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Month: January 2023

Applying For An FHA Home Loan: How To Get Approved

Posted on by Mann Mortgage

Are you shopping for your first home? The first thing you have to do is secure a mortgage that can help you buy your dream home. If you have insufficient funds available or terrible credit, it may be difficult to obtain a traditional loan. If this describes your circumstances, you may be eligible for an FHA home loan. These government-insured mortgages assist first-time homeowners with poor credit or little savings in purchasing a new house. Read on to learn in detail about the FHA home loan approval process!

How Do You Apply for an FHA Home Loan?

With only a few differences, the application process for an FHA home loan is quite similar to other types of housing loans. To apply for this loan, you must complete the following six simple steps:

  • Check out some FHA-certified lenders: Different lenders provide different FHA loan types. Compare the costs and rates of at least three lenders, including mortgage lenders, mortgage brokers, and your credit union or local bank.
  • Fill out an FHA loan form: While filling out the application, you’ll need some basic information about your income, monthly bills, and down payment funds.
  • Permit the lender to validate your credit scores: The lender acquires a credit report to confirm you satisfy the FHA’s basic credit score criteria.
  • Offer two years of job and income history: Gather pay stubs for the last month as well as W-2s, or federal tax returns, from the last two years, in addition to employer contact details.
  • Establish the source of your down payment: If you’re purchasing a property, lenders will normally evaluate two months’ worth of bank records or a letter detailing where the closing cost funds and down payment are coming from.
  • Explain any delinquent federal debt: If you have recently finished paying off delinquent student loans or any other government debt, submit a letter of explanation and supporting documentation to the lender to clear your CAIVRS (Credit Alert Interactive Voice Response System) report.

How to Get Approved for a FHA Home Loan?

Compared to other loan programs, it is quite easy to get approved for an FHA home loan. You must fulfill the below lending criteria:

  • A credit score between 500 and 580.
  • Be a permanent resident of the United States Of America.
  • Have a verifiable two-year job history.
  • Have proof of income in the form of pay stubs, bank statements, and federal tax returns.
  • Utilize the mortgage to pay for your primary home.
  • Ensure that the property has been valued by an FHA-certified appraiser and that it complies with HUD (Housing and Urban Development)  guidelines.
  • The front-end debt ratio must not be more than 31% of total monthly income.
  • The back-end debt ratio must not be more than 43% of total monthly income.
  • Hold back for three years after foreclosure or one to two years after bankruptcy before applying for a loan.

Some lenders have additional requirements that borrowers must fulfill in order to be approved for an FHA loan. You can ask your lenders about this special information.

Are you looking to finance your dream home? Let us find the right mortgage plan for you. Contact us today!

A Veteran’s Guide To VA Loan: 7 Things To Know

Posted on by Mann Mortgage

From a large down payment to financing mortgage insurance, closing charges, and other fees, the journey to home ownership can be hard. But if you’re a veteran or service member, VA home loan programs may provide significant assistance in obtaining the keys to your new home. VA home loans are one of the most distinct loan programs in the country, with significant benefits such as better terms, no down payment, cheaper interest rates, and more. Read on to learn important facts about VA loans that you may not know about.

What is a VA Loan?

It is a mortgage insured by the U.S. Department of Veterans Affairs for service members, veterans, and surviving spouses. Its primary objective is to assist veterans to purchase, build or improve a house, or refinance an existing mortgage.

Things You Should Know About a VA Loan

With interest rates currently at all-time lows, it makes perfect sense to consider VA loan options if you believe you are qualified.

Here are seven facts you should know about this loan program:

Zero Down Payment

The most significant benefit of a VA loan is that eligible buyers can typically finance 100% of the transaction price of their primary home. Almost all other financing options require a down payment of 5% to 20%. For traditional homebuyers, this requires years of dedication and savings.

Government-Backed

If the homeowner defaults, the VA guarantees that a part of the loan will be paid back to the lender. The government’s backing provides lenders with the security to offer competitive rates and conditions.

No Time Limit

Once you’ve acquired it, your eligibility for a VA loan never expires. If a veteran served 10, 20, or even 40 years ago and never used their loan, they can utilize it to purchase a property today. Eligibility for a VA loan is determined by the length and period of military  service.

Use Loan Benefit More Than Once

A common myth is that after you’ve used your VA loan, you cannot use it again. Fortunately, this is untrue. Once your eligibility has been restored and your prior loan has been repaid, you are eligible to reapply and possibly use a VA loan again at any time.

Low Interest Rates

As VA loans are backed by the government, lenders are more likely to grant favorable terms. In fact, VA loans offer the lowest rates on the market. The average 30-year VA loan fixed rate is often cheaper than those of traditional loan programs.

No Monthly Mortgage Insurance

A VA loan does not need monthly mortgage insurance, which may be necessary on other loan programs if you do not put down 20%. Both purchase and refinance VA mortgages involve a funding charge, which can be rolled into the loan or eliminated for eligible veterans with service-related disabilities.

Spouses Could Qualify

Unremarried spouses of fallen service members can purchase a house without having to pay mortgage insurance or a down payment. The fees for VA funding are also waived for them.

If you’re a service member or a veteran, it’s beneficial to consider getting a VA loan when shopping for a home. If you want to know more about VA loans and your eligibility, contact our experts today!

A Step-By-Step Guide On How To Apply For A USDA Home Loan

Posted on by Mann Mortgage

If you are having difficulty saving for a down payment on a new house, you should look into the USDA Rural Development Loan. USDA home loans provide mortgages with no down payment for rural homebuyers. It is ideal for people with modest incomes who do not wish to live in a city or metropolitan setting. This initiative has assisted many people who would not have been able to acquire a home otherwise. Read on to find out about the eligibility criteria and how you can apply!

What are the Eligibility Criteria for a USDA Loan?

To be eligible for the USDA Guaranteed program, you must:

  • Be a permanent resident of the U.S.
  • Be constructing or purchasing a home in a rural location.
  • Have a household income that falls within the program’s guidelines for your area.
  • Have a minimum credit score of 640.
  • Live in the house as your main residence.

How Do You Apply for a USDA Loan?

If you satisfy the USDA loan qualification requirements and are ready to buy a property, follow these steps:

Contact a USDA-Approved Lender

If you want to construct a house, locating a USDA-approved lender is a good place to start. Working with a lender who specializes in the rural home program can have a significant impact on prospective homeowners.

Get Prequalified

Once you’ve decided on a lender, the next step is to become pre-qualified. Pre-qualifying for a USDA loan is a straightforward process that offers an estimate of what you can pay and whether you are eligible for the program. During this phase, your lender will examine your affordability and notify you of any red flags that may prevent you from securing a USDA loan.

Find a House in a USDA-Approved Neighborhood

After you become pre-qualified, look for a property in a USDA-eligible neighborhood and put in an offer. Your requalified letter demonstrates to sellers and brokers that you are a lender-verified USDA buyer who is ready to close.

Sign a Purchase Agreement

After you’ve found the ideal home, you’ll collaborate with your lender and agent to submit an offer. Your lender will request a USDA loan appraisal as soon as you and the seller sign a purchase contract. The appraiser will make certain that the house is move-in ready and that it fulfills USDA requirements. If anything does not match industry standards, it must be corrected before the closing.

Complete Processing and Underwriting

After you have signed the contract, an underwriter will check your information and the file to ensure that your application and supporting papers are authentic and correct. Because the USDA program employs a two-party approval system, the underwriting procedure for USDA loans may take longer than for traditional mortgages. The loan file will first be reviewed by your lender to make sure it complies with all USDA standards. They will then certify the file, either automatically or manually. 

Close the Deal

When both the lender and the USDA approve your loan file, you’ll get a “clear to close,” which indicates you can proceed to closing day. You’ll sign the loan note and other documents on closing day and receive the keys to your new residence.

If you’re unsure if you and your proposed property are eligible for a USDA loan, contact us today!

6 Steps On How To Get A Mortgage

Posted on by Mann Mortgage

The first step in any home ownership journey is to secure financing. But when you don’t know where to look, it might be tough to obtain a loan for your dream house. The best approach to securing a loan is by working with a lender.  However, you must first understand what lenders are looking for and be prepared to go mortgage shopping. Learning how to get a mortgage and qualifying for one can be stressful, but this guide will simplify the entire process for you.

How to Get a Mortgage?

If you’re ready to apply for a mortgage, follow these six steps:

Focus on Saving

The first thing you need to do is start saving for a down payment. Most lenders will decline to work with you if you do not make any form of down payment. In general, you should have six months’ worth of mortgage payments in your savings account. Also, remember to save for closing costs so that you have everything you need to begin the mortgage-buying process.

Verify Your Credit Reports

Lenders start the application process by reviewing your credit history, so you should keep an eye out for them. Review your credit history to confirm that your creditors are providing you with the right information about your credit accounts. Directly dispute any mistakes you discover with the credit bureaus. Satisfy delinquent collections with creditors, and then follow up to ensure your creditor is updated.

Keep Track of Payment History

Payment history is a key element in credit scoring, so start making prompt payments on your accounts. Examine your credit record for any late payments that were incorrectly reported.  Next, keep a close eye on your fluctuating account balances. The amount you charge in relation to your extended limit will have a negative influence on your credit score.

Gather Essential Documentation

Collect the pay stubs for the last 30 days, bank statements, and federal tax returns for the last two years before meeting with your lender. Most lenders will require each borrower to possess a two-year job history (in the same field of work). Some lenders, however, may make allowances for young graduates who are new to their field. Instead of pay stubs, self-employed borrowers may be required to furnish a profit-and-loss statement and tax returns for two years.

Select a Mortgage Type

When you are confident that you have the necessary savings and that your credit score is where it needs to be, you can start exploring your loan options. Some of the most popular types of loans are jumbo loans, conventional loans, and government-issued loans.

Get Preapproved

Getting preapproved for a mortgage is one way to reduce some of the stress associated with the home purchasing process. When you are preapproved, a lender will consider personal factors like your income, credit score, and assets to determine how much you can borrow. This gives you a competitive advantage because home sellers know there’s a high chance you’ll be able to acquire financing quickly.

Ready to apply for a home mortgage? Get in touch with our team today!

A Guide To FHA Loans: What You Need To Know

Posted on by Mann Mortgage

An FHA loan is an excellent option to consider if you do not fit the traditional mortgage lending model. This government-backed mortgage may be the solution you need to secure funding for your home.

What Is an FHA Loan?

Insured by the Federal Housing Administration, an FHA loan can be an excellent opportunity for some homebuyers to acquire a mortgage. If an individual has a 500-credit score or better (on the broker’s side), they can enjoy the opportunity to simply make a minimum 3.5% down payment. For first-time homebuyers with credit challenges or very little savings, these are some of the most popular loans around.

Who issues insured FHA mortgages? Answer: Lenders like nonbanks, credit unions, and banks. Why do you need insurance? Answer: The lender is willing to let you purchase a property with a lower credit score or low down payment because they are insured by the FHA. This is one reason why potential homebuyers who might not ordinarily qualify for a loan – but who still need the money with which to purchase a house – can receive very favorable terms. Only lenders who are approved by the FHA can offer these types of loans.

An FHA home loan can be used to refinance or buy the following:

  • FHA-approved condominiums
  • Four-unit multifamily homes
  • Two-unit multifamily homes
  • Single-family houses 
  • Some types of manufactured homes

Conventional Loans Vs. FHA Loans

Compared to a conventional loan, qualifying for an FHA loan may be easier for some. Additionally, FHA loans:

  • Regarding gifts of down payment money from charitable organizations, employers, or family, they have more liberal rules.
  • Compared to conventional loans, FHA loans allow for lower credit scores. (In some cases, lower mortgage payments, too.)
  • Compared to conventional loans, FHA loans may require certain closing costs

FHA Loans – The Different Types

FHA loans come in a variety of options. Here are the most common:

  • EEM or Energy Efficient Mortgage
  • Title/Property Improvement Loan
  • CP (Construction to Permanent) Loan
  • 203(k) Rehab Mortgage
  • Basic Home Mortgage Loan 203(b)

One of these is most likely better for your situation than others. Each comes with its own set of features, limitations, and benefits. While an FHA loan can be an incredible opportunity for some individuals, it may not be right for everyone.

Explore your options by conferring with the knowledgeable professionals at Mann Mortgage. 

Mann Mortgage – It’s Never Been Easier to Apply For A Loan!

That’s a bold statement – but it’s true. In less than 10 minutes, you can apply for the funds you need through Mann Mortgage. With over 18,000 reviews from satisfied customers, we are one of the top USDA RD lenders. For over 30 years, we’ve been offering hassle-free, trusted home lending services.

To assist you in home purchasing, we’ll go above and beyond what’s expected as your personal, reliable mortgage expert. Just some of the loans we offer include the following:

  • Reverse mortgage
  • Renovation
  • Construction
  • Jumbo loan
  • USDA RD
  • FHA loan
  • VA 
  • And of course, conventional loans

Use our Branch Finder to see if we have a location near you. 

Feel free to contact us by calling our office at 855-692-0102 or emailing us at contactus@mannmortgage.com. You can also use our convenient online form, if you wish. Fill it out, send it in, and we’ll be in touch.

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