FHA mortgage loan programs normally have the lowest down payment requirements. You might would want to see if the assistance programs you are considering would accept FHA mortgage loans as the first mortgage loan or would you be required to apply for and be approved for a conventional mortgage loan.
Buying a house is a step by step process, this is the first step you should take in order to purchase a house. The rest of the steps will fall in place, no matter the type of property you are purchasing.
In order to find out the type of loan programs you are qualified for you will have to fill out a loan application, with a mortgage broker, you can find one in your local telephone book.
Make sure this mortgage broker or mortgage banker is able to do government loans such as USDA, FHA and VA loans if you qualify for one. With a VA mortgage loan you are not required to have a down payment, this will save you on closing cost.
He will fill out this application, which takes awhile so grab your favorite beverage and sit down. Once you have completed the application, he will run your credit report which will have your credit scores. These credit scores will determine your interest rate.
The amount of your monthly debt payments you are required to pay as per your credit report and the amount of your monthly income earned would be used in a formula to determine what is called a debt ratio. This debt ratio would determine the amount a mortgage lender would allow you to borrow to purchase a house. This debt ration should normally not exceed 39%.
When you speak with the mortgage broker you will need the following documents to complete the loan application, there will be others, but this will get you started.
#1 One month of pay stubs for each person that will be on the mortgage.
#2 Six months bank statements from each bank in which you bank as well as statements from any 401K from you place of employment.
#3 Two years of federal income tax along with the W-2 that match.
Once he has all that he need to do he can then issue you a pre-approval letter so you can purchase a home. In this pre-approval letter will be the amount of house you are qualified to purchased.
Make sure, before you get your pre-approval letter, you and your mortgage broker go over all your options, as to all the mortgage programs you qualify for, the interest rate, monthly payments. This will allow you to make an intelligent decision.
Once you have your pre-approval you may now find a real estate agent to find yourself a home or he might have a referral.
If you are getting a FHA, fixed rate, two loans to eliminate PMI like an 80/20 or one loan, if you are qualified for and approved for a 100% loan.
You should select the loan that best suit your financial situation at the time. That could be an adjustable rate loan. It could be a fixed rate loan for 5 or 10 years and then adjust. Some adjustable rate mortgages only adjust once.
What might be good for one person might not be good for you, in other words just because your friends and all your real estate buddies are telling you about the great fixed rate they got, your financial situation might call for something else.
So select the best option for you and your financial situation.
You should also get a Good Faith Estimate (GFE) which will indicate the cost you will have to pay for getting this loan. It will also indicate the amount of your down payment.
Once you have found a home the real estate agent will then prepare a contract for you and the seller to sign. Your mortgage broker will now order an appraisal to show proof of the property value.
The mortgage broker might ask for additional information or documentation, don't get all up tight this is normal, just supply the information or find the documents needed.
After the appraisal has been completed you will be called by your mortgage broker to sign your loan docs so you can take possession of your new home.
Before signing any loan docs make sure they say exactly what you and your mortgage broker went over when you decided on what mortgage program was best for you.
I hope this has been of some benefit to you, good luck
"FIGHT ON"
I don't know of a current mortgage assistance program that will cover 30% of your monthly mortgage payment. If there is a possibility that you will be moving in the next 3-5 years you should continue to rent and save for a down payment.
If you can find a decent place to live and have enough income to qualify for a mortgage covering the other 70% of the purchase price you should go for it. MAP will cover 30%, up to $75,000.
The challenge will be finding a home that is not scary as hell for that price within city limits.
You will be able to sell it in 3 years and it should be worth more, prices in the bay area are going up, even Oakland. I do not personally buy there, it is not a great place to be a landlord, but for you, working right across the bay, it makes sense to buy.
Bill: There are a few programs funded by the city, one is called MAP, CalHome is another, I attended classes to qualify. http://www2.oaklandnet.com/Government/o/...
The problem with continuing to rent for 3-5 years is that I'm paying rent, which continues to go up in SF, which makes it difficult to save. Waiting could be practical advice, 3-5 years sounds so long to me, I'm already in my early 30's.
I'd love to hear about people's experiences as a first time home buyer.
I'm currently renting in San Francisco, but considering buying a home in Oakland. I don't have much saved, but I have great credit, no debt, and have had the same employer for years. I qualify for first time home buyer's programs that would cover 30% of my mortgage (deferred 30 yr loan @ 3%). I've been researching real estate investing and the home buying process for about two years. I understand renting and owning have many pros and cons, but I've only experienced renting.
I'm going back to graduate school for three years, while continuing to teach. I know eventually I'll have to move out of SF, I don't want roommates unless I'm the main tenant, and I like the idea of investing in a home while I'm in school. I am in a committed relationship, but do not live with my partner, and feel good about having a tenant until we're ready to live together as a couple. I'm still researching and do not intend to rush anything. I do think about buying a home often, it is most definitely a goal.
