 Buyers seeking 100% mortgage financing along with little or no money out of pocket for closing and settlement costs has become a “norm”in today’s marketplace. Until recently, many of these buyers had to resort to an alternative mortgage or even sub-prime mortgage program. Quite often the structuring of their financing is 2 loans (80/20) to avoid private mortgage insurance which has become rather costly. Frequently their rates for the first mortgage are in the high 7% range and higher and the second mortgage in the 11% range or higher. A blended rate greater than 9% is not uncommon. Even more terrifying in accepting this as “a means to justify the end” are the other loan features which exacerbate their financial position such as prepayment penalty, short-term adjustable rate mortgages and interest-only option.
| New enhancements and features include: No down payment required? This loan is for you! There is no other restrictions such as the Homebuyer education, Terms up to 40 years, Fixed or adjustable rates available, reduced Mortgage Insurance...this insurance is Private Mortgage Insurance. No first-time homebuyer requirement (Cannot own another home at closing), 2-1 buydowns permitted, Maximum mortgage to $417,000. Up to 6% sellers contribution allowed for closing costs and pre-paid items, Boarder income may be allowed, State and County Down Payment Assistance may be used , Non-Traditional credit may be used, Interest-only Option available.
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