Sep
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e speaks asked:
Looking for the best first-time buyer programs out there for mortgages - either IO 30 yr or 5/1 ARM. I have excellent credit - over 800. Looking to put zero down.
Been also looking into internet back programs such as ING Direct and I see that B of A has a no points/no closing cost program. Anyone have any experience with these as well? Would love any insight anyone has.
Thanks!
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Tags: Closing Cost, First Time Buyer, First Time Buyer Programs, First Time Buyers, Ing Direct, Insight, Loan Programs, Mortgages, Time Buyer Programs
September 27th, 2008 at 6:43 pm
Buyers Hope Program - requires sellers to pay 6,000 to program. 1st Time Buyers have 0 closing cost.
Contact a lender - some of these programs maybe state specific.
September 30th, 2008 at 10:18 am
My Community programs are good for 100% financing, but if you have 800 credit you can get a 100% loan basically anywhere with little documentation. The B of A no closing cost program and any no closing cost program for that matter are all a marketing gimmick. The rate you get will be much higher than what you qualify for so that the costs can be paid from the yield spread from giving you that higher rate. If you plan on keeping the home for more than 2-3 years you are better off paying the closing costs yourself because of the money you will save from having a lower interest rate. You might consider breaking the loan into a 1st and 2nd mortgage to avoid the PMI, but since PMI is now tax deductable it is really not that big a deal and by taking it you don’t have the 2nd mortgage at the higher rate. I am licensed in Califirnia and would be happy to help if needed.
September 30th, 2008 at 5:48 pm
Be careful with programs that claim there’s no point and fee…sometimes when you don’t pay points and fee your rate is higher or your margin is higher. In the long run you end up saving less.
October 2nd, 2008 at 1:03 am
Alright, I don’t know why you would want a 5/1 arm or I/O loan. Both of those programs are going to cost you money in the long run. My advice, is to find a broker who can shop around for you, they get better rates than banks. Second, those no points/no closing costs loans, jack up the interest rate so they get paid on the back end. It’s a scam basically, you don’t want closing costs, so your interest rate is going to be 1-2% higher, the closing costs are always there, just placed out of sight. Education is the best thing to have when taking out a loan and always shop around.
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