Mortgage Myths Busted!

I hope this is informational, helpful and I hope we can get you in touch with the right people. If you're thinking about buying a house and you're on the fence about it, now is the right time. According to The Washington Post, the average net worth of a homeowner in the United States of America is $231,400. And the average net worth of a renter is 50 $200; that's a huge disparity. Home-ownership provides stability and an avenue to grow your net worth. Let's talk about mortgages. 

Do I need 20% down? No, you don't need 20% down to buy a house. That is a common misconception. Some people will object; well, I'm not a veteran, so I can't do the zero down thing with the veteran program. I'm not a first-time home-buyer, so of course, I need 20% down. These are widespread misconceptions. Today I'm going to run over a couple of loan products in the State of New Mexico. 

VA loans are an excellent product. If you are a veteran, they can be done with zero out of pocket when we correctly negotiate the terms of the contract. US Department of Veterans Affairs insures VA loans, and they don't specify a minimum credit score. Still, most private lenders who offer a VA loan will require somewhere between 580 and 660 credit score according to nerdwallet.com. 

The federal government also insures FHA loans. And they require a down payment of 3.5% down. These were originally designed for first-time homebuyers. And there's a common misconception that you can only do it once, but you can use this product multiple times throughout your lifetime. FHA is a good option for people who are on their second and third homes. 

What if I don't have any money down, I'm not a veteran, and I still want to buy a house? Well, there's a USDA loan, which is also called a section 502 Guaranteed Loan Program. These loans do have limitations geographically. Most of Farmington proper is exempt from the USDA loan product, except a small sliver on the west side. USDA is a zero dawn product with a minimum credit score of 580. 

What if I want to live in Farmington's city limits still don't have a considerable downpayment? Well, the good news is we have a New Mexico bond loan program that offers a minimal $500 out of pocket with a minimum credit score, similar to that of the FHA. I can point you to a loan officer authorized for the New Mexico bond loan program.  

The biggest mortgage myth of them all is the Conventional Loan BIG down Payment Myth! A  conventional loan can be done with as little as 3% down now; you will likely have to pay some mortgage insurance until you hit 80% LTV or loan to value. For a conventional loan, you're looking at a minimum credit score of 620. 

The bottom line; if you're looking for a house and want to get out of that cycle of renting and making somebody else rich. Its time to buy your own home and create avenues of stability and a route to grow your net worth. The first step is reaching out to us to get you in touch with a loan officer. We'll get you three references to loan officers who can help you achieve your dream of homeownership. Online applications with a local lender can be completed in as little as five minutes. It's swift and easy. Most of the time, the lenders that we refer to can get you same day approval. We promise to be here for you throughout the process!  

Disclaimer: I am not a licensed loan officer and all loan information should be verified by a well qualified licensed Loan officer in the State of New Mexico.