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Thursday, November 15 Real Estate

First-time buyers qualify for loan with no income limit

Mortgage banker: Dave Stambone

Home type: Single-family, owner-occupied purchase in Ridgefield

Home value: $464,000

Loan amount: $450,000

Loan terms: Conventional, 30-year-fixed, 4.625 percent, no points.

Backstory: A first-time home buyer was in the process of shopping around for a mortgage when she was advised to call Stambone by her Realtor to obtain a pre-approval.

The purpose of becoming pre-approved is to determine an individual’s maximum buying power in order to purchase a home. This is a necessary component that must be done prior to viewing homes with a real estate agent.

Additionally, a pre-approval letter from a mortgage professional is required by the real estate agent listing a home when accepting offers on behalf of a seller. The letter limits the risk of a deal falling through and increases a buyer’s credibility. A thorough review of income, assets and credit must be considered when deciding what someone may qualify for.

Stambone arranged a time to meet to discuss her situation in detail. The buyer and her family were bursting at the seams and ready to leave their small apartment in the city for country living.

Although the buyer was interested in learning about first-time home buyer programs, she was concerned she and her husband may not qualify based on their high level salaries. The other lenders she spoke to said they would not qualify for a first-time buyer program since their joint income exceeded 100 percent of the area median income. They had no intentions of leaving their positions in the city and planned on commuting each day from Ridgefield.

However, Stambone and his bank offered a special program for first-time buyers with no income limit.

A first-time home buyer is defined as an individual who meets all of the following requirements: (1) Is purchasing the mortgaged premises (2) Will reside in the mortgaged premises as a primary residence (3) Had no ownership interest (sole or joint) in a residential property during the three-year period preceding the date of the purchase of the mortgaged premises.

In order to qualify, at least one borrower must be a first-time home buyer. The program is limited to only a 30-year fixed rate loan. The property must be one unit (condo, single-family or planned unit development) and a primary residence. Financing is available up to 97 percent of the purchase price and $453,100 loan amount.

Mortgage insurance is required with down payments less than 20 percent and is automatically removed when the home has reached a 78 percent loan-to-value ratio. Refinancing is not required to remove mortgage insurance.

At last, the couple closed on their home in 30 days with 3 percent down and obtained a low fixed rate mortgage. The family is now enjoying their new life in suburban Connecticut and appreciative of Stambone and his team’s assistance.

Dave Stambone,

Total Mortgage Services,

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203-240-9611,

dave@davestambone.com

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