How To Buy Your First Home

A Guide To How To Buy Your First Home and Get a Mortgage

Gustan Cho Associates are mortgage brokers licensed in 48 states

This guide will cover how to buy your first home and qualify for a mortgage during a booming housing market. With skyrocketing home prices due to the housing shortage and the booming housing market, we will discuss how to buy your first home and qualify for a mortgage. The economy seems to continue to grow despite the coronavirus outbreak still affecting the state, county, and local businesses due to government regulations.
Historic high mortgage rates is triggering millions of renters to qualify for a mortgage and purchase a home now rather than later. The coronavirus pandemic that hit the United States in February 2020 changed the business model for hundreds of thousands of businesses.
Many companies have converted many jobs to remote job positions.  Remote workers do not have to report to a brick-and-mortar location. Workers who have remote job positions can live anywhere in the United States. Many workers in high-cost states such as California and New York with great-paying jobs were priced out of the housing market due to high home prices. However, with remote jobs, these folks can now relocate to any state in the nation with affordable housing, lower taxes, and a lower cost of living.

How To Buy Your First Home And Qualify For A Mortgage During Booming Housing Market

YouTube player

Potential homebuyers do not have to have large down payments, perfect credit, or higher credit scores to qualify for a mortgage. Homebuyers can qualify for a mortgage with prior collections or charged-off accounts and a prior bankruptcy or foreclosure. You do not need perfect credit and a 20% down payment to qualify for a mortgage, says John Strange of Gustan Cho Associates:

Homebuyers with recent bankruptcy or foreclosure no longer have to wait two to four years to qualify for a mortgage and miss out on today’s booming housing market. Gustan Cho Associates now offers non-QM loans one day out of bankruptcy and foreclosure with a 30% down payment.

Many people recover sooner than others after bankruptcy. FHA and VA loans require a two-year waiting period after Chapter 7 Bankruptcy for homebuyers to qualify for an FHA loan. USDA requires three waiting periods after Chapter 7 Bankruptcy to qualify for a USDA loan. Fannie Mae and Freddie Mac require a four-year waiting period after Chapter 7 Bankruptcy to qualify for a conventional loan.

How To Buy Your First Home With Bad Credit And Lower Credit Scores

Potential homebuyers are getting more educated in the homebuying and mortgage process. The wealth of instant information on the internet gives verified answers to questions for homebuyers about home buying and the mortgage process. Potential homebuyers can study the basic mortgage guidelines and the types of loan programs available for borrowers with bad credit and lower credit scores. Alex Carlucci of Gustan Cho Associates says the following:

Over 80% of our borrowers at Gustan Cho Associates could not qualify at other companies. We are experts in helping borrowers with credit scores down to 500 FICO.

Most homebuyers now realize you do not need a 20% down payment or a high credit score to qualify for a home mortgage. You do not need perfect credit to qualify for a mortgage. Gustan Cho Associates offers non-QM loans with credit scores down to a 500 FICO. Gustan Cho Associates has 90% LTV Jumbo Mortgages with credit scores down to a 660 FICO and a 50% DTI. Homebuyers no longer have to wait for the mandatory waiting period on FHA, VA, USDA, and conventional loans due to our non-QM mortgages one day out of bankruptcy and foreclosure with a 30% down payment. Many people recover sooner than others after a bankruptcy or foreclosure than others.

Launch Of Non-QM Loans And Alternative Mortgage Loan Programs

Before the launch of non-QM loans a few years ago, homebuyers had to wait for the mandatory waiting period requirements on government or conventional loans. The waiting period requirements halted many homebuyers from qualifying for a mortgage who have recovered and re-established themselves after bankruptcy and foreclosure. Home prices have skyrocketed in the past two years with double-digit price increases. With the mass increase of remote workers due to the coronavirus pandemic, historically low mortgage rates, and the major housing shortage, many potential homebuyers are able and ready to pull the trigger on buying a home in 2023.

Pulling The Trigger On Buying Your First Home

Pulling The Trigger On Buying Your First Home

Countless qualified and pre-approved homebuyers at Gustan Cho Associates have been shopping for homes since the coronavirus outbreak in February 2020 to no avail. Many qualified homebuyers have been shopping for homes but were getting outbid by buyers that offered higher than the list price.

Buying a home over the list price was becoming the norm for homebuyers in 2022 into 2023. Many qualified pre-approved homebuyers were being priced out of the market. HUD and the FHFA have been increasing FHA and Conforming loan limits for the past five years due to the skyrocketing home prices.

Many potential homebuyers have delayed buying a home due to the following reasons. Hoping for a housing market crash or correction due to skyrocketing home prices. Uncertainty of job stability and employment outlook. Concerns about another real estate and mortgage crisis like the 2008 housing crisis due to the COVID-19 pandemic and scare by the government.Concerns from the red state shutting down businesses and the economy.

How To Buy Your First Home During The Coronavirus Outbreak

Most Americans do not like uncertainty. Before the coronavirus outbreak, the U.S. economy was booming. The housing market was strong. Unemployment was at a historic low. Then the coronavirus outbreak hit the United States in February 2020. Disaster hit our nation like a bomb. The economy shut down. Unemployment hit over 50 million American workers. The economy is in a state of turmoil, poor leadership, and record high rates with soaring inflation, says Dale Elenteny. Add adds the following:

Despite record mortgage rates surpassing 7% and soaring inflation, the housing market is still booming. Bidding wars still exists and the market has no sign of a housing correction. Inflation is out of control and the dollar is deterioating.

The unemployment rate surpassed 20%. The majority of the state governors ordered non-essential businesses to be shut down. The Dow Jones Industrial Averages tanked to 18,000. Many industries were hurting like never before, especially the hospitality sector. America has now coped with living with the coronavirus. The U.S. economy has recovered at a historic record speed since February 2021. Most businesses have opened, and Americans are adapting to living with the coronavirus outbreak and scare. Unemployment has stabilized at under 5%. The travel and hospitality industries have returned to normalcy. The Dow Industrial Averages have set historic highs at 36,000.

Is The Booming Housing Market Expected To Continue?

The housing market is booming like never before and is now stronger than before the coronavirus pandemic in February 2020.  Economists and analysts are predicting a record robust housing market for 2022 and 2023. Demand for homebuyers is expected to be stronger than ever due to historic record mortgage rates and a major housing shortage.

The housing market is expected to remain strong. Home prices are expected to keep increasing. Inflation is skyrocketing at record speed. What this means everything is increasing, including home prices and mortgage rates. It is highly recommended that homebuyers aggressively look for homes to purchase.

Nobody has a crystal ball and cannot predict whether there will be a housing market correction. However, with today’s major housing shortage and historically low mortgage rates, the housing market is expected to keep growing, and prices will keep rising. Add inflation to the formula; housing prices are expected to increase faster.

Am I Ready To Purchase A New Home?

Qualifying for a mortgage is not the only factor that will ensure whether you have the ability to repay your new housing payment. Just because you have a full-time job does not mean you will continue to hold that job. Job stability is probably the most important factor in evaluating whether or not you are ready to purchase a new home and have the ability to repay your new mortgage.

Remember that a mortgage is a long-term investment. Most homeowners have a 30-year fixed-rate mortgage. A mortgage payment is most Americans’ single largest monthly payment. Close to half of your net income normally goes to your monthly mortgage payment. This is why it is so crucial to have job stability.

The main reason for defaulting on your monthly bills, including your mortgage payment, is unemployment. The number one reason for bankruptcy or foreclosure is unemployment or loss of business. If you have strong job stability and are in a solid industry, you should consider pulling the trigger on a home purchase in 2023.

How To Buy Your First Home and Get a Mortgage

Homebuyers should qualify and get pre-approved for a mortgage before shopping for a home. Do not assume you can qualify and get pre-approved for a mortgage without a solid pre-approved letter from a loan officer. Many factors may hinder your pre-approval and qualification. For example, there can be errors in your credit report. It can take weeks or months to correct errors on your credit report. Therefore, even though you have excellent credit, any errors or misinformation on your credit report can delay your mortgage loan pre-approval.

Make sure you feel comfortable with the loan officer you decide to represent you. Not all mortgage companies and loan officers are the same. Any lender and loan officer can handle a 700 FICO borrower with perfect credit and a low debt-to-income ratio. If you have less-than-perfect credit or other credit/income issues, you must choose a reputable lender with no overlay and an experienced loan officer. Do your due diligence and research before finalizing your lender and loan officer choice. Researching on the internet is a great start.

Over 80% of the borrowers at Gustan Cho Associates are folks who could not qualify at other lenders due to its lender overlays on government and conventional loans. Gustan Cho Associates closes 100% of our pre-approved borrowers. The team at Gustan Cho Associates tries to make every transaction a stress-free purchase or refinance transaction. If you need to qualify for a mortgage with a mortgage company licensed in multiple states with no lender overlays on government loans, don’t hesitate to contact us at Gustan Cho Associates at 800-900-8569. Text us for a faster response. Or email us at gcho@gustancho.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *