WEBVTT - Study Hall: FINANCING FOR FIRST TIME HOME BUYERS 0:00:00.400 --> 0:00:04.280 You just realized your business needed to hire someone yesterday. 0:00:04.800 --> 0:00:09.520 How can you find amazing candidates fast? Easy? Just use Indeed. 0:00:09.960 --> 0:00:12.680 Stop struggling to get your job posts seen on other 0:00:12.760 --> 0:00:16.439 job sites. With Indeed sponsored jobs, your post jumps to 0:00:16.480 --> 0:00:19.040 the top of the page for your relevant candidates, so 0:00:19.120 --> 0:00:22.119 you can reach the people you want faster. According to 0:00:22.160 --> 0:00:26.120 Indeed data, sponsored jobs posted directly on Indeed have forty 0:00:26.120 --> 0:00:30.040 five percent more applications than non sponsored jobs. Don't wait 0:00:30.080 --> 0:00:33.519 any longer. Speed up your hiring right now with Indeed, 0:00:33.960 --> 0:00:36.200 and listeners of this show will get a seventy five 0:00:36.280 --> 0:00:39.440 dollars sponsored job credit to get your jobs more visibility 0:00:39.600 --> 0:00:45.320 at indeed dot com slash pod Katz thirteen. Just go 0:00:45.360 --> 0:00:50.120 to Indeed dot com slash pod Katz thirteen right now 0:00:50.479 --> 0:00:53.040 and support our show by saying you heard about Indeed 0:00:53.080 --> 0:00:57.400 on this podcast. Terms and conditions apply. Hiring Indeed is 0:00:57.440 --> 0:00:58.240 all you need. 0:00:58.960 --> 0:01:02.360 So welcome university. Like I said, my name is Matt 0:01:02.400 --> 0:01:05.000 Garland and I'm Les's number five A seven zero zero, 0:01:05.200 --> 0:01:07.520 better known as MG the Mortgage God. Today we're going 0:01:07.600 --> 0:01:11.320 to talk about first time home buyers. So let's get started. 0:01:11.440 --> 0:01:13.479 Most people always ask me, yo, Matt, what I need 0:01:13.520 --> 0:01:15.440 to get started to be a first time home buyer 0:01:15.520 --> 0:01:18.560 or to buy a house. Everything starts with your mindset. 0:01:18.760 --> 0:01:21.520 I say this all the time. Right, you have to 0:01:21.520 --> 0:01:25.400 be prepared for home ownership, So ask yourself these questions 0:01:25.480 --> 0:01:27.280 or your first time home buyers. Are you ready for 0:01:27.360 --> 0:01:32.520 home ownership? What are your real estate goals? Okay? Do 0:01:32.600 --> 0:01:36.000 you have the capital? Meaning do you have money? Right? 0:01:36.120 --> 0:01:40.080 Most people want to be house rich and cash poor. 0:01:41.319 --> 0:01:43.880 Never be house rich in cash for cash poor. I 0:01:43.880 --> 0:01:46.400 don't care if you're getting one hundred percent financing. I 0:01:46.400 --> 0:01:49.400 don't care if you're getting any home buyer grants. It 0:01:49.440 --> 0:01:52.520 doesn't matter to me. You need to have some money saved. 0:01:52.840 --> 0:01:56.880 How soon do you want to close? Have realistic expectations 0:01:56.880 --> 0:01:59.040 on your time frame? Check out if you have a 0:01:59.080 --> 0:02:02.200 current lease one does that least expire? If you're living 0:02:02.280 --> 0:02:05.200 at home, how's that situation working out? Whatever the case 0:02:05.240 --> 0:02:09.359 may be, have a realistic expectation for when you want 0:02:09.400 --> 0:02:12.959 to close on your home. And number most importantly, are 0:02:13.040 --> 0:02:18.960 your documents organized? This is key? Okay, keep your documents 0:02:19.040 --> 0:02:20.840 organized every time. If you know you're going to buy 0:02:20.840 --> 0:02:24.600 a house, you know, create a file, create a drop box, 0:02:24.720 --> 0:02:27.560 a Google docs you know, start putting your pay stubs there. 0:02:27.600 --> 0:02:30.640 Every time you get an updated bank statement, put your 0:02:30.680 --> 0:02:33.799 bank statements in a file. You're doing, you get your 0:02:33.880 --> 0:02:37.440 W tools, you're doing your taxes, you know, upload that 0:02:37.560 --> 0:02:40.200 into a file and call a file like home ownership 0:02:40.200 --> 0:02:43.120 file or something like that, and just start putting together 0:02:43.639 --> 0:02:46.840 all your documentations so that way you guys are prepared 0:02:47.960 --> 0:02:52.560 all right now, speaking of documentation, what do you need 0:02:53.000 --> 0:02:57.160 to start the pre approval process? While you need your 0:02:57.200 --> 0:02:59.679 last two years of W tools because we need to 0:02:59.720 --> 0:03:03.640 show two year work history, last two years tax returns, 0:03:04.320 --> 0:03:07.440 and really you want to provide tax returns if you're 0:03:07.480 --> 0:03:12.600 self employed, if you have any rental income that you're collecting, 0:03:13.480 --> 0:03:16.440 if you file like a ten ninety if you get 0:03:16.480 --> 0:03:19.600 paid ten ninety nine, maybe you an uber driver or 0:03:19.760 --> 0:03:23.639 a lift driver, a hairstylist, a barber, you know, anything 0:03:23.680 --> 0:03:26.280 that you get like maybe you sell affiliate links, you 0:03:26.320 --> 0:03:31.920 got digital marketing, online marketing sales, whatever you do right 0:03:32.000 --> 0:03:34.000 that you get a ten ninety nine from and if 0:03:34.080 --> 0:03:36.800 you file on your taxes, I need to see your 0:03:36.840 --> 0:03:40.480 last two years of self employed ten ninety nine independent 0:03:40.520 --> 0:03:45.120 contractor is considered self employed, So please remember that last 0:03:45.120 --> 0:03:48.240 thirty days of pay stubs. Very key. So we need 0:03:48.240 --> 0:03:50.800 thirty days full pay stubs. If you get paid weekly, 0:03:50.880 --> 0:03:53.360 we need four pay stubs. If you get paid by weekly, 0:03:53.440 --> 0:03:56.520 we need two pay stubs, all right. Last two months 0:03:56.520 --> 0:04:00.480 are your bank statements or any assets that you are 0:04:00.600 --> 0:04:03.120 using for the transaction. So if you're borrowing money from 0:04:03.120 --> 0:04:06.000 a four to one K, we need the last quarter 0:04:06.160 --> 0:04:10.240 statement they if you using your checkings and your savings account, 0:04:10.440 --> 0:04:13.240 we need your last two months of your bank statements. Now, 0:04:13.280 --> 0:04:16.160 those bank statements we need all pages. So now if 0:04:16.160 --> 0:04:18.080 you know, if you look at your bank statements, it 0:04:18.120 --> 0:04:21.240 may say page one to ten, right, and if that 0:04:21.360 --> 0:04:25.799 tenth page is intentionally left blank, underwriting will still need 0:04:25.839 --> 0:04:30.200 that tenth page, all right. So although it's blank, once 0:04:30.360 --> 0:04:33.400 underwriting seas one of ten and we only provided none, 0:04:33.640 --> 0:04:36.479 we need to see the ten all right, even if 0:04:36.520 --> 0:04:39.400 it's blank. I know it's stupid, but that's just the rules, 0:04:39.600 --> 0:04:43.240 all right. Copy of valid ID. If you are getting 0:04:43.279 --> 0:04:46.000 any gifts. You can get gifts from a family member 0:04:46.120 --> 0:04:48.920 or close friend, we need a copy of the gift letter, 0:04:49.279 --> 0:04:53.719 all right, and we need to a complete it. Loan application. Now, 0:04:53.760 --> 0:04:57.760 if I'm your lender, then Obviously, I'll send you that 0:04:58.400 --> 0:05:01.680 online loan application, but any bank you go to, you're 0:05:01.720 --> 0:05:06.159 going to have to complete an online loan application, the 0:05:06.200 --> 0:05:10.800 pre approval process, let's go through it. So choosing a 0:05:10.880 --> 0:05:15.479 lender very important, guys. And I want to say this 0:05:16.839 --> 0:05:21.600 not trying to bash any of my fellow lenders, mortgage brokers, bankers, 0:05:21.640 --> 0:05:25.920 because that's not the purpose of my content. For at least, 0:05:25.960 --> 0:05:29.760 I try to encourage my entire industry. But you want 0:05:29.760 --> 0:05:32.600 to make sure you don't pick a linda just because 0:05:32.640 --> 0:05:36.520 you have a quote unquote banking relationship with that lender, 0:05:36.640 --> 0:05:38.800 meaning you have your checking account there, you have your 0:05:38.800 --> 0:05:42.000 savings account. You really need to be interviewing the loan 0:05:42.040 --> 0:05:45.400 officer someone like myself because you're not doing business with 0:05:45.560 --> 0:05:48.159 the bank per se. You're doing business with the person 0:05:48.200 --> 0:05:52.240 that's in my chair, right, So you have to make 0:05:52.279 --> 0:05:56.520 sure that that loan officer him or her understands your 0:05:56.600 --> 0:05:59.920 real estate goals completely because your first deal can set 0:05:59.920 --> 0:06:03.200 you up for your tenth deal. But it's very important 0:06:03.279 --> 0:06:06.240 on how you execute your first deal, on how this 0:06:06.320 --> 0:06:08.640 is all going to play out, all right, So make 0:06:08.680 --> 0:06:11.840 sure your loan officer understands your real estate goals is 0:06:11.920 --> 0:06:15.279 number one. Number two, does your loan officer have a 0:06:15.320 --> 0:06:18.640 support team? Very important, especially in times right now where 0:06:18.680 --> 0:06:22.560 you have interest rates at all time lows. You want 0:06:22.560 --> 0:06:24.960 to make sure that loan officer is not a one 0:06:25.000 --> 0:06:28.200 man band, so to speak, because you still don't want 0:06:28.240 --> 0:06:31.000 your service levels to drop off just because they're busy. 0:06:31.360 --> 0:06:34.520 You still want communication, So make sure they have some support, 0:06:34.960 --> 0:06:38.560 whether they have assistance processes. These are questions you need 0:06:38.600 --> 0:06:41.960 to you need to ask, you need to interview, and 0:06:42.240 --> 0:06:44.640 how many years of experience that they have. Now this 0:06:44.760 --> 0:06:46.919 is not a not to any of my new beasts, 0:06:47.279 --> 0:06:54.680 right but when you're dealing with experience professional, you can 0:06:54.839 --> 0:06:57.240 make sure. You have to make sure that they really 0:06:57.360 --> 0:06:59.600 understand it goes in and they have a track history 0:07:00.200 --> 0:07:04.840 of helping people accomplish their goals. So most of the time, obviously, 0:07:04.839 --> 0:07:07.280 if you're dealing with someone who's new, they may not 0:07:07.360 --> 0:07:09.240 have that experience, but they may be able to give 0:07:09.240 --> 0:07:11.200 you all the time in the world that you need 0:07:11.560 --> 0:07:15.800 versus someone like myself who may be experienced. All right, 0:07:16.480 --> 0:07:19.880 but I always recommend work with experience loan officer because 0:07:19.880 --> 0:07:22.200 they have a track history of closing deals. Because the 0:07:22.280 --> 0:07:25.880 name of the game is closing. ABC always be closing, 0:07:26.800 --> 0:07:30.080 all right. So the pre approval process the next steps 0:07:30.160 --> 0:07:33.080 after you choose your linda, after you discuss your goals, 0:07:33.080 --> 0:07:35.680 you got to run your credit and review your income documents. 0:07:35.680 --> 0:07:39.480 That's what I do, right, determine what mortgage programs you 0:07:39.600 --> 0:07:43.160 qualify for. Now, I'm going to keep it right there 0:07:43.200 --> 0:07:46.840 for a second. Determine which mortgage programs you qualify for 0:07:47.280 --> 0:07:50.040 is very important. There's a ton of programs out there, 0:07:50.040 --> 0:07:52.960 but sometimes linders only want to give you one option. 0:07:53.760 --> 0:07:57.120 Make sure that you guys are asking the lenda to 0:07:57.160 --> 0:08:00.200 provide you all the options that you qualify for for 0:08:00.720 --> 0:08:05.920 whether it's a conventional mortgage faha mortgage, whether it's thirty 0:08:05.960 --> 0:08:09.160 year fixed, twenty year fix, whatever it is. That way 0:08:09.200 --> 0:08:13.520 you can see the full picture. And always always always 0:08:13.560 --> 0:08:19.360 remember there's a big difference between eligibility and affordability. Just 0:08:19.440 --> 0:08:23.680 because of bank or lender or broker will approve you, 0:08:24.120 --> 0:08:27.880 it does not mean you can afford that mortgage, So 0:08:28.120 --> 0:08:32.640 choose wisely. Banks and loan offices like myself, we are 0:08:32.679 --> 0:08:35.440 in the business to make loans and to sell money. 0:08:36.120 --> 0:08:38.400 We will tell you your goals. We will tell you what 0:08:38.520 --> 0:08:40.520 you have to do to accomplish your goals. We'll tell 0:08:40.559 --> 0:08:42.920 you what you qualify for, we will close your loan. 0:08:43.360 --> 0:08:45.440 But guess what, at the end of the day, you 0:08:45.480 --> 0:08:49.520 are responsible for that mortgage payment. So please, please, guys, 0:08:50.400 --> 0:08:53.920 it is very difficult. One of the scary things about 0:08:54.320 --> 0:08:58.840 low interest rates is that it is so much easier 0:08:58.880 --> 0:09:03.840 to overleverage because money is cheap, and now you might 0:09:03.920 --> 0:09:07.800 bite off more than you can chew. Because let's just say, 0:09:07.920 --> 0:09:10.800 for example, when the rates are higher, you may like 0:09:10.920 --> 0:09:13.720 four percent, right, you may only be able to be 0:09:13.760 --> 0:09:16.560 pre approved for four hundred thousand, But now at rates 0:09:16.600 --> 0:09:19.920 are two point seventy five three percent, you can probably 0:09:19.920 --> 0:09:22.520 get five hundred and fifty thousand, you know what I'm saying, 0:09:22.960 --> 0:09:26.080 because of that dipping interest rates. So the very scary 0:09:26.440 --> 0:09:33.280 thing about low interest rates is that people tend to overleverage. 0:09:34.000 --> 0:09:37.560 Don't over leverage, guys, don't bite off more than control. 0:09:37.640 --> 0:09:39.920 This is probably the most important thing that I can 0:09:39.960 --> 0:09:43.040 tell you, especially we got elections coming up, We have 0:09:43.440 --> 0:09:46.760 so many we got the Corona disease, we have so 0:09:46.880 --> 0:09:49.880 many things. Stock market going crazy right now, we have 0:09:49.960 --> 0:09:52.840 so many different things that are happening that no one 0:09:52.920 --> 0:09:56.520 knows if and when a recession will come. So over 0:09:56.640 --> 0:09:59.520 leveraging is a very scary thing, and that's something that 0:09:59.559 --> 0:10:02.560 I'm paying attention to when I'm when I'm having consultations 0:10:02.559 --> 0:10:05.680 with clients. So but it's your responsibility. You guys are 0:10:06.200 --> 0:10:09.280 are adults at the end of the day. So you 0:10:09.400 --> 0:10:12.440 got a man and woman up and make sure you know, 0:10:12.679 --> 0:10:15.400 just because the bank can approve you for a mortgage 0:10:15.480 --> 0:10:18.800 doesn't mean you can afford it. So sorry for the rent, 0:10:18.800 --> 0:10:21.160 but I had to go there, all right. So now 0:10:21.200 --> 0:10:24.040 after you discuss your terms for these programs, interest rates, 0:10:24.080 --> 0:10:26.959 closing course, et cetera. Now you're pre approved and you're 0:10:27.000 --> 0:10:30.360 ready to shot, all right, So let's just give you. 0:10:30.400 --> 0:10:33.760 I'm gonna give you a quick snapshot now of the 0:10:33.800 --> 0:10:39.640 blown programs and what's what you need to qualify for them. Now, 0:10:39.800 --> 0:10:41.800 mind you, this is not a commitment for me to 0:10:41.880 --> 0:10:43.760 lend to you, all right, I'm just giving you a 0:10:43.800 --> 0:10:48.640 snapshot of the programs. For FAHA and FAHA two or 0:10:48.640 --> 0:10:52.000 three K, your minimum credit scores a five eighty minimum 0:10:52.040 --> 0:10:55.200 down payment is three point five percent of the purchase price. 0:10:56.880 --> 0:11:00.679 The max seller's concession allowed is six percent. Now for 0:11:00.720 --> 0:11:04.520 those of you who don't know. A seller's concession is 0:11:04.559 --> 0:11:08.920 when a seller pays agrees to pay a portion of 0:11:09.120 --> 0:11:17.679 the closing course. Sorry had the text home, is when 0:11:17.720 --> 0:11:20.040 a seller agrees to pay a portion of a closing course. 0:11:20.559 --> 0:11:23.240 So ultimately, at the end of the day, let's say 0:11:23.280 --> 0:11:25.920 say if the sales price is one hundred K, then 0:11:26.040 --> 0:11:29.520 six percent is six thousand that the seller will agree 0:11:29.600 --> 0:11:34.040 to pay for. FAHA allows one to four family properties, 0:11:34.400 --> 0:11:37.960 FAHA approved condos and mixed use properties. Now, for those 0:11:37.960 --> 0:11:40.880 of you who don't know what mixed use properties are, 0:11:42.400 --> 0:11:45.439 a mixed use property is typically when a commercial property 0:11:45.440 --> 0:11:49.000 when you have residential on the top and commercial on 0:11:49.040 --> 0:11:52.720 the bottom. Right, FAHA will allow you to purchase this 0:11:52.880 --> 0:11:56.520 property as long as the total units don't total more 0:11:56.559 --> 0:11:59.840 than four total units and the residential square footage is 0:12:00.040 --> 0:12:04.040 at least fifty one percent of the square footage of 0:12:04.080 --> 0:12:06.880 the building. All right, So for those of you who 0:12:07.080 --> 0:12:10.120 are running your own business, maybe you have a restaurant, 0:12:10.240 --> 0:12:13.680 a bar, you know, you have some sort of sales 0:12:13.720 --> 0:12:16.679 business and you need a brick and mortar location. This 0:12:16.720 --> 0:12:20.840 can be ideal for you if someone if someone doesn't 0:12:20.880 --> 0:12:24.480 have that business, remember written out to commercial clients. The 0:12:24.480 --> 0:12:26.600 rent is probably going to be more expensive than a 0:12:26.640 --> 0:12:29.319 residential so that can be a good opportunity for you 0:12:29.440 --> 0:12:31.880 to look for, all right, and they will allow you 0:12:31.920 --> 0:12:33.480 to do it with three and a half percent down. 0:12:33.960 --> 0:12:37.840 Your max loan amounts is based on the FAHA county 0:12:38.040 --> 0:12:41.839 loan limits. Now, only thing you have to do if 0:12:41.840 --> 0:12:44.760 you want to know what your FAHA county loan limits are, 0:12:45.480 --> 0:12:49.719 google FAHA county loan limits for whatever county you live 0:12:49.760 --> 0:12:52.520 in and they'll tell you from one to four family 0:12:53.000 --> 0:12:56.760 what the max loan amount is. FAHA office fixed and 0:12:56.760 --> 0:13:01.320 adjustable and adjustable mortgage rates, and f is only for 0:13:01.480 --> 0:13:04.400 primary residents. I wish I could zoom in on this 0:13:04.520 --> 0:13:10.520 camera right now. Primary residence only. Okay, it's not for 0:13:10.559 --> 0:13:13.880 investment properties. You cannot use your LLC to purchase the 0:13:14.000 --> 0:13:17.800 FAHA purchase the house using the FAHA loan. You can't 0:13:17.840 --> 0:13:22.160 put the mortgage, the FAHA mortgage in your LLC. No, no, no, 0:13:22.160 --> 0:13:27.680 no no. It is only for primary residents only. FAHA 0:13:27.880 --> 0:13:32.319 does require a one year occupacy right, so that means 0:13:32.320 --> 0:13:34.160 you have to live in that property for at least 0:13:34.200 --> 0:13:37.360 twelve months, all right, and then if you want to 0:13:37.360 --> 0:13:40.760 rent out you can. I just wanted to make that 0:13:40.800 --> 0:13:43.720 clear because I get a lot of questions about that. 0:13:45.679 --> 0:13:48.320 Let's move on to another program, conventional loans. You have. 0:13:48.920 --> 0:13:52.880 This is the ideal programs for conventional loans where you 0:13:52.880 --> 0:13:55.400 can put down at least three percent down payment. You 0:13:55.520 --> 0:13:59.040 have Fanny Made Home Ready, Freddie Mac Home Possible. You 0:13:59.080 --> 0:14:02.000 need a minimum of a twenty credit score. The down 0:14:02.000 --> 0:14:04.440 payment could be between three and twenty five percent of 0:14:04.480 --> 0:14:08.959 the purchase price max three percent selless concession is allowed. 0:14:09.360 --> 0:14:12.640 One to four families and Fanny May Approve condos are allowed. 0:14:12.920 --> 0:14:14.920 The max loan amounts is based on the Fandy May 0:14:14.960 --> 0:14:17.720 loan limits or again, just google Faning May Loan limits 0:14:17.720 --> 0:14:20.080 and they will tell you the loan limits for your area. 0:14:20.240 --> 0:14:25.600 Fixed or adjustable rates, interest rates, primary residents, second homes, 0:14:25.600 --> 0:14:32.080 and investment properties are allowed with Fanny May with conventional loans. Now, 0:14:33.000 --> 0:14:34.560 let's I'm gonna do a little bit of deep dive 0:14:34.600 --> 0:14:38.680 into this one. So one to fourth family they do allow, 0:14:39.520 --> 0:14:42.960 but Fanny May Home Ready. If you're buying a two 0:14:43.040 --> 0:14:47.200 to four family or duplex, triplex aquad like some folks 0:14:47.280 --> 0:14:50.880 call it, then you will have to put down fifteen 0:14:50.960 --> 0:14:54.840 percent even if it's on the occupied and if it's 0:14:54.840 --> 0:14:58.400 an investment property, you have to put down twenty five percent. 0:14:59.040 --> 0:15:03.040 With Freddie mac Home Possible, you can potentially put down 0:15:03.120 --> 0:15:07.400 five percent on a duplex, triplex quad But with any 0:15:07.480 --> 0:15:12.760 of these programs, they are income based programs, so we 0:15:12.800 --> 0:15:15.120 would have to determine basically, and you can just probably 0:15:15.120 --> 0:15:19.760 google it right go to Google freddiemac Home Possible income 0:15:19.840 --> 0:15:22.920 limit and then there'll be a map that will come 0:15:23.000 --> 0:15:26.680 up and you punching your address or the zip code 0:15:26.640 --> 0:15:29.280 of where you're looking to buy, and then the system 0:15:29.320 --> 0:15:33.200 will tell you the maximum income you can make to 0:15:33.240 --> 0:15:36.560 be qualified for this loan. So they use eighty percent 0:15:37.080 --> 0:15:41.040 of the AMI. The AMI stands for Area Media income. 0:15:41.120 --> 0:15:44.920 So let's just say, for example, the AMI is one 0:15:45.040 --> 0:15:49.640 hundred thousand dollars of income. They only use eighty thousand 0:15:49.680 --> 0:15:52.920 income to qualify, So if you make eighty five thousand dollars, 0:15:53.120 --> 0:15:57.120 you automatically don't qualify for this program. Another thing I 0:15:57.160 --> 0:15:59.160 want to tell you guys about this if you're using 0:16:00.120 --> 0:16:03.080 a if you're losing a conventional loan you want to 0:16:03.080 --> 0:16:06.320 buy a multi family, if you are a first time 0:16:06.400 --> 0:16:10.600 home buyer, conventional loans will not allow you to use 0:16:10.640 --> 0:16:14.800 rental income to help you qualify. Let me repeat that, 0:16:15.000 --> 0:16:18.360 if you are a first time home buyer, conventional loans 0:16:18.400 --> 0:16:23.280 will not allow you to use potential rental income from 0:16:23.320 --> 0:16:27.200 those units to help you qualify for the mortgage. The 0:16:27.240 --> 0:16:29.960 only program right now that will allow a first time 0:16:30.000 --> 0:16:33.160 home buyer to use rental income to help you qualify 0:16:33.520 --> 0:16:38.520 is an FAHA loan. All right. FAHA will lose seventy 0:16:38.560 --> 0:16:43.200 five of the gross rental income from those apartments to 0:16:43.280 --> 0:16:46.200 help you qualify. So let's just say you're collecting one 0:16:46.200 --> 0:16:49.480 thousand dollars a month in rent. FHA will use seven 0:16:49.520 --> 0:16:53.480 hundred and fifty dollars to help you qualify. Now, this 0:16:53.520 --> 0:16:55.600 is what I want to tell all your first time 0:16:55.600 --> 0:17:00.280 home buyers. These guidelines for conventional just changed at the 0:17:00.360 --> 0:17:03.280 end of twenty nineteen. I have a video on my 0:17:03.360 --> 0:17:06.000 YouTube page mg DE Mortgage God. You can go check 0:17:06.040 --> 0:17:10.560 that out too, but basically stayed in these new guidelines. 0:17:11.240 --> 0:17:15.199 When you see programs starting to change guidelines like this, 0:17:15.359 --> 0:17:19.119 that means at some point everyone changes their guidelines to 0:17:19.200 --> 0:17:20.280 kind of match with the other. 0:17:21.640 --> 0:17:23.879 This episode is brought to you by P and C Bank. 0:17:24.280 --> 0:17:27.040 A lot of people think podcasts about work are boring, 0:17:27.240 --> 0:17:31.080 and sure they definitely can be, but understanding of professionals 0:17:31.160 --> 0:17:34.439 routine shows us how they achieve their success little by little, 0:17:34.800 --> 0:17:38.440 day after day. 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To see how Square can transform your business, 0:18:55.000 --> 0:18:59.600 visit Square dot com backslash go backslash eyl to learn 0:18:59.640 --> 0:19:04.919 more that Square dot com backslash, go backslash euyl. Don't wait, 0:19:05.160 --> 0:19:07.960 don't hesitate. Let's Square handle the back end so you 0:19:08.000 --> 0:19:11.200 can keep pushing your vision forward. 0:19:11.840 --> 0:19:14.240 The one is doing and it's all based off of 0:19:14.359 --> 0:19:21.040 risk analysis. So right now, FAHA allows this still, but 0:19:21.480 --> 0:19:26.439 conventional doesn't. So with that being said, that means you 0:19:26.520 --> 0:19:31.200 need to get on it and do not wait because 0:19:31.920 --> 0:19:35.880 everything about this industry, about the mortgage business, is all 0:19:35.920 --> 0:19:41.399 about timing, all about timing. The market does not wait 0:19:41.440 --> 0:19:46.000 for you. Okay, it does not wait for you. Let's 0:19:46.000 --> 0:19:48.320 go on to VA loans Via Loans minimum five eighty 0:19:48.359 --> 0:19:53.200 credit score, one hundred percent financing with no PMI six 0:19:53.440 --> 0:19:56.320 up to six percent sales concession allowed. One to four 0:19:56.440 --> 0:20:01.840 family VA approved condos allowed, and it's for primary residents only. 0:20:01.880 --> 0:20:07.680 With a one year requirement for primary residence. Again, VA 0:20:08.440 --> 0:20:11.240 does not allow first time home buyers to use rental 0:20:11.320 --> 0:20:15.040 income to help you qualify unless you can prove that 0:20:15.119 --> 0:20:21.320 you have prior rental property management. Okay. So and in 0:20:21.359 --> 0:20:23.720 most cases, if you're a first time home buyer, you're 0:20:23.760 --> 0:20:25.920 not going to have that type of experience. So you're 0:20:25.960 --> 0:20:27.840 going to have to be able to qualify on your 0:20:27.880 --> 0:20:30.399 own That's why for me in all honestly, if someone's 0:20:30.400 --> 0:20:33.480 looking to buy a multifamily and if they can't qualify 0:20:33.840 --> 0:20:37.879 on their own income, then FHA is the ideal program 0:20:38.280 --> 0:20:43.800 for that multifamily buyer. All right, So now we got 0:20:43.840 --> 0:20:48.320 a little bit of information about the programs. You know 0:20:48.359 --> 0:20:50.240 what it takes to get pre approved, you know with 0:20:50.359 --> 0:20:54.000 documents that you need. Now, congratulations, you went out shopping 0:20:54.000 --> 0:20:56.280 with your real to. You saw one hundred and fifty 0:20:56.280 --> 0:20:59.320 thousand houses, you hated them all except for the one 0:20:59.359 --> 0:21:02.120 you fell in love with it. Now, congratulations, you put 0:21:02.160 --> 0:21:07.280 in the offer, and now you have you're in contracts. Now, 0:21:08.200 --> 0:21:12.680 So in some states, every state operates differently. I'm based 0:21:12.680 --> 0:21:15.359 here in New York. So in New York, the process 0:21:15.480 --> 0:21:18.520 is you put in the offer, what's real to. The 0:21:18.600 --> 0:21:20.639 realtor puts in the offer what the seller's real to. 0:21:21.480 --> 0:21:25.200 They accept the offer, and then we do a home inspection. 0:21:26.000 --> 0:21:30.919 After the home inspection is completed, then the contracts are 0:21:30.960 --> 0:21:33.720 sent to the attorneys. Then the bi goes meets with 0:21:33.800 --> 0:21:37.520 the attorney. The attorney they signed contract, they give their 0:21:37.520 --> 0:21:41.359 down payment check. Then the seller, the buyer's attorneys sends 0:21:41.400 --> 0:21:43.879 the contract over to the seller to seller signs and 0:21:43.920 --> 0:21:49.040 now your congratulations, you have a fully executed contract. In 0:21:49.119 --> 0:21:54.200 states like Georgia, there's no attorneys, there's the realtors take 0:21:54.200 --> 0:21:55.879 care of this. And in a lot of states, you know, 0:21:55.960 --> 0:21:57.800 Florida is a real to state, I believe. I think 0:21:57.880 --> 0:22:00.960 Texas is also the sort of several states out there 0:22:00.960 --> 0:22:04.000 where they there's no attorneys. Is not attorney states. So 0:22:04.119 --> 0:22:06.440 now when you make your offer, your offer is actually 0:22:06.520 --> 0:22:08.959 you signing a contract and it's handled by your real too. 0:22:09.480 --> 0:22:11.879 And then once you make your offer, you have a 0:22:12.000 --> 0:22:15.720 due diligence period. Some places are different, you know, I've 0:22:15.760 --> 0:22:20.080 seen due diligence periods be five days, two weeks, ten days, 0:22:20.359 --> 0:22:23.080 whatever case may be. All of that is negotiated between 0:22:23.080 --> 0:22:27.119 you and the real estate agents. But that's the typical process, 0:22:28.280 --> 0:22:31.760 So check with your local realtor to determine what in 0:22:31.800 --> 0:22:35.000 your state, what that process look like. But if in 0:22:35.080 --> 0:22:37.040 any event, you're still going to get you're going to 0:22:37.119 --> 0:22:39.480 need a home inspection. If you're an attorney of state, 0:22:39.480 --> 0:22:41.719 you're going to meet with an attorney to sign contract. 0:22:42.240 --> 0:22:45.320 They're going to and then once your contract is executed, 0:22:45.680 --> 0:22:48.480 your real to your attorney or you the buyer, are 0:22:48.480 --> 0:22:51.119 going to now email that contract to your lender. The 0:22:51.240 --> 0:22:54.840 lender is now going to finish the loan application, and 0:22:54.880 --> 0:22:57.199 they're going to disclose the loan to you, meaning when 0:22:57.240 --> 0:22:59.080 they disclosed a loan to you, they're going to provide 0:22:59.119 --> 0:23:04.040 you all the documentation, all that initial documentation, it's like 0:23:04.080 --> 0:23:06.240 one hundred pages, and you're gonna have to sign your 0:23:06.280 --> 0:23:09.679 life await basically, and within that documentation, you're gonna have 0:23:09.720 --> 0:23:13.040 what's called the loan estimate, and the loan estimate. The 0:23:13.119 --> 0:23:16.520 loan estimate or l E is going to break down 0:23:18.640 --> 0:23:21.080 or your costs, your terms, what type of loan you have, 0:23:21.200 --> 0:23:24.560 your mortgage payment, et cetera, et cetera. Right, and I'm 0:23:24.600 --> 0:23:26.639 going to break down more towards the end, I'm going 0:23:26.720 --> 0:23:30.040 to break down the CD, which is the closing disclosure, 0:23:30.240 --> 0:23:32.080 and that's one of the most that's the most important 0:23:32.080 --> 0:23:35.159 thing you need to see, all right. So after we 0:23:35.320 --> 0:23:38.679 disclose to you, you e signed all of the documents, 0:23:38.760 --> 0:23:40.639 then you have to pay for your appraisal so that 0:23:40.720 --> 0:23:44.360 the lender can order the appraisal. Appraisal fees varies from 0:23:44.359 --> 0:23:47.240 different states. Single families can be anywhere from four to 0:23:47.320 --> 0:23:50.880