|
FHA Plus Loan Program
If you are an active duty service member or military veteran you know you can purchase a home with zero dollars down using your Veterans Administration (VA) eligibility. That’s great, but what if you are not active duty or a veteran, having never been in the military? Is there a program that can assist you with down payment?
There is such a program for qualified homebuyers and most people are not even aware of it. It’s called the FHA Plus Loan Program. The FHA Plus loan is financed through the Virginia Housing Development Authority (VHDA), and insured by the Federal Housing Administration (FHA). It’s designed to assist qualified, credit worthy borrowers who need down payment and closing costs assistance.
The FHA Plus Loan Program would entail taking a first and second mortgage on the property. The first mortgage would be for the amount of the sales price less your down payment (if any) and the second mortgage would be for the amount of closing cost and down payment assistance you are taking.
Both mortgages would close simultaneously when you purchase the home and both payments would be due on the same date to the same loan servicer. The second mortgage is limited to the lesser value of five percent of the sales price or appraised value of the home. The term is 30 years and the interest rate for both mortgages will be slightly higher than the Virginia Housing Development Authority (VHDA) standard fixed rate home loan programs.
Both mortgages combined cannot exceed the VHDA sale price limits for your area. Currently in the Hampton Roads area the VHDA sales price limit is $352,600, but that is subject to change periodically.
Sounds great you say, but do I qualify? What are the program requirements?
- You must be first time homebuyer or have not owned a home within the last three years.
- You must complete a free, VHDA approved Homeownership Education Program. This is a one day course that will teach you the entire home buying process and it can be completed in person or online.
- Income limitations apply. For a household of no more than two persons the current gross annual income limit is $63,000 and for a household of three or more persons the current limit is $73,000.
- You must have cash available equal to at least one percent of the sales price.
- The total monthly house payment (principal and interest, plus 1/12th of the real estate taxes, hazard insurance and mortgage insurance) should not exceed 32% of your gross monthly income. In addition, the total monthly house payment plus any additional monthly debt owed (car payments, charge cards, child support payments) should not exceed 40% of your gross monthly income.
- You must provide the previous three years tax returns.
- Your net worth cannot exceed 50% of the sales price (some assets not included).
- You must intend to occupy the property as your primary residence and it cannot be used as part of a trade or business.
- Normally, lot sizes are limited to two acres, but a waiver may be granted for lots up to five acres.
For more information on the FHA Plus Loan Program, you can contact any FHA approved lender. I recommend contacting Deborah Bruno with Wells Fargo Home Mortgage. You can contact Deborah by calling 757-222-1428 or by email at Deborah.E.Bruno@wellsfargo.com.
Energy Efficient Tax Credits, Mortgages & Incentives
In an era of "global warming" and "green products" that are better for the environment, many homeowners are taking advantage of available savings, tax credits and specialized mortgages that encourage energy efficiency. Some homeowners may not be aware of these incentives so I wanted to list some of them here with a brief description and links to more information.
You can get Federal Tax Credits for certain energy efficient upgrades. The idea here is that although these products will save you money in the long run, the initial costs to install them are typically more expensive than less efficient products. The Federal Tax Credits help you offset that initial sticker shock and help you save even more money in the long run.
For “existing homes only”, a Federal Tax Credit of 30% of the cost, up to $1,500 for the years 2009 and 2010 is available for the installation of certain “Energy Star” rated windows, doors, insulation, metal and asphalt roofs, heat & air conditioning systems, non-solar water heaters and biomass stoves.
Also, available for “new or existing homes”, is a Federal Tax Credit of 30% with no upper limit for the installation of certain “Energy Star” rated geothermal heat pumps, solar panels, solar water heaters, small wind energy systems, and fuel cells. The credits in this category are available through 2016.
I recommend that before you purchase any energy efficient products that you do some research to make certain the products you wish to purchase are available for the tax credits.
For more information on these and other available tax credits, click here.
Energy Improvement Mortgages (EIM) give borrowers the opportunity to finance cost-effective, energy-saving measures as part of a single mortgage when purchasing a home that is not yet rated as energy efficient. These loans stretch debt-to-income qualifying ratios thereby allowing borrowers to qualify for a larger loan amount and a more energy-efficient home.
An Energy Efficient Mortgages (EEM) is typically used to purchase a new home that is already energy efficient such as an Energy Star qualified home. These loans also stretch debt-to-income qualifying ratios to allow borrowers to get a larger loan.
To get one of these loans a borrower typically has to have a Home Energy Rater conduct a home energy rating before financing is approved. This rating verifies for the lender that the home is energy-efficient.
Sellers can also take advantage of these loans. In a world where consumers are becoming increasingly concerned about the earth, not to mention their monthly utility bills, a Seller can have his/her home rated before placing the home on the market. If upgrades are required to get an official rating he/she can complete the upgrades prior to selling and advertise the home as an energy efficient home available for an Energy Efficient Mortgage. This can increase the property value and may likely result in a quicker sale.
To learn more about these loans you can visit the Energy Star Website or visit this Energy Efficient Mortgage Homeowner Guide. You can also contact your local lender, the Veterans Administration (VA) or the Federal Housing Administration (FHA) as these types of loans are sponsored by Fannie Mae, Freddie Mac, VA and FHA.
Did you know that Virginia Natural Gas provides their customers a free programmable thermostat or a $25 rebate on the programmable thermostat of their choice because heating expenses can be better controlled with a programmable thermostat.
They also have a Low-Income Weatherization Program where they have partnered with state certified weatherization agencies to provide cost effective energy efficiency measures for customers with an income at or below 175% of the federal poverty level.
Virginia Natural Gas will also provide High Efficiency Natural Gas Equipment Rebates of up to $500 on efficient home heating and water heating products.
For more information on these incentives click here!
|
In This Issue
FHA Plus Loan Program
&
Energy Efficient Tax Credit, Incentives & Mortgages
View all My Listings
Search the Entire MLS
Request a Market Analysis on Your Home
Virginia Beach-Woodstock
4BR, 2.5BA, 3266 SqFt
$590,000
Waterfront-Elizabeth River
Deeded Boat Slip & Lift!
Chesapeake-Norfolk Highlands
3BR, 1BA 1430 SqFt
$150,000
Fixer Upper!
Chesapeake-Heritage Point
4BR, 2.5BA, 2300 SqFt
$270,000
Family Neighborhood
Must Sell!
Chesapeake-Riverwalk
3BR, 2.5BA, 2446 SqFt
Cul-de-Sac Lot
Under Contract!
Chesapeake
Woodlake Forest
3BR, 2BA, 1092 SqFt
Cul-De-Sac Lot
Sold!
|
