Wednesday, December 10, 2014

3% Down Conventional Loans Are Here For Real

3% Down Conventional Loans Are Here For Real

First time homebuyers can now in fact put as little as 3% down and get conventional financing (no longer confined to the FHA only box). There are no prohibitive restrictions; in fact if two people are buying a home, only one of them need be a first time buyer.

This is a significant mortgage financing event and should bring more first time buyers into the active home buyers’ pool.

Enter 3% down payment conventional mortgage financing and the landscape changes dramatically. Conventional financing does not handcuff borrowers to mortgage insurance forever like FHA MIP does

And let us not forget about that upfront FHA MIP insurance which is 1.75% of the loan amount added to the loan. So a $200,000 FHA loan would actually start at $203,500 ($3,500 for the upfront MIP). I did not make that up, go look it up for yourself!
By the way, conventional PMI (Private Mortgage Insurance) has no upfront PMI, never has.

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