Monday, March 26, 2012

USDA Guaranteed Home Loan

This USDA Loan is absolutely one of the best home loans available on the market today.  No down payment required.  Yes!! ... It's real.  Home buyers love it and so do lenders.  Lenders love it because the guidelines are very much like a conventional loan. 

It's easy,  unlike the FHA Guidelines that can be cumbersome and difficult to understand.  But to be fair, FHA is a good loan too.  They require 3.5% down and that can be a gift.  It gets a little complicated and the documentation requirements are really tough.  If you don't have the documentation chances are it will not be approved.  That is pretty true with all home loans today.  Every penny must be documented and traceable.

The VA home loan is also a great loan, but ... you have to be a veteran.  The VA loan does not require a down payment and the guidelines are different and can be confusing.  This loan does not qualify buyers based on Debt To Income ratios.  The calculations are all about Residual Income.  Personally I think this is better than the DTI stuff.  It really gets down and dirty as to: "can you really afford the mortgage payment or not"?

USDA actually has another home loan called the Direct Loan.  Not a lot of people know about this loan.  I would say it is a sub-prime loan on the tax payer's dime.  It's all Government money and people can qualify for this loan even if their income includes food stamps.  The Government actually subsidizes the payment if their income is less than 50% of the median income for that county.  That should warm your heart.

There are a lot of good home loans on the market today.  Most people are so busy with their family and jobs that they really do know which loan is the best one to apply for.  We put together the video below as an overview so buyers can start to understand their options.  When you walk into a bank or a lenders office and talk about a home loan, they are going to point you to the loan they want you in.  It is better that you have some in site before you sit in that chair.  If you have questions just shoot us an email.  We do not do loans and we do not share your information.

Here is a much shorter video just on the USDA Guaranteed loan.

Good luck and send us an email if you have questions.

Wednesday, March 21, 2012

Mortgage Processing Tips That Help Your Loan Close Faster

Getting a home loan through processing, underwriting, and closing is possibly one of the most frustrating things you will do in your life.  It is not uncommon for a loan to take two to four months to close.  I remember the days when everyone thought 30 days was too long!

I am hoping the information here will help you get all your stuff in one bag before you even apply for a mortgage.  After you have applied, a sharp loan office can also do many things that will help speed things along before your file actually goes to underwriting.

The first thing you should do as a home buyer is pull all three of your credit reports.  You also need to know what your credit scores are.  Do your research about credit guidelines and try to get your credit in order if it is not.  Do your research, ... know what you are up against.  A great place to start is here:  They have other sites for more detailed guidelines focused at different loan types.  Learn as much as you can and compare the information to your reports.

Then, based on everything you have learned try to decide which loan is best for your situation.  Questions you should ask yourself are:

  • How much do I have for a down payment?
  • What is my DTI?
  • Should I pay off some bills first?
  • Is my credit score high enough?
When you feel pretty confident then apply for a mortgage and I would recommend that you use a mortgage broker in your local area.  Banks are way too conservative and don't always offer all the products that are available today.  If there are questions or things you don't understand you can always send us an email and we will try to find the answers for you.  We are totally unbiased.  We don't do mortgages or try to sell you anything at all.

You should also watch this short video so you can have documentation ready if you need it.  Your loan officer should be looking out for this stuff but just in case, well, ... you will know what you need.

So, if you have done your research, pulled your credit, and have your documentation together your loan has a better chance of being underwritten smoothly.  Of course these are not all the things that could delay underwriting or a closing.  There is sooo much more,  and much of which you have no control.

We wish you the best and remember if you have questions, just send it to us at