What is the smallest down payment for a purchase?
USDA and VA loans allow up to 100% financing. The buyer will still need to come up with the closing costs and pre paids for the transaction unless the seller is paying them per the contract. You must of course be a veteran with VA eligibility to qualify for a VA loan. All I would need is a copy of the Veterans DD214 to look up the eligibility. USDA loan are eligible for specific rural locations. You can look up the USDA eligibility at www.usda.gov.
Another option would be an OHFA (Ohio Housing) loan. The FHA option allows the borrower to get a 5% forgivable grant after 7 years to cover the 3.5% down payment and 1.5% of the Closing Costs and Pre-Paids. There are income and credit restrictions for the OHFA loans but many people are pre-approved for the is loan and don’t even know about it.
What is included in Closing Costs and Pre-Paids?
Included in Closing Cost and Pre-Paids would be the:
- Lender Fee
- Title Fees
- Government Charges
- Setting up escrow account (1 year of homeowner’s insurance and 2-3 months of real estate taxes) and Daily interest charged for the month you close (if you close Dec. 15th you would have 16 days of interest until January 1st. )
- Appraisal fee but the buyer normally pays this up front outside of closing.
How long will it take to close my loan?
Normal turn time a purchase is right around 30 days. As long as both realtors, buyer and seller are all motivated to get the transaction completed, it should never go much more than 30 days.
What is the most important thing to have ready when you are looking to get pre approved?
Make sure you have all of your income documents ready from the last 2 years .
This guest blog post was written by Joe McGregor, a Mortgage Advisor with Stonegate Mortgage. Please feel free to contact Joe anytime with questions or if you would like to get Pre-Approved. The initial conversation should only take a few minutes.
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