Non Occupying Co Borrower

Single Parents CAN Buy A Home in North Carolina!

November 22, 2011 by admin Leave a Comment

With the Economy in a “slump” statistics show more and more families have a single parent. If you are in this situation, and want to purchase a home, there are some very specific details you should know:

FHA requires a 3.5% Investment into the Property, which is lower than the 5% charged on most Conventional Loans.

The down payment for a FHA loan can be a gift (here’s more information on Down Payment Options with FHA) When we talk, we can also check and see if you qualify for up to $8000 from NC Housing Finance Agency for your downpayment! [Read more...]

FHA Underwriting Guidelines for NC

November 21, 2011 by admin Leave a Comment

We talk to people everyday who have questions about qualifying for a FHA Mortgage Loan in NC. FHA Underwriting Guidelines, are actually pretty straightforward.

Unlike qualifying for a VA Mortgage loan (where you must be a qualifying Veteran) or a USDA Home Loan (that requires that you meet income limits for your county and the property must fit within the USDA RD Loan Footprint) – FHA has far fewer restrictions! They do have Maximum Loan Amounts, which vary per county – but other than that, just about anyone who wants to purchase an Owner Occupied Home can do so!

Maximum Loan Amounts: Maximum FHA Loan Limits Vary per County, and are subject to change each October. Congress has said that they will be lowering the High Cost Area FHA loans that are currently available in areas like Washington, DC and San Francisco in October of 2012. It looks like the maximum FHA Loan Limit for Homes in Raleigh will change at that time too. The 2010 FHA Maximum Loan limit for Wake County is $295,000 – the 2012 limit could go down to $271,050. [Read more...]

Filed Under: FHA Mortgage Loans Tagged With: credit score requirements, fha condo guidelines, FHA LOANS, fha loans raleigh, FHA mortgage loan, fha mortgage loans, fha pmi, FHA Programs, maximum fha loan limit, non occupying co borrower, underwriting guidelines fha

Kiddie Condos are Not Just for Kiddies!

July 12, 2011 by admin Leave a Comment

kiddie condo

Kiddie Condo Loans refer to a FHA provision that allows for non-occupying co-borrowers. Parents like us, with kids in college, come out a LOT better owning a unit with the student, and renting it back out. We’ve done many of these for our friends – and most of them were NOT condo units. It’s just an industry slang term for the loan that only requires a minimal investment (less than 5% normally covers all costs), and does not require the student to be employed full time – or have a credit score established.

We used this program for a family that moved here and wanted their dad to live in Cary. Their mom died a few years earlier – and her illness pretty much wiped out their dad’s cash… He also didn’t have a ton of income. Using the non-owner occupied co-borrowing of the FHA loan, we were able to get Grandpa a loan in a nice ranch near their home! He could live independently – and everyone was happy!

Wondering how Social Security Income works with FHA? Well, we can gross it up 115%! So if you need the Social Security income to qualify with another family member – that’s allowed.

If you or your family are looking for a mortgage loan in Cary or Raleigh, please call Steve and Eleanor Thorne,Mortgage Banker in Cary , 919-649-5058

Filed Under: FHA Mortgage Loans Tagged With: buying a house with a parent, buying a house with your dad, fha non occupying co borrower, FHA Programs, kiddie condos fha, non occupying co borrower

One Borrower Has Income One Borrower Has Credit Score

August 18, 2010 by Eleanor 1 Comment

When one borrower has most of the income… the other borrower has good credit scores… there ARE options for purchasing a home. Look at the question we had yesterday:

“We want to purchase a home, and I want to know if we can get it. My husband currently has a mid credit score of 538, and mine is 678. He makes about 52,000 and I make 25,000. I’m still in graduate school full time. We saved $4,000 for closing cost so far. We want the house by the end of October 2010 Can we get a loan?”

Option 1:

Purchase a home using FHA, and have a non-owner occupied co-borrower on the loan with the borrower who has good credit scores. If you know that you can make the payments on your own, then having a parent, or other family member, on the loan will not be a burden to them. After you’ve made 12 months of payments (and by all account mortgage interest rates will still be low a year from now) you can refinance the loan and take the family member(s) off. [Read more...]

Filed Under: FHA Mortgage Loans, First Time Home Buyer Tagged With: credit scores, fha home loan, fha home loans cary, FHA LOANS, fha loans raleigh, FHA mortgage loan, fha mortgage loans, first time home buyer, income requirements, no down payment, no downpayment, non occupying co borrower, usda home loan, usda home loans, VA Mortgage Loan, va mortgage loans

FHA Home Loans for Single Parents

August 14, 2010 by Eleanor 2 Comments

FHA requires a 3.5% Investment into the Property, which is lower than the 5% charged on most Conventional Loans.
The down payment for a FHA loan can be a gift (for more info about FHA Down Payment requirements click here).
FHA loans, in today’s lending environment generally require 12 months of clean credit, and a credit score of at least 620.
FHA will consider part time jobs if you’ve only had that part time job for 18 months – most other underwriting requires you to have a 24 month history of working 2 jobs. (and let me just say, if you are a single parent working 2 jobs – God Bless you! WOW! Talked to a Dad today who is doing that!)

CHILD SUPPORT or Alimony

You have to have evidence that you have received child support, on time, for a year for it to count as income. One of the most common problems we see is when a mom will get a child support check, cash it, and deposit part of the check into their account. In order to have EVIDENCE that you are receiving that income, we need to have bank statements that reflect the entire “check.” We suggest that mom’s deposit the child support check into their account at the same time each month. DITTO with Alimony.

We must have evidence that you will receive Child Support or Alimony for at least 3 full years after the date of closing. Let’s say you receive $300 for each of your 2 children until they are 18. So if you have a child who is 12 and a child who is 16 – we would only count the 12 year old’s portion of your support in qualifying you for the mortgage.

If you PAY Child Support or Alimony… we are only going to count that payment against you (like a car loan) if you have more than 9 months of payments left per your agreement. If you are behind on Child Support or Alimony, and the court is garnishing wages for those payments, we would need 12 months history of that “work out” being made on time. You will need a credit score of at least 620.

Non-Occupying Co-Borrower

You can purchase a home without being married to the other borrower. You could buy the home with your parents (for instance), and they would not have to live in the home. We would take all of their income, all of your qualifying income, all of their debts and all of your debts, and see what the ratios look like. Having someone purchase the home with you helps from an Income Qualifying standpoint. Having someone else purchase with you will not help a single parent with CREDIT issues.

Purchasing a home with someone who is NOT a family member would require that the other person live in the property with you. Again, you take all of their income, all of their debts and add it to yours… and their credit needs to be at least as good as no late payments in the last 12 months and at least a 620 credit score. (Don’t have a 620 score yet? Click here for tips you can start doing today to improve your credit score! 8o))

RoomMates

We are seeing a ton of single parents who are living with OTHER single parents. If you HAVE a roommate, or if you are GOING to have a roommate – it is very very difficult for us to count that income. If the roommate is not going on the mortgage loan with you, 99% of the time we can not count that rental income.

Previous Mortgage

If you and your Ex owned a home, and the mortgage was NOT in your name – there’s nothing to worry about.

If you owned a home, and the mortgage was in BOTH names, and you Quick Claim Deeded the Property over to your Spouse… you are STILL responsible for the mortgage.

If the Seperation Agreement says that the SPOUSE is responsible for the mortgage payment -and you were ON the mortgage loan… you are STILL responsible for the mortgage. Unless you have been TAKEN OFF of the mortgage – let’s say the other person refinanced the mortgage and took your name off, or if you sold the home, you are still responsible for the mortgage.

If there was a Short Sale, or Foreclosure on that home, and you were on the mortgage, (even if you did not live there at the time and you the separation agreement said you were not responsible for the mortgage) click here for more details and time lines.

HERE’S THE GOOD NEWS!

Less income, in today’s real estate market – buys MORE home. With Interest rates in the 4% range, and home prices coming so far down – a parent who makes $38,000 with no more than $350 a month in debt can purchase a home in Raleigh with 4 bedrooms, a 2 car garage, in a NICE neighborhood for around $200,000. The TOTAL payment, Taxes, Insurance, Mortgage Insurance, Homeowner dues and ALL on one we looked at for a mom yesterday was $1050 a MONTH!

So, if you make $35,000 – and receive $300 a month in child support… you could purchase a nice home, and you could GET a room mate to help you make your payments! NOW really is a great time to purchase a home!

If you are a Single Parent, interested in buying a home, call Steve and Eleanor Thorne at 919-694-5058. Each situation is different. Let us help you with a plan that will mean you can purchase a home! We know the FHA guildelines in NC and we love helping people buy a home for their family!