Posts Tagged ‘3.5% closing costs paid’

New FHA max loan limit

January 8, 2019

Just as conforming loan limits rose again this year, the maximum loan amount for FHA loans got a bit higher too.

Remember the maximum loan amount for FHA loans vary from county to county; meaning, the max loan amount is determined by the county in which the property resides.

  • The new FHA loan limit for 2019 is $379,500 for the metro Atlanta area.
  • The non-metro max loan amount also increased to $314,827.
  • Georgia also has some counties with max amounts between those ranges (for example, Clarke county is $341,550).

For those who want to see their specific county, use this lookup tool provided by HUD. Just choose your state and county then press “send” to get the exact amount.

The new limit for metro Atlanta counties means a buyer could purchase a $393,000 home and make just a 3.5% down payment. Buyers can look to purchase a home for more than $393,000, but they will need to make a larger down payment. For example, a person could buy a $400,000 home using an FHA loan. Since the max loan is capped at $379,500, the down payment will need to be about 5% instead of the minimum 3.5%.

I know what you may be thinking… why put 5% down and use an FHA loan? Wouldn’t a conventional loan be better? True. Maybe. Remember for those with credit scores under 680 who make a 5% down payment, the private mortgage insurance for a conventional loan is higher than the monthly mortgage insurance for an FHA. Also, the mortgage rate is higher for the conventional loan versus the FHA loan.

This is why it is imperative to speak with a licensed mortgage lender about the differences in loan programs instead of assuming an FHA loan is only for first time home buyers OR never consider an FHA loan if you can make a 5% down payment. The specific details of each client’s situation could make one program more attractive than the other even if it goes against what most people would consider normal.

Looking to purchase a home in the state of Georgia? Unsure of the loan program that is right for you? Contact me today. I can get you prequalified for a home loan in a few minutes, and we’ll discuss the pros and cons of each loan program to ensure the best fit for your situation.

Fannie Mae paying closing costs on HomePath

April 13, 2011

Breaking news… starting April 12, 2011, Fannie Mae is paying 3.5% of the purchase price towards a buyers closing costs when the buyer purchases a HomePath eligible property.

Great!… but what is a HomePath property?

HomePath properties are Fannie Mae owned foreclosures. This plan to pay 3.5% of a buyers closing costs is designed to encourage qualified buyers to get into the market and purchase some of these foreclosed homes.

What does one need to do to qualify:

  • get prequalified for a loan (credit, income, down payment)
  • plan to reside in the home as one’s primary residence (closing cost incentive not eligible on investment property purchases)
  • close on the HomePath property on or before June 30, 2011

Starting from the day of this post, you have 6 weeks to find the property, and then another 4 weeks to close on the loan before the end of June. That is sufficient time, but not a ton of time. Also like other credits and incentives, the closer we get to the end date, the busier things tend to get.

In other words, start early! To get started, contact me to be prequalified to buy a home as long as the property is in the state of Georgia. The next step would be to find a home, and you can search for HomePath properties at https://www.homepath.com/

Free money to your closing costs! How can one go wrong with that!?!