- Parent Gifts & Loans
- Lease Options
- Negative Amortization
- No Money Down
- Appraisals & Market Value
- Private Mortgage Insurance
- Veterans Administration
- Federal Housing Administration
- Low Down Loans
- Alternative Loans
- Whom to Contact (Home Loan Options)
- Whom to Contact (Qualifying)
- Fannie Mae
- Whom to Contact (Government Loan Programs)
- Mortgage Credit Certificates
- State Programs
- Bankruptcies & Foreclosures
- All Cash
- Reversed Annuity Mortgages
- Assumable Loans
- Prequalifying and Preapproval
- Seller Financing
|Q:||Do I have to disclose a parent’s gift?|
|A:||Having generous parents is nothing to hide. An estimated one-third of first-time buyers purchase their home with a loan or a money gift from their parents.
Lenders will ask for a gift letter stating that no repayment of the "gift" is expected. In addition to the letter, a lender can ask for two or three months’ worth of statements for the account where the down payment funds are located. If the money was recently placed into that account, the lender may ask where it came from and request verification of that source as well.
|Q:||What is a gift letter?|
|A:||If someone is willing to make a gift of funds in order for you to purchase a home, lenders will ask for a gift letter stating that no repayment of the "gift" is expected. The amount of the gift and the date funds were transferred should be spelled out in the letter, along with the donor’s name, address, telephone number and relationship to the borrower.
In addition to the letter, a lender can ask for two or three months’ worth of statements for the account where the down payment funds are located. If the money was recently placed into that account, the lender may ask where it came from and request verification of that source as well.
Gifts — with the proper documentation — can be from relatives, friends, an employer, church, municipality, or nonprofit organization. Lenders often have stricter restrictions on gifts from friends and relatives other than parents.
Also, if you put less than 20 percent down, some lenders may require that a portion of the down payment be your own cash, not a gift. If you want to use a gift as part of your down payment, check with individual lenders to learn the restrictions of specific private or government-insured mortgage programs.
|Q:||When is the best time to refinance?|
|A:||The traditional answer to that question is when interest rates fall 2 percent below your current mortgage interest rate. However, in recent years some experts have argued that refinancing may be appropriate with a smaller point spread.
Some weight is often given to the length of time the owner anticipates holding on to the property. If the owner expects to keep the property for at least three or four years, then refinancing may be worthwhile.
While refinancing can involve upfront costs, in many cases it is possible to roll the costs of the refinancing into the new note and still reduce the amount of the monthly payment.
|Q:||Where do I get information on refinancing?|
|A:||For information on refinancing, the following booklet may be helpful:
* "A Consumer’s Guide to Mortgage Refinancing;" Federal Reserve Bank of San Francisco, Public Information Department, P.O. Box 7702, San Francisco CA 94120; call (415) 974-2163 to order.
|Q:||Can I refinance after bankruptcy?|
|A:||Refinancing may be prudent but could be difficult after a bankruptcy. If you’re considering bankruptcy, you may want to go to your current lender first and explain the situation. If you have been current on your payments, the lender may be accommodating and refinance your loan, easing your financial situation.|