First Time Buyer

A basic guide from choosing the right purchase loans and programs for first time home buyers [California] +bonus tips about interest rates and credit scores

Chapter 1 Types of Loans 1. Conventional 2. VA 3. FHA 4. USDA A Quick DIY Basic Calulation to determine down payment (what lender pay attention too) Front end ratio Conventional = VA Back end ratio FHA *Other determining factors may be calculated by mortgage lenders California Housing Finance Agency (California) -Eligibility and Requirements Credit Scores CalHFA Loan Programs My home assistance CalHFA zero interest School teacher and employee assistance CAL-EEM+Grant program Bonus: Interest rate for 2019(subject to change) 20 yr(year) fixed rate 3.70% 15 yr fixed rate 3.90% 30 yr FHA rate 3.35% 30 yr VA rate 3.42% What Stays onYour Credit Report Negative info- 7 years Paid tax liens- 7 years Bankruptcy- 10 years Unpaid tax liens- Forever

Credit Score Cheat Sheet Pay your accounts on time. If you know you will be 30 days late call your creditors. This accounts for 36% of year total credit score. Pay down your credit card debt. Keep balances under 30% of your credit limit. Build credit at a young age. Apply for your first credit card at 18 or get added as a authorized user. Have a mature line of credit. It is best to have a mortgage, auto loan, and credit card. Category Score Excellent (13% of people) 750-850 700-749 Good (13% of people) 650-699 Fair (18% of people) 550-649 Poor (34% of people) 350-549 Bad (16% of people) For any additional information concerning mortgage loans and first time home buyers programs, please contact Coastal Lending at (562) 315-8220 or [email protected]

Conventional Mortgage Loans -Low down payment (3-5%) -Less than 20% down payment requires limited mortgage Insurance premiums -20% down payment or more requires no mortgage insurance premiums -Should have sufficient liquid assets to make a cash down payment, pay closing cost and other expenses related to the purchase of the property. -Should have two months of house payments or deposits. - Loans are made by bank or institutional lender. VA Loans (Military) -Low -Low down payment/ No down payment -No pre-payment penalty -No mortgage insurance -VA funding fee waived for veterans with disabilities or surviving spouses FHA Loan -Low credit score -Low down payment (3.5%) Depends on credit score -10% down payment for a lower credit score -Mortgage insurance is required and cannot be canceled MIP (Mortgage Insurance Premium) or UF (Up Front) MIP - Entire down payment can be a gift from a relative -Lenders set interest rate not FHA USDA Loan ( U.S. Department of Agriculture -No down payment -Eligible rural and suburban home buyers -Income limitations (vary by region) -No pre payment penalties -No premium mortgage insurance -100% purchase loan for rural areas or farming properties -Funds can be used to build, repair, renovate or relocate a home. -Front end ratio= 29% or less -Back end ratio= 41% or less -Must meet income requirements based off area medium income

(AMI) AMIX 115%=Yearly CAL FHA Programs (eligibility) -Property must be located on California or borrower primary residence until its sold or refinanced -First time home buyers, U.S. citizens, permanent residents or qualified aliens -Must meet all income and sales price requirements of the lender and mortgage insurer -Must take an approved home buyer education course and obtain a certificate of completion -Minimum credit score 640 Credit Scores -Conventional loan ~660 or higher -FHA loan ~580 or higher (money for down payment interest rate is higher) Based on lender requirements -VA loan ~ 640 or higher -USDA loan ~620 or higher CAL FHA loan programs CAL FHA Zero interest -Closing cost assistance -Provides up to 4% of total loan amount in a no interest second loan -Loan is deferred as long as you reside in home -Required to pay back in full if sold, refinanced, or title is transferred to someone else or default on loan My Home Assistance -Low to moderate income -Down payment assistance -Closing cost -Can combine My Home Assistance program with another down payment assistance or grant programs -Loans are limited to 3.5% of home purchase price or appraised sale -Loan does not need to be paid back until the home is sold, refinanced, or paid off School Teacher and Employee Assistance (teachers, public /charter school employees)

-Down payment assistance -Loans are limit to 4% of sales price or appraised value (whichever is lower) -Can combine with other FHA approved or Fannie Mae CAL- EEM + Grant Program -Energy efficient improvements grossing more than maximum allowed for FHA -Repeat home buyer and with a short term fixed rate -Combined with a grant up to 4% total loan amount -Help with down payment can be combined with My Home Assistance or Teacher Employee Assistance program About the Author The “MaMu” of real estate, as her grandson calls her, Sharnique Williams, is a native of South Carolina. Growing up in the south, at heart Mamu has always enjoyed nurturing families and individuals whether it is by giving her helping hand, knowledge, support, or comfort. For years she has worked as a leasing professional where she leased apartments. Most of her clients were first time renters. Helping smiling families brought her great joy with every approval. Within a few years Mamu transitioned to licensed Realtor in Atlanta, GA with Beccon Properties Realty where she could truly broadcast her qualities in seeing families happy in their new homes. Following her ambition she relocated to California to become a licensed Realtor with Berkshire Hathaway Luxury Homes. Inspired, she create this interactive electronic publication. A easy guide to prepare future families and individuals for first time home buying with choosing the right purchase loan and program so, love, peace and happiness, can flourish in a place they can call home.