The recent credit tightening due to the “credit crisis” in the U.S. has seen thousands of mortgage companies go out of business and so many loan programs no longer available.  145 mortgage licenses were cancelled in the state of Virginia just last month.  Below I put together a list of programs that are still available.  Over time I expect we will see more creative mortgages become available, maybe never to the extent that we witnessed a couple of years ago, but definitely more than the current loan options.

FHA and Down Payment Assistance program
The sub prime market is virtually non-existent.  FHA, which was barely used in recent years, is now a vital outlet for borrowers.  Flexible guidelines, little money needed, and recently raised loan limits…  It is almost the only option for borrowers with lower credit scores and/or very little money saved.

FHA can also serve to get a borrower into a home with no down payment at all and no money for closing costs at settlement.  It involves the Down Payment Assistance program which is a gift from the Seller.  In this market with so much inventory available, it is not difficult to find a Seller willing to pay this gift and all closing costs for the borrower.

VA
For veterans and military personnel, this is probably the best option out there if you are eligible.  100% financing is available at a great market rate.   No mortgage insurance is required, which keeps the total payment very low for a $0 down mortgage.

GRH USDA
Guaranteed Rural Housing program is available for properties in rural areas.  No MI (mortgage insurance) is required on this loan either.  Current maximum loan amount is the conforming limit of $417,000.

OFFICER NEXT DOOR | OND
Police Officer next door program is made available by HUD so law enforcement may purchase a Hud home at half price.  If the police officer uses fha financing for this purchase he/she will only need a downpayment of $100 and can finance the closing costs into the loan.

TEACHER NEXT DOOR | TND
This works like the above Officer Next Door program.  Contact us for a list of Hud homes in your area and to get preapproved for the fha mortgage.

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NO CLOSING COST REFINANCE
Yes, rates are still low enough where a no closing cost refinance still makes sense.  Many borrowers can lower their rate slightly not pay any closing costs.  No, closing costs are not “rolled” into the new loan.  These programs do offer a slightly higher rate, and that is how the lender is able to pay these actual costs for you.

MY COMMUNITY
The My Community program was extremely popular just a short while ago.  As the market changed this program was still available but Mortgage Insurance companies were no longer underwriting them at 100% financing.  The bare minimum went to 5% down.  The mortgage insurance can be expensive with this program and right now it makes sense to go FHA instead in most cases.

INTEREST ONLY
Interest only loans are still available.  They received such an undeserved bad stigma once the market changed for the worse.  It was 100% financing combined with a 2 year adjustable rate, combined with the option to pay interest only…  that led to so many borrowers not being able to afford their homes when 2 years was up.  It’s when homes stopped appreciating that these loans blew up on lenders.  They can still make a lot of sense for borrowers who understand them.  The borrower is still allowed to make a fully amortized payment on these loans.

ARM
Adjustable Rate mortgages are still popular and still a great option to a higher fixed rate.  The most popular currently are the 3 year and 5 year ARM’s.  There isn’t enough spread between the 7 and 10 year arms and a fixed rate.  An ARM is also available through fha.  The caps are usually 1/1/5.  Conventional arms caps are typically 2/2/6.

HELOC
Home Equity Line of Credit, also known as a Home Equity Loan… is a second mortgage.  The most popular are tied to the Prime Rate.  Whenever prime changes, your rate will change.  This option is called a “heloc”.  The other option is a fixed rate second, which offers a higher fixed rate.  You have to borrow the whole amount at once and make payments based on it.  A Heloc is so advantageous because you can get a 100k line, but only take out what you need.  This way your payments are only based on your outstanding balance.  You also have the option to pay interest only, which makes your payment incredibly low.  It’s usually a tax write-off and it makes sense to use it to pay off any higher rate debt you may have.

REHAB
Rehab loans are set up a lot like construction loans and usually offer a 6 month construction term where you can make interest-only payments.

CONSTRUCTION
Financing when you have the land and want to build a home.  Construction phase is usually interest only, and then converted to a permanent rate at completion.

MULTI UNIT
Whether it’s a 3 unit Multi-family dwelling or a 50 unit apartment building, we can help you with the financing.  If it’s 5+ units, make sure you complete the commercial application and then the standard 1003. Both are needed.

REVERSE MORTGAGE

FORECLOSURE BAIL OUT
You will need a minimum of 30% equity for us to help.