Monday, May 5, 2008

Financing Options are Changing!

Please be aware that the days of conventional 100% financing are over, so if you are planning on buying a house you must have a down payment. Here are the three most common financing types and a few key points for each loan type.
Conventional FHA VA
Maximum Financing 95% 97.75% 100%
Down Payment Required 5% 3% 0%

Important Notes on each loan type:
  • Conventional: 5% Borrower own funds required, and any additional down payment can come from an eligible gift.
  • FHA: 97.75% Maximum financing available when borrower pays all closing costs. Down payment can come from borrower funds or eligible gift sources
  • VA: Borrower must be active military, veteran or civil service employee to qualify.

Unfortunately, the loss of conventional 100% financing will affect borrowers who borrowed 100% when they purchased their home and are considering refinancing; as they too will need to have equity before refinancing.

With all of the market changes, we are still originating loans and helping borrowers make meaningful changes to their financial situations through refinances. It is important that you utilize a lender who will be there for you during the loan process as well as after closing!

30 Year Fixed 6.25% with 0 points
15 Year Fixed 5.875% with 0 points
FHA 30 Year Fixed 6.00% with 0 points

by Shawn Tihen, Bankers Home Lending (314) 520-3649

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