Q: Bob, my wife and I have been debating on whether or not to up grade from our current house or invest in another as the market has seemed to have leveled off and the supply of very affordable homes is everywhere. Are main concern is a potential problem in acquiring a mortgage in today’s market as all or most sub prime lenders have dissolved and the big conventional lenders have changed all their loan packages making them very difficult to acquire. Got any tips on applying for or looking at that seemingly all elusive Florida Loan?

Chris & Rebecca Swartz

A: Well Chris, you have really hit it all on the head with your statement. Yes, it is the opinion of many that Florida housing has finally leveled and will stay stable. Yes, because of this as well as the abundance of available houses out there, now more then ever is the time to buy! With another big yes to the fact that due to the mortgage crisis and the dissolving of so many lenders as well as the overwhelming numbers of foreclosure, lenders have indeed change their requirements for getting financed making it much harder then in the past, regardless of your credit scores. Now day’s, conventional lenders want more then ever to have at the very least, 20 percent down on their loans and sometimes even more. You’ll also want to make sure that all liabilities are up to date in payment and that your “debt to Income” ratio’s are in line with new guidelines. If these few steps are not available and you’re a veteran, consider applying for a VA loan. As long as you have your “certificate of eligibility,” you can acquire great programs at lower rates with much less requirements then a conventional lender. Not a veteran? then take the time to sit with someone educated in FHA loans. These loans have come a long way in the past couple of years in supplying home buyers with a wider array of product loans. Some examples, FHA programs can require lower credit scores, possibly up to 40 points lower then conventional lenders. FHA offers loans that require less money down but with the need to carry “mortgage insurance.” The plus here is that as of this year, your mortgage insurance is tax deductable and FHA mortgage insurance cost less then the conventional lenders mortgage insurance. Another advantage of FHA is that the loans require lower reserves to be available. They also allow gifts of money to be used for a down payment without it being sourced, showing where it came from. FHA will also allow the seller to pay up to six percent of your closing cost, as the buyer, apposed to any conventional bank who will only allow up to three percent.

I have always said no matter what it is that you are attempting to accomplish or invest in, always do your homework. Go out and talk to that conventional lender, then go talk with a FHA representative, but make sure that you feel educated in the facts, then make a decision and stick with it. Also remember to us your local Real Estate rep when you do finally make your move, as that is always time well spent! GOOD LUCK TO YOU!

(Special thanks for input from Jim Printy, licensed mortgage broker from Gulf Coast Mortgage!)



Have a real estate question? Write, call, fax or e-mail:

Bob Jeffries, Realtor

Century 21 Birchwood Realty, Inc.

4040 Del Prado Blvd.

Cape Coral, FL 33904

239-540-6659 Office

239-542-7760 Fax

e-mail: bobjeffries@juno.com

Web site: c21birchwood.com