Michael Gayda, PrimeLending
Q. What are the main differences between the current guidelines for FHA, VA and USDA loans?
A. The first thing that differentiates these three types of loans are the qualifying parameters. VA financing requires the borrower to have VA eligibility; usually someone that has served in a branch of the Armed Forces. USDA has specific geographic and household income requirements. FHA is the most flexible of the three in that it does not have any of the restrictions noted above.
Q. Have lending guidelines loosened up some?
A. Not really. We have actually seen instances in which FHA has increased expenses on their loans as a way of reducing its appeal. Conventional financing has actually opened back up a little and can be a preferable option when compared to FHA, with the right client.
Q. Which of the government loans are the most prevalent at this time?
A. We see a healthy mix of VA and FHA. There are some USDA opportunities in northern St. Johns as well as parts of Clay County, but at a far lower scale than the other two options. With the large military presence in Jacksonville and the excellent benefits of a VA loan, I don’t see this option scaling back anytime soon. FHA has lost some of its shine, but it is still a fair option, especially if the borrower does not fit into the conventional “bucket”.
Q. For those seeking government assistance, are there counseling services available to help them determine the guidelines to qualify? Is counseling required?
A. There are optional avenues that may be pursued for counseling but very rarely will they be required by a lender. Working with an experienced mortgage professional will allow the client to explore their options and determine their ability to qualify. Some lenders add additional requirements to those from the actual agencies and that may present some flexibility in someone’s ability to qualify from one lender to another.
Q. What tips do you have for Realtors and site agents working with buyers who are seeking government loans?
A. Make sure that they are working with an experienced lender who can help them navigate the process. There may be some additional hoops to jump through regarding fees, inspections, or property requirements, depending upon the loan type. Government loans are a great option and literally open the door for many buyers that wouldn’t qualify otherwise.
Stanley H. Bishop, Exit Real Estate Gallery
Q. What are the main differences between the current guidelines for FHA, VA and USDA loans?
A. All three of the loan types have their unique guidelines. One thing about VA is their ability to roll in the closing cost into the loan. USDA will allow for 100 percent financing but is limited in the area that it covers. FHA has lowest of all three types for credit score and is the driver for loan types in our market.
Q. Have lending guidelines loosened up some?
A. They haven’t gotten looser but at the same time haven’t become more strict. The good news is we are use to the stricter guidelines and run our business accordingly. Professionals understand the current guidelines and we are seeing the customers aware of the guidelines more frequently.
Q. Which of the government loans are the most prevalent at this time?
A. We see a lot of FHA and for the military we are seeing mostly VA financing.
Q. For those seeking government assistance, are there counseling services available to help them determine the guidelines to qualify? Is counseling required?
A. Yes, there are first time home buyer seminars. For the most part, counseling is not required.
Q. What tips do you have for Realtors and site agents working with buyers who are seeking government loans?
A. Make sure you have a great lender partner to help you navigate through the different types of loans. Asking the right up front questions at application stage will save you and your customers lots of time and headaches.