Buying a home

/Buying a home
5 06, 2018

3 Things to Know About Getting a VA Loan

June 5th, 2018|Buying a home, Mortgage 101, Tips & Advice|

Veterans Affairs mortgages, better known as VA loans, make it easier for veterans to get financing to buy a home. VA loans do not always require a down payment and are available to military veterans and active military members. These home loans are made through private lenders and are guaranteed by the Department of Veterans Affairs, so they do not require mortgage insurance. There’s no minimum credit score requirement.

 

The VA loan remains one of the few mortgage options for borrowers who don’t have the money for a down payment. VA loans are somewhat easier to qualify for than conventional mortgages. The U.S. Department of Veterans Affairs is not a direct lender. The loan is made through a private lender and partially guaranteed by the VA, as long as guidelines are met.

If you think you may be eligible for a VA loan, here are some things you must know about the program.

Qualifications For A VA Loan

Most members of the regular military, veterans, reservists and National Guard are eligible to apply for a VA loan. Spouses of military members who died while on active duty or as a result of a service-connected disability also can apply. Active-duty military personnel generally qualify after about six months of service. Reservists and members of the National Guard must wait six years to apply, but if they are called to active duty before that, they gain eligibility after 181 days of service.

Associated Costs

Although the costs of getting a VA loan are usually lower than they are for other types of mortgages, they still carry a one-time funding fee that varies, depending on the down payment and the type of veteran. […]

31 05, 2018

Closing Costs Explained

May 31st, 2018|Buying a home|

What are closing costs?

Closing costs are fees associated with your home purchase that are paid at the closing of a real estate transaction. Closing is the point in time when the title of the property is transferred from the seller to the buyer. Closing costs are incurred by either the buyer or seller.

What fees can you expect at closing?

Closing costs vary widely based on where you live, the property you buy, and the type of loan you choose. Here is a list of fees that may be included in closing. The list is inclusive of fees you may see, but it’s not likely that your loan will include all of the fees listed here.

 

  • Application Fee: This fee covers the cost for the lender to process your application. Before submitting an application, ask your lender what this fee covers. It can often include things like a credit check for your credit score or appraisal as well. Not all lenders charge an application fee, and it can often be negotiated.
  • Appraisal: This is paid to the appraisal company to confirm the fair market value of the home.
  • Closing Fee or Escrow Fee: This is paid to the title company, escrow company or attorney for conducting the closing. The title company or escrow oversees the closing as an independent party in your home purchase. Some states require a real estate attorney be present at every closing.
  • Courier Fee: This covers the cost of transporting documents to complete the loan transaction as quickly as possible.
  • Credit Report: A Tri-merge credit report is pulled to get your credit […]
10 05, 2018

How To Buy a House With Student Loan Debt

May 10th, 2018|Buying a home, Tips & Advice|

For many consumers, buying a house is a major financial and life milestone. However, student loan debt is preventing some millennials from making home purchases.

Having student loans won’t keep you from buying a house, although you should be comfortable with the idea of taking on a large amount of debt while still dealing with your student loans. Carefully consider your options, and decide what makes sense for your own financial situation.

You can still get a mortgage

If you’re bogged down in student debt, that doesn’t mean you can’t get a mortgage. You just have to be aware of your options. Improving your financial profile is one key step to getting there. For example, paying down that high-interest credit card balance is a great place to start. Or, if you don’t have the cash to pay down a big chunk of your debt, consider refinancing or consolidating your other debt to reduce the amount you have to pay every month.

Consider government help

If you have federal student loans, you may want to explore an income-driven repayment plan. With this option, your monthly payments can be reduced to a percentage of your discretionary income. This can be a huge help for those whose income is absorbed by high loan payments. Lower monthly student loan payments can help improve that important debt-to-income ratio.

In April 2017, Fannie Mae introduced three new policies aimed at helping homeownership become more achievable for those with student debt. The policies are:

  • Student Loan Cash-Out Refinance: Offers homeowners the flexibility to pay off high-interest student debt while potentially refinancing to a lower mortgage rate.
  • Debt Paid […]
23 04, 2018

Mortgage Pre-Qualification vs. Pre-Approval: What’s the Difference?

April 23rd, 2018|Buying a home, Mortgage 101|

When buying a home, cash is king, but most folks don’t have hundreds of thousands of dollars lying in the bank. Of course, that’s why obtaining a mortgage is such an important part of the process. And securing mortgage pre-qualification and pre-approval are important steps, assuring lenders that you’ll be able to afford payments.

However, pre-qualification and pre-approval are vastly different. How different? Read on to find out why one is better than the other in the long run.

What is mortgage pre-qualification?

Pre-qualification means that a lender has evaluated your credit and has decided that you probably will be eligible for a loan up to a certain amount.

However, the pre-qualification letter is an approximation, not a promise, based solely on the information you give the lender and its evaluation of your financial prospects.

A pre-qualification is merely a financial snapshot that gives you an idea of the mortgage you might qualify for.

It can be helpful if you are completely unaware what your current financial position will support regarding a mortgage amount. It certainly helps if you are just beginning the process of looking to buy a house.

Why is mortgage pre-approval better?

A pre-approval letter is the real deal, a statement from a lender that you qualify for a specific mortgage amount based on an underwriter’s review of all of your financial information such as credit report, pay stubs, bank statement, salary, assets, and obligations.

Pre-approval should mean your loan is contingent only on the appraisal of the home you choose, providing that nothing changes in your financial picture before closing.

The reliability and simplicity of your offer stand out from other offers. And pre-approval can give […]

10 04, 2018

Programs for Ohio First-Time Homebuyers

April 10th, 2018|Buying a home, Tips & Advice|

The state of Ohio works with mortgage companies, lenders and credit unions to offer home loans to people with low and moderate incomes, including first-time home buyers.

The Ohio Housing Finance Agency (OHFA) helps low- and moderate-income borrowers get 30-year, fixed-rate conventional, Federal Housing Administration, Veterans Affairs and U.S. Department of Agriculture Rural Development mortgages with relaxed income and purchase price limits. OHFA also has a number of programs that assist first-time buyers and others buying a home. Benefits include lower mortgage rates, down payment assistance, tax credits and combined financing for buying and renovating a home. Besides basic eligibility rules, each program may have additional requirements.

About OHFA and eligibility requirements

  • A free homebuyer education course is required after borrowers submit a mortgage application
  • Down payment assistance is available for first-time home buyers and is forgiven after seven years unless the home is sold or refinanced during that time
  • There are limits on purchase price and borrowers’ incomes, which vary by county and the number of people in a family
  • A minimum credit score is 640 for conventional mortgages and USDA, VA, and FHA 203(k) home loans
  • A minimum credit score is 660 for other FHA loans
  • Each type of loan has its own debt-to-income requirements
  • Veterans who’ve been honorably discharged are eligible for VA loans. They do not have to be first-time home buyers.
  • Eligible property types for these programs include existing single-family homes, duplexes, triplexes, fourplexes and condominiums; one-unit existing modular homes; and newly built single-family homes.

4 04, 2018

Home Buying Help: Should I Lock in a Rate on My Mortgage?

April 4th, 2018|Buying a home, Mortgage 101, Tips & Advice|

Mortgage rates change daily, making it difficult to spot the perfect moment to lock in a mortgage rate. To simplify the decision, keep these things in mind:

  1. Timing is everything.
  2. Have a few options to compare.

What is a Mortgage Rate Lock?

It’s an agreement the lender will deliver a specific combination of interest rate and points if the mortgage closes by a certain date. A point is a fee or rebate equal to 1 percent of the loan amount. Often times, rate locks last for 30, 45 or 60 days, but they can be shorter or longer. A rate lock protects the borrower from rate fluctuations during the lock period.

To begin, find out when your loan is expected to close and work backward to determine when to lock the rate. If you think you need 45 days to close your loan, find out what the interest rate would be if you locked it for a 60-day period.

Find the Best Combination For You

Look for the sweet spot when pricing out a rate lock. The sweet spot is the combination of interest rate, term, and cost you need to acquire the best deal. Most lenders won’t lock-in your rate for less than 30 days. An exception would be if you’re ready to close and offer the same rate for a 15- and 45-day period. There are different lock periods between 15 and 60 days. Anything longer than 60 days gets pricey, so it might be smarter to wait until you get closer to the closing date and check rates again.

When is the best time to lock in your rate?

For most homebuyers, it makes sense to sign a purchase […]

24 10, 2017

5 Reasons to Buy a Home this Fall

October 24th, 2017|Blog, Buying a home|

Real estate markets flow up and down as the seasons change. The spring and summer markets experience high volume, then as the weather cools down, the market seems to slow down as well. Fall signals the beginning of a slow market, which could be good for buyers. If you are in the market for a new home, now could be a good time, let’s check out why:

Leftover Inventory

If a home is still on the market from spring, the sellers probably listed the house too high out of the gate. This could mean a series of reductions in price during the spring and summer months. By October, buyers are likely to find desperate sellers and prices that may, in fact, be below a home’s true market value.

Fewer Buyers

Most families do not have the flexibility to move once their children start another school year, therefore they will not resume shopping for a home until the following spring. These people have exited the market, which leaves less competition for those who are still looking. This means more opportunities. Taking out an entire segment of the housing market provides millennials, single and baby boomer buyers some breathing room.

End of the Year Approaching

The end of the year is rapidly approaching, for those motivated sellers they will see a new year as a hard deadline for wanting to have sold their home. Sellers may want to take advantage of a gain or loss during this tax year. Ask why the seller is selling and look for listings that offer incentives to close before the end of the year.

Home Sales Near the Holidays

If someone is selling their home during the holiday season, that usually means they are an extremely motivated seller. The holidays are a time […]

25 09, 2017

Single Women Home Buyers

September 25th, 2017|Blog, Buying a home|

Building equity is important for everyone, no matter if you are male or female. Single women home buyers face challenges, but no challenge is big enough to stop them from achieving their home buying dreams and increasing the value of their homeownership in a timely manner. First Ohio Home Finance wants to help you start achieving those goals as soon as possible, here are a few tips to get started.

Getting Started  

Can you afford to buy a home? Is your credit score strong enough? Do you have enough for a down payment and closing costs? These are questions to ask yourself before you start shopping. Affording a home means more than making a mortgage payment. It also includes paying taxes, insurance, repairs and maintenance, utilities and possibility HOA dues and other fees. It is important to research these hidden fees and find out if you can afford them. Our mortgage calculator can help you answer some of those questions!

If saving for the down payment is an issue, our Loan Officers are here to find the right loan for you. They will also help you get pre-approved. This will give you a competitive edge when you go to buy a home and sellers will respect your offer more with a mortgage pre-approval.

Long-Term Investment

You want to love the home you purchase. There may be things you love about the house and things you aren’t in love with but willing to work with. When looking at home, focus on the potential profit. As much as we want these homes to be forever homes, it usually does not happen that way. New jobs, kids, pets and many more circumstances could affect the amount of time you spend in a home. When it comes time to […]

27 03, 2017

Tips for buying a home this Spring

March 27th, 2017|Blog, Buying a home|

It is not a secret that spring is a great time to put your home on the market. Prospective homebuyers can look at homes and condos without having to worry about trudging through snow or bad weather. Plus families search for homes during this time so they can move in the summer without disrupting the school year.

A seller’s market means that buyers have to be smart and prepared if they want to get the right house at the right price. Agents suggest that prospective buyers start by looking at home online, narrowing down neighborhood choices and deciding between must-have and preferred features.

Here are tips for buying a home this spring:

• Get mortgage prequalification or preapproval before you start looking. As with any purchase, you need to know what you can afford. If you do this before you start shopping it will help narrow down your options and makes your offer more competitive.
• Do your research. Use the internet and different apps to research neighborhood and asking prices for the type of home you want.
• Have the documents ready. In order to obtain a mortgage you will need documentation to complete the qualification process. Check out the full list of what is needed on our website: http://firstohiohome.com/purchase-home/mortgage-checklists/
• Be ready to move fast. A well-located house in good condition and priced right will sell quickly; it can even be the first day it goes on the market. A buyer needs to be ready to commit if they find a home they like because they risk the chance of losing it if they don’t. One of the things First Ohio Home Finance is known for is how quickly they work for their customers.
• Understand that no house is perfect. Making your offer contingent on a […]

7 03, 2017

Use your tax Refund to Purchase/Finance a Home

March 7th, 2017|Blog, Buying a home, General, Home Finances|

Use your tax Refund to Purchase/Finance a Home

It is tax season which also means refund season! Tax refunds help people either become homeowners or make an extra mortgage payment or two. For first time homeowners, one of the biggest obstacles is coming up with the down payment. So, there is no better time to qualify for a new home than now if you save your tax refund! Sometime a tax refund may actually cover the whole down payment on a home purchase. If your tax refund does not cover your down payment, you will be in better shape financially than you were before you got the refund. If you put it straight into savings, you will have that down payment before you know it! Tax returns may be used as assets so down payment right away.

If you are applying for a loan that does not require a down payment (click here to learn about those loan types) it is still smart to save your tax refund. You could use the tax refund for any of the following:

  • Pay closing costs
  • Pay off debts to help you qualify
  • Keep the refund in the bank as reserves. The more reserves equal better chance of approval
  • Pay down credit card balances to raise credit scores
  • Have money for furniture and emergency funds as a homeowner

It is perfectly fine to apply for a mortgage loan when you have not yet received your refund yet. When you are filling out the application, we can just assume the amount that you will be receiving. As long as we can prove that the funds are in your account prior to the final underwriting approval.

Do you already have a mortgage loan on your home?

That is […]

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