Helping Washington State homeowners learn more about their mortgage options.
Most of our lenders are being flexible about receiving IRS tax transcripts during the government shutdown. However, once the shutdown is over, expect lenders to require IRS tax transcripts to be included on every transaction…and expect possible delays.
Lenders obtain tax transcripts on transactions to make sure the income provided on the application and other supporting documentation matches what is filed with the IRS. This is largely due to the fraud that happened during the mortgage meltdown.
If there can be one positive tidbit from the government shutdown, it just may be lower mortgage rates. And by the way, we are still originating and closing mortgages during the government shut down. USDA has been reduced to essential functions only and therefore, loans that have not yet been approved USDA may not be closing during this time. However, conventional, FHA and VA loans are available. Not all lenders are able to operate during the shutdown because of not being able to obtain tax transcripts from the IRS, so please do confirm with your lender whether or not this is an issue for your mortgage scenario. Self employed borrowers may find it more challenging during these times.
Earlier this week’ during our Seattle Real Estate Chat, Jim Reppond of Coldwell Banker Danforth and I discussed multiple offers, which we are seeing a lot of in the greater Seattle area.
Here’s our “show” from this week and learn more about what you need to know before you find yourself in a multiple offer situation.
This week, Jim Reppond of Coldwell Banker Danforth and I sat down to discuss getting preapproved for a mortgage and why it’s so important for today’s hot Seattle’s real estate market.
UPDATE May 21, 2013: Everything is looking good. Please let me know if you notice anything wonky. Thank you!
I’m in the process of moving my blog to a new host. We’re experiencing a few hiccups and should be back to “normal” soon.
Thank you!
USDA recently published updated income limits for their zero down mortgage program which is available in rural areas. Other mortgage programs, like FHA or conventional, has loan limits which limits availability. USDA does not have loan limits, the program is restricted by household income.
USDA offers a government backed program that allows zero down payment on homes that are in a designated rural community for families earning less than a certain income. A majority of Washington State single family residences (homes and condos) qualify…of course if you live in metropolitan areas like Seattle or Bellevue, odds are your home will not. However, if you’re considering areas like Duvall, parts of Maple Valley, Vashon or Bainbridge Island, it may qualify for zero down financing.
To qualify, families must be without “adequate housing” (may not own a home or adequate home), must have reasonable credit history and be able to afford the mortgage (29/41 is the debt to income ratio guidelines).
Income limits vary by county and the entire household income is considered (not just the primary borrowers or those borrowers on the mortgage) for determining if the income meets the guidelines. This is separate from income considered for “debt-to-income” ratios. USDA loans allow incomes up to 115% of the median income for the area. Income limits vary on household size from 1-4 person or 5-8 person.
As of the publishing of this article, in Washington, the income limits by county are:
You can check current USDA income limits by visiting the USDA site (clicking here)…be sure to click the “guaranteed” option. Income limits can and do change. You can also use USDA’s income eligibility calculator which will factor in deductions to income, select the “guaranteed” results (not “direct”).
Income used to determine if a family is under the household income limits includes all those (18 years and older) who will be living in the home regardless of whether or not they’re on the mortgage. Incomes of children over 18 who working AND who are full time students are not factored. Here is more information of how USDA loans calculate household income.
Once you’ve determined that you meet the household income limits, the next step is to see to see what communities in your area are eligible for USDA financing. You don’t have to go too far from Seattle or Bellevue to find homes that do qualify for this type of mortgage. Using the USDA site, under “Property Eligibility” click “Single Family Dwelling”. From there you can either enter a specific address or click on the map to narrow down your search.
Sellers and real estate agents who are working in neighborhoods that qualify should be sure to include this program as an option they’ll consider for financing on their offers.
This map is as of the publishing of this post. Areas that are outside of the peachy orange shade are eligible for USDA zero down home loans.
I’m pleased to offer USDA financing as an option for borrowers who meet the criteria. If you have any questions regarding USDA or other mortgage programs for financing homes located anywhere in Washington State, please contact me, I’m happy to help! Click here for a mortgage rate quote for homes located anywhere in Washington.
I am taking a couple days off to recoup, review and relax! I will be back to help you with your mortgage needs for homes located any where in Washington state on January 3, 2013.
Mortgage Master Service Corporation will be closed on January 1, 2013 in observance of the New Year Holiday.
Thank you for your continued support and for making 2012 a wonderful year.
I wish you and yours a very happy, healthy and prosperous 2013.
Rhonda Porter is a Licensed Mortgage Originator MLO121324 living in the greater Seattle area. Rhonda began her career in 1986 in the title and escrow industry and began her mortgage career in 2000. She enjoys helping people understand the mortgage process and started writing The Mortgage Porter in late 2006. Read More…
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