Can you help us & give us some of your wonderful knowledge as far as loans & financial stuff regarding buying a house & loans etc:prettyplease:beg:wink

:bump

Sure!!

Some advice for getting a loan:


Gather your documentation beforehand.

General conditions that are required by most mortgage companies:


*Full months paystubs (your most 2 current if you are paid bi-weekly or semi-monthly, or recent 4 if you are paid weekly) for you and your spouse
*Assets statements (if you have TSP, 401ks, stocks, bonds, etc)
*2 full months of bank statements
*2 years of W2s

It's also a good idea to pull your credit somewhat close to when you're buying a house because then you will know what you're up against. If you have collections, judgements, liens, late payments, bankruptcy, etc., it's best to prepare (or at least think about what you'd write) an LOE (letter of explanation) giving the lender an idea of what happened in your life at that time, along with your assurance that those problems are a thing of the past and your good credit is very important to you.



Some advice regarding loans:

FIXED RATE!!! With the changing market, you want to get into a loan that you will be comfortable with regardless of what interest rates are. Especially with this market, you might find yourself upside down on your investment, and therefore, you will not be able to refinance. That's why you want to have an interest rate and payment that you can afford, and that will remain the same for a very long time. If rates are considerably lower, perhaps consider a 10/1 (fixed for 10 years, then adjustable) but in my experience, the best thing to do is get a fixed loan.

I also do not recommend interest only loans. Sure, your payment is a bit lower, BUT you will not pay down your balance. However, it's a good option for people who can't afford a full payment. But the guidelines are more strict for I/O (interest only) loans.

Pay some points if you can to buy down your interest rate. We were able to get a 5.5% (fixed) by paying 1 point. You will see some of this back at tax time AND over time, you will save money in having the lower interest rate.







Anything else? Just ask. :D

:yourock:thanks

Is it worth it to buy points if you are only going to be in the house for a couple of years?

We're JUST starting the process and right now we are still undecided if we are going to try and sell when we go to a new duty station (2 1/2 years from now), or if we're going to keep it as an investment property. Might depend on how the market is looking at the time.

Well having points = lower rate. If you want a higher payment and it's a comfortable payment for you, then you don't NEED them. Hell, you don't need them anyway... but I personally wanted a 5.5% opposed to a 6.0%. If for those 2.5 years, you don't mind paying a little extra, then you don't necessarily need to bother with them - but there is tax advantages to it as well.

Well having points = lower rate. If you want a higher payment and it's a comfortable payment for you, then you don't NEED them. Hell, you don't need them anyway... but I personally wanted a 5.5% opposed to a 6.0%. If for those 2.5 years, you don't mind paying a little extra, then you don't necessarily need to bother with them - but there is tax advantages to it as well.


Okay, thanks. We were just told by someone that because we weren't going to be there long term that it really wouldn't be adventageous for us to pay them down.

Well, ANYTHING to save $$ is good, right? Points are "prepaid interest" so when you pay 1 point, you're paying 1% of your loan amount.

thanks that was very informative and helpful

You're welcome!! I've been in the industry 5+ yrs :D