USDA changes have taken effect!

Let's revisit the USDA changes that we informed you about earlier this year.

Although these changes technically take affect October 1, 2014, the USDA office is extremely backlogged nationwide for new USDA loan files. They are currently quoting 35 business days for turn times of new files submitted to them--this is after your mortgage broker gets you completely approved, and your appraisal has been completed. That said, USDA loans are taking quite awhile right now, and even if your file was approved by us and submitted to USDA today, your file will be affected by the new rules because it won't be reviewed by USDA before October 1.

Free “grant” money for your down payment?

You may have ben hearing recently about a few lenders’ new loan programs that give you a “Grant” for a down payment. They advertise 3% or 5% “cash” that you can use for your down payment or closing costs.

 

Ever heard that saying, “If it sounds too good to be true, it probably isn’t?"

Although there are limited government programs from time to time that have provided real benefits to first time home buyers, many offerings are just marketing smoke and mirrors. What these lenders do is increase the interest rate higher than the market rate to provide this “Grant”. You, as the buyer, end up paying far more than your “grant” benefit in added interest over the term of the loan, many times paying up to 3 times the original grant amount in extra fees and interest. Since the rate is also above market, your house payment will be higher, and you will qualify for a lower amount than a regular FHA or Conventional loan.

Before you buy, research your options and calculate the real cost of home ownership—many times it may be a more prudent decision to just save up a modest down payment and get a regular Conventional or FHA loan.  Be informed in your financial decisions, as a home purchase will most likely be the largest investment you will make in your lifetime.

We at Mortgage First want to guide you to the right loan for the long term and help you make financially sound decisions. Our goal is to guide you to your best option for the long term and refer your friends and family to us with the confidence that we will point them in the right direction. That is how we have done business in Salem for the last 25 years, and will continue to do so for many more!

 Keywords: NHF grant, down payment grant, CHF grant

Latest extension update on USDA changes

As promised, we are following up on the USDA changes that will limit areas eligible for USDA 100% financing, as referenced here and here.

VA Guideline update Nov 2013

Great news!  Federal VA loans no longer require a home to be hooked up to city water and sewer. In the past this was an expensive requirement to meet VA loan guidelines. Now if the home has a private well or septic system, even if  city services are available, VA will not require hookup unless otherwise required by local laws!

 This change will save thousands of dollars on

each home that falls into this category!

Read the full VA memo, here:  http://www.benefits.va.gov/homeloans/documents/circulars/26_13_24.pdf

Rural Housing Designation changes POSTPONED

USDA has postponed the changes to the Rural Area Designations. 

Remember our Sept 10, 2013 post about changes in the USDA program's eligible rural areas with a September 30 deadline? The potential changes to the Rural Area Designations have been put on hold until January 15^th, 2014 unless otherwise determined by Congress.

Important USDA home loan program changes!

 

Big changes are coming very soon to the USDA 100% financing (zero down payment) program in Oregon.

 

Effective the beginning of October 2013, the USDA rural housing program will exclude 25 cities from the program.

Albany	• Eugene-Springfield	• Portland Metro
• Ashland	• Forest Grove	• Redmond
• Bend	• Grants Pass	• Roseburg
• Canby	• Klamath Falls	• Salem-Keizer
• Central Point	• McMinnville	• Sherwood
• Corvallis	• Medford	• St. Helens
• Cornelius	• Millersburg	• Wilsonville
• Dallas	• Newberg	• Woodburn
• Damascus

Read the complete memo, here.
 

Have you been considering buying a home under the USDA rural housing 100% loan program? If you have, call us today to get the process started--we need to have your application processed no later than September 30, 2013 if the home you have chosen is in one of these communities! Note that this doesn't mean you have to close by September 30--we just have to get you started.

 

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