in today's video we're going to talk about how to get approved for a home mortgage even if you have bad credit or no money for a down payment and we'll also get into how i closed on my home in just two weeks and as a special bonus we'll talk a little bit about the most common types of loans how to calculate your home buying costs and how to clean up your credit if you need a little bit of help there so let's get started [Music] hi everyone welcome back to my channel it's me jazzymac thank you to everyone that has liked shared and subscribed to my content and if you're new to my channel go ahead and hit the subscribe button and turn on those notifications like now i talk about everything from faith family and finances and lately we've been on a credit like role so many people have been grabbing my templates and cleaning up their credit and i'm so proud of all of you that have been putting in the work don't worry about trying to just write everything down that i'm going to say today it's a lot of information but i put together a home buyers kit so that those of you that are more visual those of you that like to have things at your fingertips you can have access to everything that i'm saying and so you can just listen to this video and take it all in so let's get started i'm going to just grab my notes the first thing that you're going to need to do is understand what the home buying process entails and i just made like a short little checklist um there are six steps to home buying the first step is the pre-approval process this is where you're going to just talk to someone over the phone you're going to like briefly talk about your credit your income um and like what your budget's going to be and that's going to determine what type of loan pathway they're going to send you down and we'll talk about those three different types of loans step two is going to be home shopping where you're actually purchasing um looking for the house that you want to purchase you're shopping for the house and once you find the house step three is going to be the offer and negotiation stage where you place an actual bid through your realtor and you wait to see if the sellers are going to accept that particular bid if they do accept your bid then you're going to go into step four which is going to be the due diligence process where depending on the type of loan that you have or that you're applying for um it could be anywhere between 5 and 15 days that you're given to either back out of the deal without losing your earnest money so usually it's a minimum of five up to 15 sometimes it can be a little bit longer depending on the terms of your real estate seller and buyer agreement step five um is going to be the pre-closing and um title phase and that basically is going to be the phase where you confirm if the repairs are going to be taken care of by the sellers sometimes they take care of it some don't um you'll do your pre-closing walk-through like a final walk through of the house and you'll send your funds to the title company um you know and that's kind of like you know like the icing on the cake and so step six is gonna obviously be the closing where you'll sit down with an attorney um the sellers are sometimes present sometimes they're not but you'll sit down with an attorney to sign a whole bunch of paperwork and that's where you'll actually get the keys um and most people depending on the type of loan they might get a check back at closing um where you know you as the buyer will receive a check at closing and so those are just the general home buying steps and so now what i want us to get into are the types of loans there are three very common types of loans um fha loan va loan and conventional loan and i'll talk about um you know the pros of all three of those starting with the fha loan and i'm just going to grab my nukes so with an fha loan um that stands for federal housing association and it's for first time home buyers and it's generally used for people that may not have a very high credit score um or maybe on the low to moderate income scale with an fha loan what's good about it is you can apply with really bad credit you know credit score in the 500s um usually a 580 is sometimes the lowest that um your lender will accept for an fha loan but it can go lower um the only caveat is if you have less than 580 um you'll have to pay like 10 of the you have to pay 10 of the price of the home as your down payment um if you have 580 and above you only have to pay three and a half percent um or a down payment and because it's a federal backed loan you would still qualify for um down payment assistance programs there are some programs that um a you will that will give you you know up to ten thousand dollars in down payment assistance i know georgia dream um home buyers program has something similar that gives you a very significant amount of money so it varies by state but down payment assistance and fha loans kind of go hand in hand another good thing is the fha loans they provide assistance for you to avoid foreclosure most loans don't do that but for fha there's you know they want to keep you in the house and keep you from losing the house um and so that's some of the pros for fha loans um so like i said if you have a low credit score you don't quite have a lot of money to put down fha loan is probably going to be the best path for you now if you have zero money to put down and you are a service member then the va loan is going to be perfect for you um with the va loan i come from a military family so many people in my family have used a va loan and you know it's got some good things to it the va loan doesn't have a prep prepayment penalty like some loans do um there are no borrow limits so there's no cap on how much money you can borrow of course i still want to be contingent on your income but just initially there is not a cap for what you can borrow um there's also no mortgage insurance that you have to pay so your monthly mortgage insurance your monthly mortgage payments will not include insurance which means your payments are going to be lower each month um and of course you don't have to have a down payment the va is very clear that for active or veteran service members no down payment is required for them to issue you a loan also no minimum credit score is what the va also offers so even if you had like a 550 i've seen people with a 540 get approved for no money down for the va loan of course they had the 540 credit score but they were able to close on the deal because the va does not have a minimum credit score requirement that is going to be the biggest benefit so if you're using a va loan if you are a service member about joining the service that's a huge benefit that you want to make sure that you are capitalizing on um the third type of loan is going to be the type of loan that i use when i purchase my home just a couple of months ago it's a conventional loan and a conventional loan is generally um it's a much faster closing process and so the fha and the va loans are going to probably take you minimum 30 to 60 days to close you know from the time that the seller accepts your offer um it's gonna be 30 to 60 days before you get the keys in your hand or a conventional loan i closed in 10 days it was very fast processed conventional loans generally have lower interest rates reduced mortgage insurance costs and multi-tier down payment options and so you can put down as little as three percent on a conventional loan but you do have to have a much higher credit score i think a minimum of maybe a 620 um some lenders will probably want you to have higher than that i entered into my mortgage with i think a 820 credit score or something like that but mind you when it comes to mortgages lenders are going to use an older credit scoring model so if you go to credit karma a credit sesame and it says you have a 700 chances are what the lender sees and the credit scoring model that they use you're going to have something lower than that and so that's when the whole cleaning up your credit thing comes into play if you have collections if you have any type of late payments um those are things that you're going to want to get rectified and especially collections um my lender made it clear even before we talked about the pre-approval process they do not deal with collections if they see that you had a collection even if it's paid off the fact that it's on your credit shows irresponsibility and so many of you have used my credit templates and you've started to clean up your credit you started to boost those credit scores i've also put that down below for those of you that haven't been exposed to that yet um and it's also included for free in my home buyers kit if you were to get the home buyers get i threw in the credit boosting kit that includes the dispute templates and the goodwill letters for late payment removals um of course you have to do the work i can't guarantee what your credit is going to look like but if you do the work like many other people have then this is going to make your home buying process so much smoother when you have a clean bill of credit it makes it go so much smoother um the other thing that you want to consider are your home buying costs um and so when it comes to getting approved let me just back up when it comes to approval it's going to be based on credit and income mostly amongst smaller things but credit and income are going to be the two bigger things want to have your credit just a decent credit score depending on your loan type no late payments no collections no judgments or repossessions um and then when it comes to income you want to make sure that you have two years worth of income you don't have to spend two years consecutively on one job if you had two jobs within two years you just want to show that you had consistent income on the other thing that you'll be required to submit um at some point in the pre-approval process is going to be your tax returns um and or your pay stubs if you don't have your tax returns you can get away with the pay stubs but you will need that the tax returns for underwriting um and they will also ask you for your bank statement so make sure your bank statements don't show like these large deposits for ten thousand dollars that you can't reasonably trace back to a source um you want to really kind of avoid a lot of cash deposits anything over a thousand dollars you want to avoid that because that could raise a red flag with your lender um so make sure that you can explain where all of your money is coming from because that is going to be a very big part of getting you approved um again when it comes to home buying costs i did create a calculator for you to calculate the closing costs um which is going to be a grouping of piti which is principal interest title and insurance those are the four costs that make up the bottom line amount that you'll pay for your home so i do have a calculator in the home buyers it um and then there's also a debt payoff calculator that i created if you're trying to pay off any debt before you purchase your home um but the most important thing when it comes to applying for a home is you don't want to wait until you're ready to buy to go through the pre-approval process if i wanted to buy a house in june and i wanted my move-in date to be like august i would probably go through the approval process in january because i want to give myself a good six months to number one get my credit straight and then number two get whatever savings is necessary well before it's time for me to purchase a home that makes your home buying process so much smoother when you go and do the pre-approval process six months early and again um depending on your lender your closing um time frame um and you're under contract time frame that can vary so you don't want to say well i want to move into a house in june and then you'll apply for it in may but you got to wait 60 days to get the keys like do it early that's all i'm saying so i hope this video was helpful if anyone has questions about the home buying process you know going under contract how to submit your bids how to negotiate i'm so happy to provide that information i personally was very blessed to have negotiated a deal where the sellers paid the closing costs um they actually paid around i think maybe seven thousand which saved me seven thousand dollars out of pocket that i would have potentially had to pay at closing a lot of people when they negotiate things like that they actually get a check at closing like the buyer like for me um if i was the buyer in one of these cases there would be a you know i'd meet with the attorney to fill out all the closing paperwork and then he would cut me a check at the end of it um for any like extra money that was left over a lot of people take that money and just remodel their house with it or they just make their first mortgage payment with it um but i'm happy to answer any questions that you all may have um happy house hunting happy credit building i'm totally here for that um for any questions that you guys may have on either of those processes um this is my first video since having my baby two weeks ago so i'm so happy to be talking to you all again and until the next time stay safe stay healthy and i will see you later bye

buying a house

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