If you're new to home buying, you're luckily heading into a favorable time to take the plunge. In addition to low mortgage rates nationwide, recent data from MIBOR Realtor Association shows that central Indiana has seen increasing sales activity – a sign that the approaching season will be a healthy one for real estate.
Despite these signs of an improving economy, a lot of first-time buyers still struggle to compile the funds for a down payment on a home. However, there are increasingly more options for buyers looking to finance their first home, even beyond standard mortgage agreements.
"There are increasingly more options for buyers looking to finance their first home."
For example, Caliber Home Loans now has "Affordable Home," a program that offers first-time home buyers the opportunity to receive an FHA loan below market interest rate. To qualify, buyers must be able to pay their own down payment or receive the funds from an FHA-approved source, like a 401K or other savings plan.
Other ramifications include originating the loan through an IHCDA Participating Lender, having a minimum credit score of 600, agreeing to a 60-day lock, attaching a rider to the first mortgage, not combining the loan with the MCC program and using a US bank or Master Servicer.
The program is only available to first time buyers, or buyers in a "target" county. Acquisition and household income limits still apply to the loan, but participating lenders can only charge 1 percent origination fee plus $1,000 in junk fees. There is also a $100 non-refundable reservation fee for the loan.
According to Zach Sheppard, a mortgage consultant with Caliber Home Loans, this is a brand new product from the company, added to its other financing options. The lender also offers IHCDA down payment assistance programs that allow borrowers to buy a home with little to no money down.