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| Government-Backed Zero Down Mortgages Still Available After the mortgage meltdown lenders made some adjustments to ensure that they did not suffer any additional losses. Banks became more cautious as more investors came forward to request that their banks buy back bad loans. These adjustments included tighter underwriting guidelines, and larger down payments. Years after the housing collapse, many homebuyers stopped looking for low down payment or zero down payment mortgages. As the higher credit standards and stricter guidelines took hold of the mortgage market, potential buyers simply sat on the sidelines. If you ready to buy and are looking for such a program you are in luck. Zero down and low down payment mortgages are returning to the market, but in a limited role. Two popular programs are backed by the US government. They are the Veterans Administration (VA), and the USDA Rural Development. Reasons you should choose a VA Loan The US Department of Veterans Affairs is responsible for VA Loans. The loans are available to veterans, members of the reserve and active duty service members. Under certain conditions spouses are covered. There are four reasons why you should choose a VA Loan. 1. Zero down payment. 2. No Private Mortgage Insurance (PMI). 3. Lower interest rates. Rates are generally about 0.75% lower than for a conventional loan. 4. The right to prepay the loan without a penalty. It is easy to find out if you have a chance at a VA loan. Here is a quick review to see if you are eligible. 1. Served 181 days or more during peacetime. 2. Served 90 days or more during wartime. 3. Served 6 years or more in the reserves or National Guard. 4. You are the spouse of a service member who was killed in the line of duty. If any of the above applies to you, then go ahead and apply for the loan. You should first contact a VA approved lender and apply for a Certificate Of Eligibility (COE). The certificate is a must. Your lender can get the certificate on your behalf. You should consider USDA Rural Development Loans Many people believe that these loans are only for farmers. That was years ago. The United States Department of Agriculture Rural Development was originally designed to provide loans to assist farmers. The USDA has gone through many changes. Now the USDA covers all rural communities in their housing needs. It does this by guaranteeing up to 90% of the lenders loss if the loan becomes delinquent. So far for 2010 the USDA has done about 112,000 mortgages. This is a big jump from 2008 where only 55,000 mortgages were closed. prev: next: Home: Readers of this article also enjoyed: How To Cancel Private Mortgage Insurance Know Your Closing Costs And Be ... |
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| Loans For Our Veterans It is heartbreaking to see a veteran broke, hungry and homeless. Many might not be aware that help is available. In terms of housing, we should counsel and help every veteran achieve homeownership. If the veteran doesn't want the responsibility of owning a house and paying a mortgage, then let's help with adequate rental housing. There are countless ways that a VA mortgage can uplift a veteran and his or her family. Applying for the mortgage takes a bit of paperwork. But there are support groups and non-profit organizations that will provide guidance in completing the forms. The most important form is the 26-1880. This form is required for the veteran to get a Certificate of Eligibility. With the Certificate in hand, the veteran can go to a VA approved lender or mortgage broker, and apply for a mortgage. It is that simple. The following are a few reasons to get a VA loan: >low 30 year fixed rate >mortgage is assumable >zero downpayment. Watch the slideshow. |
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