The majority of people buying their first home will not be paying cash, so they will need to get financing through a mortgage lender. It's a good idea to talk to a trusted lender in order to see what you are comfortable spending each month.
The mortgage lender will collect:
- Pay stubs
- W-2's
- A mortgage application
Once they crunch the numbers, they can issue you a pre-approval letter based on a suitable loan amount. Marketplace Home Mortgage can even provide you with an approval letter to avoid any glitches at closing.
Conventional Loans: a loan in which you put at least 5% down and finance the other 95%. Conventional financing has a maximum loan amount of $417,000, anything above that amount would be considered a Jumbo loan. This type of loan is usually a fixed rate loan that has a 30 year term and can be obtained from almost any bank or mortgage lender.
FHA Loans: a loan backed by the Federal Housing Authority and has to meet specific conditions. It is the least expensive way to get into a home because you are only required to put 3.5% down. The maximum loan amount for FHA is $318,550 for a single family home.
Some counties offer down payment assistance, which also helps with the out of pocket expenses. Be sure to check with your lender to see what counties offer these programs. Contact me today for an appointment to discuss financing and buying your next home!
Find all for sale homes in the Twin Cities South Metro to start your home buying experience. Once you have secured your financing, it's time to look at buying a home!
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