IE Business Daily Business news for the Inland Empire.
By Ed Hoffman
Merry Christmas and happy new year, everyone! If you’re in the market to buy a house, it can be a very happy new year because 2015 is going to be a great year to get a home loan. As I explained in this column last week, there are things you can do to minimize your risk of “getting the shaft” the next time you apply for a mortgage. My Christmas generosity hasn’t stopped flowing yet, so I have a few more tips to share.
Not surprisingly, the first one concerns where to get your loan. I want to strongly caution everyone against trying to save a few dollars by finding a non-locally based lender on the Internet. Sure, the company may have a big enough advertising budget to make sure you recognize their name from TV commercials – but so what? If you’re in California and they’re in New Jersey, you have no way to keep track of what’s going on with your home loan – that is, if you even get approved.
Too many of these companies exist because they take application fees from people before denying them a loan. They count on subpar applicants thinking an online lender is more likely to approve them; no matter how qualified you are, don’t fall for it. With a local mortgage lender (yes, like me), you can get in your car and be face-to-face in a matter of minutes. What if they say I’m in a meeting? If I hear a client has come to see me, I get out of the meeting. That’s that.
The next tip concerns down payments; you want to take advantage of any down payment assistance you can get your hands on. As you may have heard, Fannie Mae and Freddie Mac are back with their 3% down program. It’s a good thing if you’re buying a home above $350,000, but below the jumbo loan threshold (in both Riverside and San Bernardino Counties, that’s $417,000). Interest rates are higher and the mortgage insurance interest rates are about the same, but some buyers may benefit from this program regardless.
Then there’s NHF Platinum™, a little-known down payment assistance program made possible by a grant from the National Homebuyers Fund®. Because of this program, some buyers in the Inland Empire can get into a home with less than 1% down out of pocket. The interest rates are higher, but if you’re approved for a $300,000 loan, you can get into the house for next to nothing. Now, the catch: You can’t make too much money in order to qualify. It’s a government program; what did you expect? To take advantage of the NHF Platinum down payment assistance program, the income limit on buyers is $78,315. That is the case in both Inland Empire counties.
If you don’t qualify for down payment assistance, you can still buy a home in 2015. Final tip: Don’t be afraid of an FHA loan; it gives you more flexibility on your credit and your debt ratios. If you want more customized home loan tips, give me a call at Wholesale Capital Corporation, and be sure to do it while the new year is still new.
Ed Hoffman is the host of the Main Event on AM590, which airs Saturday at 9:30 AM and Sunday at 4:00 PM. Follow him on Twitter @EdHoffman, and like him on Facebook by searching The Main Event AM590.
