Get a Mortgage Break

Buying your first home can be hard if you don’t have a lot of money saved up. If you are a teacher or public service worker however, it’s easier than ever to get a mortgage. If you qualify, you can buy a home with only $500 into the deal.

Eligible professions are teachers or administrators at the elementary or secondary levels in public or private schools. Public safety employees that are employees of a police department, sheriff’s office, university, hospital, airport or port authority that are responsible to the prevention and detection of crime are entitled. Fire department personnel on the local, state or federal level that are involved in fire suppression, emergency medical response, hazardous waste and response to terrorism fall into the classification.

Teachers and public service workers can qualify to purchase a home with as little as $500 or 1% of the sales price of their own money, whichever is less. In addition, they have less restrictive guidelines than is normally required from borrowers for a mortgage.

This program includes 100% financing of the purchase price under the FNMA’s MY Community Mortgage Program. You can even borrow another 5% with a community loan through a bank. This could pay for your closing costs and property tax and insurance reserves. That’s a total of 105%. The program restricts income limitations to 100% of the area’s median income. However, there are a number of areas in the country where 120% is allowed. There are even other areas that do not have these income restrictions. You can check these areas out for yourself on the web.

Teachers and public service workers who do not have enough established credit to make up an acceptable credit report have an alternative. If the borrower has a 12 month rental history with no delinquency, and no delinquencies on anything else that comes up for the past 12 months that will qualify for the credit part of it.

Homes have to be for primary residence and not for rental. They also have to be single-family residences and not a duplex. Condos are eligible. Manufactured housing is not eligible. The maximum loan is $417,000 in 38 states and $650,500 in Hawaii and Alaska.

All borrowers who are first time homebuyers will have to complete an approved homebuyer education program. The lending institution will give you information as to how to go about this. The education part should easily be completed by the time the loan is to close.

This program is also open to private sector workers as well. The difference is more general restrictive underwriting criteria, but the program is the same at 100% financing and only $500 into the deal.

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