NJ / NY First Time Home Buyer Loans
Don't get overwhelmed by the mortgage process. Golden Mortgage can help you make it a hassle free experience. Get Pre-Approved before shopping for your new single family, townhouse, condo or multi-family property in New Jersey or New York. Gain the advantage of a free mortgage pre-approval and get more bargaining power!
Lenders evaluate a mortgage applicant based on their ability to repay by reviewing:
- credit history (established credit and 12 month payment history)
- income for two years
- job stability
- assets available for down payment and closing costs
- assets available after purchasing property
1) One of the first time home buyer mortgage programs allows you to purchase a home with minimal down payment. If you qualify, the are some programs that require a 3% down payment.
2) FHA loans allow 3.5% down payment. The seller is allowed to pay for buyer's closing costs up to 6% of the home purchase price
3) New program with 5% down payment which allows for a 15% Home Equity Line of Credit (HELOC) to avoid mortgage insurance. Must have a minimum 700+ FICO score to qualify based on down payment amount.
4) When a borrower has a down payment of 20%, there is no private mortgage insurance (PMI) see definition of PMI below.
Important factors in qualifying for a mortgage are:
- Credit score - depends on how you pay your bills and the ratio of outstanding credit versus your total credit limit
- Income and Employment will dictate the purchase price you can afford
- Asset verification - source of your downpayment, closing costs and reserves. Large deposits other than payroll must be sourced and explained.
- You should be in the same line of work for at least two (2) years. Recent college graduates can use their college transcript to fulfill the two (2) year employment history.
- Your housing payment (principal, interest, taxes and homeowner insurance-PITI) should not exceed between 32% - 36% of your gross monthly income.
- Total debt (PITI including minimum monthly credit card and installment loans) should not exceed 45% of gross monthly income. Execptions can be made for compensating factors, such has high credit scored, large downpayment and liquid reserves remaining after closing on your mortgage loan.
- Learn more about credit reports at the Consumer Financial Protection Bureau website.
Down payment less than 20% down
When you put less than 20% down payment on your purchase price, your loan is subject to Private Mortgage Insurance (PMI). The PMI covers the lender in case the borrower defaults on the mortgage and the property goes into foreclosure. We have both Borrower paid and Lender Paid PMI rates. Typically, the PMI will drop off when your equity reaches 78% of the purchase price, your refinance or sell your property.
To learn more about the mortgage process, get your questions answered and get your mortgage pre-approval by calling toll-free at 800-327-0123.