From a lender’s point of view, they want to see that a borrower has the ability and willingness to pay back the loan. They will check your credit score to see your past payment history. While we have loans available for credit scores 500 and above, 580 is a major milestone with getting the best terms, and if you are over 640, there are even more options. To check on the ability to repay the loan, lenders will check your debt to income ratios. How much do you bring in versus how many other obligations do you have. Rent does not count and neither does car insurance or cell phone. A good rule of thumb is any payment that still has a year or more left on the repayment schedule. Rent is year to year, insurance is year to year, while a car payment is typically 5 years, so we have to use that. Depending on those figures is how we will come up with your housing budget. You can follow the link below to find out how much you could borrow.
The short answer is no, it ended in 2010. However, there are still ways to claim deductions if you are a homeowner.
If you purchase a home under $750,000 (and let’s be honest, that’s most of us), there is a mortgage interest deduction you can claim on your taxes. Mortgage Interest is what the lender charges each month for you to borrow the money to buy a home. Don’t worry, this is already built into your mortgage.
There are also the property taxes and mortgage insurance that are able to be written off on your taxes. The property tax is charged by the county to whoever owns the plot of land and/or home. Mortgage insurance is paid to the lender for any borrower that doesn’t put typically a 20% down payment on a home (again, that’s most of us!). Since the lender has way more money in the invested in the house than the borrower, they need to “insure” their money that is given to the seller when you purchase the home in case of a default. This mortgage insurance gives the lender peace of mind.
All of the above mentioned is included in your monthly payment. You do not need to send a bunch of checks around the country, you will pay one check a month to the lender, and they will pay your property taxes, mortgage insurance, and their interest.
If you are thinking about purchasing a home, or don’t know where to start, please reach out to us! We specialize in first-time home buyers. No question is too small! To see if you qualify to purchase a home, click here.
You didn't think you had to have a 20% down payment in order to buy a home, did you?
Heck NO! At Rapid Rate Mortgage, we have multiple different options to help you purchase a home with no money down. Let's review the different requirements for each option below:
1. VA Loan- This loan is strictly for active and retired military. There is a 500 minimum credit score for this loan, and is the best option if you are a veteran. This loan can be used anywhere, with no location restrictions.
2. USDA Loan- The USDA loan is available to everyone with a 550+ credit score! The main restriction on this loan is location. It cannot be in a heavily populated area. If you are willing to drive an extra 15-30 minutes, this is a great option to save a bunch of money on a down payment.
3. Down Payment Assistance- We are really excited to announce our newest option at Rapid Rate Mortgage, launching February 2019, our Down Payment Assistance Program. This is the best option for people with a 620+ credit score. There are NO location restrictions, and available to everyone! Our Down Payment Assistance option pays your down payment, and does not need to be repaid if you live in your new home for at least 2 years! That's as close to FREE MONEY as it gets, am-I-right?!
To see if you qualify for any of these Zero Down Loan Options, click here.
You’ve been on a budget, saving all that you can….for a down payment on a home. Now what?
Gone are the days that you need 20% down to purchase your home. In fact, there are programs out there for ZERO down. That’s right, zip, zilch, nada. The next step above is 3.5% down. That means for a home priced at $100,000, you only need $3,500! This puts home ownership within reach for so many more people than ever before.
So you’ve finally decided to ditch the rent, and invest in your own asset. Congratulations! This is one of the best things you can do for yourself. The first step is to contact a lender, like RAPID RATE MORTGAGE (NMLS #1654276), to get prequalified. Prequalified is just a fancy way of saying “to see how much home you can afford”. During this step, you will need to provide a few things like pay stubs, bank statements, etc. You can get prequalified HERE to make it easy.
Now comes the fun stuff. After you get prequalified, you get to start looking for your dream home. All that HGTV watching is about to pay off! Whether you want a fixer upper or move in ready, your real estate agent can help you find exactly what you are looking for. Don’t have a real estate agent yet? No worries, we can help you with that too! We have trusted real estate agents across the area that we can pair you with to make sure you are in the best hands possible.
Ok, so now you’ve got your dream home under contract. Next will come inspections, the survey, appraisal, and title work. Let’s slow it down for a minute. Inspections will include a complete home inspection to make sure the home is in acceptable condition for the new owner. You will also need the inspection for your insurance company. The survey is so you know exactly where your property line is. This is important for any fence, pool, etc. down the road. Lastly is the appraisal. This is a third party that comes to the home and gives you their valuation. This let’s you know that you are not overpaying for your new home. Meanwhile, behind the scenes, a title company will be searching for any liens against the house to ensure no one will come after you for money that the previous owner might have neglected to pay.
After these steps are complete, it’s time to close on your NEW HOME! Be sure to bring your ID to the closing table, as the notary will need to verify who you are.
Of course this is just an overview of the home buying process, and should be used as a general guide. If you have any questions or are ready to get prequalified, feel free to reach out to us here.
Military families get the benefit of zero down loans through the VA. What if you are not in the military, but do not have the money for a large down payment?
Rapid Rate Mortgage has a solution for you! If your middle credit score is over 550, you are eligible for our zero down payment loan! The main restriction is location. Milton and Pace both qualify. This is a great option for those who are willing to commute and extra 15 minutes to save thousands! See the map below. Areas outside of the shaded area are eligible for our Zero Down Loan.
To see if you qualify for the Zero Down Loan, click here.