Buying a Home with Zero Down Payment in Irvine, CA Written by Vincent Bindi
Years ago, only person that could buy a home in Irvine with zero down payment using a new purchase money loan were Veterans of War (called a VA loan). In past several years, there has been an explosion of new loan programs designed to fit most any buyers circumstances. Today, most anyone can buy a home with zero down payment if they have sufficient income and decent credit. There are three factors that determine if you have sufficient income to purchase a home with zero down payment, and they are: Purchase price of home, Interest rates, and debt to income ratio that mortgage program requires. These three factors are interrelated as described below. The debt to income ratio is monthly mortgage payment of zero down loan, divided by your monthly gross income (not your net take home income). This ratio can vary from 35% to 50% dependent upon loan program, and your credit score. The monthly mortgage payment is determined by purchase price, current interest rates, and type of mortgage program, such as 15 versus 30 years, fixed versus adjustable interest rate, etc. There is another ratio that mortgage lenders look at which is total debt to income ratio which is too complicated to discuss here. This ratio also analysis other debts that you may have such as car payments, credit card payments, etc. You’re your credit rating is reported by three different reporting agencies called Experian (formerly TRW), EquiFAx, and TransUnion. Your rating is boiled down to a single number, called your FICO score. An excellent FICO score would be about 800 and higher, and good score is about 700 to 800, an average rating is about 600 to 700, and a poor FICO score is below 600. Some mortgage lenders even have some zero down loan programs for borrowers with poor credit ratings at somewhat higher interest payments and lower debt to income ratios.
| | UK house price increases take a summer holiday Written by Richard Green
Property website Rightmove has released its latest house price index announcing a “Summer sale” for house buyers. The report shows that on average, house prices fell by 1% over four weeks leading up to 9th July, indicating that “affordability gap” between house prices and buyers ability to purchase, is at last starting to close. The price fall has been heralded as a great boost for house buyers and an indication that fears of an expected imminent price crash may be premature.The statistics show that asking price demanded by sellers over report period fell by an average of £1,993 implying that; "Sellers are now realising they have to compromise some degree of their gains in order to sell their properties," said Miles Shipside, Commercial Director of Rightmove. The Rightmove conclusions correspond with other reports from Halifax and Nationwide Building Society. Halifax reported that annual house price inflation had fallen behind average earnings growth for first time since 2001. The new figures have lead to UK firms becoming more optimistic about economy than they were three months ago, with companies such as Lloyds TSB expecting interest rates to be cut next month, leading to a general increase in economic confidence. However indicators show that there is a long way to go to attract many first-time-buyers (FTB). Figures, based on mortgage value requests, released by financial comparison site Moneynet prior to last months slow down, gave average value of a property purchase for an FTB as £206,250, up from £194,961 two months earlier, a massive jump which could not possibly have been matched by equivalent wage increases. The recent slight price drop follows a long period of huge price increases, and with house price inflation a year ago topping 18%, equivalent to an average of £29,991, it may be some time before many FTBs feel able to enter market. A recent survey by Abbey highlights trepidation felt by FTBs with just over a third indicating that they wanted to buy a home within next year, but only 5% of these were actually confident that they would be able to. National Savings and Investments (NS&I) Senior Savings Strategist Dax Harkins said: "Despite a recent cooling house market, house prices have continued to outstrip both savings rates and incomes over last year which means potential first-time buyers need to start saving sooner and harder to get into market." Rightmove believes housing market is in for a summer where competing sellers are more likely to be flexible on prices, further improving situation for buyers. They postulate that sellers and estate agents appear to have been brought to their senses by a painful 12 months and have belatedly taken matters into their own hands by reducing prices to a level at which increasing numbers of buyers are able to proceed. The report sounds a note of caution however, stating that, “Rises in interest rates or sellers over-optimistic expectations on price could choke off any recovery however.”
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