U.S. bank is now offering a low down payment mortgage.
Wells Fargo introduced
Thursday that offers home loans for up to $417,000 with down payments as little
The San Francisco-based
bank said the program is aimed at helping low- and moderate-income people and
first-time buyers become homeowners.
The past few years have
been a tough market for real estate buyers. Low inventory has pushed home
prices up in many areas of the country, and lending standards have remained
tight in the wake of the housing crash.
Applicants will still
need good credit -- a FICO score of at least 620 -- to be eligible for the
loan. But the bank will allow slightly higher debt loads than a typical
conventional loan would allow. That means the loans will not be backed by the
Federal Housing Administration.
Wells Fargo is also
being more flexible with the income and credit requirements under the new
program. It will take into account nontraditional sources of credit like rent
and utility bill payments to help establish credit history, and will consider
income from other household members and renters.
Buyers who put less than
10% down can also snag a 1/8-percent cut to their interest rate if they're
willing to take a home buyer education class before closing.
California DRE License #02056729 FallbrookCA 92028
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RETHINKING ACCESS TO CREDIT
models are keeping many qualified consumers from becoming home owners.
Housing and Urban Development Secretary, Julian Castro, participated in a
summit on credit access hosted by the National Association of REALTORS®
and several partner groups in April. NAR President Chris Polychron and
other industry leaders are pushing for broader criteria to be used in
calculating creditworthiness, saying that entrepreneurs, millennials,
and many minority households are having an especially difficult time
qualifying for a mortgage using conventional lending standards.
SOURCE: MAY/JUNE 2015 - REALTORMAG.REALTOR.ORG
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