Virginia Mortgage Overview
Virginia homes are always in high demand
because of the close proximity to the government and the many jobs they offer.
Despite its popularity, homes are still affordable in the area with a median
cost of $273,000 in the area.
If you're thinking of moving to the
Virginia area, here are your loan options:
Virginia conventional loans
If you have at
least a 660 credit score and low debt ratio (around 36 percent), you may
qualify for conventional financing. You don't need the traditional 20 percent down
- lenders accept as little as 3 percent down for first-time buyers and 5
percent for subsequent buyers. You will pay PMI for the time you owe over 80 percent
of the home's value, but that doesn't last forever.
Virginia FHA loans
If you have less than
perfect credit, the FHA loan may be a good alternative. You need just a 580
credit score and 3.5 percent down. Most borrowers can use down payment
assistance and/or gift funds for the FHA loan. If you have a score between 500
- 579, you'll need a 10 percent down payment and 3.5 percent should be from
your funds. FHA loans have mortgage insurance for the life of the loan in
exchange for the flexible guidelines.
Virginia VA loans
VA loans are for veterans of
the military. You may also qualify if you are currently serving if you served
at least 181 days in peacetime or 90 days during wartime. Veterans don't need a
down payment and you can get approved with a credit score as low as 620. VA
loans allow debt ratios of as high as 50 percent. VA loans don't charge
mortgage insurance but most veterans pay a funding fee.
Virginia USDA loans
USDA loans are for borrowers
who don't qualify for other financing options. It's for low to moderate-income
families. If you're eligible, you need a 640 credit score and a max 41 percent
debt ratio. You must live within the USDA boundaries, but they aren't as
'isolated' as you think.
Programs in Virginia
Mortgage Credit Certificate
homebuyers can secure an MCC that's equal to up to 10 percent of the mortgage
interest you pay for the year. The tax credit reduces your tax liability and puts
more money in your pocket. This makes it easier to afford a home loan and the expenses
that homeownership creates.
Virginia Housing Plus Second Mortgage
Housing Plus Second Mortgage helps you meet the down payment requirements of a
first mortgage. You can borrow up to 1.5 percent more than the sales price and
if your credit score is high enough (680) you may include the closing costs in
the loan too.
Down Payment Assistance Grant
This grant helps
with the down payment. You may borrow up to 1.5 percent more than the sales
price. You may use the funds for the down payment and/or any closing costs
associated with a loan including funding fees. No repayment is required.
Closing Cost Assistance Grant
The Closing Cost
Assistance Grant provides funds to cover the closing costs on your loan. It's a
non-repayable grant that helps offset the cost of closing on a loan.
Mortgage Credit Certificate
The MCC provides
you with a dollar-for-dollar tax credit on the mortgage interest you pay for
the year. This decreases your total tax liability and enables you to have more
money to afford housing payments.