If you've been following home-buying news and trends over the past four years, you have heard that lending is tight and it is hard to get a home loan. With expertise in the Vermont market, I have to say this is not the reality of the situation. Mortgage underwriters are requiring more verification's than the pre-2008 era and you may need to provide a bit more documentation, especially if you are self-employed, but loans to purchase Vermont real estate are still readily available.
If you are a first time home buyer looking to get into the Vermont real estate market you are in luck. This is a great time to purchase a home, especially in the Burlington, Richmond, Waterbury, Stowe or Morrisville area. Mortgage interest rates are still low, home prices are beginning to recover, and there are plenty of good lending programs to allow you entrance into the market.
One such lending program is the FHA program, allowing you to purchase a home with as little as 3.5% downpayment, possibly a gift from a parent or grandparent, and the seller can pay your closing costs. FHA will allow as low as a 640 credit score and a debt-to-income ratio as high as 50%.
Another great program available to interested buyers in Vermont is . This product allows 100% financing, though it does have a few more restrictions, such as income limitations and geographic restrictions. Luckily, most of the Vermont real estate market will allow buyers to qualify for such financing. In addition, Fannie Mae and Freddie Mac have low down payment programs, with as little as 5% down on a primary residence or 10% on a second home. For the most success using a conforming loan such as this one, you will want to have a stronger credit score.
The best thing to do is to meet with a loan originator to go over your situation, see which programs you qualify for, how much you can borrow, and decide how much you are comfortable paying each month. Then you will be ready to go out and shop in whichever Vermont real estate market you choose. So, get pre-qualified and happy house hunting.
Article written for NELR by Jeff Teplitz, Mortgage Loan Officer, - Dedicated to helping clients throughout the mortgage process, with over 8 years of mortgage experience and a thorough knowledge of the Vermont and Northern New England markets.