The real estate market in Alachua county has gradually recovered from its 2008 recessionary levels and, based on recent figures released by the Florida Realtors Association, we are poised for an even bigger recovery. According to the February 2014 report that they released, examining year-over-year performance from February 2013 to February 2014, there are some strong indicators of a continued recovery. Here they are:
- New Listings: up 3.9%
- Median Sales Price: up 6.6%
- Average Sales Price: up 7.4%
- Median Days on the Market: down 28.9%
- Average Percent of Original List Price Received: up 1% to 90%
These are very promising figures for our local real estate market especially considering that a harsh winter (by Florida standards at least) hampered a lot of peoples' efforts. Up until now, you may have been asking why buy or sale your home… So now, I'm asking WHY NOT?! Oh, and just for a little extra sauce on your spaghetti, rates are still at historic lows; but as a word of warning, there has been much speculation that the economy is recovering and those rates will begin creeping back up in the near future.
Now, I'm sure you're probably saying to yourself, "Jason, I get it… the market is favorable, rates are low, it all sounds compelling, but who on God's green earth will be able to qualify me for a mortgage given my situation?" Well, I'm glad you asked!! I have taken the liberty of compiling some very locally-specific, potentially credit-friendly, mortgage loan programs that may insight hope and reinvigorate your goals and dreams of owning or refinancing your home!! Here they are:
USDA LOAN PROGRAM
What is This?
A USDA home loan comes from the USDA loan program, also known as the USDA Rural Development Guaranteed Housing Loan Program. It is a mortgage loan offered to rural property owners by the United States Department of Agriculture.
What are the Benefits?
Applicants for home loans may have an income of up to 115% of the median income for the area. Families must be without adequate housing, but be able to afford the mortgage payments, including taxes and insurance. In addition, applicants must have reasonable credit histories. Additionally, the property must be located within the USDA Home Loan "footprint."
Who is Eligible?
- To be eligible, you must be purchasing a property in a rural area as defined by the USDA.
- The home or property that you are looking to purchase must be "owner-occupied"; investment properties are not eligible for USDA loans.
- USDA Loans require 2% of the purchase price in up front funding fee, and a monthly mortgage insurance premium based on .40% of balance annually. The annual premium is divided by 12 to arrive at the premium charge per month.
THE SHIP PROGRAM
What is this?
Florida Housing administers the State Housing Initiatives Partnership program (SHIP), which provides funds to local governments as an incentive to create partnerships that produce and preserve affordable homeownership and multifamily housing. The program was designed to serve very low, low, and moderate income families.
What are the Benefits?
SHIP dollars may be used to fund emergency repairs, new construction, rehabilitation, down payment and closing cost assistance, impact fees, construction and gap financing, mortgage buy-downs, acquisition of property for affordable housing, matching dollars for federal housing grants and programs, and homeownership counseling.
Who is Eligible?
SHIP funds are distributed on an entitlement basis to all 67 counties and 53 Community Development Block Grant entitlement cities in Florida. The minimum allocation is $350,000 and the maximum allocation is over $8.8 million. In order to participate, local governments must establish a local housing assistance program by ordinance; develop a local housing assistance plan and housing incentive strategy; amend land development regulations or establish local policies to implement the incentive strategies; form partnerships and combine resources in order to reduce housing costs; and ensure that rent or mortgage payments within the targeted areas do not exceed 30 percent of the area median income limits, unless authorized by the mortgage lender. Click here for a full SHIP Program Checklist
VA LOAN PROGRAM
What is This?
The VA loan was designed to offer long-term financing to eligible American veterans or their surviving spouses (provided they do not remarry). The basic intention of the VA direct home loan program is to supply home financing to eligible veterans in areas where private financing is not generally available and to help veterans purchase properties with no down payment.
What are the Benefits?
The VA loan allows veterans 103.3 percent financing without private mortgage insurance or a 20 per cent second mortgage and up to $6,000 for energy efficient improvements. A VA funding fee of 0 to 3.3% of the loan amount is paid to the VA; this fee may also be financed. In a purchase, veterans may borrow up to 103.3% of the sales price or reasonable value of the home, whichever is less.
Who is Eligible?
The Veteran Loan program is designed for Veteran's who meet the minimum number of days of completed service. The program does allow for benefits to Surviving Spouses.
The VA does not have a minimum credit score used for pre-qualifying for a mortgage loan, however, most Lenders require a minimum credit score of at least 620.
A Veteran who has used their entitlement to previously purchase a home, may have entitlement left to purchase another one. If you previously purchased a home using your VA Benefits then you might still have some of that “Entitlement” available to you for the purchase a new home! For a full list of VA Loan eligibility requirements, click here.
FHA LOAN PROGRAM
What is This?
This is a US Federal Housing Administration mortgage insurance backed mortgage loan which is provided by a FHA-approved lender. FHA insured loans are a type of federal assistance and have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford.
What are the Benefits?
FHA primarily serves people who cannot afford a conventional down payment or otherwise do not qualify for PMI.
Who is Eligible?
1. The potential lender assesses the prospective home buyer for risk. FHA loans for buyers who don't meet a minimum 640 FICO score may be subject to higher mortgage rates, but can very likely still qualify.
2. The FHA makes provisions for home buyers who have recovered from "economic events". Via the Back To Work - Extenuating Circumstances program, the FHA reduces its standard, mandatory three-year application waiting period for buyers with a history of foreclosure, short sale or deed-in-lieu; and two-year application waiting period after a Chapter 7 or Chapter 13 bankruptcy. The Back To Work program lasts through September 30, 2016.
So archive this post, book mark it, copy and paste it to a word doc, whatever you have to do because this is valuable stuff! And, other than the conventional mortgage loans, you may be able to take advantage of one of these unique programs NOW!! I have built a network of individuals who can help you get started with one of these programs and get on the road to homeownership so e-mail me with your questions and I'll get you hooked up with the right person. Until next time, when it comes to Real Estate…. Think Hurst First!!
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