The following is a partial list of programs offered by Arizona Mortgage Broker Jake Taylor Home Loans with a brief description of the key elements of each. For a complete list of the programs that we offer, please contact us at 480-999-3339.
These materials are not from HUD or FHA and were not approved by HUD or a government agency.
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Buying a house involves a lot of considerations, and it's common to have questions, especially if it's your first time. As a first-time home buyer, you may be looking for tips on how to navigate the process or seeking assistance with down payment and closing costs. To help you make informed decisions, we'll explore some of the best grants, home loans, and programs that cater to first-time home buyers. By learning about the available options, you can identify the most advantageous solution for your unique circumstances.
When buying a home, a down payment is a significant upfront expense that's usually required for most types of mortgages. However, there are options available to help you cover this cost, such as down payment assistance, which is often accepted by many lenders.
Typically, down payment assistance programs come in the form of grants or low- to no-interest loans, with some programs reserved for first-time home buyers. The assistance programs that you're eligible for can affect the way you can use your funds and whether you'll need to repay them.
With government-backed loans, you may be able to purchase a home even if you have a low down payment or poor credit. These loans are backed by the government, which reduces the risk for lenders and can result in lower interest rates for borrowers.
There are three main types of government-backed loans available: FHA loans, USDA loans, and VA loans, each with its own set of eligibility requirements.
Like down payment assistance, there are government-sponsored and private programs that can help you pay closing costs. Closing costs are additional fees you pay at the end of the mortgage process. Closing costs are typically around 2% – 6% of the total cost of your home loan. Like down payment assistance, closing cost assistance can come through a grant or loan.
You can also look to your seller for help with closing costs, with seller concessions. The seller may be able to help with attorney fees, real estate tax services and title insurance. They can also help pay for points upfront to lower your interest rate and contribute to property taxes.
A 3-2-1 buydown is a mortgage feature that reduces the interest rate temporarily. This feature can be used with a Conventional Loan or a VA Loan.
During the first year of the loan, the interest rate is lowered by 3 percentage points, followed by a reduction of 2 percentage points in the second year and 1 percentage point in the third year. After this initial period, the interest rate returns to its original rate. At current interest rate levels, a 3-2-1 buydown can be a significant advantage. For instance, if you secure a mortgage with an annual percentage rate (APR) of 6%, opting for a 3-2-1 buydown would mean a 3% interest rate in year one, 4% in year two, and 5% in year three. The mortgage will then proceed at the agreed-upon 6% rate for the remainder of the term.
The financing for a 3-2-1 buydown can come from different sources, such as the seller, homebuilder, or mortgage lender. This mortgage option is frequently used by sellers who are motivated to sell their property for various reasons. By offering a 3-2-1 buydown, sellers can increase the chances of getting their full asking price while also making the property more attractive to potential buyers, thus stimulating the real estate market
The mortgage industry is subject to frequent changes, and interest rates can fluctuate rapidly on a daily or weekly basis. With a 3-2-1 buydown, you can navigate the current interest rate hike, and also prepare for a possible refinance in three years when the program concludes. After the temporary buydown period, you can refinance to a lower permanent rate, provided that your home equity is at least 20%.
While it's uncertain whether 30-year fixed rate mortgages will be lower at that time, opting for a 3-2-1 buydown offers an advantage since you secured a lower mortgage rate initially. Even if rates increase, you'll still have the advantage of the lower rate you locked in, placing you ahead of the game.
Overall, a 3-2-1 buydown offers a win-win solution for homebuyers looking to optimize their mortgage payments.
Conventional fixed-rate loans are a well-known loan type, characterized by a constant interest rate for the duration of the loan. Typically, the monthly payments remain unchanged throughout the life of the loan. While borrowers are traditionally expected to make a 20% down payment, this is not always a requirement. Contact us for more information on specific down payment requirements. These loans are available with a range of terms, including 10, 15, 30, and 40 years.
Despite the recent rise in mortgage rates, home prices continue to increase significantly year over year. To assist potential homebuyers facing this challenging market, the Federal Housing Finance Agency (FHFA) and the Federal Housing Administration (FHA) have decided to raise the limits for conforming and FHA loans for 2023.
These loans, which include both conforming conventional and FHA loans, account for 85% of loans issued for primary residences in 2021, as per the Consumer Financial Protection Bureau's (CFPB) mortgage market trends report. Increasing these limits is expected to provide more buyers with access to an important means of overcoming the high home prices currently seen in the market.
FHA loans are a type of loan that are privately issued but insured by the federal government. These loans are attractive to borrowers who may not have enough funds to make a traditional 20% down payment as they only require a 3% down payment to qualify. However, borrowers who choose an FHA loan will be required to pay mortgage insurance which will slightly increase their monthly payments. Lenders who wish to offer these loans must be approved by the Department of Housing and Urban Development. If you're interested in an FHA loan, please contact us to find out if it's the right option for you.
FHA loans are a popular loan option that only require a 3.5% down payment, a 43% debt-to-income ratio, and a minimum credit score of 580. It is important to note, however, that borrowers with a credit score as low as 500 can still apply for an FHA loan. However, if the credit score falls between 500 and 579, the borrower will be required to make a minimum down payment of 10%.
The three primary reasons that may disqualify an individual from obtaining an FHA loan are:
Yes, you can get preapproved for an FHA loan with Jake Taylor Home Loans! We will review your income, down payment cash, credit score, and credit payment history to determine your eligibility.
This preapproval process can give you an idea of how much you can borrow and can help you narrow down your home search to properties within your budget.
VA loans are indeed private loans insured by the federal government, and they are only available to qualified veterans and their families. These loans are intended for the purchase of a primary residence and have a loan limit of $726,200. To qualify for a VA loan, veterans must have served a minimum amount of active duty time, and must meet certain income and credit requirements. If you are a veteran interested in a VA loan, it's best to contact a VA-approved loan officer with Jake Taylor Home Loans for more information on the qualifications and application process.
One of the biggest advantages of a VA loan is that there is no down payment required. This is a significant benefit for veterans and their families who may not have the savings or resources for a down payment. Additionally, unlike FHA and Conventional loans which typically require a 3.5-5% down payment, VA loans do not have a minimum credit score requirement, which can make it easier for veterans to qualify for a loan.
Another advantage of VA loans is that they do not require private mortgage insurance (PMI) which can save borrowers thousands of dollars over the life of the loan.
These benefits can help veterans and their families save money and make homeownership more accessible.
Yes, like other types of home loans, VA loan borrowers will have to pay closing costs to the lender for processing the loan. These costs can include things like appraisal fees, title fees, and origination fees. However, VA loan borrowers have options to reduce the amount they pay out of pocket for these costs.
One option is for the seller to pay for a portion of the closing costs. This can be negotiated as part of the purchase contract.
Another option is for the lender to offer a lender credit, which can help cover some of the closing costs.
VA borrowers can also use their entitlement to reduce the amount they need to bring to closing.
Additionally, some lenders may offer a no closing cost loan, which means that the lender will pay the closing costs on behalf of the borrower, but these loans may have a higher interest rate.
It's important to note that closing costs vary based on the lender, location and the price of the property, and it's always good to compare offers from different lenders to find the best deal.
It's always good to consult with a lender to find out what options are available to help reduce the closing costs.
Veterans and service members can request a certificate of eligibility (COE) for a VA home loan on the eBenefits website. They will need a Premium DS Logon account to access the application, but can register for one on the eBenefits site if they do not already have one.
Veterans and service members can also request a certificate of eligibility (COE) for a VA home loan through Arizona mortgage broker Jake Taylor Home Loans. This option provides a personal touch and an opportunity to work with a dedicated mortgage professional who can guide you through the process and answer any questions you may have about the loan process.
A jumbo loan, also known as a non-conforming loan, is a type of home loan for amounts that exceed the conforming loan limit, which is currently $726,200 in most areas. Jumbo loans are similar to other loan programs such as fixed rate and adjustable rate mortgages, but they typically have higher interest rates because they are considered to be riskier for lenders.
Jumbo loans can be used to purchase primary residences, secondary homes, and investment properties.
The main difference between jumbo loans and conforming loans is the interest rate, as jumbo loans typically have higher rates due to the greater risk for the lender.
It's recommended to consult with a lender to learn more about jumbo loan options, qualifications, and terms to help you decide which loan program is best for your individual circumstances.
The conforming loan limit for a single-family unit in Arizona is $726,200, which means that any mortgage loan exceeding this amount would be considered a jumbo loan.
Jumbo loans typically have stricter qualifying guidelines and a higher interest rate than conforming loans. They also have more stringent income and credit requirements, and may require larger down payments. Because of the higher risk for the lender, they may also require additional documentation and assets to secure the loan.
It's also important to note that loan limits can vary by county and by the type of property. It's best to check with a lender to find out the specific loan limits for your area and the type of property you're looking to purchase.
It's recommended to consult with a lender to learn more about jumbo loan options, qualifications, and terms to help you decide which loan program is best for your individual circumstances.
As a general rule of thumb, borrowers can expect to make a down payment of at least 10% when applying for a jumbo loan. However, some lenders may require a larger down payment, such as 25% or 30%.
A 20% down payment is a good benchmark, as it can help lower the risk for the lender and may result in a lower interest rate.
But it's important to note that not all borrowers have access to 20% down payment, and some lenders may offer alternative options like a lower down payment with a higher interest rate, or with the requirement of private mortgage insurance (PMI).
It's always best to talk to your lender about all options and to find out what the specific down payment requirements are for the jumbo loan you're considering.
It's also worth noting that some lenders may also offer a jumbo loan with a lower down payment but with a higher interest rate, or may require private mortgage insurance (PMI) to offset the risk.
It's recommended to consult with a lender to learn more about jumbo loan options, qualifications, and terms to help you decide which loan program is best for your individual circumstances.
Cconstruction loans are used to finance the construction of new structures, whether it be a residential or commercial property. These types of loans are typically short-term and are used to pay for the cost of building a new property.
Construction loans can be more complex than traditional mortgages and may have different requirements, such as a detailed construction plan, a detailed budget, and a timeline for completion.
The loan is typically disbursed in stages, as the construction progresses, and the lender may require inspections or progress reports.
Once the construction is completed and the property has been appraised, the construction loan can be converted into a permanent mortgage, also known as a end loan or take-out loan.
It's important to note that construction loans can be harder to obtain and may have higher interest rates than traditional mortgages.
It's always recommended to consult with a lender to learn more about construction loan options, qualifications, and terms to help you decide which loan program is best for your individual circumstances.
Adjustable rate mortgages (ARM) are loans with interest rates that can change over time. The rate is typically based on a benchmark interest rate, such as the prime rate or the London Interbank Offered Rate (LIBOR), plus a margin. The interest rate and monthly payment can increase or decrease as the benchmark rate changes. Hybrid ARMs, such as 10/1, 7/1, 5/1, and 3/1 programs, have a fixed rate for a certain number of years before adjusting. It's important to understand the terms and potential risks of an ARM loan before deciding if it's right for you. Please schedule a time with us to consider the risks and. Benefits of a ARM.
Refinancing is a process by which a homeowner obtains another mortgage loan to pay off their original mortgage loan. This can be a good option for homeowners who are looking to decrease their interest rate, switch from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage (FRM), or reduce their loan term.
Refinancing can lead to lower monthly mortgage payments, which can help homeowners save money over the life of their loan. It's important to note that refinancing may also include closing costs, and the homeowner should factor that in to determine if refinancing makes financial sense.
It's also worth considering the length of time the homeowner plans to stay in the home, as the savings from refinancing may take a while to recoup the costs of refinancing.
It's always recommended that homeowners consult with a lender to determine if refinancing is the right choice for their individual circumstances.
Refinancing is the process of replacing an existing debt obligation with a new loan that has more favorable terms. This can include lower interest rates, a different loan type, or a longer or shorter loan term. The new loan is used to pay off the existing debt, and the borrower is then bound by the terms of the new loan agreement.
Refinancing is a way for borrowers to improve the terms of their loan, lower monthly payments, and save money over the life of the loan. However, it's important to consider the costs associated with refinancing, such as closing costs, and to determine whether the long-term savings outweigh the costs.
It's always a good idea for borrowers to consult with a lender to determine if refinancing is the right choice for their individual circumstances.
Refinancing a personal loan can be a good option if interest rates have dropped or if your credit score has improved since you took out the original loan. By securing a lower interest rate, you can reduce the cost of borrowing and ultimately pay less on your personal loan overall.
Another reason to refinance a personal loan is if you need to extend your repayment term, which can help lower your monthly payments and make it more manageable for you to pay off the loan. However, keep in mind that extending the loan term will likely increase the amount of interest paid over the life of the loan.
It's important to evaluate the cost of refinancing and compare it to the long-term savings to determine if it makes financial sense. It's also a good idea to check with Jake Taylor Home Loans or other lenders to compare rates and terms, as some lenders might offer better terms or lower fees than others.
It's always recommended to consult with a financial advisor or a loan officer at Jake Taylor Home Loans to evaluate your options and to determine if refinancing is a good choice for your individual circumstances
Refinancing does involve taking out a new loan with new terms, so in that sense, it can be seen as starting over. However, it's important to note that refinancing allows you to choose new terms that better suit your current needs and financial situation. For example, you may be able to choose a lower interest rate, a different loan type, or a longer or shorter loan term.
When you refinance, you don't have to choose a term based on your original loan's term or the remaining repayment period. You can have the flexibility to adjust the terms of the loan to better match your current circumstances.
It's also important to note that refinancing may have costs associated such as closing costs, and it's important to factor that in when considering if refinancing makes sense for your situation.
As always, it's recommended to consult with a financial advisor or a loan officer to evaluate your options and to determine if refinancing is a good choice for your individual circumstances.
A reverse mortgage, commonly refered to as a HECM (Home Equity Conversion Mortgage) is a type of loan that enables homeowners to convert some of their home equity into cash while remaining the owner of the property. Home equity is the current market value of a home minus any outstanding loans on the property.
With a reverse mortgage, the lender pays the homeowner instead of the homeowner paying the lender each month, like in a traditional mortgage. As long as the homeowner continues to reside in the home, no repayment of the loan's principal, interest, or servicing fees is required. The funds received from a reverse mortgage can be utilized for any purpose, such as paying for housing expenses, taxes, insurance, fuel or maintenance costs.
To be eligible for a reverse mortgage, the individual must be the owner of the home. The funds from the reverse mortgage can be received in various ways such as a lump sum, regular monthly payments, a line of credit or a combination of these options depending on the type of reverse mortgage and the lender. The amount that can be borrowed depends on the borrower's age, the equity in the home, and the interest rate offered by the lender.
It is important to note that even though the borrower retains ownership of the home with a reverse mortgage, they are still responsible for paying taxes, making repairs and covering maintenance costs.
When a borrower obtains a reverse mortgage, they retain ownership of their home and, as such, are responsible for paying taxes, making necessary repairs and covering maintenance expenses.