Mortgage Programs

You are about to purchase the first home to call your own. How exciting! Would you like to hear some more exciting news? For lending purposes, you may qualify as a first-time home buyer if you meet one or more of these conditions*:

• An individual or spouse who has not owned a primary residence for at least three years. This means married couples may qualify as first-time home buyers if one spouse meets this condition.
• A single parent who previously owned a home with a spouse during the marriage.
• An individual who has only owned a primary residence with no permanent foundation (a mobile home) in accordance with regulations that would apply to the buyer.
• Displaced homemakers whose only previous home ownership was with a spouse.
• A buyer who has only owned property that did not comply with local building code ordinances and cannot be improved to meet building code standards for less than the cost of constructing a new residence.

Please click on the FHA Program tab below to learn more about loans that are backed by the Federal Housing Administration (FHA).

*Criteria set by the U.S. Department of Housing and Urban Development

Landmark Community Bank offers home loans that are backed by the Federal Housing Administration (FHA). FHA programs have features that suit buyers who may have lower credit scores or little cash savings. First-time home buyers are fans of these mortgages which allow down payments of just 3.5% for those with credit scores of 580 or higher. Buyers who choose this option must pay mortgage insurance premiums as well as mortgage payments.

Even if your credit score is below 580, you may qualify for an FHA loan if you:

• Have a steady employment history or have worked for the same employer for the past two years.
• Have a valid Social Security number, lawful residency in the United States, and are of legal age to sign a mortgage in your state.
• Pay a minimum down payment of 3.5% toward the cost of your home (note: down payments may be in the form of a gift from a family member).
• Plan to use the property for primary residence occupancy.
• Obtain a property appraisal from an FHA-approved appraiser.
• Have a front end-ratio (mortgage payment, plus homeowner association fees (if applicable), property taxes, mortgage insurance, and homeowners’ insurance) that is less than 31% of your gross income.
• Have a back-end ratio (mortgage plus all monthly debt: credit card payments, student loan payments, car payments) that is less than 43 percent of your gross income.
• Have a minimum credit score of 580 for maximum financing with a minimum down payment of 3.5%
• Have a minimum credit score of 500-579 for maximum LTV of 90 percent with a minimum down payment of 10%. (Landmark Community Bank will evaluate buyers’ credit worthiness on a case-by-case basis.)
• Are at least two years out of bankruptcy and have re-established good credit.
• Are at least three years out of foreclosure and have re-established good credit.
• Selected a property that meets certain minimum standards at appraisal. If the home you are purchasing does not meet these standards and a seller will not agree to the required repairs, your only option is to pay for the required repairs at closing (to be held in escrow until the repairs are complete).

Exceptions may be made based on extenuating circumstances that were out of your control. Ask us if you qualify for FHA loans and learn how they might benefit you.

FHA loans are assumable mortgages. That means that you may sell your home to a buyer who may assume the debt on your home.

The Federal Home Loan Bank (FHLB) First Front Door (FFD) Program uses grants to match the financial contribution of qualified homebuyers for down payment and closing costs 3-to-1. In other words, for every $1 the homebuyer contributes, FHLB will provide $3 in grant assistance up to a maximum of $5,000.

If you qualify, you may use FFD grants toward your down payment and closing costs, making home ownership within easier reach. To qualify, you must:

• Be a first-time homebuyer (not owned a home within the past three years or owned a home only while married, but not as a single person, within the past three years. This includes a married couple if either has not owned a home within the past three years.)
• Contribute personal funds as part of the down payment and closing costs
• Have household income at or below 80 percent of the area median income at the time of registration
• Complete at least four hours of homeownership counseling, including the topic of predatory lending, prior to the purchase of the home
• Work at least 30 hours a week (students only).

The LCB Mortgage Center Team is happy to take you through the process. Make an appointment today!

Veterans, thank you for your service! We would like to be of service to you to help finance your home. You may be eligible for a Veterans Affairs (VA) home loan if you meet several criteria as outlined by the U.S. Department of Veterans Affairs.

Eligibility
You must have satisfactory credit, sufficient income, and a valid Certificate of Eligibility (COE) to be eligible for a VA-guaranteed home loan. The home must be for your own personal occupancy. The eligibility requirements to obtain a COE are listed below for Servicemembers and Veterans, spouses, and other eligible beneficiaries.

VA home loans can be used to:

• Buy a home, a condominium unit in a VA-approved project
• Build a home
• Simultaneously purchase and improve a home
• Improve a home by installing energy-related features or making energy efficient improvements
• Buy a manufactured home and/or lot
• To refinance an existing VA-guaranteed or direct loan for the purpose of a lower interest rate
• To refinance an existing mortgage loan or other indebtedness secured by a lien of record on a residence owned and occupied by the veteran as a home.

Service during wartime:

Service during peacetime:

If you were separated from service:

Active-duty service personnel:
If you are now on active duty, eligibility can be established after 90 days of continuous active duty.  Upon discharge or release from active duty, eligibility must be reestablished.

Selected Reserve or National Guard:
If you are not otherwise eligible and you have completed a total of six credible years* in the Selected Reserve or National Guard (member of an active unit, attended required weekend drills and two-week active duty for training) and one of the following:

• Were discharged with an honorable discharge
• Were placed on the retired list
• Were transferred to the Standby Reserve or an element of the Ready Reserve other than the Selected Reserve after service characterized as honorable service
• Continue to serve in the Selected Reserve

*Individuals who completed less than six years may be eligible if discharged for a service-connected disability.

You may also be determined eligible if:

• You are an un-remarried spouse of a Veteran who died while in service or from a service-connected disability
• You are a spouse of a Servicemember missing in action or a prisoner of war
• You are a surviving spouse in receipt of Dependency and Indemnity Compensation (DIC) benefits in cases where the Veteran’s death was not service-connected

Note: A surviving spouse who remarries on or after age 57 and on or after December 16, 2003, may be eligible for the home loan benefit. However, a surviving spouse who remarried before December 16, 2003, and on or after age 57, must have applied no later than December 15, 2004, to establish eligibility.

Spouses
The spouse of a Veteran can also apply for home loan eligibility under one of the following conditions:

• Unremarried spouse of a Veteran who died while in service or from a service connected disability, or
• Spouse of a Servicemember missing in action or a prisoner of war
• Surviving spouse who remarries on or after attaining age 57, and on or after December 16, 2003
 (Note: a surviving spouse who remarried before December 16, 2003, and on or after attaining age 57, must have applied no later than December 15, 2004, to establish home loan eligibility. VA must deny applications from surviving spouses who remarried before December 6, 2003 that are received after December 15, 2004.)
• Surviving Spouses of certain totally disabled veterans whose disability may not have been the cause of death

Other Eligible Beneficiaries
You may also apply for eligibility if you fall into one of the following categories:

• Certain U.S. citizens who served in the armed forces of a government allied with the United States in World War II
• Individuals with service as members in certain organizations, such as Public Health Service officers, cadets at the United States Military, Air Force, or Coast Guard Academy, midshipmen at the United States Naval Academy, officers of National Oceanic & Atmospheric Administration, merchant seaman with World War II service, and others

Restoration of Entitlement
Veterans can have previously-used entitlement “restored” to purchase another home with a VA loan if:

• The property purchased with the prior VA loan has been sold and the loan paid in full, or
• A qualified Veteran-transferee (buyer) agrees to assume the VA loan and substitute his or her entitlement for the same amount of entitlement originally used by the Veteran seller. The entitlement may also be restored one time only if the Veteran has repaid the prior VA loan in full, but has not disposed of the property purchased with the prior VA loan. Remaining entitlement and restoration of entitlement can be requested through the VA Eligibility Center by completing VA Form 26-1880.

Make an appointment today to meet with a member of the LCB Mortgage Center Team. We’ll review your eligibility and outline home financing options.

The United States Department of Agriculture (USDA) offers loans through its Office of Rural Development. Just like its name suggests, these mortgage loans are designed to develop rural areas, which are defined as areas (confirmed by the latest decennial census of the Bureau of Census) that are not located:

• within a city, town, or incorporated area that has a population of greater than 20,000 inhabitants; or
• an urbanized area contiguous and adjacent to a city or town that has a population of greater than 50,000 inhabitants.

The USDA further clarifies its guidelines to identify regions that may have once have been known as rural and have since become more developed:
Any area classified as ‘‘rural’’ or a ‘‘rural area’’ prior to October 1, 1990, and determined not to be ‘‘rural’’ or a ‘‘rural area’’ as a result of data received from or after the 1990, 2000, or 2010 decennial census, and any area deemed to be a ‘‘rural area’’ at any time during the period beginning January 1, 2000, and ending December 31, 2010, shall continue to be so classified until the receipt of data from the decennial census in the year 2020, if such area has a population in excess of 10,000 but not in excess of 35,000, is rural in character, and has a serious lack of mortgage credit for lower and moderate-income families.

Why should you consider a USDA mortgage? The major benefits are:

• 100% mortgage LTV based on the appraised value of the home
• No down payment and no minimum contribution required
• No limit on seller concessions or gifted funds
• Low mortgage insurance rates
• Low-interest financing rates
• Flexible credit guidelines

As with the Federal Housing Administration’s FHA mortgage, the USDA uses homeowner-paid mortgage insurance premiums to maintain the USDA home loan program.

USDA upfront mortgage insurance is combined with your loan balance and is not paid as cash.

Interested? Let the LCB Mortgage Center Team members tell you more and help calculate the loan amount for which you’re eligible.

If you want a home loan that offers competitive rates, lower costs, and home buying flexibility, you’re like the majority of mortgage applicants who seek conventional loans. Why are conventional loans the option most people prefer? Also known as conforming loans, this type of mortgage conforms to the standards set by Fannie Mae and Freddie Mac.

Benefits of conventional loans include:

• Financing for primary residences, second/vacation homes, or rental property
• Variable loan terms (10-30 years)
• Choice of fixed or adjustable-rate mortgages (ARMs)
• Down payments as low as 3%
• No requirement for mortgage insurance if your down payment is at least 20% (if your down payment is lower, you may cancel mortgage insurance when your home equity reaches 20%)
• Lower mortgage insurance costs than those with FHA loans.

Is a conventional mortgage for you? You may opt for this type of loan if you:

• Purchase a property within the conventional loan limits for the year (for 2018, the general loan limit is $453,100; in areas with a higher cost of living, loan limits are mich higher)
• Have a credit score of 680 or higher (buyers with lower credit scores may still qualify but may pay higher costs than with other lending programs)
• Have a maximum debt-to-income ratio of 43%.

With proper documentation, the LCB Mortgage Center Team can determine the best leanding option for you with the best value for you. Make an appointment to find out today, and pack your things tomorrow!