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Asked by Tere, Pennsylvania Tue Dec 23, 2008

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Answers

4
Michael D De…, , 18969
Tue Dec 30, 2008
Lois,
With 20% to put down and a good credit score, i would go with a conventional fixed mortgage. There are less hoops to jump through. FHA and VA were designed for people with lower credit scores andless money to put down. There would be no advantage to using these programs. Im am surprised that your estimates came oout the same. In this scenerio I would think conventional would get you the better interest rate. if you need any more help, feel free to contact me.\
The very best of luck to you! Have a Happy and Healthy New Year!

Michael

Michael D Delp
Mortgage Pro
4802 Old Bethlehem Pike,
Telford Pa. 18969
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0 votes
, ,
Sat Dec 27, 2008
Lois,
Are you planning to put 20% down, or you just have the ability to put it down if required? VA (if you are a qualified veteran) is a more friendly program if you are down payment challenged because it is 0% own and has no PMI. The downside is that you pay a 2% funding fee.

If you have good credit scores (740+) then your best bet is probably conventional. You will get a low rate with no points, normal closing costs, and no PMI. FHA charges an up front premium equal to 1.5% of the mortgage amount PLUS monthly PMI. If your credit scores are not excellent then FHA may be friendlier because rates are not tiered based on scores.

If you want to compare apples to apples, have your lender compare FHA with 0 points vs Conventional with 1.5% points and see which has the lowest paymen. That is your winner
Tony
0 votes
, ,
Wed Dec 24, 2008
Well, VA is for Veterans only and I have always been a fan of VA loans. 100% financing, good rates, no monthly mortgage insurance and guaranteed by the VA. On VA your up front VA funding fee is 2.15% of the loan amount (financed in)

FHA is good when you don't have a lot of money to put down. FHA will give you a good rate with only 3% of your own money invested into the transaction. With FHA you do pay a 1.75% up front Mortgage Insurance (financed in) and a .55% monthly Mortgage Insurance.

With 20% down and assuming you have good credit, I would recommend conventional. NO up front mortgage insurance and NO monthly mortgage insurance, especially if the rates are the same.

GOOD LUCK!!
Web Reference:  http://www.myallied.net
0 votes
Manu Kapoor, Agent, New York, NY
Tue Dec 23, 2008
I would go with FHA, as u did not mention your fico score. Clossing cost varies some times with different lenders, as all hv different items/charges according to their policies.
0 votes
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