December 02, 2008

FINANCING YOUR HOME…..it’s easier than you thought!

Posted to Julie Sarton

With all the negative media coverage of the housing downturn and the stock market on a roller coaster, it’s difficult these days to get a clear picture of mortgage lending availability. Home buyers seem to be holding back from even looking, fearful that if they find their perfect home they won’t be able to obtain reasonable financing. While subprime and no documentation loans are a thing of the past, most banks are still eager to grant mortgages to credit worthy buyers.

Even after the financial volatility of the past six months, we continue to work with local lenders in Walworth County who are strong, solid, and eager to make mortgage loans. They are also familiar with area property values and appraisers, an important benefit to underwriters. Most of the banks our company highly recommends never fell prey to the subprime market, and so their parameters remain the same as they have all along. Buyers with credit scores of 720 or higher who are able to put 10% down will probably be unaffected by any recent changes in mortgage standards. With this said, it’s still advisable to be pro-active in positioning yourself to apply for a mortgage commitment. Take advantage of your access to a free annual credit report, and make sure there are no surprises or mistakes there. Get a pre-approval letter from your bank (have your W-2’s and previous year’s income tax return ready to submit) and, if it takes more than 30 days to sell or find a home to buy, make sure the pre-approval is still good since bank underwriting policies continue to fluctuate. Having a pre-approval letter also makes any offer to purchase look more attractive to sellers, and for many sellers today it’s a required part of the offer.

For buyers with less than 10% down and lower than 720 credit scores, there is also mortgage money available, contrary to the national doom and gloom that we hear daily. Our local banks all have custom programs with different criterion, varying rates and payback options. For example, several lenders currently have a program for first time home buyers, with only 2-3% down and a fixed rate available. It’s important to work closely with your lender to find a program that fits your needs and abilities; no one wants to repeat the chaos of the past six years. It’s also important to work closely with your real estate agent; Keefe agents can direct you to recommended and preferred local lenders that we have worked with for many years, and we know their track record. With a bountiful inventory to choose from, rock bottom prices, and historically low interest rates available, it’s a great time to buy!

Posted By: Julie Sarton

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