What effect will higher FHA loan limits have for first-time buyers in San Jose?

Asked by Hw, San Jose, CA Wed Mar 26, 2008

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Laarni G. Om…, , Orange County, CA
Wed Mar 26, 2008

Well, it gives you a better chance to buy a home in San Jose. FHA allows you a minimum down payment of 3% but please check with your lender as they check the zip code you want to buy your home for the maximum loan amount you can avail. Furthermore, most lenders require your 2 years of taxes and ask you to sign the IRS 4503 form to verify the income you submitted. This is their way to eliminate fraud in the mortgage business. In more ways than one, this could be very helpful to new homebuyers.
0 votes
Infinity Rea…, , Saratoga, CA
Wed Apr 2, 2008
They are greatly already changing the amount of borrowers that can afford to buy with mediocre Fico's. So many Realtors are missing the boat on this FHA product and really dont have a credible approved FHA broker to use, or train them on how to pre-qualify there clients.

Those that learn this new product will be taking advantage of it numerous benefits, and scoop up buyers that other Realtors cant qualify.

Most Realtors that i interview or just have small talk with, were so shocked by what happened in the last six months that they are also over correcting the way they prequalify there clients. I hear all the time i only take clients that are putting down 20% with 740+ fico. Well there loss our gain.

We qualify everyday clients with FHA Jumbo products with 3% down in the low 600's or even high 500's.
If you need a referral for a great mortgage professional send me a message i would be glad to. This is the market to adjust. The listing agents are amazed when we send a contract over and it is for 3% down on a 750K home. They have been bitten with bad deals fallen through, so they are cautious. But in the end they are glad to approve the offers.
1 vote
Chris, , 95037
Sat Mar 29, 2008
A great benefit to first time home buyers! Wish they did this sooner!!!

Let me know if I can help you out in your quest!

Best Wishes
0 votes
Darren Miller, , CA (Licenced in 50 States)
Thu Mar 27, 2008
Well, now the conforming loan limit is $729,750 for Santa Clara County... The rates for conforming jumbo are still pretty steep because we are teetering on recession and the credit risk that has evolved in the secondary market. Investors are scared about purchasing mass loans over half a million.

You are able to go 3% down with FHA or Conventional with borrower paid PMI, or you can put 5% down with seller concessions and/or your own money to get lender paid MI, you take a little hit to the rate though.
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