Mortgage Loans

Utah Rural Housing Loans

Posted in Mortgage Loans

Utah Rural Housing Loans are one of the most affordable loans available. Ha, you say, all loans are affordable right now, and if you are saying that you would be correct.

Most mortgage loans are available for less than 5%  interest rates, But….and this is a big BUT for most folks these days, this is one of the only loans available with 100% financing…that’s right, 100% financing.  Happy Dance Here!

Other Benefits Of Utah Rural Housing Loans

• No Mortgage Insurance- unlike FHA or any loan that you don’t have 20% down with, there is no mortgage insurance on this loan
• No Down Payment required- even HUD homes these days require $100 down (well plus $1000 in earnest money). VA loans are the only other mortgage loans that do not require a down payment.
• Rates are comparable to other interest rates available. (You will need to check with your lender to find out current rates for Utah Rural Housing Loans

Requirements for Utah Rural Housing Loans

Yes, I know, there is no free lunch, so here are the basic requirements on Utah Rural Housing Mortgage Loans

• Income limits- this is based on the number of persons in your home and other mystical math calculations but here it is :  1-4 people in household max income $70,750, for 5-8 people in household max income $93,400
• Your debt to income ratio must not exceed 41% (This is the amount of your proposed monthly payment (principal and interest), real estate taxes, insurance, and other credit debts cannot exceed 41% of you gross monthly income)
• You must have a good credit score (this is another one you should check out with a lender, rule of thumb 660)

And the biggie….this is a Rural Housing Loan.  So you must purchase your home in a more rural area, but that does not mean you have to live in a log cabin in the nether reaches of the Oquirrah mountains or on a farm some where miles from the nearest neighbor.

For the most part, rural housing would be places like Tooele County, Eagle Mountain, Saratoga Springs to name a few. So if you work around the 1-80 corridor, near the airport, or down south, these communities would be great for you!

The communities are all great, with newer homes at reasonable prices.  What you could buy for $250,000 in Salt Lake County, you could easily purchase for under $200,000 in these areas. This is because the land value is less in these communities.

There are also new construction homes in these communities that are also less expensive  than these same builders are building in Salt Lake County.  Call or text us for a list of these builders at 801-819-9005

Homes That Qualify For Utah Rural Housing Loans

Bottom line….you get more bang for your buck, AND a 100% loan when you purchase a home in rural areas like Tooele County, Eagle Mountain, and Saratoga Springs. Contact us for details at 801-819-9005 or loves@saltlakehomefinders.com

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The Sky Is Falling-Will Interest Rates Go Up?

Posted in For Buyers, General Musings, Mortgage Loans

I just received this letter from one of my lenders, and she makes some important points about interest rates that I thought should be passed along.

Everyone Wants a Lower Price, But What About the Impact of Interest Rates?

When shopping for a home, the natural tendency of any buyer is to want to pay the lowest price possible. It’s important to keep in mind, however, that the sales price is not the only factor that determines what the monthly payment will be. In fact, the impact of higher interest rates can easily nullify any benefit of waiting for a lower price.

Why Should I Rush to Buy?

While you may have heard discussions in the media about the decline of property values in many markets, the rate of decline appears to be stabilizing.

That being said, it would not be unreasonable for buyers to want to hold out for an additional decline of 10%, hoping to capture the best possible price. However, as property values have declined in many areas to 2003 levels or lower, waiting longer to pull the trigger could be a mistake. Many markets are reporting that lower property values have been bringing out investors and the result has been multiple offers on many properties. Properties priced correctly are not declining and, in fact, are creating a lot of interest.

Interest Rate Complacency

The problem is that many home buyers have been lulled into a sense of complacency because of extremely low interest rates. Since the Federal Reserve initiated its program of buying mortgage-backed securities, which control the rates peopl pay for their home loans, rates had been range bound, bouncing between 4.50% to 5.00% for a 30-year fixed-rate loan.

But buyers shouldn’t be confused by this. These rates are artificially low! Historically, interest rates have been above 6.00%.  And any rate obtained below this number is a great deal, especially on homes with price tags from 2003!

Markets are Unforgiving

The last two weeks of May showed just how unforgiving the markets can be for people who choose to procrastinate. In just five days, interest rates from many lenders increased anywhere from .50% to 1.00% as fixed-income investors demanded more for their money.

For anyone who was waiting for prices to drop even more, a 1.00% increase in interest rate would bring a higher monthly principal and interest payment on a home, even if the price of that same home had fallen an additional 10% in value.

If your clients are waiting for prices to fall even lower, be aware that while holding out for a lower price may help them win the battle, they could lose the war in terms of monthly payments and overall affordability. With the Federal Reserve scheduled to end its buying of mortgage-backed securities this year, rates only stand to go higher for those that wait. In fact, interest rates are already on the rise and could go higher from here.

Cindee D. Stone

Let me know your thoughts! Later…ciao!
Debbi Love

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