Lauren Davis
REALTY EXECUTIVES Boston West | 508-254-0449 | [email protected]


Posted by Lauren Davis on 4/7/2021

Image by Aline Oliveira from Pixabay

If you've been dreaming of buying a home or have started looking at houses and mortgages, you've likely seen ads and information that directly targets the first time home buyer. Buying your first home is a significant milestone and one of the most financially beneficial things you'll ever do, and there are some mortgage programs designed to help first time buyers succeed in this life changing endeavor. If you're buying a home for the first time, you should know what programs and perks are available to you so you can strike the best possible deal. Even someone who has purchased a home in the past (but is now a renter) may be able to qualify for some of these plans. 

What is a First Time Home Buyer?

On the surface, its simple -- a first time buyer is one who has never owned a home or had a mortgage. For some programs, though, a first time buyer can also be someone who has not owned a primary residence in the past three years. If you fit either of these categories, you should check out the programs offered for this increasingly large group of buyers. 

Programs for First Time Buyers

First Time Buyer Mortgage Perks: Just about every mortgage company now offers some kind of perk or benefit for first time buyers; talk to your real estate agent to learn more about your options as you shop for your home. FHA, VA and USDA loans are particularly good for first time buyers, since they offer low down payments and more relaxed credit requirements. 

Grants: The Federal government and both state and local governments offer first time buyers assistance in the form of grants. The idea behind these grants is to bolster the buyer's ability to make a purchase, often by helping them out with a downpayment. Grants vary by location and do not have to be paid back; they are designed to help first time buyers get past one of the big barriers to ownership -- that 10 or even 20% downpayment. New Jersey has a grant program for first time home buyers; this plan is replicated by most other states as well. Search your state or city name and "first time home buyer grants" to learn more -- or better yet, work with an experienced real estate agent and get the scoop directly from them. 

Good Neighbor Next Door: This plan can help you save up to 50% of the purchase price of a home if you are a civil servant - police officers, firefighters, teachers and others who serve the community can benefit from this national program, with details seen here.   Because of the nature of the loan, most borrowers are first timers and can purchase homes they would otherwise be unable to afford. 

HomePath: Fannie Mae offers this program for first time buyers; it can save you up to 3% on your closing costs. You'll need to attend a class, must be a true first time buyer and purchase a qualifying property to save. Other perks include a first look at foreclosed properties as they arrive on the market, making this an ideal program for areas with a lot of competition for buyers. 

First Time Buyers Can Find Big Savings

The time to learn about first time home buyer benefits is now -- before you make a purchase. Once you have a mortgage, you no longer qualify and you could miss out on some substantial savings. Get in touch today if you are buying your first home -- we can help ensure you know about all the ways you can benefit and help walk you through the ownership process, every step of the way. 




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Posted by Lauren Davis on 7/29/2020

Image by Shutterbug75 from Pixabay

With a mortgage, a buyer is applying for financing to purchase the property in its entirety. They're relying on their credit and assets for approval before assuming responsibility of the full property. In a land contract, you're cutting out the need for a formal lender and relying on the seller to approve or deny your application.

The seeming simplicity of the transaction may make some people discount the importance of negotiation. However, there are a few things to keep in mind so both the buyer and seller are comfortable with the terms of the agreement. 

Talk to the Seller 

With a land contract, you may be more beholden to the seller than you would be to a lender in a traditional mortgage. If the seller thinks of you as a tenant rather than an owner of the place, you'll need to discuss their exact involvement over the course of the contract.

Because the seller won't receive the full value of the property upon sale, their financial insecurity is entirely understandable. They may want to check up with you over the phone, in-person, or through a third-party. If you're uncomfortable with the level of oversight, you may need to speak up or find a different property. 

Make sure you understand your obligations during this time. Some buyers are treated as a renter of the property — until it comes time to make significant and costly repairs. If you're responsible for all upkeep, you may be able to negotiate more freedom in exchange for the additional expense. 

Think Through the Finances 

One of the starkest differences between a traditionally financed home and a land contract is the speed of repayments. Even if you do find a seller willing to extend the contract, it can still be a major strain on your finances. As you factor in your current assets and credit score, you should also consider the future.

If the final payment is large enough, it may still require a substantial loan. If your credit hasn't improved enough by the time the contract nears the end, it could be a significant blow to your savings. And if you can't meet the terms of the contract, the seller will get to keep the money you've already paid them (as well as the property). 

Negotiating a land contract means thinking through the repercussions of each clause. While the terms may seem looser than a standard mortgage, there may be strings attached that aren't as obvious at first glance. Ensure that you understand your financial and practical responsibilities before signing on the dotted line. 




Tags: Financing   finance   loans   home loan  
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Posted by Lauren Davis on 4/15/2020

Image by InspiredImages from Pixabay

When you plan on getting a mortgage, you have some choices. There are conventional, FHA, VA and other options. One term you'll likely hear is a conforming or a non-conforming loan. If you aren't sure what that means, you could end up confused about the kind of loan you're actually getting for your property. To protect your investment and your finances, make sure you understand your loan type. Here's what you need to know about conforming loans.

What Are Conforming Loans?

Conforming loans are generally what most people think of as conventional or traditional loans. They're what most banks and other lenders offer to the majority of borrowers when those borrowers need a mortgage. The reason they're called conforming loans is that they meet federal guidelines for Fannie Mae and Freddie Mac. These are two agencies that buy the loans from the bank. Being able to sell the loan to one of these agencies is a benefit to the lender.

Who Can Receive a Conforming Loan?

Anyone who meets the qualifications -- and chooses a property that also qualifies -- can receive a conforming loan. Typically, to be conforming the loan has to be under a set dollar amount. For single-unit properties, for example, that limit was $484,350 as of 2019. If you want or need a mortgage bigger than that on a single-family home, you'd have to choose a nonconforming loan.

You'll also need a credit score of at least 620 (this may need to be higher based on your down payment and other factors), a debt-to-income ratio below 36 percent (or 45 percent for some loans) and private mortgage insurance if you don't have a 20 percent down payment. You'll also need to be 18 or older and have proof of income and identity.

Why Would You Choose This Loan Type?

Most people don't really choose this type of loan. It's just the one that's typically offered to them. It's the most common loan type, and it works very well for the majority of people. Lenders will often assume that this is the kind of loan you want, but there's no harm in asking them if another type of loan would be a better fit for your real estate needs.

How Can You Get This Kind of Loan?

As long as you meet the qualifications, you can get this type of loan. There aren't any special requirements, such as being a veteran or purchasing a property in a specific area of the country. Most people who apply for a conventional mortgage to buy a primary residence will have a conforming loan, because it's used most often and easier for banks to work with. Choosing this kind of loan is often easier for everyone involved.




Tags: mortgage loan   home loan   loan  
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