Difference between a conforming loan and a non-conforming in real estate? from your local Huntington county realtor

What is the difference

between a conforming and non-conforming loan?

The big difference is the borrowing limit, although other factors come into play.  Most everyone who gets a mortgage has a conforming loan. 

Conforming loans

Limits: Conforming loans are generally limited to $417,000, although there are higher limits in areas where housing is very expensive. The conforming loan limit  can go up to $625,000 in housing markets, such as certain counties in California, New York, Massachusetts, and Washington, D.C., among others.

Loan-to-value ratio: Your down payment has to be equal to 20 percent or more of the home’s value, but first-time buyers can qualify for a conforming loan through Fannie Mae with as little as 3 percent down. Your mortgage lender helps with the required forms and analysis of what you qualify to buy.

Credit score: A conforming loan requires a FICO credit score of 620 or better. However, there are other government-insured mortgages (such as FHA loans) for lower credit scores.

Debt-to-income ratio: Your debt-to-income ratio can be no more than 36 percent (although some exceptions raise this to 45 percent) of your gross income.

Non-conforming loans

Sometimes people can't qualify for a conforming loan. They might need a non-conforming Jumbo loan to buy a property that costs more than the loan limit . Or they might have problem credit, such as a low credit score from bankruptcies. Self-employed people might not be able to document their income. 

In the case of credit or income documentation, some lenders might still make a loan, but the interest rates and down payments will be higher.

Such loans often require payment of large fees up front, and there could be expensive insurance requirements. 

Out with the OLD and in with the NEW...2017, from your local Huntington county realtor, Andy Eckert

Out with OLD and in with the NEW…….2017

I hope your 2016 was a healthy, happy and prosperous year for all of you. I also hope you spent a lot of time enjoying Mother Nature and your family and friends. I want you all to make 1 New Year resolution and that’s to plan 1 trip away from home and enjoy yourselves. The length of this trip doesn’t matter but the quality does. Go do something you really want to do or try something you have always thought about trying, life is too short for wishing for things to happen. Take a chance……..

My goal for 2017 is to watch my Son Sebastian graduate from college and find a good job in his field. I also look forward to seeing Aleah finish her Freshman year of High School with as little drama as possible. Olivia is my biggest challenge for her to find her place in the working world and start really living instead of just surviving. I also hope for Steph and I to take our health more seriously and get more active in our downtime. I weigh 240 lbs and I should be around 190lbs to feel good again, my hope is to slowly start the shaping up and firming up process. I remember talking with my old wrestling coach when I was 21 and hearing him say how hard it was to stay healthy when you get older, I said heck I’ll never weigh more than 200 lbs. he just smiled and said good luck. Well I showed him………NOT

I didn’t realize how much effect your health has on your day to day happiness and how much harder life is when tying your shoes causes a loss of oxygen and the threat of passing out. My wife has consistently shrinks my clothes because my pants and shirts are always getting tighter, she seems to keep my socks the same size.

In every page we turn in life some chapters end and some begin, I hope the chapters you ended in 2016 gained you wisdom and the chapters you’re starting in 2017 give you motivation.  For all the people that have passed this year my prayers are with you and your families. I want to offer up prayers for all of you that are struggling and fighting your own battles, may you win and kick ass doing it.

Merry Christmas and Happy New Year!!!!!!!!!!!!!!!

Real Estate 2017 - more homes, drones and stable interest rates, from your local Huntington County Realtor

The 2017 real estate market has some surprises in store as buying and selling might go high tech, and the mortgage market remains stable.

Here are some of the predictions by market experts for the new year.

Drones

Daniel Goldstein, writing for Market Watch,  expects real estate buying and selling to go high tech as drones become a feature of the selling process.

Drones aren't just for kids; they are for home buyers and sellers, too. It's a new way to inspect and show off a house for sale.

The Federal Aviation Administration has cleared the way for expanded use of drones by regular people who just want a view from the sky.

That means you could get a small drone and offer a sky view of your property or neighborhood. In fact, drone views are predicted to be the next thing in home selling.

Meanwhile, commercial drone pilots want to offer a view from the sky of expensive real estate, but FAA regulations have made much drone work illegal. Now, the FAA has lightened some requirement, especially one that required drone pilots to have a manned pilot license. New regulations allow commercial drone pilots to pass an unmanned  aircraft operator test.

According to MarketWatch, the use of drones in real estate now resides in the hands of homeowners and real estate agents who can legally offer sight-line aerial views of properties.

More homes to buy

For all of 2016, the real estate market favored sellers as low supply raised prices slightly.

During the next year, buyers should have more choices for homes.

An early indicator is an 8 percent rise in new homes completed and ready for sale in October 2016.

Most analysts see a brisk year for home building. This should make buyers happy since they will have more homes to choose from and prices should nudge down slightly.

Mortgage rates

One can't really say mortgage rates are inching up. That would be an overstatement. But rates are higher, as every analyst predicted. Even so, rates remain a fantastic deal and are historically low.

According to Bankrate, the 30-year fixed rate mortgage rose in December 2016 to 4.13 percent from 4.1 percent.

Bankrate's survey found: At the current 30-year fixed rate, you'll pay $484.94 for every $100,000 you borrow, up from $483.20 earlier in December 2016.