Nothing can stop millennials from becoming a homeowner, including those who are actively improving their credit scores. Even industry experts are noticing that a significant percentage of millennials are flocking the housing market this year to fulfill their American dream of homeownership.
It makes sense to refinance your FHA loan with a conventional loan if you want to stop paying for mortgage insurance premium, or MIP. MIP is the annual and monthly fees you pay for when opting to put a low down payment. Homeowners who put a 3.5 percent down payment on their FHA loan expect to pay MIP until they finish repaying the loan.
Home shopping immediately comes to mind for veterans and other eligible VA-backed home loan borrowers who were able to obtain a Certificate of Eligibility or COE. However, if you’re a serious homebuyer taking out a VA loan for the first time, there are steps you need to take before shopping for a home.
Many people find it difficult to save for a down payment to buy their first home. That’s why it’s a big help when they receive a lump sum amount of money from a loved one that they can use to fund a down payment. It’s called a gift fund. Homebuyers taking out a conventional loan are required to follow guidelines if they will use a gift fund for their down payment. Lenders may not approve the mortgage if you could not prove the source of the gift fund.
When taking out a mortgage, lenders prefer that homebuyers put a 20 percent down payment upfront. Although mortgage rates remain historically low, home prices are expected to increase this year. Homebuyers might find the 20 percent down payment overwhelming, not to mention the closing costs, which is another upfront payment they need to settle.
Eligible veterans and other homebuyers who were able to obtain a Certificate of Eligibility or COE may start using their VA home loan benefits, especially this year that they can apply for a higher loan amount to buy their dream home. Without the need of putting a down payment and with no mortgage insurance requirements are, by far, the most significant advantages of taking out a VA loan to buy a home. The U.S. Department of Veterans Affairs (VA), however, requires veterans to pay a funding fee.
When you’re ready to buy your dream home, it’s often ideal to work with a buyer’s real estate agent. Often called “buyer’s agents,” they are among the industry’s top professionals who will assist you in making one of your life’s biggest purchases.
New homeowners should know that accidental fires can strike anytime even during the cold months and it can cause serious structural damage to their homes. If you just moved into a new home with your family, it’s critical that you understand what may cause winter fires so that you can practice safety measures to keep your family and home safe.
Getting a mortgage pre-approval, or simply “pre-approval,” is an important step in the homebuying process that you may want to consider if you want to fulfill your homeownership dreams. A pre-approval simply means that a lender initially determines that you qualify to take out a mortgage up to a certain amount. Obtaining a pre-approval from a lender could give you an edge especially when there’s a low inventory in the housing market.
Home shopping immediately comes to mind once you’ve got a preapproval from a mortgage lender. An open house gives you an opportunity to set your feet, observe and get the feel of a property that you’re considering buying. As a first-time homebuyer, you’ll find yourself overwhelmed with information as you attend several open houses. Since you’re making one of the biggest investments in your life, it’s important that you end up with a home that suits your personal preferences and your finances.