The first step towards buying your home is obtaining a mortgage. You have to check numerous factors to select the right one. You may find a wide range of financing options for first-time buyers in the market. However, it can be a daunting task as you have to research a lot of things. Researching property financing can be time-consuming but can help save lots of time and money. Understanding how your identified property in the market will offer incentives to the mortgage company or lender will greatly benefit you. The article discusses the simple mortgage any first-time buyer can easily qualify for.
The First Time Home Buyer Requirements
To get a quick mortgage approval, you have to meet numerous requirements per the loan you intend to apply for. Anyone who has not owned any principal residence for three years falls under the first-time homebuyer category. These could include a single person or even a married person with a temporary space or someone with a property that does not suffice the building codes.
All you need is proof of income for not less than two years before applying for mortgage loans, a minimum of 3.5% of the loan amount as a down payment and a credit score of more than 620. However, first-time buyers have special programs which help them buy their homes even with low income and no down payment with a score of 500.
Types of Loans
There are several types of loans that you can apply to buy your first-time home. Have a look:
These loans are mortgages, which come without any guarantee or insurance by the federal government. These are usually fixed-rate mortgages and thus remain challenging to qualify for its stringent requirements like higher down payment and credit score with lower debt-to-income ratios, higher down payment, and good credit scores PMI (private mortgage insurance) requirements.
However, if you satisfy all these requirements of a conventional mortgage, these prove more inexpensive than other loans that the federal government guarantees. These loans are conforming and nonconforming loans. The former sticks to the guidelines, including the loan limits, which are established by the government-sponsored enterprises Freddie Mac and Fannie Mae. These lenders procure such loans and then sell away like securities to the security market. But these loans going to the secondary market should comply with certain guidelines that are classified as conforming loans:
- In 2022, the maximum conforming loan comes with the minimum conventional mortgage to be around $647,200; however, it may be more for any assigned expensive areas.
- Any loan exceeding the above amount is known as a jumbo loan. This often varies slightly with the higher interest rates, while it comes with more significant risks, thus making it unattractive to the secondary market.
- In nonconforming loan cases, the lending groups taking care of the underwriting loan often chalk out their guidelines as profile lenders. With several regulations, the nonconforming loans can be easily sold on the secondary market.
Tic:Toc Fixed Home Loan
The latest to add to this list is the Tic: Tock Fixed home loans, where home loan applicants can get a loan in less than 22 minutes. Hence, if you are considering a home loan at an affordable fixed rate with exciting features, you are always welcome to fill out the mortgage loan application form online. These loans are worthy enough to consider for a quicker loan inspection. This is only part of it; you get more with this mortgage loan. The home loan from the company has bagged the 2022 Mozo Experts Choice Home Loan Awards. It speaks volumes about the ease and other features which any homebuyer would appreciate. This loan is more beneficial for people looking for fixed repayments for their desired period, like enjoying the flexibility and other things.
One-Two Variable Rate Home Loan
The next worth considering for a home loan is the OneTwo Variable Rate Home Loan, which comes with a competitive rate of interest and is also known to give good discounts and offers for your loan. Apart from the low-interest rate, there are many perks for Australian home loan borrowers. For the newbies, the bank reduces the interest rate by 0.03% every time they return 5% of the original loan amount. This loan is the best choice for refinancers as well in places like South Australia, Victoria, Queensland and NSW metropolitan regions.
Getting mortgage loans is a daunting task for first-time home buyers. However, there are mortgages with simple requirements. The above is the list, which is simple to pursue without any hassle. All the best for your mortgage hunt exercise!