Funding Fee | NC FHA Expert

Veteran Administration Home Loans Above $417,000

With recent changes, it might make sense for a Veteran to consider using their VA Benefits when they are purchasing a home above $417,000!

Loans UP TO $417,000 are 100 percent, no money down loans with no monthly mortgage insurance. There’s a one time Guarantee Fee charged by the VA for insuring the loan (to see what your fee would be click here).

Now, for Veteran’s purchasing a home OVER $417,000 you might get better terms. To Calculate the down payment VA Jumbo Loans:

Take the purchase price, which for example purposes is $600,000. Subtract the maximum VA Guarantee amount of $417,000. In this case, $600,000-$417,000 = $183,000. The Veteran is required to make a down payment of 25% of the amount above the VA Guarantee (in this case $417,000). $183,000 x .25 = $45,750 downpayment, or just over 7.5%!

On a $500,000 purchase price with everything else being the same, $500,000 -$417,000 =$83,000. $83,000 x .25 = $20,750 Down payment, or just over a 4% down payment!

In addition, the Funding Fee is LOWER when you make a downpayment! 8o) Plus! Veteran’s have cheaper closing costs!

With the housing market offering such great values, and mortgage interest rates at an all time low… this might be the perfect scenario! We are talking to tons of veterans who moved here with less cash in their pocket from the sale of a previous home, and this is the perfect solution!

If you are considering a purchase in NC, and you want more information on VA Mortgage Loans, please call Steve and Eleanor Thorne 919-649-5058. We have the best mortgage rates available, and the lowest fees!

USDA Home Loans have PMI?

USDA loans are the coolest loans on the planet right now, and most people don’t understand that it has a form of mortgage insurance…

Mortgage Insurance does not pay your mortgage off when you die (well, maybe there’s a kind that does, but that’s not what I’m talking about). The PMI-type mortgage insurance is default insurance. It covers a small portion to the bank if you default on the loan.

With Conventional loans, it’s referred to as Private Mortgage Insurance, or PMI. This insurance generally cost @ .58%of the loan amount on a monthly basis (assuming you have 10% to put down and really good credit scores).

FHA has Mortgage Insurance Premium, or MIP, which is 2.25% of the loan amount PLUS a monthly amount of .90% of the loan amount (think it’s kinda’ expensive?).

VA has a Guarantee Fee. So if you are Veteran using your VA benefits the fee could be as much as 3%! (For details click here).

USDA Home Loans also have a form of default insurance (PMI), and it’s a Guarantee Fee. The actual dollar amount is a rather complicated formula, and it ends up being about 3.5% – but most people use 3.5% as a rule of thumb for prequalifying purposes. (updated 5.27.2010 from 2% which is what they charged earlier) USDA Home Loans are AFFORDABLE!

Note that starting October 1, 2011 USDA Home Loan will change it’s PMI calculations. Starting in October – there will be a 1% upfront fee and a MONTHLY CHARGE!

If you want more information about USDA Home Loans in NC - please call Steve and Eleanor Thorne, 919-649-5058. We are Mortgage Lenders in the Triangle that specialize in these types of mortgage loans. Ask us about your Tax Credit! We have the lowest rates!