Experts Corner: Are you looking to refinance or apply for a mortgage?

Do you have a home mortgage? Would you like to be able to get one? With mortgage interest rates at historical lows, wouldn’t you like to be able to take advantage of them? I would like to share some of the recent mortgage changes.


If you currently own your home and your interest rate is higher than 4.5% but you are upside down on your house (you owe more than it is worth) there is still help out there for you.

If you are not upside down, do you know that 15 year fixed rates are below 3% now? Maybe you want to convert your 30 year fixed rate to a 15 year fixed rate and get that mortgage paid off!

As of June 11th, 2012 FHA Streamline Refinances changed the Mortgage insurance premium from 1.75% upfront to .01% upfront and the annual (monthly) from 1.25 to .55%. What does this mean to you… appraisal required, no income, no assets…refinance to the low rates if you currently have an FHA loan and save money!

Don’t own a home yet, but want to? Here are some helpful tips to home ownership;

• 3 to 6 months before you are ready to buy, have your credit scores checked and work on improving them (if applicable) I can help you with details on how to raise your credit score. The higher your credit score, the lower your interest rate will be for the life of the loan. You must have a 640 mid score to GET a loan.

• Talk to an expert to see what type of mortgage will best suit your needs.

• Start gathering and keeping your paperwork, i.e. income documents, bank statements, W-2’s, tax returns, proof of pensions/retirement and proof they will continue 3 years into the future.

• When you are ready to purchase, get your pre-approval in place with your mortgage professional, then contact your Realtor and start shopping for the correct priced home. Your offer is stronger and more likely to be accepted if you have a letter showing loan approval.

Different types of mortgages that are available are Conventional, FHA, USDA, and VA loans.

The main difference between a conventional loan and other types of mortgages are a conventional loan is not made by a government entity nor insured by a government entity. Conventional mortgages are normally insured and backed by Fannie Mae or Freddie Mac.

Types of government loans are FHA, VA and USDA. An FHA loan is insured by the Federal Housing Authority and the minimum down payment for an FHA loan is 3.5%. VA loans are for Veterans, active duty and reserves for our armed forces with a DD214 or Certificate of Eligibility, and have ZERO down, and no monthly mortgage insurance….it does have an upfront funding fee that is financed onto the loan amount. USDA is the United States Department of Agriculture and is for rural areas with a ZERO down payment. It too has a funding fee financed onto the loan and a very minimal monthly insurance fee. These loans interest rates are in the 3.5% range today! Amazing, for zero down loans.

The criterion for qualifying varies on each type of loan. The main advantage to an FHA home loan is that the credit criteria for a first time borrower are not as strict as for conventional loans. Someone who may have had a few credit problems or no traditional credit should not have a problem obtaining FHA financing.

Call Silverton Mortgage Inc. at any time to ask questions, get educated and or get pre-qualified for that dream home purchase or refinance. Karen O’Donovan is a veteran in this industry and is here to help you every step of the way. Call her today at 843-492-4747 or come by and visit her new offices centrally located at 3565-A Fountain Lane in Myrtle Beach.

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