In recent weeks, the news coming from the financial markets has been generally negative.
Does the negative press mean that the banks have quit lending money to people who are interested in buying homes? Absolutely not.
There are still quite a few great loan programs available for people who are interested in buying a home.
Many of today’s loan programs are “plain vanilla” – meaning it is usually pretty easy for people to figure out what they can qualify for.
Just a few of the great loan options and highlights that are available for people to use for buying a new home include:
- 3% down payment (goes to 3.5% on 1/1/2009)
- Debt-to-income ratio should be no higher than about 43%. I say “about” because it is possible that it could be slightly higher and still be approved
- FHA loan limit for Maricopa and Pinal counties is $346,250
- FHA requires up-front mortgage insurance (UFMIP) in 1.75% and a monthly mortgage insurance of .55 on all FHA loans
- Must be your primary residence
- If your credit score is less than 580, it is difficult but not impossible to get an FHA loan
- Must have a certificate of eligibility showing that you are a veteran or active military
- Possible to put zero down as your down payment
- Maximum loan amount is $417,000 for a single family home
- No monthly mortgage insurance
- Funding fee is paid up front and varies from 1.25% to 2.4% and amount paid depends on military status, whether or not you are a first time home buyer and how much money you are putting down as a down payment
- Debt-to-income ratio should be no higher than about 41%. I say “about” because it is possible that it could be slightly higher and still be approved
Conventional / Conforming Mortgages
The term “conventional” or “conforming” can be used interchangeably and is used to describe loans that meet the guidelines and requirements in order to be purchased by either Fannie Mae or Freddie Mac. Highlights of these loans include:
- Conforming loan limit for Maricopa and Pinal county is $417,000
- 5% required down payment for primary residences
- Investment properties/seconds homes are allowed (higher down payment will be required)
- Ability to use automated underwriting system to find out if approved in real-time
We don’t currently help people who want USDA loans, but they are becoming more popular since 3rd party down-payment assistance programs were banned recently. Two great loan officers in Arizona who specialize in these loans are Gary Miljour in Tempe and Paul Dunn in Tucson. Highlights of the USDA program include:
- 100% financing — zero down payment
- No monthly mortgage insurance
- Must be in a rural area (most of Pinal county and parts of Maricopa meet the “rural” guidelines)
- Some income restrictions apply
These are all just a few of the great loan options that are available and are still being utilized by people to finance their home.
Mortgage Rates For October 14, 2008
If you have any mortgage questions for Justin & Tammy McHood feel free to forward any questions by submitting the form below:
If you are looking for information on buying Arizona Homes for Sale give me a call at (480) 202-3558 – It’s a great place to live, work and play! Arizona offers so many indoor and outdoor activities.
2008 Copyright All rights reserved by Candace Robinson, Arizona Real Estate Agent specializing in Maricopa County Homes and Condos for Sale