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A: Why use a Connecticut Mortgage Broker?
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3. Mortgage Process >>
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Assume total out of pocket expenses with a FHA Connecticut home loan is $5345 (including down payment). At the closing, the seller pays the Non Profit Organization: $6,000. The Non Profit gifts you: $5,000.
Total out of pocket from you would be $345 The seller still gets the agreed upon sales price of $94,000. If the total out of pocket expense for the FHA Connecticut home loan was $5,000, you would have to bring $0 to close. This is a true no money out of pocket option!
Loans:
Some loans are acceptable for the down payment and acquisition cost. The one thing that all of the loans have in common is, they are all collateral debt (a loan that is secured against an item of value). The following are acceptable loans:
401K:
Taking a loan against your 401K is an acceptable source of funds. With many CT mortgage programs, the payment you will incur after taking this loan is not used as a debt for qualifying purposes.
HELOC:
A home equity line of credit is an acceptable source of funds. This also assumes you already own a home.
Cash on Hand:
Cash on hand, (commonly referred to as “mattress money”), is not typically a usable source of funds. The only typically acceptable way to use cash on hand is with an FHA Connecticut home loan. The only stipulation is that you have to show that you do not believe in bank accounts. This is typically proven if you do not have an account at all. The best way to use cash on hand is to deposit it in a bank and wait 90 days.
Grants:
Some programs do accept grants as a source of cash to close. We recommend if you find a grant program, use one of the lenders recommended by the organization offering the grant
Credit and Loan Programs
Credit plays a vital role in your down payment and CT mortgage rate options available to you. Please keep in mind that there are exceptions to every rule and that the guidelines here are only an outline, not the rule.
FHA:
Credit qualification for an FHA Connecticut home loan is not quite as strict as the other options available. The standard guideline for an FHA Connecticut home loan is simply no late payments for the past 12 months. Any type of open collection (still has a balance), charge off, or judgment is considered an active late payment until you satisfy the debt (the exception is medical bills. Typically these are overlooked for FHA in qualification, yet you will still be required to settle them prior to closing). They also want
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