This is a loan which carries a second mortgage for up to 15% of the purchase price of the property. It is usually used when wishing to avoid PMI insurance or to keep your first mortgage under the FNMA/FHLMC limit to avoid Jumbo rates. The borrower puts down a 5% down payment and then finances a first mortgage up to the FNMA/FHLMC limit and a second mortgage of up to 15% of the purchase price. Other variations are 80/10/10 or 75/15/5.
Backed by the Department of Housing and Urban Development this mortgage offers the borrower the ability to put as little a 3% down payment and they can even finance “allowable” closing costs. Seller can contribute up to 6% of the purchase price to the buyer towards closing costs.
Nehemiah FHA MORTGAGE
Same as above but with a down payment assistance granted to the borrower from the Nehemiah Corporation. The seller agrees to give the Nehemiah Corporation up to 4% of the purchase price and Nehemiah will grant back to the borrower up to 3% to be used as a down payment or towards closing costs.
203K FHA MORTGAGE
Same as FHA above but with the ability to finance home improvements that are needed. One mortgage is given based on the value plus improvements up to 115% of the future value. These improvements must be over and can be for a new kitchen, new bathroom, to add a garage or to structurally improve the property. They cannot be to add a swimming pool etc…
Backed by the Veterans Administration and the federal government it is similar to FHA except that you have to be a qualified Veteran or military person.
Offers 30 and 15 year fixed rate mortgage and competitive ARM products with full document, alternate documentation and limited documentation.
Cash out and No cash out refinance are allowable. Single family detached, Condo’s, PUD’s and single-family second homes can be financed with no prepayment penalty.
107% DOWN PROGRAMS
0% Down payment required and closing costs can be financed up to 107% of the purchase price. Only single-family homes that will be owner occupied are eligible. First time homebuyer status not required and there are no income limits.
ZERO DOWN PROGRAMS
Same as above only the borrower pays for closing costs or can have the seller contribute up to 6% towards closing costs.
REVERSE MORTGAGE A reverse mortgage (known as lifetime mortgage in the United Kingdom) is a loan available to seniors (62 and over in the United States), and is used to release the home equity in the property as one lump sum or multiple payments. The homeowner's obligation to repay the loan is deferred until the owner dies, the home is sold, or the owner leaves (i.e. into aged care).