan officer who can interview the buyer and weed through some of the programs.

Praful,

VA loans can be deal makers, and provide the lowest payment possible. what's not to like about that?

Edward & Celia,

you're welcome. the numbers don't lie

thanks

all

jay

Jul 07, 2013 02:43 AM #13
Rainmaker
2,257,352
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Jay..this is what people have to hear to move forward in Real Estate...well done...Call Jay now

Jul 07, 2013 03:26 AM #14
Rainmaker
592,340
Than Maynard
Coldwell Banker Heart of Oklahoma - Purcell, OK
Broker - Licensed to List & Sell - 405-990-8862

FHA (our government) got stupid again with upping the PMI requirements. PMI adding $135.00/month is just plain stupid.

Jul 07, 2013 03:30 AM #15
Ambassador
1,341,361
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

Thanks, even after 24 years of real estate I needed this refresher course.

Jul 07, 2013 04:03 AM #16
Rainer
237,463
Jay & Michelle Lieberman
Keller Williams World Class - Agoura Hills, CA
Creating Calm in the Buying and Selling Chaos

What a great run down.  I am printing it out and keeping it handy.  Thanks for the info.

Jul 07, 2013 05:09 AM #17
Rainmaker
1,143,371
David Shamansky
US Mortgages - David Shamansky - Highlands Ranch, CO
Creative, Aggressive & 560 FICO - OK, Colorado Mtg

There are many options and its wised to explore all you can before making the choice to ensure you have the right product to best fit your needs

Jul 07, 2013 06:20 AM #18
Ambassador
1,693,298
Tammie White, Broker
Franklin Homes Realty LLC - Franklin, TN
Franklin TN Homes for Sale

Jay, your timing is impeccable. I am working with a couple right now who is using THDA. This gives a buyer a clear understanding of the differences.

Jul 07, 2013 06:35 AM #19
Rainmaker
275,477
Jay Beckingham
Fairway Independent Mortgage Company - Delray Beach, FL
"I love first time homebuyers"

Richie,

thanks,

it's best serve our clients we need to have good information available.

Than,

it does seem excessive, but it may not be forever, and we need to keep that program strong.

Joe,

24 yrs; congratulations. homebuyers need experienced representation.

Jay & Michele,

if you ever need to fill in any gaps, send me an email or just give me a call.

David,

you need a good Loan Officer who'll conduct an interview and present the best options.

Tammie,

thanks, may it work out well.

thanks everyone

jay

Jul 07, 2013 09:27 AM #20
Ambassador
1,132,490
Ralph Gorgoglione
Maui Life Homes / Metro Life Homes - Kihei, HI
Hawaii and California Real Estate (800) 591-6121

A great visual example of how calculations in each category are made. Thanks for helping me help new clients.

Jul 07, 2013 11:00 AM #21
Rainer
275,469
Jimmy Faulkner
Florida. Homes Realty & Mortgage - Wantagh, NY
The Best Of St. Augustine

This is all about knowing what you are doing and caring about what you are doing. You can be of real value as a Realtor to the first time buyer or any buyer if you take the time to learn the industry.

Jul 07, 2013 11:02 AM #22
Rainmaker
275,477
Jay Beckingham
Fairway Independent Mortgage Company - Delray Beach, FL
"I love first time homebuyers"

Ralph,

you're welcome,

Jimmy

I agree with you.

thanks

jay

Jul 07, 2013 12:03 PM #23
Rainmaker
1,327,753
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Los Angeles CA

The problem with FHA in my area( Los Angeles/Valley): they are not going through. Most HOA communities are not FHA approved. There are not a lot of houses, as well, who would take FHA offer... Not an easy time for FHA buyers.

 

Jul 07, 2013 05:03 PM #24
Rainmaker
275,477
Jay Beckingham
Fairway Independent Mortgage Company - Delray Beach, FL
"I love first time homebuyers"

Inna,

if they're PUDs they don't need to be approved, if they are condo's they do. always check the docs.

 

jay

Jul 07, 2013 07:45 PM #25
Rainer
2,088
Al Giacalone
RockStar Realty - North Fort Myers, FL

Very good information Jay. Veterans deserve all the help we can give them. Why do you suppose the USDA/Rural Housing program is not as popular as FHA? In SW Florida (Lee and Collier Counties) there are a lot of homes that would qualify. 

Jul 09, 2013 04:23 AM #26
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Jay Beckingham

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