This simple breakdown of loan types will not overwhelm you. You’ll easily find the right mortgage.
Most people have an idea of what they want when it comes to purchasing a house: a bungalow, a condo, a hot area, or a quiet street.
There are many types of mortgages. Recognizing which type to choose can be a little more difficult than knowing whether you prefer hardwood floors or wall-to-wall carpeting.
First, know your exact situation to determine the best loan option 후순위담보대출. Are you going to be living in the home for many years? Decades? Do you feel financially secure? Do you worry about the possibility of changing your loan rate? Before you talk to lenders, consider these questions. Before you decide on a lender.
This simple breakdown of loan types will not overwhelm you. You’ll easily find the right mortgage.
Most people have an idea of what they want when it comes to purchasing a house: a bungalow, a condo, a hot area, or a quiet street.
Borrowers needing a loan greater than $625,500 must apply for a jumbo loan. This loan typically requires a downpayment of at least 20%. FHA loans offer a greater flexibility in terms of qualification requirements, and require only a 3.5 percent down payment.
Patrick Cunningham, Vice President of Home Savings and Trust Mortgage Fairfax, stated that “Switching on-the-fly from a downpayment of 3.5 percent up to 20 percent of the purchase price isn’t really an option for most people.”
Cunningham says that it could make a $100,000 difference in the amount of money required. “Not something that most people pull out from the couch cushions.”
Rules governing ability-to-repay
The Consumer Financial Protection Bureau will introduce a new set rules on Jan. 10 to combat predatory lending practices, which have fueled a wave in foreclosures over the past five year.
The Dodd-Frank Act authorized the “Ability-to-Repay” regulations. They are designed to prevent lenders from approving mortgages to borrowers with poor credit scores and low debt-to-income ratios.
Partly because rates on ARMs were raised, the housing crisis was born. Millions of homeowners were not fully qualified to mortgages and lost their homes in foreclosure.
Borrowers have the good news that loan origination fees will not exceed 3 percent of the mortgage amount of $100,000 or more. Loan origination fees are currently not subject to a cap. To remain competitive, lenders try to keep their fees low enough for customers but high enough to keep their business profitable.
These rules define what the government considers “qualified mortgage.”
Risky mortgages — negative-amortization, interest-only or balloon-payment loans — fall outside the qualified-mortgage standard.