Posted by: thepinetree on 12/17/2010 02:29 PM
Updated by: thepinetree on 12/17/2010 04:12 PM
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Home Ownership in Reach for Many with Federally Guaranteed Programs~By Mark Hughes
Murphys, CA...There are three common loan programs which are Federally Guaranteed – namely FHA, USDA and VA as well as a myriad of State programs. Many renters will qualify for one of the programs with little or no down payment. Some programs even allow down payment assistance in order to help first time home buyers.
Federal Housing Administration (FHA) insured loans are a type of federal assistance and have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford. The program originated during the Great Depression of the 1930s, when the rates of foreclosures and defaults rose sharply, and the program was intended to provide lenders with sufficient insurance. Click Here For Entire Article
FHA is the largest government insurer of mortgages in the world. A part of the United States Department of Housing and Urban Development (HUD), FHA provides mortgage insurance on homes made by FHA-approved lenders throughout the United States and its territories. In the depths of the Great Depression, as the economic collapse caused bank failures, widespread foreclosures and massive unemployment, the government devised a strategy to stimulate the housing market, which was – and still is – vital to the health of the American economy.
While everyone has been watching Fannie and Freddie historically, the current Administration has quietly shifted most federal mortgage initiatives to FHA. FHA now accounts for about 60 percent of all home purchases. This amounts to more than $1 trillion and is rising rapidly. The administration justifies this policy by saying it is necessary to support the mortgage market.
“The minimum FICO score for an FHA loan has gone up for most lenders, but our FHA program provides financing for borrowers with a FICO score down to 580 with as little as 3 ½% down payment.” States Greg MacDonald, Branch Manager of Platinum Home Mortgage in Murphys.
Funds for down payment can be a gift from family and the seller can pay closing costs. With an FHA loan, you will have more flexible credit and asset guidelines, especially when making a minimal down payment. This alone has helped scores of families to buy their dream home.
You do NOT have to be a first-time homebuyer. However, you can only have one FHA loan at a time and you can only use it to purchase or refinance your primary residence. With special FHA financing, you can also get the minor repairs and renovations you’ve been delaying, like that kitchen or bathroom remodel and finance the costs into your mortgage.
“Deferred maintenance shouldn’t stop you from contacting your Realtor immediately and making an offer to purchase your dream home. If you’re not yet working with a Realtor, give us a call and we will be happy to assist getting you approved with this home improvement purchase loan and recommend a local Realtor FHA specialist.” MacDonald added.
“Platinum Home Mortgage is a mortgage bank, not just a mortgage broker. Housing and Urban Development delegated Platinum Home Mortgage to be a direct underwriter for FHA loans 16 years ago. Because we went through the testing phase years ago, we have developed a high level of expertise to ensure FHA loans flow smoothly and quickly to the closing table.”
The Guaranteed Rural Housing program (USDA) is another popular Federally Guaranteed program for our area. Part of the United States Department of Agriculture, it help provide financing for families in more rural areas who are able to afford the mortgage payments, including taxes and insurance. In addition, applicants must have reasonable credit histories. Applicants for USDA loans may have an income of up to 115% of the median income for the area. There is no down payment requirement and the seller is allowed to pay closing costs. Under the program, housing must be modest in size, design, and cost.
The Department of Veterans Affairs (VA) is a third Federally Guaranteed Mortgage program. The VA backs the loan on the veteran's behalf but it does not issue loans, extend credit. If a borrower is not qualified, we won't issue the loan. The program is limited to Veterans.
When it comes to VA mortgages, eligibility for VA home loan benefits is no guarantee the veteran can get them. Vets have to be in military service for a minimum time before they can get a VA certificate of eligibility. For most Veterans, there is no down payment requirement and the seller can pay closing costs on behalf of the Veteran.
Few Veterans are aware that military families get an extra year to take advantage of the Federal Homebuyer’s Tax Credit which ended last Spring for most buyers. The Federal tax credit for first-time buyers is 10% of sales price up to $8,000. The Federal tax credit for move-up homebuyers, who have used their previous home as a principal residence for five of the previous eight years, is $6,500. Servicemen and women must have a sales contract signed as of April 30, 2011 and must close by June 30, 2011.The extension only applies to individuals or their spouses who serve on qualified official extended-duty service outside the country for at least 90 days between Jan. 1, 2009 and Apr. 30, 2010. Veterans should contact their tax advisor for full details.
Platinum Home Mortgage routinely approves 1 out of 3 loans turned down by banks and other lenders. If you’re considering purchasing or refinancing a home or simply want to ask a question, please call, click or come by, we’re located in downtown Murphys next to V Restaurant. We’ll be happy to discuss all of your financing options.
All the Best!
Mark O. Hughes
NMLS ID# Ca-DOC 268235 Ca-DRE01178888
(209) 728-9898 Office
(209) 728-9891 Fax
Mark@MortgageOnMain.com
www.MainStMoney.com/MarkHughes
Platinum Home Mortgage Corporation
Main Street Financial Group
402 Main Street, Suite G
Murphys, CA 95247
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