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If You Are Not Quite Ready To Pay Cash For A Home
I had a conversation this morning with Danny Martinez of Supreme Lending in Corpus Christi. I wanted an update on the current home lending market, interest rates and any special financing programs for First Time Home Buyers. If you have a Good to Excellent credit score, the home you want to buy is in good shape without the need for a lot of structural repairs and under $250,000.00 you could apply for an FHA loan. The home would also need to be your principal residence, not a second home or investment property. Your interest rate would be about 4% and the down payment would be 3.5% of the sales price. Homes not qualifying for an FHA loan would need to be financed with a Conventional Loan which requires a 5% down payment and with Good to Excellent credit score the interest rate would be around 4.25% . Conventional Loans will cover homes up to a sale price of $424,100.00 . Supreme Lending is currently able to close FHA and Conventional loans in less than 30 days, provided that you supply all the necessary documentation.
Perhaps your credit score is not perfect. Don't give up on buying a home. Supreme Lending will work with clients who have at least a 580 credit score. Interest rates will depend on credit score and other criteria.
Here is what you will need to provide the Lender.
Tax Returns for the last 2 years
W-2's for the last 2 years
2 months of your bank statements
1 month of pay stubs from your employer
Copy of a valid Drivers License
Are you or your Co-Borrower a First Time Home Buyer?
If you or your co-borrower are First Time Home Buyers the Texas SETH grant program offers down payment assistance for up to 6% of the home purchase price. This is a grant program and does not require repayment. There are a few requirements. Your credit score must be at least 640. The annual family income maximum for a Conventional SETH loan is $82,000 per year. The annual family maximum for an FHA SETH loan is $64,000.00 The interest for a Texas SETH loan is 5%. This assisted loan takes a little longer to close, around 45 days. The same documentation detailed above would be required.
Danny feels like interest rates should remain steady for the rest of the year.