Becoming a homeowner is still seen as the American Dream. However, being a first-time home buyer can be a frustrating situation. Traditional mortgages require high down payments and can be fairly difficult to qualify for.
The following is a proposal for Hertford Savings Bank, SSB to establish a loan program for First Time Homebuyers in our surrounding communities.
Proposed name of program: Hertford Savings Bank First Time Homeownership Program
Loan Program Guidelines
- Loan amount not to exceed $250,000
- Maximum financing up to 95% with no PMI
- Minimum down payment 5% (down payment can be gifted)
- Minimum buyer contribution $500.00, must show they have their own funds
- Ratios: 33% housing, 41% total debt. Can go up to 45% if no other debt
- Property: Single Family residence, townhouse or condo
- Closing cost can be gifted or seller paid
- Affordable mortgage rate: .25% below current 30-year fixed rate with 1% origination fee
- Escrows for taxes and insurance required through life of loan
- Home must be move in ready with no repairs needed. (If repairs are needed, must be completed by seller before closing).
- Borrower must not have owned a home within the past 3 years
Buyer Credit Qualifications
- 2 years employment or copy of college transcript with one-year employment with the same employer
- Student loans will not be counted in debt as long as payment is deferred at least 36 months
- Non-traditional credit sources can be utilized. Must be opened and maintained for 12 months.
- No 30-day delinquencies within the past 12 months. Derogatory credit must be explained. Collections must be paid off.