The big rave the past few years was; 100% financing and how easy it was to obtain. Wow, what a difference 2 weeks makes! Lenders have really cracked down on high ltv (loan-to-value) loans (ie 100% financing) and what it takes to qualify for them.
Most Fannie Mae loans are requiring the borrower to invest at least $500.00 of their own funds in the transaction which honestly, to purchase a home is not that much money. Second, lenders are more likely to require the borrowers to have a least 3 months payments in reserves. This means if your total payment is $1000.00, they want to see a minimum of $3,000.00 in a savings, IRA, checking or some other form of liquid asset. One other thing they are cautiously watching is late payments and the recentcy of them. If you have a couple of minor 30 day lates, lenders are wanting a valid explanation as to why they were late.
Don't get me wrong 100% financing is still alive and well and still very much a part of the growing housing community but lenders are stiffening the guidelines it takes to achieve them. Make sure you deal with a lender that will explain every detail of the loan process to you and make you aware of program changes as they come available. The market is changing fast and you will need a professional who is on top of his/her game!
Your comments are welcomed!
Brought to you by the Professional Mortgage Group, Inc. "The Industry Professionals"
Most Fannie Mae loans are requiring the borrower to invest at least $500.00 of their own funds in the transaction which honestly, to purchase a home is not that much money. Second, lenders are more likely to require the borrowers to have a least 3 months payments in reserves. This means if your total payment is $1000.00, they want to see a minimum of $3,000.00 in a savings, IRA, checking or some other form of liquid asset. One other thing they are cautiously watching is late payments and the recentcy of them. If you have a couple of minor 30 day lates, lenders are wanting a valid explanation as to why they were late.
Don't get me wrong 100% financing is still alive and well and still very much a part of the growing housing community but lenders are stiffening the guidelines it takes to achieve them. Make sure you deal with a lender that will explain every detail of the loan process to you and make you aware of program changes as they come available. The market is changing fast and you will need a professional who is on top of his/her game!
Your comments are welcomed!
Brought to you by the Professional Mortgage Group, Inc. "The Industry Professionals"
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