A Few Developments in Financing with Low to Zero Down Financing
One of the big changes in the real estate market in the last few years has been the financing and the amount of down payments required to finance a home. This is a reminder of 3 different programs that are currently out there that still allow zero to 5% down payments, one of which can actually be used to purchase Investment property with only 5% down.
VA Vendee Financing
This financing is only available on properties that were originally financed with a VA Guaranteed Loan that has been foreclosed upon or surrendered to back to the VA. It is the best financing currently available to a non veteran, as it allows a purchaser to follow the same guidelines normally reserved for a Veteran with VA eligibility.
Vendee financing is a loan product offered to individuals to help
finance the purchase of VA REO Properties. Vendee Financing will be
offered to both veterans and non-veterans are the Broad Strokes
(Note the Non Owner Occupied financing ) :
• Seller may contribute up to 6% of the contract sales price
to pay for funding fee, closing costs (including the $2500.00
origination fee), prepaid and other expenses.
• Vendee mortgages are assumable by qualification.
• Vendee Financing is not a credit score driven product.
• There are two available terms, a 15 and 30 year fixed rate.
• The VA funding fee is 2.25%.
Owner Occupied purchase:
• Can be financed with as little as 0% down. The loan amount
may be increased up to 2% to finance closing costs, prepaids or
other expenses. Funding fee may not be financed.
Non-owner Occupied purchase:
• Can be financed with as little as 5% down. Investors may use
75% of anticipated rent based on appraiser's estimate to offset
against the subject property monthly payment.
• Investors must have experience managing rental properties to
include anticipated rent on subject property in underwriting.
• No maximum number of investment properties.
Our Office receives these listings and we currently have a few properties with this type of financing on some great investment properties. If you would like information on our current inventory of property offering VENDEE financing or would like to be made aware of them as they become listed, CLICK HERE to Get On Our List
The second program that is often overlooked, misunderstood or occasionally out of money is the Rural Housing Administration. Makakilo, Kapolei and the Waianae Coast. Bank of America has just announced the following:
Bank of America will re-instate the Rural Housing production on
Monday, November 8, 2010.
USDA has announced that funding is now available for the Rural Housing/ Development Program and so, as we promised, we are ready to make this program available to you and our customers!
Please review the re-launch detail below from USDA on the new Guarantee Fees (G-Fees) and make note of the updates on credit requirements for Rural Housing loans.
* New applications will be allowed on Rural Housing programs beginning Monday, November 8, 2010.
* Pricing for Rural Housing will be available beginning Monday, November 8, 2010.
* USDA has increased the Guarantee Fees as follows:
Purchase: From 2.0% G-Fee to 3.5% G-Fee
R/T Refinance: From 0.5% G-Fee to 1.0% G-Fee
* Rural Housing Guidelines have been updated to reflect new credit requirements:
Minimum Credit Score of 620
Allowed on Risk Tier 1 through Risk Tier 3 ONLY (Risk Tier 4/5 are no longer allowed for both Accepts and Refers)
For qualified veterans, there is just no better option available than the VA loan with guarantee. This loan allows the Veteran to borrow up to 100% of the price of the home, to finance the one time funding fee ( ranging from 1.5% to 3.25% ) into the loan and for the seller to contribute all of the purchasers closing costs. Current VA interest rates are in the 4% area !
So... If you'd like to buy a house, it's entirely possible that you can, even if the one thing that was holding you back was the down Payment. I'm real old school and believe in the value of home ownership. It has been a wild ride for the past 6 or 7 years. A wild ride up and an equally wild ride down in a lot of cases. The key is that if you've been thinking about buying a home, you might want to explore one of these loan programs and see if one of them will work out well for you.
By the way, if you are a first time home buyer and have been deployed recently, you might also be eligible for the extension of the First time home buyer incentive of up to $8,000. Interest rates, prices, loan programs and selection... It's a good time to be a buyer!
If there is anything we can do to help get you started, 
Aloha !
Michael Hege' RA
Kapolei Realty, Inc.
(808) 225 3660
www.HomesOahuHawaii.com
Categories: Home Buying Tips
Tags: Non owner occupied financing kapolei Buying VA Repos in Ko Olina Vendee Financing in Kapolei Rural Housing loans in Kapolei
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