Notes From The Mortgage Insider

I just got home from a few days of rest in Florida (it was wonderful!) so this week my newsletter will be short!

Today is the third installment on the subject of how FHA mortgages can help your clients in situations that conventional loans can not. If you are using a conventional loan to buy a house and you are putting less than 20% down, then 5% of the down payment must come from the purchaser’s own money and the rest can be a gift from a qualified donor (like a parent or sibling). So, if you are buying a house for $400,000 and putting 10% down ($40,000), then $20,000 must come from the purchaser's own funds. On the other hand, if you are using an FHA mortgage under the same scenario, none of the down payment has to come from the purchaser’s own funds. It can all be a gift from a qualified donor. In this case the entire $40,000 down payment could be a gift. As you can imagine, this can make a big difference!

Have a wonderful week!  Margie