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News You Can Use
To get the lowest mortgage payment, focus on the loan’s rate – right? Yes and no. Borrowers want and deserve to obtain a loan that meets their short and long term goals that has a competitive rate. But there’s more than just the loan’s rate to think about. If that loan has mortgage insurance, that deserves attention as well.
When it comes to MI, there are three things to take into account: which company is providing coverage, can the lender offer below market MI rates, and how the MI affects qualification amounts.
Consider this: the published rates for the country’s leading MI companies range from .78 to .94% for a borrower with a 700+ credit score purchasing a home with a 95% Loan to Value. If that loan is $200,000 those rates translate to $130-157/mo – a difference of over $300/yr. See how the MI company impacts the payment?
We’re fortunate to have relationships with several companies which allow us to offer preferred MI pricing to our clients. Using this same example, if this borrower was my client their MI rate could be as low as .631% – a monthly savings of up to $52/mo. That adds up to over $600/yr and $6000+ over the next ten years. Now we’re talking some serious bucks.
Another thing to think about is how this influences the borrower’s qualification amount. A $50 monthly savings translates into a $9000 increase in their qualification limit. Imagine what that would do to their buying power and property selection.
The take away here is mortgage insurance is more than just an afterthought. It deserves proper attention, knowledge and advice to maximize its’ use and minimize its’ cost.
Featured Loan Program
Mortgage Credit Certificate
Cunningham & Company along with North Carolina Housing Finance Agency offers the Mortgage Credit Certificate program to help qualified homebuyers obtain a federal tax credit.
· Must meet income requirements, sales price, and first-time home buyer guidelines· MCC can be used with almost any type of mortgage, including adjustable rate mortgages· An MCC can be used to improve the qualifying ratios of your borrowers, increase their disposable income, and provides a true federal tax benefit· Eligible buyers can now claim 30% of their mortgage interest (up to $2000)Have You Heard?
Many people run from their fears and it has negative consequences on their business. The difference between failure and success is understanding those fears, overcoming them, and profiting from them. Think about it…if you’re part of the 1% that doesn’t run from your fear, you’ll be part of the 1% that significantly grows your business this year.
Join us June 3rd for the Fearless Living Tour with John Alexandrov, Dave Jenks, and Laurie Hathorn. Looking forward to seeing YOU there!
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News You Can Use
As rates rise over the next few months, I expect we’ll see more first time home buyers using NC Housing’s loan programs. For each of the programs listed below, the buyer cannot have owned a home within the last three years and that their income does not exceed NCHFA’s income limits.As a refresher here are their main offerings:FirstHome Mortgage:This is NC Housing’s ‘bread and butter’ program. The main benefit of this program is it allows buyers to purchase a home at below market rates. The sales price limit is $210,000 for an existing home and $220,000 for a new one. Remember a 1% decrease in the interest rate could increase the purchasing power by approximately $15,000Down Payment AssistanceNCHFA’s DPA programs offer up to $4000 or $8000 in down payment assistance in the form of interest-free, deferred second mortgages. The borrower does need to have at least $1000 from their own funds in the transaction. Do keep in mind that homes built before January 1, 1978 and homes that are tenant-occupied are not eligibleMortgage Credit CertificateAnother benefit NC Housing has for first time home buyers is the Mortgage Credit Certificate program. Eligible buyers can claim 20% of their mortgage interest (up to $2000) as a tax credit by using the MCC. This program can be used with almost any type of mortgage, including adjustable rate mortgages. However, it cannot be used with any other NC Housing program (such as the FirstHome Mortgage).As you can see there are several options offered by NC Housing to help first time home buyers purchase a home. Have questions? Give me a call!Featured Loan Program
VA
Cunningham & Company offers 100% financing through VA mortgages. These loans are available to past and present service members and require no down payment and no mortgage insurance.
- Maximum loan amount with no down payment is $417,000
- VA eligibility can be used time and time again
- Fixed rates and ARMs available
- Reduced documentation available through automatic underwriting
- The funding fee can be financed into the loan
Have You Heard?
Looking ahead to the weekend, it seems we’ll have some warm weather to accompany any planned Easter egg hunts. Charlotte on the Cheap has a list of area “hunts” if you are looking for one near you. Ever wondered about the story behind this tradition? Read about the history of the Easter egg and check out Worldwide Easter Traditions at Schiele Museum in Gastonia this Friday from 1-3.
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