As rapidly as things are moving and changing in the mortgage industry, I’m relying heavily on my trusted mortgage advisors these days; moreso than in months past, simply because keeping up with the changes truly is a full-time job and, obviously, my full-time job is selling homes, not mortgages.
I recently got an update from Cody McCollom of Grandmark Mortgage and felt I should share this with my clients:
Effective immediately, 100% conventional mortgages have been eliminated from the mortgage market. This is an industry-wide guideline change. Regardless of credit score, income, or debt ratios, 100% conventional mortgage financing has come to an abrupt end.
A 3% minimum down payment will be required by all borrowers. FHA loans with down payment assistance from the seller (if seller is willing) still exist. This type of loan allows the seller to pay the borrower’s down payment of 3%. Seller must be willing to participate in this type of transaction and we will likely see fewer sellers willing to do so as a result of uncertainty in real estate markets.
There are still great mortgage programs for borrowers and rates are still low. However, it is more important than ever for borrowers to have their credit, assets, and down payment in the best shape possible if they expect to qualify for a mortgage, especially if they expect to qualify for the preferred programs with the lowest rates and fees.
Make sure you are working with an experienced and reputable Realtor. Also make sure you are working with an individually licensed loan officer. Ask for their individual license number. Don’t accept a blanket license for everybody in the office. Get theirs, and match it with the Department of Consumer Credit’s database to make sure that they are current on licensing as well as continuing education.
If you have any questions specific to this, or any other mortgage topic, please feel free to get in touch with Cody.
About Ryan Hukill
