House hunting? Confused with terms like "Short Sale"??? Don't be discouraged, let me explain why this may be an option for You!
What is a short sale? In short, no pun intended, a short sale is when the sales proceeds of a property fall short of the balance on the mortgage loan. Therefore the seller owes more money than what they are selling for.
Why would a lender agree to a short sale? If the owner stops making payments and lets the property go into foreclosure, it could take several months for a bank or lender to take the property back. When the lender takes control of the property, they still have to put the house on the market and it could take months until the house is sold. Foreclosure is a very expensive process and it is one good reason why banks would rather short sell than to go through a foreclosure.
Short sales are becoming increasingly more prevalent in the housing market. Why would this be a good option for you? Lets find out!
- More likely to get a better deal than a traditional sale!
- Get a great mortgage rate!
- Better condition than foreclosed homes
- Go through the home buying process easily! (with an experienced real estate agent)
Well that sounds great, but whats the catch??? The homes are sold in AS-IS condition and the process can be drawn out a little as the time frames are uncertain. Additionally the approving lender rarely agrees to pay for any extras that a regular seller may agree to. This could mean higher closing costs for the buyer. The buyer would have to pay those costs such as the cost for inspections and repairs.
But if you are not bound to a certain time frame and you would like a good deal on a house, then a short sale may be right for you! If you would like to start searching for short sales, traditional sales or foreclosures, please visit my website at www.MrKniceGuysHomes.com
Traditionally Conventional loans required a 20% down payment in order to qualify, pushing anyone without a 20% down payment to consider using an FHA loan. An FHA loan is not a bad option unless you are looking to purchase a single family home more than $271,050. This is where the new conventional 3% down program comes into play.
Lets say you wanted to purchase a home for $300,000. Unless you had $60,000 to put down on the home you would need to use an FHA loan. FHA would only cover $271,050, leaving you with $28,950 to come up with out of pocket as well as the original down payment, if any, on the type of FHA loan you qualified for.
With the new 3% conventional loan you can now purchase that same $300,000 home with only $9,000 for a down payment! That sure beats $28,950 on an FHA and surely beats the original $60,000 for the old conventional loan.
So a few things to consider... Can you qualify? Qualifications- The loan must be approved through Fannie Mae's automated Desktop Underwriter system and one borrower must be a first time home buyer.
What can you buy? Eligible properties- One-unit, primary residence; planned unit development (PUD), and Fannie Mae eligible condominiums.
Financing- 97% financing with a 3% down payment (gift funds allowed). Closing costs may be paid by the property seller, employer assistance, or with gift funds.
What about Mortgage Insurance? Flexible plans and payment options for mortgage insurance. No upfront mortgage insurance required. Unlike some other loan programs, mortgage insurance drops off automatically when the loan is paid down to 78% loan to value.
Is this the solution you have been looking for to make your dream home ownership come true? If so contact me today for more details!
Josh Knicely
JK Realty
480-330-0371
MrKniceGuy@jkrealtyaz.com
www.MrKniceGuysHomes.com
