Tag: first time homebuyer

Buy a Home with Just 1% Down!

Buy a Home with Just 1% Down and get up to a 2% Lender Gift towards your down payment. Buying a home has never been more affordable with our low down payment Conventional Mortgage.

SUBMISSION DEADLINE FOR PROGRAM: MAY 31ST, 2018

Unlike Down Payment Assistance programs, such as MSHDA, there is no 2nd mortgage required. This is a true gift at the closing from the lender that is applied to the down payment. This give you 3% equity at the closing!

This program is available through our FannieMae HomeReady Mortgage which offers low fixed rates on 10 year to 30 year mortgage loans.

1% Down Mortgage with No PMI

To get the lowest overall mortgage payment you could opt for our lender paid PMI option. This will allow you to have no monthly PMI included in your mortgage payment resulting in some of the lowest possible mortgage payments available!

Get Pre-Approved for  a 1% Down Home Loan

To get started with our low down payment mortgage simply call a licensed loan officer at 800-555-2098 or request information below.  You will supply some basic information to confirm you meet the income, credit and asset requirements for the program. If everything looks good, you will be given an Pre-Approval Certificate so you can start shopping for a home!

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EXAMPLE DETAILS: Borrower contributes 1% down, lender contributes 2% of the loan amount up to $5000 for the down payment and the borrower is responsible for any difference to get to the required 3% down. The principal and interest payment on a $200,000 30-year Fixed-Rate Loan at 4.625% and 97% loan-to-value (LTV) is $1028.28 with 0 points due at closing. The Annual Percentage Rate (APR) is 4.866%. The principal and interest payment does not include property taxes and home insurance premiums, which will result in a higher actual monthly payment. Rates current as of 01/15/2018.

How to Prevent Buyer’s Remorse

Forty-four percent of homebuyers end up regretting their purchase, according to a recent study by Trulia, a residential real estate website. The biggest regret? Not buying a larger home. If you’re entering into the home-buying process, you may be tempted to settle for less, especially if your budget doesn’t allow for a larger place. But keep these considerations in mind so you can prevent buyer’s remorse:

What should I consider when buying a house?

Don’t go into the buying process without doing some research and making a wish list. On average, Americans have been staying in their homes for 13 years, according to the National Association of Home Builders.

With that in mind, think about what you might be doing over the next 13 years: Will your family grow? Will you need space for an office? Will you need a larger yard for your children to play in? Will your kids be going off to college? Will you be retiring and needing less space? Will you need a one-floor setup for easy accessibility?

Your home is a long-term investment, so don’t just think about what you need now. Buy your home with the future in mind.

How much will my home appreciate?

When you find a home you love that meets your current and future needs, the next step is to calculate its appreciation over the next decade or so. You want a home that’s going to build your net worth, not depreciate over time.

Not sure how to predict whether a home will appreciate? First, consider its location. Choose a home that’s in a growing community and has a reputable school district. Second, consider the house itself and the property it’s on. Is the land desirable and without major issues? Does the house have sound structure (roof, walls, foundation)? Fixer-uppers can actually appreciate more than newly constructed homes if you’re up for the task of renovating, providing they don’t become a money pit in the process.

Did I get the best home loan?

When you buy a home, there are several types of home loans that you can consider.  If you have a large down payment over 20%, you may have selected a Conventional Mortgage to avoid PMI. Conventional loans typically have the lowest overall payment if you have higher credit scores and a large down payment. If you purchased using FHA financing, you may want to consider refinancing in the future to drop the Mortgage Insurance. Most FHA loans do not automatically drop this extra insurance premium.

Another consideration would be to confirm that you picked the best rate and cost combination for your home ownership goals.  Many lenders allow you to pay discount points to get a lower than market interest rate. If you consider this your “forever home”, then having a lower rate may save you a significant amount of interest over the term of your loan. Conversely, if you plan on selling your home within a few years you may want to select a loan option with the lowest amount of closing costs so you save money immediately on your purchase. Selecting the wrong home loan may cost you thousands and leave you regretting the extra costs.

See our Mortgage Amortization Calculator to estimate interest paid over the life of your loan.

How much will it cost to sell my house?

In looking toward the future, consider how much it will cost to sell your house. You may need to make repairs and upgrades to make your home more desirable. You’ll also need to pay your realtor commission (unless you’re selling by owner), which is usually 5% or 6% of the home price, and closing costs if the buyer doesn’t foot the bill (especially in a buyer’s market). As long as you plan ahead with these costs in mind, you won’t be surprised when it comes time to sell. If you buy a better house at the start, you may save a lot in the end.

Learn about our Home Renovation Loans to increase the value of your home.

For more information on how you can choose the best home for your needs, contact Riverbank Finance at (800) 555-2098 to schedule a meeting with one of our mortgage professionals.

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Three Rules for First-Time Homebuyers

first time homebuyers

Ready to stop wasting money on rent and invest in your own home? As a first-time home buyer, the process may seem overwhelming. Here are three rules for first-time home buyers and a basic run-down of everything you need to know to buy your first home.

  1. Get your finances in order

First and foremost, you need to get your finances in order to qualify for a mortgage. You don’t have to have perfect credit in order to get a mortgage, but most loans do have minimum credit score requirements. So it’s not a bad idea to clean up your credit as best as you can.

When lenders consider you for a mortgage, they want to see that your finances are consistent. Keep these things in mind when applying for a mortgage:

  • Don’t quit or change your job
  • Don’t make any major purchases, such as furniture, jewelry, or vehicles
  • Check with your mortgage officer before you move or withdraw any large amounts of money from your accounts
  • Check with your mortgage officer to find out whether you should pay off your debts or collections
  • Don’t use cash for a good-faith deposit, because it’s hard to track
  • Don’t have your credit report pulled too many times, because it can hurt your credit score

Before you get a mortgage, you’ll also have to get all of your documentation in order, including two years of W2 statements, tax returns (if commission or self-employed), 2 months of bank statements, drivers license and social security card. When you apply for the loan, you’ll need to provide all of the documentation to the lender within 24 hours, otherwise your loan closing could be delayed.

  1. Understand your mortgage options

When you talk with a loan officer, he or she can help you navigate all of the available mortgage options. In the past, 20% down payments were required, but programs are available that can help first-time home buyers put down as little as 1% on a 15 or 30-year fixed loan with a low interest rate and no Private Mortgage Insurance (PMI).

Riverbank Finance offers low and no-down payment loans, including government programs, such as the FHA loan, VA loans, and USDA Rural Development home loan. Riverbank also offers a 1% Down Conventional Mortgage, where the borrower only needs a 1% down payment and the lender contributes 2% to give the borrower 3% equity upon closing.

  1. Be ready to close on the house

Knowing the home buying process can help you be prepared so you can close on the house without delays.  After you’ve submitted all of your documentation and your mortgage is approved, you can begin home inspections and the home appraisal. The home appraisal typically costs between $400 and $600, which you’ll have to pay with a credit or debit card before closing.

Once the house is inspected and appraised, you can schedule the closing with your Realtor and the seller. Your loan officer and the title company will work together to finalize the closing costs. Closing costs typically run between 2 and 5 percent of the total price of the home you’re buying. If you are short on funds ask your loan officer about solutions to have your closing costs paid for you. From the application to closing, the process averages between 30 and 60 days (although Riverbank Finance may be able to close in under 2 weeks), and then you’ll get the keys to your new home.

From start to finish, Riverbank Finance can help you purchase your first home. Contact us at (800) 555-2098 to schedule a consultation with one of our loan officers.

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Buy a Home with No Closing Costs

Buy a Home with No Closing Costs

An alarming number of first time homebuyers are unaware that mortgages involve closing costs, and which often creates a financial obstacle. Here, we’ll explain not only what closing costs are, but more importantly, how to avoid paying them!

What are Closing Costs?

Closing costs are additional fees a homebuyer is responsible for, outside of the down payment, at the time of closing. They include things like lender fees, title fees, government fees, and prepaid items such as property taxes and homeowner’s insurance. See below for a more conclusive list of closing costs you may encounter.

Lender Fees
• Credit Report Fee
• Application Fee (if applicable)
• Origination Fees (if applicable)
Appraisal Fee
Flood Certification Fee
Title Fees
• Chain of Title
• Owner’s Title Insurance (typically paid by the seller in Michigan)
• Lender’s Title Insurance
• Closing Fee
• Courier Fee
Government Fees
• Recording Fees
• Transfer Tax (typically paid by the seller in Michigan)
Real Estate Broker Fees (if applicable)
Prepaid Items
• Per Diem Interest
• Property Taxes
• Homeowner’s Insurance
• Tax Prorations (to reimburse the seller for taxes they already paid)

Related: Transfer Tax Calculator and Title Insurance Calculator

How Much are Closing Costs?

Closing costs vary based on factors such as loan amount, location (state and locality) of the property, and lender fees. Total closing costs typically range between 3-6 percent of the sale price. As stated above, not all fees apply in every loan situation. For instance, here in Michigan, title insurance and transfer taxes are typically paid by the seller.

Ask your buyer’s agent about what (if any) fees their brokerage charges for their services, as their administrative fees can range up to $500. Lender fees can also have a large impact on a homebuyer’s total closing costs. Here at Riverbank Finance, we don’t charge any additional lender fees for most loan programs! Be sure to ask your loan officer what fees you can expect to pay for their services.

Can I Avoid Paying Closing Costs?

There are several ways in which homebuyers can avoid paying closing costs. The most common way to do this is to request seller paid closing costs when writing an initial offer on a property. Each loan program is different, but allows for a percent of the purchase price to be given back– up to 3% on Conventional, 4% on VA, and 6% on FHA and USDA. For example, if you are purchasing a $200,000 home with a VA mortgage, you can request seller paid closing costs of up to $8,000.

Homebuyers should also speak with their loan officers about no-closing cost loan programs. By utilizing lender credits, buyers can reduce or even eliminate their closing costs altogether—ask your loan officer if you qualify for lender paid closing costs! Here at Riverbank we charge NO APPLICATION FEES and most of our loan programs have NO LENDER FEES.

Get More Information

To apply for a Mortgage or Refinance with NO closing costs, call Riverbank Finance today at 1-800-555-2098.

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7 Mortgage Myths Debunked

7 Mortgage Myths Debunked

It is no secret that the home buying process is a long and complicated one. Getting started can be intimidating and confusing, so we’ve compiled a list of common mortgage myths we hear from our clients. Here, we’ll break them down and explain the truth about mortgages, in plain English.

1. Having my credit pulled will drop my credit score

Many prospective buyers are hesitant about having their credit pulled because they fear it will destroy their score, but it has far less affect than you’d think. Having your credit pulled for any reason may have an impact on your overall score, but it is usually very minor.

Did you know, you actually have many different types of credit scores? Depending on who accesses your credit report, from which bureau, and for what purpose, a different scoring model is reported. Mortgage inquiries are treated differently than other credit inquiries because you can shop around for the best rate and terms. The credit bureaus do not penalize consumers for rate shopping, so any mortgage inquiries that happen within the same 45 days are treated as only 1 inquiry on your credit report.

2. Credit Karma says my score is…

Popular sites like Credit Karma and Free Credit Report are great tools for monitoring trends in your credit report, but are simply not reliable sources for determining credit eligibility. We’ve compared Credit Karma’s “scores” to actual scores we’ve pulled, and seen as much as a 100-point swing in either direction—whoa!

Don’t necessarily trust information you obtain from these websites—talk to a mortgage loan officer! In addition to providing you with an accurate credit rating, your loan officer can provide insight into what factors may be affecting your score, and what you can do to improve it.

3. I haven’t been at my job for 2 years yet

If you haven’t been in your current job or position for the last two years, don’t worry! As long as you have had continuous employment for the last two years, you’ll still qualify. Any gaps in employment will have to be detailed with a signed letter of explanation, but do not necessarily doom your chances of being pre-approved.

4. I need to payoff and close out my credit cards first

For some unknown reason, many of our clients believe they should have all other debts paid off before buying a home. While this is a noble idea and paying off debt is rarely—if ever—a bad idea, closing revolving accounts will actually do more harm than good! Pay off—or pay down—as many accounts as you can, but do not close out your credit cards. Having unutilized credit positively affects your credit score and your borrowing profile!

5. I don’t have the funds for a down payment

It is a common misconception that borrowers must have 20% to put down on any home that they want to purchase—not to mention closing costs—but that simply isn’t true anymore. There are many mortgage programs available today that did not exist a decade ago. For example, the FHA now offers mortgages with as little as 3.5% down, and both USDA and VA offer programs with no down payment at all!

6. Owning is more expensive than renting

It is almost always cheaper to pay a mortgage than rent a comparable home in the same area. Owning a home also allows you to build equity. When your lease ends on your apartment, you are welcome to leave, but the rent you paid is long gone. Buying a place of your own allows you to build your own wealth over time, not your landlord’s.

7. My bank will give me the best deal

Many borrowers, when thinking of purchasing a home, start with their trusted bank or credit union first. It makes sense, right? They know you, you’ve banked with them for years, they already have all of your personal information, it should be easy peasy, right? Wrong! Loan guidelines are the same for everyone, no matter which bank or lender originates the loan. Your bank won’t be able to cut you any special breaks or give you an extra low rate, just because you’ve been a member for a while—even if they want to!

Get More Information

To apply for a Mortgage or Refinance call Riverbank Finance today at 1-800-555-2098.

Request Information Now!

FHA Lowers Mortgage Insurance Premium

FHA Lowers Mortgage Insurance Premium

Great news for homebuyers considering an FHA home loan or FHA refinance! The popular mortgage program is getting even better. The Department of Housing & Urban Development announced this morning that the FHA will be decreasing their annual mortgage insurance premium by a quarter of a percent. The upfront guarantee fee will remain the same.

Effective for new mortgages closing on or after January 27th, the annual fee—paid monthly—will decrease from .85% to .60%. This news comes only four months after the USDA decision to lower their own upfront and annual fees on rural development loans.

New FHA MIP Savings Example

Now, unless you spend your spare time studying loan program guidelines, that might sound like gibberish—so let’s do some math to demonstrate the savings. On a $200,000 home purchase, the monthly mortgage insurance premium would decrease from $142 to $100. That is a savings of $42 per month, over $500 per year!

The FHA made this decision following four straight years of growth and $44 billion dollars of value gained since 2012. They aim to protect the insurance fund while also offsetting the cost of increased mortgage interest rates.

“After four straight years of growth and with sufficient reserves on hand to meet future claims, its time for FHA to pass along some modest savings to working families” -HUD Secretary, Julian Castro

Requirements for an FHA loan

You might be thinking, that’s great, but how do I know if an FHA loan is the right fit for me? I’m glad you asked! Qualifying for an FHA loan is relatively simple and provides many benefits, including but not limited to:

  • Minimum credit score of 580
  • Down Payment as low as 3.5%
  • No early payoff penalties
  • Allows seller-paid closing costs

FHA announcement: Read FHA Mortgagee

Have a specific scenario you’d like to run past us? Give us a call to speak with one of our licensed loan officers, or check out our FHA Mortgage Calculator. We would love to recommend the best loan program for you and your situation.

Apply for a FHA Mortgage

Call Riverbank Finance today at 1-800-555-2098

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Millennials, Mortgages and Homeownership

Millennials, Mortgages & Homeownership

It is no surprise that millennials, generation aged 18-34, make up more than 40% of homebuyers today. Follow these simple steps to join your peers on the path to home ownership.

Don’t Wait Forever

If you find yourself waiting for the perfect house, at a great price, and the lowest rate, you may never become a homeowner. It is no secret that interest rates have risen over the last quarter, but by historical standards, rates are still extremely low. Appreciation of home values went up 6.8% nationally in 2016, and are predicted to increase another 4% in 2017. Home sales are also up 15%. With interest rates and housing prices on the move, waiting could cost you more than you think.

Stop Renting

Studies have shown, you’re probably paying about 20% more in rent than you would for a mortgage on the same property. This is great news for your landlord, but not for you! When you own your own home, not only is it yours, so you can DIY it to your hearts desire, but you are contributing to your investment, not your landlord’s.

Don’t Assume the Answer is No

You know what they say when you assume, “Don’t make a…” Anyway, you get the point. Many potential buyers just assume they will not qualify, so they don’t even try. Student loans and little savings will not automatically disqualify you from obtaining a mortgage. In most cases, only 1% of your total student debt must be counted toward your debt-to-income ratio, and many no-or-low-downpayment programs are available today.

Get Pre-Qualified

One of the biggest mistakes potential homebuyers make is looking at homes before speaking with a loan officer. It is important to know now only if you qualify for a mortgage, but how much, and if the payments are comfortable for your financial situation. You would not want to fall in love with a home outside of your price range, or waste the sellers’ time.

Hire a Buyer’s Agent

After you have been pre-qualified for a mortgage, find a buyer’s agent you can trust. Searching for a home on your own will not save you any money—in fact it could do just the opposite! Realtors play a vital role in the real estate transaction, including showing the property, writing the offer, handing negotiations, obtaining concessions (such as closing costs), and help coordinate all of the involved parties.

Do Not Give Up

Don’t just give up if you don’t qualify today! Ask your loan officer what barriers are preventing you from being qualified, and how to improve. Sometimes, all it takes is a small downpayment gift from a family member. If poor credit is the problem, inquire about what problems may be negatively affecting your score, and work to resolve and remove them.

According to a recent survey conducted by mortgage giant Ellie Mae, 90% of millennials want to own a home, just don’t believe they can yet. 45% of those polled said lack of downpayment was their barrier, and only 30% said inability to qualify was the issue. Whatever the problem may be, do not give up. Talk to your loan officer who will be happy to advise you!

Have a specific scenario you’d like to run past us? Give us a call to speak with one of our licensed loan officers. We would love to recommend the best loan program for you and your situation.

Get More Information

To apply for a Mortgage or Refinance call Riverbank Finance today at 1-800-555-2098.

Request Information Now!

How to Ensure a Fast Mortgage Closing

If you’ve ever purchased a home, you know how stressful the process can be. What should be an exciting experience can quickly turn to panic, as the target closing date approaches. So, what can be done to prevent delays along your path to homeownership? Check out our list of tips and tricks below to meet (or beat!) your closing date.

Get Pre-Approved. Never shop for a home without first speaking with a mortgage loan officer. You wouldn’t want to fall in love with a home you may not be able to afford.

Tell the truth. Be 100% honest and transparent with both your mortgage loan officer and your Realtor. If you provide incorrect or incomplete information, it could cause major problems during the underwriting process.

Work with professionals. Find an experienced Buyer’s Agent to represent you and help you negotiate. It will make all the difference.

Be Responsive. Always send required documents within 24 hours of our request for them. Always send complete documentation (all pages). Be sure they are legible and not cut off. The Underwriter will conduct a thorough review of all documents provided by the borrower, realtor, loan officer, and title company. Additional document requests throughout the process are completely normal and necessary to close.

Ask Us Questions. Review all documents that you receive and let us know if there is something you do not understand. It is important to be aware of all costs associated with your mortgage.

The Appraisal. The appraisal is a required out-of-pocket cost to the borrower which generally ranges from $400 to $600. This must be paid when ordered via credit or debit card. If repairs are required by the appraiser, a final re-inspection will be required, which is an additional out-of-pocket cost to the borrower of approximately $150-$175.

Be patient. The total time to complete the mortgage process varies by loan program, property type, and borrower qualifications. You can expect 30-60 days from application to closing, but the process may take more or less time depending on the situation.

Don’t Jeopardize your Approval. DO NOT deposit large amounts of cash into your bank account. DO NOT transfer large amounts of money between accounts. DO NOT apply for new debt. DO NOT have your credit pulled. DO NOT change jobs or pay structure.

Have a specific scenario you’d like to run past us? Give us a call to speak with one of our licensed loan officers. We would love to recommend the best loan program for you and your situation.

Get More Information

To apply for a Mortgage or Refinance call Riverbank Finance today at 1-800-555-2098.

Request Information Now!

Tips for First Time Homebuyers

First Time Homebuyer TipsIf you are a first time homebuyer, the process of buying a house can seem overwhelming and even complicated, however just like anything important in life, you must take the necessary steps to get through it. Here are some important steps to follow before and you buy your first home.

Get your credit in order

Having a mortgage is potentially the biggest financial obligation you will take on. First, you definitely want to make sure you have good credit. That means the higher the credit score the easier it is to obtain financing. Make sure there are no late payments, no collections or unsatisfied judgments. You can usually get a copy of your annual credit report for free. Look over your credit report to make sure all the information is accurate.

Load up your piggy bank

When buying a house, you will need enough money for a down payment, closing costs, and appraisal fees. Rule of thumb is 3.5 % down payment for an FHA government loan and 5% down payment for conventional loans on the sales price of the home. You should also speak with your loan officer to determine what payment you would be comfortable making each month for a mortgage payment. Once you have your down payment and monthly payment figured out, you will know the price range of homes to look for in your area that meet your budget.

Find qualified housing professionals

The next step in the process is finding a real estate agent and mortgage company who both come highly recommended. Ask your co-workers, neighbors, friends, and family who they would recommend. After getting a list of names of real estate agents and mortgage brokers, give them a call to see who has the best rates and prices and who you feel most comfortable working with. Having a good team on your side will likely make this process move more smoothly.

Learn all about the home buying process

Knowledge is power so do some research. Each state has different rules and processes to getting a mortgage. Having a general idea or understanding of how it all works will also help you with the home buying process. There’s tons of information online or you can talk to your loan officer and realtor to get more details about the process.

Understand the Costs

Another thing to be aware of is what you will need to purchase prior to closing on your home. Working with a great mortgage broker, you may be able to buy a home with no lender fees however in most cases there will be some costs.  Most lenders require you to pay a full year of homeowner’s insurance upfront and if you live in an area prone to hurricanes, tornados, or flooding, then you will need to have that as well, which is an added expense to your homeowner’s insurance. Other costs you may have to pay include title company fees, appraisal fees and government fees.  Closing costs can also get pretty pricey so be sure to inquire about getting an estimate of what those might be and ask if here are way to have the seller help to pay these costs for you.

Once you feel you have these few steps in order, you’ll be ahead of the game and ready to start shopping for your new home with confidence and ease of mind.

Get Pre-approved to buy your first home

Complete the form below to get additional information and eligibility for first time home buyers in Michigan.

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Michigan Home Prices Lowest in 10 Years

Michigan Home Values Lowest in 10 YearsOur mitten state of Michigan has unfortunately been one of the hardest places hit when it comes to real estate woes.  Over the past decade, countless Michigan homeowners have lost their homes to foreclosure.  While many others face the reality that the value of their home has been drastically reduced.  This is a double-sided event though.  As the homeowners suffer from dropping values.  The homebuyers are greeted with extremely low values allowing them to purchase amazing home at bargain price.

The average value of homes dropped a total of 2% from this past December to January.  Making the median home price a total of $154,700 making it the lowest price we have faced since November 2001, just before the “housing bubble” occurred and home values skyrocketed.

For you homeowners, not all hope is lost as sure home values are dropping but so have mortgage rates.  If your facing a home that you may be losing value on, you could potentially refinance to some extremely low rates and save yourself a pretty penny thanks to all of the mortgage programs that have been instated as of late.  Some of the programs include help for homeowners with mortgages owned/guaranteed by the Federal Housing Administration.  While other loans backed by Fannie Mae and Freddie Mac are susceptible to mortgage refinancing as well.  All-in-all homeowners are currently stuck with poor home values until the market, potentially, rebounds in the coming future.  Refinancing is something we specialize in and love to help out Michigan-based homeowners with whether they’re in underwater situations or just want to save some money.

Now whether you’re a first time homebuyer or your veteran of the process towards buying a new home.  Today’s values and rates are definitely in your favor.  With the value of some homes down 20% and even higher in some situations, you can buy a dream home no matter where it may be located.  Previously the only real estate being affected drastically from the crash of the housing market were homes located near the inner city.  Well as time has gone on, neighborhoods along the lakeshore to small towns in the Upper Peninsula have all been affected.  Truthfully you can select any city you want to live in whether it’s in Grand Haven, Grand Rapids, Traverse City or even Marquette Township.

Whether you want to refinance under the Home Affordable Refinance Program (HARP), FHA Streamline Refinance or some help with purchasing a home.  Be sure to contact our certified loan-officers by calling 1-800-555-2098.

Looking to refinance?

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