Buying a house is a straightforward process, right? You line up a lender, you find the right house and you get a mortgage to buy it. While this is the case in much of the country, there are plenty of regions where the home prices are too low for traditional home loans. How can a loan be “too small?” And where can buyers find alternate funding options? Small Dollar Mortgages Defined Most home loans under $100,000 are considered to be small dollar mortgages. In 2019, less than 10% of all U.S. single-family or condominium home purchases were for $100,000 or less. That’s a ...
October 7th, 2020 | First-time Homebuyers, Purchasing a Home, How to Get a Small Dollar Mortgage Loan
A conventional mortgage loan requires a 20% down payment. If you are a first-time homebuyer however, saving up tens of thousands of dollars can seem like an impossible task. Of course, there are loan programs, like FHA mortgages, that allow for low down payments, but they often have stricter requirements. For some of those programs, you may have to pay higher interest rates, have better credit scores, or pay higher mortgage insurance fees. Fortunately, there is a little-known mortgage loan that requires no down payment and minimal fees: the USDA loan. USDA Loan Defined These are mo...
September 9th, 2020 | Government Loans, USDA Loans, The Little-known Mortgage That Doesn’t Require a Down Payment
When potential buyers are ready to begin their dreams of homeownership, they often start by looking at real estate listings. The asking prices are the starting point for determining how much home a buyer can afford, but there are plenty of other costs and fees not spelled out in that one number. By looking at all the associated expenses, you can decide if you have enough money to buy a home. Down Payment Most mortgage loans require at least some down payment (VA loans for military are one big exception). A conventional loan an require as much as 20% down. For a $250,000 home, a 20% dow...
August 12th, 2020 | Purchasing a Home, Do You Have Enough Money to Buy a House?
As the U.S. economy reels from record-high unemployment and continued COVID-19 shutdowns, the Fair Isaac Corp. (FICO), a global analytics company and producer of the FICO credit score, released a new credit index recently it hopes will keep mortgage lending and other loans flowing during these unprecedented times. After reviewing over 70 million consumer credit files from the Great Recession, FICO found that the majority of consumers - including those with lower credit scores - kept up with their financial obligations even during that time of double-digit unemployment and devastating h...
July 15th, 2020 | Credit, New FICO “Resilience” Credit Score Could Help Borrowers
For Americans living and working in the nation’s most expensive real estate markets, homeownership can seem like the impossible dream. Prices are high and options can be limited. It may feel like home values rise faster than your ability to save up for a down payment. Although the process may look different than in other parts of the country, becoming a first-time homebuyer in a pricey area is possible. Here are some suggestions for making that dream a reality: Determine Your Budget First, you need to figure out how much home you can afford. That number needs to be determined by yo...
July 1st, 2020 | Purchasing a Home, Buying a First Home in an Expensive Area
When you buy a home with a mortgage, you will be required to pay all sorts of insurance, including homeowner’s insurance, title insurance and private mortgage insurance. What are all these policies and why do you have to pay for them? Homeowner’s Insurance Homeowner’s insurance is a policy that protects you against loss if your property or any structures on it are damaged. This covers damage from fire, storms, and vandalism. If you are unable to live in your home because of one of these issues, the insurance will also cover the cost of temporary housing while your home ...
June 3rd, 2020 Understanding Mortgage-related Insurance