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Old 08-25-2007, 09:49 PM
 
9 posts, read 25,197 times
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Someone please give me information on a first time buyers loan. I dont have excellent credit but it's not aweful either. I have a great work history but make less than 50k a year. Someone mentioned something to me about a foa loan or something that sounded like that. Also with a first time buyers loan do I have to have a down payment? HELP!
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Old 08-25-2007, 10:59 PM
 
Location: Charlotte, North Carolina
5,137 posts, read 15,578,777 times
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No such things as a 'First time buyer loan'.
It's a sales gimmick to get you in the door.
FHA is very lenient on credit scores, but you need a strong history for the last 12months. Meaning NO LATE PAYMENTS.
There are many places that help you fix your credit for free.
They would also need to evaluate how much you're taking out for a loan compared to your income.

FHA is around 2.25% down payment, and can be gifted from the seller.
Seller can also pay for closing costs.
MyCommunity is a no down payment program, but you will need a 620 or you will have a HIGH PMI payment.

What city/state are you in?

Quote:
Originally Posted by MaryG601 View Post
Someone please give me information on a first time buyers loan. I dont have excellent credit but it's not aweful either. I have a great work history but make less than 50k a year. Someone mentioned something to me about a foa loan or something that sounded like that. Also with a first time buyers loan do I have to have a down payment? HELP!
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Old 08-26-2007, 12:54 AM
 
Location: California
510 posts, read 3,050,424 times
Reputation: 383
Here are some things you'll want to do:

1. Search "First time home buyer assistance -insert your city and state here-
based on your income it's highly likely you will qualify for this assistance. It's typically in the form of a 2nd mortgage to be used as a down payment. 99% of the time you will not have to make payments on this 2nd mortgage. They generally get their money back in one of two ways. They either defer the interest, which means the interest payments monthly are added to your loan balance. The other thing they could do would be to take a share of your equity. So if they gave you 20% down, they would get paid back the money they gave, plus 20% of any equity gained. You will repay the loan the next time you refinance, or when you sell the house. With this in mind, it's best to get a longer term loan if you can afford it. These assistance programs often have a class you have to take, where you will learn more about mortgage and home ownership as well.

2. Go to www.annualcreditreport.com and check out your credit from all 3 bureaus. DO NOT buy the score they offer for 7 bucks, because it's not a real FICO score. A FICO score is generated using the Fair Isaac Corporations scoring model, and 95% of mortgage lenders look at this scoring model. You want to go over this with a fine tooth comb and look for mistakes. A mistake could simply be a high credit limit not reporting accurately. If you choose to dispute anything, each bureau you dispute with has 30 days to investigate. If the creditor does not respond within that time with proof, the outcome defers to you. So if you were to say "never late" and they don't respond, then your late payments disappear.

You want to find a mortgage brokerage, or a bank that is licensed to do FHA loans. This does two things for you. First, someone licensed for FHA is likely to be a reputable lender. Second, that may end up being the loan you get. Remember when you call, you are interviewing them, just as much as they are interviewing you. Ask about their experience, how long they have been in the business, etc... don't give up your social until you believe they know what they are doing. Most of the lackeys in the business have since been forced out, but there still may be some around.

As questions arise, feel free to post them here.

Good luck!
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Old 08-26-2007, 04:41 AM
 
305 posts, read 1,589,210 times
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Question The Scores Aren't Valid?

You said:

DO NOT buy the score they offer for 7 bucks, because it's not a real FICO score. A FICO score is generated using the Fair Isaac Corporations scoring model, and 95% of mortgage lenders look at this scoring model.

So if we have a score of 726, that's not valid?

How do we figure out what the REAL FICO score is?

I'm so confused. I paid for all three. Dang.
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Old 08-26-2007, 06:30 AM
 
2,775 posts, read 3,109,629 times
Reputation: 2997
Quote:
Originally Posted by MaryG601 View Post
Someone please give me information on a first time buyers loan. I dont have excellent credit but it's not aweful either. I have a great work history but make less than 50k a year. Someone mentioned something to me about a foa loan or something that sounded like that. Also with a first time buyers loan do I have to have a down payment? HELP!
I'd steer clear of all mortgage brokerages and bring your business directly to a federal credit union or to a bank. I recommend this as a first-time buyer so you don't get pushed into obtaining what I would call a creative-mortgage (which are generally creative to make them easier and more profitable for a brokerage to sell to other loan institutions). Brokerages will sell your loan to others who will probably sell your loan to others and indeed as your first mortgage I would suggest to you that you do not want to deal with this ongoing issue but instead with an institution you can form the foundation of a long term banking relationship with.

I suspect after talking with a couple institutions in your vicinity which do loan origination (and not brokering), you will have better understanding of what you really can or cannot get approved for. Whatever you do, do not sign for an interest only, balloon payment, or any mortgages which have prepayment penalties assigned. If you see any of those things I submit to you that they are creative financial products which in the end will have cost you more money than something more traditional (even though short-term they may appear to save you some money - perhaps an upfront down payment or closing costs). Lastly, if you need a little longer to save up for a down payment so you can get a traditional loan product, then by all means, rent an additional year and save.

Good luck - and FYI your income is most likely fine - there are loans for people of all income ranges. With steady employment, no monthly rolling credit card bills, and a history of paying all your bills on time you should not have difficulty.

Last edited by belovenow; 08-26-2007 at 06:46 AM..
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Old 08-26-2007, 06:38 AM
 
2,775 posts, read 3,109,629 times
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Quote:
Originally Posted by teebopop View Post
You said: DO NOT buy the score they offer for 7 bucks, because it's not a real FICO score. A FICO score is generated using the Fair Isaac Corporations scoring model, and 95% of mortgage lenders look at this scoring model.
So if we have a score of 726, that's not valid?
How do we figure out what the REAL FICO score is?
I'm so confused. I paid for all three. Dang.
Don't be confused. The scores given directly by the three credit bureaus themselves are fine and in conjunction with the report detail given by them they are exactly what you need/want to see where you stand credit-wise.
I've found of high importance to ask whatever institution you plan to get a loan with what credit bureau or bureaus they check - that way there is no surprise on your end with the score/report they retrieve and ask you about.
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Old 08-26-2007, 09:57 AM
 
553 posts, read 1,802,947 times
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Quote:
Originally Posted by mbuszu View Post
I'd steer clear of all mortgage brokerages and bring your business directly to a federal credit union or to a bank. I recommend this as a first-time buyer so you don't get pushed into obtaining what I would call a creative-mortgage (which are generally creative to make them easier and more profitable for a brokerage to sell to other loan institutions). Brokerages will sell your loan to others who will probably sell your loan to others and indeed as your first mortgage I would suggest to you that you do not want to deal with this ongoing issue but instead with an institution you can form the foundation of a long term banking relationship with.

I suspect after talking with a couple institutions in your vicinity which do loan origination (and not brokering), you will have better understanding of what you really can or cannot get approved for. Whatever you do, do not sign for an interest only, balloon payment, or any mortgages which have prepayment penalties assigned. If you see any of those things I submit to you that they are creative financial products which in the end will have cost you more money than something more traditional (even though short-term they may appear to save you some money - perhaps an upfront down payment or closing costs). Lastly, if you need a little longer to save up for a down payment so you can get a traditional loan product, then by all means, rent an additional year and save.

Good luck - and FYI your income is most likely fine - there are loans for people of all income ranges. With steady employment, no monthly rolling credit card bills, and a history of paying all your bills on time you should not have difficulty.
Just so you know those loans you described as creative financial products are very good if used in the correct way.The problem is some people abused them and took advantage of people. Now as far as going to a bank instead of a broker you should be aware that it is not so cut and dry as you make it seem. I have worked for both and prefer the brokers, because it gives me more flexability . The people have to find a person who is honest and will do rite by them. There are bad bankers also.I would also suggest to try for FHA if you can qualify for that, that will be the best way to go.
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Old 08-26-2007, 12:08 PM
 
1 posts, read 3,460 times
Reputation: 10
The first time homebuyer loan is an OHFA loan. It allows 100% financing at a low 30 year fixed rate. Several banks in the area offer this type of loan.
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Old 08-26-2007, 12:10 PM
 
Location: Liberty Township, Ohio
122 posts, read 911,388 times
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Quote:
Originally Posted by banker0679 View Post
No such things as a 'First time buyer loan'.
WRONG! Speak not, unless you know what you are talking about!
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Old 08-26-2007, 12:58 PM
 
Location: Charlotte, North Carolina
5,137 posts, read 15,578,777 times
Reputation: 1008
i do know what i'm speaking about!
The reason why FHA among OTHER loans are NOT 1st time home buyer loans IS BECAUSE they can be used for refinances, and can be used OVER and OVER and OVER again. When you sell your first home...you wouldnt be considered a '1st time home buyer'.

2nd. SOME counties OR states offer some programs for down payment assistance. NOT ALL COUNTIES OR STATES OFFER THE SAME PROGRAM.

I'm not sure what you're talking about but i have been a banker, and a broker.

Nice try.

Quote:
Originally Posted by Linda Pratt View Post
WRONG! Speak not, unless you know what you are talking about!
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