Despite historically low interest rates, many financial institutions have tightened lending standards, making it harder to obtain a mortgage for a lot of people who had their eyes set on homeownership in the near future. This blog post will discuss why that is and what we’re doing to navigate these times of uncertainty while paving the way for our customers to finance a home of their own, even amidst the coronavirus pandemic.
Why It May Be Tougher to Get A Mortgage
COVID-19 sent markets across the globe into a tailspin as unemployment rises and uncertainty looms. This led our nation’s lenders to become increasingly risk-averse as the possibility of forbearance and mortgage defaults became more likely. The response was that some lenders initially tightened their eligibility requirements making it harder to qualify for loan programs. This was done, in part, by requiring higher credit scores and down payments than would have previously been necessary. Some programs, such as those that aren’t backed by Government-Sponsored Enterprises (GSEs) like Fannie Mae®, have been temporarily scrapped altogether. Along with difficulties in originating mortgages, the underwriting guidelines by the GSEs have changed as well. Hearing there may be more stringent requirements and guidelines out there, it’s understandable to become discouraged at the thought of obtaining a mortgage.
How We’re Adjusting to Help Our Borrowers
While we have our tried-and-true programs, such as Silverton Secure+ that allows you to have a mortgage underwritten and preapproved before you even find a property, and down payment assistance programs to help alleviate the upfront costs of buying a home. Unlike some other lenders, we’re continuing to offer FHA and VA loans with a 600 minimum credit score. This gives potential borrowers more options as they explore which program is right for them. For those who qualify for the VA loan program, they’ll also enjoy the benefit of no lender fees, which means up to $1,295 in savings for our nation’s veterans.
We understand that millions of people across America are in need of affordable housing along with attainable financing. With our MH Advantage® program, borrowers have the option to purchase both traditional manufactured homes and CrossModTM homes, which are a hybrid of site-built and manufactured homes and offer enhanced interior and exterior features. This can translate to a beautiful home with a competitive mortgage. If you’re interested in making improvements to a home you’re looking to purchase or already own, our Construction-Permanent Rehab Loan may be the perfect fit. It has two phases, the renovation/build phase, and the permanent phase. Specifically, once home improvements are complete, your loan is converted to the permanent phase of the mortgage. This means one loan and one closing, potentially saving you time and money.
What It All Means for You
By working to maintain a clear path to homeownership for our borrowers, it is our hope that the current climate doesn’t deter those who are serious about buying a home of their own. The mortgage industry has changed in response to COVID-19, but it doesn’t mean that your goals aren’t attainable. At Silverton, we’re committed to giving our customers the same great service that we always have. Our loan originators are ready to talk with you and review your circumstances in an effort to help you get to the closing table. Our numbers say it all: more than 9 out of 10 borrowers and agents would recommend Silverton to their friends and family.* If you’d like to learn more about what programs we offer, and which may work best for you contact one of our loan originators, and let’s start a conversation.
*As compiled by SocialSurvey as of September 1, 2020.