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Don’t have 20% to put down to buy a home, that’s ok

Posted on March 20, 2018 by Kelly McCurdy (NMLS# 1663896).

Looking to buy a house but don’t have 20% to put down to get out of pesky M.I.?

Little does the public know there are programs that allow for only 3% down and no M.I. Today I’ll be going over two options that we have available for the borrow who is worried about having to pay mortgage insurance.

The first program is an exclusive product we offer here at the Mortgage Maestro Group.

There are a couple key qualifications for this program and they are as listed below:

  • First, you must have a qualifying credit score of 680
  • The subject property must be a single unit property
  • A Full appraisal is required
  • And you must be an occupant borrower or co-signer, meaning that this will be the borrower and co-borrower/ co-signers primary residence.
  • Meet Fannie and/or Freddie applicants income limits.

The Second program is similar and is offered through CHFA (Colorado Home and Financing Authority), who is a third-party agency that offers financial resources to strengthen homeownership here in Colorado. We are a preferred lender with CHFA.  Thier program is the CHFA Advantage Program. Since CHFA is a third party they have their own set of key qualifications that need to be fulfilled, additional to the ones that your lender may require. Here are a few of CHFA’s additional requirements outside of the key qualifications listed above:

  • Complete a CHFA-approved homebuyer education class
  • Meet CHFA household income limits.
  • $1000 invested in the loan program (can be earnest money)
  • Pay a 1% origination fee.

Though these programs are very similar they do have key differences. Listed below are their differences:

  • Both require a 680 credit score, but CHFA will have a fixed interest rate as long as you are over that 680 thresholds. Our program the interest rate will improve for those with scores significantly higher than that 680 qualifying bottom line.
  • Both require a Home Buyer Education course, though CHFA’s must be approved by them. Not just Fannie and/or Freddie approved.
  • Both programs are geared for low to moderate income borrowers, so they have an income limit for qualified borrowers. CHFA is a household limit. That means that anyone working in the household will need their income to be claimed, yes that means the employed dependent’s income will count toward the household. The program that we offer here at the Mortgage Maestro is only limited to applicant income. Meaning that only the income from those that are applying for the loan will count.
  • CHFA requires a 1% loan origination fee be added to the loan.

Though these programs are similar, there are some small differences that could save you money in the home buying process. By cutting out that 1% loan origination fee one could save anywhere from $1,000-$5,000. As your lender, we will help you understand and compare each program to see what suits your personal situation.  If you want to start saving on your home loan today call the Mortgage Maestro Group at 303.779.0591.

 

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