Mortgage calculator with 8 side by side scenarios
Dan Dobbs with Capital Mortgage Services always sends the most helpful emails. One in particular has a Mortgage calculator with 8 scenarios so you can plug in your anticipated sales price, then decide whether a 5%, 10% or 20% down conventional, a 3.5% FHA, a FHA Access, a 3% down Homepath, or a USDA or VA zero down loan would be the best choice for you (of course, you need to be a veteran to get a VA loan, and FHA Access is only available in California). The best part of this calculator is that the results of all 8 scenarios are on the same page, so you truly can compare wisely.
From a real estate point of view, especially if you are a zero down buyer, you will also want to take into consideration the competitiveness of the market. Right now, here in La Mesa and San Diego, is it most definitely a sellers market, as it is in many parts of the nation. What this means to you as a buyer is that most correctly- priced homes are receiving multiple offers. This normally leads to bids coming in at over list price (“bidding wars”) which then can lead to potential appraisal issues later on during the escrow. If you can also get approved for a 3% Homepath, a 3 ½% FHA loan or a 5% conventional loan, this will help move your offer higher up in the pecking order, as there will be less risk to the seller from an appraisal standpoint.
Many listing agents are writing in phrases like “buyer to pay the difference between appraised value and contract price” on their counteroffers-- this won’t work with a VA loan, and for many buyers, it won’t work financially. Again, know what you’re up against ahead of time, and start planning early on. Having a “Plan B” is a great idea! Meet with your trusted lender and Realtor(R), and set up a strategic plan of action from the beginning. Seasoned real estate professionals keep on top of the current market conditions, and their advice can give you the competitive edge.
Success to you in your house hunt!
© 2013 Barb Fischer San Diego La Mesa
Calculator courtesy Frontier Consulting and Dan Dobbs
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