subject: Three Mortgage Facts You Need To Know When Buying Miami Beach Real Estate [print this page] When it comes to mortgages, most Miami Beach real estate first-time homebuyers easily get anxious. For them, this means setting out looking for mortgages and facing the cruel reality of not qualifying. While there are a lot of things that can hinder your success in landing a mortgage wrapped with a bow of great terms and interest rates, there are also a lot of things that can help you qualify for one. If youve been misled to believe that mortgages are hard to come by and qualify to, read on to know the three common facts about it.
1. You dont need 20 percent as down payment.
Its true that mortgages are quite hard to come by these days due to the hard-hit economy. But this isnt necessarily ubiquitous. There is still a great chance of you landing the best loan terms for your Miami Beach real estate property; natch, with credit-building, debt-paying diligence. If, however, you're wary of the 20-percent down payment plague that has been hitting most lenders, dont be. There are ways for you to finance a home without adhering to the 20 percent requirement.
Your solution: FHA loans. As the mortgage du jour, FHA loans can help you buy the property you want with a 3.5 percent down payment and 620 FICO score duet. This certainly breaks the wall that blocks you and the keys to your new Miami Beach real estate home.
2. Interest rates skyrocket with supersized loans.
But even though you can finance the property with an FHA loan, there is a limit. If you need a home loan that is well over the FHA loan limit (Miami-Dade County limit is $423,750 to $814,900), you need to apply for a conventional loan, instead, and back it up with a 720 credit score and at least 10 percent down payment. And dont forget that with bigger loans come bigger responsibilities. Expect bigger interest rates.
3. DTI is important but you can qualify if you meet the requirements.
The foremost requirement for a loan is the credit; you need to be able to meet the set credit for the loan you're applying for. Furthermore, you have to have the necessary assets to back-up your debt-paying abilities once you land the loan. Further still, you have to meet the other guidelines that the lender sets.
And dont forget the debt-to-income ratio. Nowadays, if want to qualify for the loan you need for your Miami Beach real estate purchase, your mortgage as well as other payments included within your credit report must not exceed between 43 to 50 percent of your gross monthly income.
