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New Rules For First Time Homebuyers-Santa Rosa Home Loans-Ascent Home Loans

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Mortgage and Lending with Ascent Home Loans

Never before have things changed so quickly in the mortgage industry. Interest rates increase and decrease depending on the markets, on an hourly basis. Loan programs are being changed sometimes on a daily basis, others are being discontinued all together.

With this in mind, first time homebuyers who were counting on the first time homebuyer loan programs with 100 % LTV or 0 down must be aware that those programs are no longer offered. Over the past month the MI or better known as mortgage insurance companies have cut back their exposure to these types of loans. They will now only insure loans to a maximum LTV of 97% on first time loans. That means the borrower must have at the very least a down payment of 3%. For example if you were looking to purchase a home for $300,000, you would need a down-payment of $9,000. Now for those of you whose stomaches just turned, please be aware that many of these programs allow for the down payment to come from other sources, such as relatives, employers or charitable organizations.

First time borrowers must also be aware that many of the credit score criteria have changed also. The majority of first time homebuyer programs now require much higher credit scores to be considered for approval. For example, if you wanted to apply for a loan with an LTV of 95,01 to 97% you would have to have a minimum credit score of 680. With a credit score below the 680 watermark, you will have to put down a down-payment of at least 5% or a 95% LTV. If you do fall in the range below 680, the minimum credit score for these programs is 620.

However, do not feel that you have been shut out of the market. FHA loan programs may be the way for many first time homebuyers to go. Although they also require a 3% down payment, they too allow for assistance with the down payment. On top of that, interest rates are usually lower then many of the conforming first time home-buyer programs. Also, many lenders will allow credit scores down to the 580 mark.

All in all there are still programs available for the first time homebuyer. One thing to keep in mind is that it is very important with the many changes going on within the market, that you get pre-approved before looking for a home. That way a loan officer can let you know what your maximum loan amount is, thus giving you an idea what range of properties you can be looking at.

For more information in regards to first time homebuyer programs, please call Scott Dovala Branch Manager Ascent Home Loans of Santa Rosa Ca. Office 707-494-8532 or toll free 877-392-0674 

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