Scripps Howard News Service A new source of mortgage money will help homebuyers who have almost no cash to put into a house but can afford substantial monthly mortgage payments and have a decent credit record.
The money is coming from the non-profit Nehemiah Corp. in California, which is working with First Nationwide Mortgage and other lenders.
If you qualify, you can get a first mortgage covering 97 percent of the loan and a second mortgage that covers the final 3 percent and provides another 2 percent for closing costs. The two loans combined will amount to 102 percent of the mortgage amount. The total loan can be as high as $289,175.
You must put in 1 percent of the mortgage amount and take a financial education class. But there are no income limits. You can make $200,000 a year or more and still qualify.
A spokeswoman for First Nationwide said the interest rate on the first mortgage would be at or close to market rate, currently 7-1/8 percent to 7-7/8 percent, and the second mortgage would be a 20-year loan at 9-3/8 percent.
Your total debt-to-income ratio can be as high as 41 percent--substantially higher than with most conventional loans. To find out your ratio, add up your total house payment--interest, principal, taxes and insurance--and any revolving credit cards or car loans and divide that by your total gross income.
Under this plan, if you needed a mortgage of $175,000, your first and second mortgage payments together on a 102 percent loan would be about $1,230 a month for principal and interest at current market rates.
The loans are currently available in just 19 states--Arizona, California, Colorado, Florida, Georgia, Illinois, Indiana, Maryland, Michigan, Nevada, New Jersey, North Carolina, Ohio, Oregon, Pennsylvania, Tennessee, Texas, Utah and Virginia. But Nehemiah said they should be available nationally in 30 to 60 days.
Resources Nehemiah Corp.
Find out more on the Web or call toll-free to find a lender near you. Choose "2" when the recorded voice comes on.
Nehemiah Corp.
Phone: 877-634-3642
URL:
www.nehemiahloan.com
First Nationwide Mortgage Corp.
First Nationwide Mortgage Corp.
Toll Free Phone: 800-444-8443
URL:
www.firstnationwide.com
