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Right Now Is A Great Time For Buyers!

Mortgage rates are at record lows, with 30-year fixed-rate mortgages. How can home buyers get such low financing for their home purchase?

Banks have constricted their lending guidelines in recent years which has put such record-low rates out of reach for many home buyers. To get a loan, borrowers find that lenders inspect their credit scores, income, employment history, liquid assets, down payment, property value, type of property (single home vs. multifamily, for example), and how much money they’ll have left after closing.

The greatest challenge in processing a loan nowadays is documenting your income and every bit of information on your application, down to the last penny. The level of inspection, documentation, analysis and re-verification around assets, income, employment and appraisals is because Lenders are in fear of repurchases. What that means is if a lender makes a mistake, or there’s a difference in opinion, and they close the loan and it goes into default, Fannie Mae or Freddie Mac could require them to repurchase the loan.

To lock in the lowest mortgage rate you must get: 1) Credit score of 740 or better;
2) Down payment of 25 percent or more; and 3) Single-family home.

Home buyers with a lower credit score may still be able to get a low rate. If you have a 700 score but you are only financing 50 percent of the home’s value you might get the same rate as someone who has an 800 score doing 75 percent financing.

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About the Author

Andrea Sturm, Keller Williams
29 South Main St
West Hartford, CT 06107

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