It may seem paralyzing to try to figure out the best time to buy a home. Talk of high interest rates, low inventory driving prices even higher, market crashes, and on and on. . . it’s no wonder buying a home is so overwhelming. And if you are considering purchasing a home, you may be wondering if it is better to wait until mortgage rates drop again. Unfortunately, there is no guarantee that interest rates ARE going to drop. And if rates DO drop, there’s no guarantee that home prices aren’t going to also increase. Compared to a couple years ago, interest rates are high, but compared to interest rates our parents and grandparents paid, today’s interest rates are low. The truth of the matter is if you have a strong down payment, a good credit score, and a secure job history, you are in a good position to buy a home. Buying a home now allows you to begin building your own equity. You aren’t stuck with interest rates forever. Trust me. If interest rates go down, your lender will be calling you to refinance. You may have heard the ol’ saying. . . marry the house and date the rate. Buying your own home is better than renting a home to pay someone else’s mortgage. Ask any investor the best time to buy. They will tell you the best time to buy is when others aren’t. Check out New American Funding’s 5-Year Rate Protection Pledge. You can buy now and refinance to an even lower rate later, if rates drop, with no LENDER FEE or APPRAISAL FEE. 

 

      

 

A good lender is one of the biggest keys to a smooth real estate transaction. You should never be told which lender to use; however, your agent works with several lenders and can help guide you to a finding the right lender that fits your home-buying goals. For example, some lenders cannot loan on manufactured homes. Some cannot loan on property. Some offer a 3% Conventional, while others do not. Understand that it is illegal for a lender to give a "kickback" to a realtor for using them; however, referred lenders are going to typically have a partnership with your agent in terms of know each other's operational processes, being easily accessible, and having a sense of urgency to close the transaction on time. 

 

Meet Brandon Moore: Brandon has many years of experience in the mortgage banking industry and extensive practice in originating home loans for both purchase and refinance. He is a firm believer in excellent customer service. He is never too busy to answer your questions. And whether you qualify for a loan today or need to work on your credit, Brandon will help you take the necessary steps to getting you qualified in the future. As a Senior Loan Consultant with New American Funding, Brandon continues to be one of the most knowledgeable Loan Consultants in the area. 

 

Click Here to get Pre-Approved.  

FREQUENTLY ASKED QUESTIONS:

1. Does getting a pre-approval cost me anything? No. It’s just scary to many buyers. There is no cost to get pre-approved. A lender will pull your credit. A pre-qualification letter is typically good for 3-4 months. Ask your lender to be sure.

2. Why do I need to get pre-approved before looking at homes? While looking at homes is THE most exciting part of the home buying process (Hey, I get it! That’s one of my favorite things to do, too). But nobody wants to waste their time--not the seller, not you, and not your realtor. Did you know that realtors have an ethical obligation to show homes ONLY to willing and abled buyers? We don’t know who is able to buy until they meet with a lender. Sellers expect people who are walking through their home to be qualified to buy. Your loan program will dictate the homes you are able to buy--both in terms of cost AND condition.

3. Why does my realtor tell me that I can’t buy some homes with an FHA loan? Government-backed loans (FHA, VA, USDA) require a move-in ready condition. Because these types of loans have a lower down payment, lenders tend to see them as a greater risk; therefore, they want the condition of the home to be good so that if you default on the loan, they can re-sell it. When listing agents list a home, they have enough experience to predict whether a home will qualify for these loan types and will include it in the listing comments to buyer’s agents.

4. What are the perks for 1st time home buyers? The Missouri Housing Development Commission (MHDC) will help you with down payment, but if you sell your home before 10 years, you may have to pay the down payment back. There are also other down payment assistance that you may qualify for.

5. Why didn’t I get approved for a loan? The most common reasons for loan denial are: high debt-to-income (DTI), poor credit score, no credit history, judgements (or lawsuits) against you, unpaid taxes, work history, high student loans, or bankruptcy.

6. What credit score do I need to qualify for a loan? There are a lot of factors that go into qualifying for a loan, not just credit score. For example, if you have a high credit score but have a lot of debt, it is possible to not qualify. Generally, a credit score of 580 is the cutoff for FHA provided that debt is low, work history is at least 24 months, and you have no defaulted payments. This is just a rule of thumb. Your lender is the only one who can tell you whether you qualify for a home loan.

7. What if I filed Bankruptcy? Chapter 7: (all debt wiped clean) FHA and VA require two years from the time of discharge, USDA three years, and Conventional four years. Chapter 13 (making payments on debt) Must have history of 24 payments made to resolve debt.

8. What is DTI? Debt to income ratio. Lenders will take your debt and divide it by your income to get a percentage. Anything over 49.9% is generally considered high. This is where a lender may require you to pay off some bills before qualifying for a loan to bring the DTI percentage down.

9. What is PMI? Private Mortgage Insurance. A policy that protects the mortgage lender from financial loss if the borrower stops making their monthly payments. PMI is added if you don’t offer at least a 20% down payment when you purchase a home as lenders see a lower down payment as more risk for them. So if your home is $200,000, you’ll need to offer at least $40,000 down to avoid paying PMI. For the most part, PMI premiums average around 0.5% to 1% of the loan amount each year. So, on a $200,000 loan, you could pay anywhere between $1,000 and $2,000 a year for PMI. Most PMI premiums are paid monthly and added to your mortgage payment. Some mortgages may require an upfront premium paid at closing. Homeowners Protection Act (also called the PMI Cancellation Act), gives a borrower the right to request PMI removal once the principal balance on the loan falls to 80% of the original value of the home. You can wait until the lender or servicer automatically cancels it, or you can contact the lender or servicer once the principal balance reaches 80% of the original home value. Another way to get rid of PMI is by refinancing.

 

QUESTIONS TO ASK YOUR LENDER:

  1. Do you keep my loan in house or sell it off?
  2. What loan origination or other fees do you charge?
  3. How accessible are you if I have any questions? Will you give me updates throughout the process?
  4. Will you give me a list of documents I need up front and in plenty of time to close?
  5. How important is it for you to follow the contract and close on time?
  6. At what point do you take my file through underwriting?
  7. Will you help me get qualified for a loan even if I don't qualify today?