The world wants us all to believe that getting a mortgage right now is impossible. That is not true. The rules have changed, but there is money available. Get this, if you don't have a job or if your credit score is below 680 you don't qualify! To me that is logical. That type of buyer is too great a risk. If you have a credit score of 680+, a record of employment for 2 years, and 3% of the purchase price in liquid funds for a down payment, you are a buyer. That kicker is the 3% down. I might sound cruel, but I do believe someone making the largest financial investment of their lives should have some investment in the deal. Who would want a business partner that is putting zero dollars into starting the business? A mortgage is a business relationship with a lender.
It truly was too easy to purchase in the last 4 years. Now we are seeing what happens when we get creative with financing. It happened in the 70's when graduated mortgages were invented. We suffer from memory loss, as we did not learn from that mess.
As a Realtor, I help people purchase houses, but I also counsel them on finances. I will only work with a lender who helps the buyers select a mortgage product that will get the deal done but also protects the buyer. 75% of those working today do not have 2 months of savings that they could live on if something happened to their job. I encourage a buyer to have 6 months. We used to call that "rainy day money." Truly, the majority of us are living check to check.
Lending guide lines will often let one have 41% of their gross income be debt. Forget about going to Taco Bell! Don't just look at the amount your are qualified for, look at what that means in monthly payment, PITI+MIP. Purchasing a property for $200,000 with 3% down with today's interest rates means about $1350 per month in PITI+MIP. If one has been paying $900 per month for rent, that is a considerable change in their budget.The saving grace is the tax right offs.Once you get your return it will look more like $1050 a month.
Meeting with me and one of my loan officers prior to even going through the first open house, will help a buyer stay on the right course to buying a house. It is easy, fun, and a positive experience.
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