Accredited Home Loans for Christians
Lending agencies which offer accredited home loans to Christian borrowers with unusual financing situations pride themselves on being flexible and personable. They know that when it comes to buying a house, not every borrower fits into the conventional profile or meets prime lending qualifications. Some are first-time home buyers, borrowers with high debt-to-income ratios, or homeowners seeking to refinance with a second mortgage. Lenders who specialize in extending accredited mortgages work with buyers, sellers, and real estate agents to broker the best deal for everyone involved at the most agreeable terms, in spite of less-than-perfect financials. While some lenders scoff at high-risk borrowers with excess buying baggage, banks and other financial institutions which offer accredited mortgages underwrite loans financed through conventional lenders. First-time buyers who fall short of prime lending requirements can get a boost by lenders who underwrite or guarantee all or part of the loan.
Working with an accredited home loan provider is what banking used to be before high-tech money management made the industry cold and impersonal. Lenders get to know non-traditional borrowers on a first-name basis and become familiar with the particulars of each situation to resolve commonplace to complex issues with good old fashioned common sense. Unconventional mortgages are underwritten by agents who are skilled at problem solving and making buying or refinancing a house seamless and headache-free. By applying fair and flexible lending principles, accredited home loans are tailored to meet borrower requirements and selected from a variety of diverse products at competitive interest rates to give borrowers a hand up and not a handout. Lenders underwrite mortgages up to $750,000 for borrowers with FICO scores of at least 650.
Most first-time homebuyers are young couples without a lot of credit. They may have student loans or car financing, but not a lengthy credit history. Accredited home loans level the playing field for borrowers who lack top FICO scores or a sufficient record of paying on time. Lenders who turn down home-buying beginners are like employers who refuse to give eager high school students their first job because of a lack of experience. The question is, "How can students get experience if no one is willing to take a chance and give them a job?" Similarly, first-time buyers cannot be expected to build good credit histories and accumulate top consumer report scores without a lender who is willing to take a chance on that first home mortgage! God is also a God of the second chance. When we fall short of His glory, He is able to save and to restore us to righeousness. "If we say that we have no sin, we deceive ourselves, and the truth is not in us. If we confess our sins, He is faithful and just to forgive us our sins, and to cleanse us from all unrighteousness. If we say that we have not sinned, we make Him a liar, and His word is not in us" (1 John 1:8-10).
Some borrowers with not-so-hot payment histories need a second chance and a willing lender to finance a home, college education, or provide retirement income. Should lenders turn high debt-to-income borrowers away? Most do. But lenders who extend accredited home loans may analyze borrowers who may have over-extended themselves in the past to assess an ability to repay. In some cases, debt ratios of as much as 50 percent are acceptable. Homeowners applying for a second mortgage are offered loans with up to 90 percent cash out, freeing funds to resolve outstanding debts or provide income retirement or funding for college. Home refinancing offers owners a chance to pay off a high-interest mortgage and get a second loan with lower interest and payment for a shorter term, usually fifteen years. Borrowers can elect to utilize accredited home loans as a ready source of cash withdrawn as needed for medical expenses, home repairs and improvements, or college tuition. Retirees can put monies to good use, saving up for the golden years without fear of relying solely on Social Security. A certain percentage of monies may be deposited into a tax-deferred retirement plan, such as an Individual Retirement Account (IRA). Currently, up to $5,000 per year may be deposited without incurring income taxes or penalties, as long as depositors do not withdraw monies before reaching the age of 59 and a half.
To locate lenders who specialize in accredited home loans, borrowers can search the Internet or local telephone directories under "Mortgage or Home Loans." Online websites will feature electronic applications to pre-qualify borrowers and gather enough information to give loan officers an accurate picture of the borrower's financial situation. Online and local lenders can check consumer credit reports from any or all of the three reporting agencies located in the United States. Applicants who are at least 18 years of age with debt-to-income ratios of fifty percent and a steady employment record will need to furnish earnings statements, income tax returns, proof of citizenship, and bank statements. Web-based applications will likely be processed within twenty-four hours and applicants approved via email or telephone. In some circumstances, lenders of accredited home loans will make allowances for borrowers with less-than-perfect credit but with stable income. Most online lenders will have a "Frequently Asked Questions" sections to help guide applicants through the process and give them an idea about how accredited home loans work. Sometimes, all it takes is a second chance lender to finance the dream of a lifetime.
Christian Home Mortgage LoanWhen getting a home mortgage loan for the very first time, the adventure can be quite rocky and even disappointing especially during these times of tightening credit and tougher scrutiny of the borrower. Easy credit for home borrowing was as plentiful as rain in Seattle and people bought houses often times way beyond their means, but the prospect of instant high profits were too much for lenders to ignore. Now subprime loans have caught up with many lending entities and the door has been slammed in the faces of many wishing to have a piece of the American dream, home ownership. Knowing what is facing a person before leaving their apartment or parent's home and buying that first house is very important in the battle against discouragement or even disillusionment.
So it's assumed that a house has been found that meets all of the reader's needs. What will the monthly payment be? A person can go online and look for a mortgage calculator to figure out the type of home mortgage loan or loans are available. How long will the stay in that house be? If it's more than ten years, consider a thirty year fixed rate. It offers the security of knowing the payment will never go up, even in hard times, and it can payoff much more quickly than thirty years by paying more on the principle each month above the regular mortgage payment. If less than ten years is expected, look at an ARM loan. But remember, that depending on where the house is located, there will be property taxes and perhaps city taxes also placed on the monthly payment and so talking to a local realtor about this is important. In addition, if less than twenty percent down is put on the property, private mortgage insurance (PMI) will be added to the monthly payment which can add up to thousands of dollars over the life of the home mortgage loan.
So after looking to see how much the real monthly payment will be, how much will the loan cost other than the interest rate, over the life of the lending agreement? The real estate section of the paper that comes out every Sunday will probably have a page just devoted to the cost of securing a home mortgage loan. That's right; a person has to pay big money for the privilege of borrowing money! The ads will mention how much down the borrower will have to put on the lending agreement as well as the current percentage rate and the points the lending agreement will cost. Each point is equal to one percent of the loan, so three points on a hundred thousand dollar lending agreement will be three thousand dollars. That money will be due at the convenience of the lender, often at closing. Depending on the home mortgage loan agreement, these points may be rolled into the mortgage of the house.
After knowing how much the monthly payment and closing costs will be, is that house still a viable option? If so, the next thing to look at is the viability of the borrower. There are two important factors going in to deciding whether a lending entity, either a banking institution or a mortgage company will loan a person the needed funds for a home mortgage loan. First is the credit score of the person or persons seeking the mortgage. This score is the result of the three main credit reporting companies putting mathematical algorithms to all late payments, the amount of days of payments past due and defaults over many years go into a person's credit score and the average American score is 620. Banks usually want to see at least 640 before speaking seriously with a borrower about a home mortgage loan, but this is not a hard and fast rule for all banking institutions. In addition, lenders are very interested in the debt to income ratio which is divided by adding all the monthly debt payments which are made by the potential borrower and the total income of the household. In most cases, the ratio must be less than forty percent so be honest when figuring the ratio out because the loan officer certainly will.
If a borrower cannot get a home mortgage loan at a bank, go to a credit union and then to a mortgage company. In each situation the interest rates and closing costs typically climb, but the disdain shown for spots on a person's credit history decline. A borrower must not give up in the quest to find money, if the house is really something someone wants or needs. Look for upfront lenders because all fees are stated at the beginning of lending discussions. "Hear me when I call O God of my righteousness; thou hast enlarged me when I was in distress; have mercy upon me and hear my prayer." (Psalm 4:1)
It is extremely important that the potential Christian borrower do a lot of research on the different types of loans and the cost each one will be to the borrower over time. Get quotes from various lenders and play them off against each other. Encourage or even challenge them to beat one another so that the best lending opportunity for the borrower is obtained. At the same time, don't fall in love with a house. Don't believe that life won't be the same without that one pile of brick and concrete because poor money decisions can easily occur from such infatuations. Remember that after about a year of living in any house, it's just another house that needs dusted and vacuumed and its flaws will be known.