Information about different types of home loans. First time home buyers information.

Q. HOW MUCH CAN I BORROW TO BUY MY HOME IN STAFFORD COUNTY?
Q. HOW DO I CHECK ON MY CREDIT?
Q. HOW MUCH MONEY DO I NEED TO SETTLE ON A HOME LOAN IN STAFFORD COUNTY?
Q. CAN I FINANCE MY CLOSING COSTS?
Q. WILL I HAVE TO PAY PRIVATE MORTGAGE INSURANCE (PMI)?
Q. CAN I PAY MY DOWN PAYMENT WITH MY CREDIT CARD?
Q. DO I NEED TO BE PRE-APPROVED BEFORE LOOKING AT HOMES IN STAFFORD COUNTY?

Q. How much can I borrow?
A. Depending on your income and credit score, you should be able to borrow approximately 3 to 3 1/2 times your annual gross income. $100,000 annual income times 3.5 = $350,000. This is an estimate. Actual borrowing power is a combination of your credit score, your annual income, your fixed monthly debt payments and savings for down payment. Contact us for a quick qualifyer over the phone, 800-711-7988.
If you are already working with an agent, please contact your agent.

Q. How do I check on my credit?
A. There are numerous on line resources to obtain a credit report. The most well known is probably the Equifax company. Homefinders.com agents will help you obtain a FREE credit review from a known and trusted lender. Once you have been credit approved, you'll receive a "Lender's Letter" which is necessary before you can buy a home in Northern Virginia.

Homefinders.com will gladly have a trusted, experienced lender familiar with financing homes in Stafford County to review your financial information and provide us with a credit review. No need to guess. Let's get the facts. Just contact me and I'll take care of everything. I'll need the full name, address, phone, Social Security number and date of birth. We'll do everything else.

Q. How much money do I need to buy a home in Stafford County?

Closing costs in Staffred County are approximately 2-3% of the purchase price, PLUS the down payment which can vary from Zero to 5, 10, 20 percent or more. This does not include any points to the lender that buyer may elect to pay in advance to reduce the interest rate and monthly payments. For a detailed example of a closing cost estimate for Stafford County, see http://www.stafford-county-real-estate.com/closing-costs.shtml

Q. Can I finance my closing costs?
A. Yes. Lenders offer loans that are 100%, 103% and 107% of the purchase price of the home you wish to buy. You will actually finance your closing costs and down payment by paying a slightly higher interest rate. This is not a bad solution for home buyers who have good income, good credit but little cash. The interest on the loan is tax deductible and you benefit by accruing equity in your home.

Q. Will I have to pay Private Mortgage Insurance (PMI)?
A. Probably not. Private mortgage insurance is required from borrowers who borrow more than 80% of the purchase price of the home they are financing. Lenders can offer loans that combine the 80% First Trust and a 20% Second Trust. Interest on the Second Trust will be slightly higher than the First Trust, but the interest payment is tax deductible and the home will be appreciating from the day you settle your home purchase.

Q. Can I pay my down payment with my credit card?
A. Probably not. The charge on the credit card would have to be included in the debt ratio and could cause you to fail to qualify for a loan. However, if the lender knows that you are taking the loan from the credit card provider and it is included in your income to debt ratio, you can withdraw money from the credit card line of credit, deposit that money in your bank account and the lender will then have the "paper trail" for your credit transaction and if the loan meets the income to debt ratio for your particular type of loan, that is permissible.

Q. Do I have to be Pre-Approved before looking at homes in Stafford County?
No. Homefinders.com agents are happy to take you on a tour of homes in your price range and area of interest. However, it's a good idea to have a lender review earlier on for serious buyers. Once you see a home
you wish to buy, you will want to move quickly. You need to be "PRE-QUALIFIED" before writing an offer on a home because you'll need a "Lender's Letter" to show that you have had a credit review. That satisfies the seller that, if they accept your contract, the contract will get to settlement. Stafford County real estate sells very fast and most sellers will only consider a pre-qualified buyer's offer.

MORE QUESTIONS??
Contact Homefinders.com at 800-711-7988 or lenn@lennharley.com if you have additional questions about mortgage financing. We can help.

Many loan instruments are available for home buyers in Stafford County today. Conventional loans with rates fixed for 30 years, 10 years, 7 years, 5 years, 3 years, 1 year and several combinations of fixed and Adjustable Rate Mortgages (ARMs). Terms may be for 10 years, 15 years or 30 years or 40 years, with the amortization of 30 years the most popular.

CONVENTIONAL MORTGAGE LOANS IN STAFFORD COUNTY
By far the most popular loan type to buy a home in Stafford County is the Conventional loan. These loans generally follow the Fannie Mae guidelines. Many of the Fanny Mae guidelines are designed to protect home buyers. However, many of the guidelines that lenders follow are designed to protect lenders. The guidelines require that buyers be credit worthy to reduce the likelihood of default.

JUMBO CONVENTIONAL LOANS
These loans conform to the Fannie Mae guidelines for eligibility, meaning that, on average, the buyers may devote up to 28% of their before tax income to housing. These loans generally require a down payment of at least 5%. In exchange for a slightly higher interest rate, the lender will lend you money with no down payment and will even pay your closing costs. The higher interest rates are deductible and are often a good buy for folks with good income, good credit and little cash. CONTACT US for more information about Jumbo or Super Jumbo loans.

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