Comparing mortgage programs and selecting the mortgage that best meets your needs can only be done if you know the basis for the comparison.

The lowest funds required at time of purchase (from buyer, seller, and financed) compared to the fixed monthly payment and term, will allow you to compare your offers.

Closing Costs which can vary significantly from lender to lender:
    Mortgage Origination Fee
    Broker Fee
    Mortgage Discount Points
    Processing Fee
    Underwriting Fee
    Document Preparation Fee
    Commitment Fee

Customary costs with little variance and little lender control:
    Tax Service Fee ($100 to $150)
    Flood Certification Fee ($15 to $30)
    Express Fees
    Property Appraisal Fee
    Settlement Agent and Title Search

Costs not controlled by the Lender
    Recording Fees
    Real Estate Taxes
    Interest per day
    Title Insurance
    Credit Report Fees
    Home Inspection
    Home Owners Insurance

Mortgage Payback:
    Compare principal and interest payment.  Include any monthly MI payment.  (Do not include montly escrow payment to real estate taxes and hazard insurance)

Mortgage Atlantic, Inc. suggests making payback comparisons based on the initial five year performance.  Historically, a high percentage of mortgages are paid off in five years.  The initial five years is also a good comparison for mortgages over 80% which include monthly MI, the five year payback period should give an accurate basis for comparison for the five year cost of your new home.

Comparing "Interest Only" loans would require not including the principal paid each month above.

Comparing an 80/20 could include the payments on both.

Comparing Adjustable Rate mortgages is more difficult due to the uncertainty of the rate during the five year period.

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GOVERNMENT INSURED LOANS

"The pursuit of happiness" and the freedom to own your own home is truly the American Dream and is strongly encouraged by our Government.

No mortgage program can surpass programs offered by the government because..... The private sector does not have the weath to take the risk the Federal Government will take!

HUD and USDA have limits that encourage first time homebuyers and also "middle" america.  They are not designed to enhance the wealthy.  The Veteran loan is limited only the maximum available for secondary financing which is $417,000.00 in Virginia at this time, but higher in other metropolitan areas.

All government program credit guidelines are much more "common sense" than standard conventional programs and decisions are much more influenced by the last 12 - 24 month credit performance than the 3+ years reflected in credit scores.

All programs have "debt to income" requirements which support that the borrower(s) will be able to afford and enjoy their home.

We have seen the programs become friendlier and friendlier in regards to real estate properties and do not know of any negatives to the consumer or to seller.

Not all mortgage companies offere government programs and even a lot of banks do not offer them. 

Mortgage Atlantic has offered FHA and VA loans since 1987 and the USDA programs since 1996.  Please contact us to see how much these programs can benefit you.




FHA FINANCING

Parameters:

FHA is not limited to First Time Homebuyers.  FHA is 1 - 4 family owner occupied residential housing only.  Thres is no household income limit.

There is no limit on how many FHA loans you can have (There are restrictions on more than one loan open at the same time, but no restrictions if you sell your present home and get FHA financing on the next home or if you have had an FHA loan in the past.)

There is a "Maximum loan amount" for different areas of Virginia.  The maxium loan amount in most of Virginia is $271,000.00, but some metropolitan areas are $300, 000.00.  There is not a maximum property, just a maximum loan amount. 

FHA requires homebuyers to invest 3% on home purchases, the 3% cannot come from the seller or the lender, but may be a gift (usually from a member of the family), or it may be a secured loan.  The total cash to close for a down papyment, closing costs, and prepaids usually exceeds 3%, but FHA will allow seller contributions to cover the difference if the contract can be negotiated to do so.

CREDIT

FHA offers computer underwriting, which may allow you to confirm immediately that you meet the financing guidelines.  Since FHA is "Common Sense" based underwriting, even if the computer underwriting does not confirm approval, special circumstances can be documented and reviewed by an underwriter.

Our experience is that many borrowers who accept "sub-prime" financing and the higher overall costs that are usually carried, could have been approved for FHA financing.

There are special requirements for borrowers with previous bankruptcy or foreclosure, or even current Chapter 13 programs.  Please contact us directly to discuss these particular situations.


REFINANCES

Cash out refinances are a great opportunity for debt consolidation or if home improvement is needed.

The "no-cash-out" refinance is also available and may meet the need to refinance the adjustable rate mortgage and interest only loans.  Rate reduction refinances for current FHA loans are highly encouraged if the interest rate and and payment can be reduced.  Mortgage payment history is reviewed, however, income, ration, property value are not addressed.  Definately one of the easiest and least expensive refinances available.

FHA financing may be available for "STUDENT HOUSING" for your college bound children, this is the only exception to the "owner occupied" requirement.  Call us for more details!