Smart Women Hosts Presentation for First Time Home Buyers

This article is republished with the permission of the State Gazette and Rachel Townsend.

State Gazette photos/ Rachel Townsend

Thursday, August 15, 2019

Judy Long, President & COO of FirstCNB

First Citizens National Bank President and COO Judy Long (above) opened the event with words of thanks to those attending before introducing guest speaker, Sonya Burks (below), who serves as the vice president of mortgage lending at First Citizens National Bank in Dyersburg.

In an effort to address questions regarding purchasing a home, and methods of financing, First Citizens National Bank hosted a Smart Women “Find Your Way Home:  First Time Home Buyers”presentation at McIver’s Grant Public Library, offering information on current home loan programs, grants, and what to look for in a local lender.

Sonya Burks, Vice President of Mortgage Lending

Whether you’re buying your forever home, or maybe just a started home, Sonya Burks, vice president of mortgage lending at First Citizens National Bank, said she and her team can help you navigate through the process of home ownership.

So, what items are helpful for mortgage pre-qualification?

Burks says clients should be prepared to bring in their most recent full tax return, documentation from all investment accounts, and, if divorced, a petition, parenting plan and final recorded divorce.

Those who lack credit may present proof of monthly payment from car insurance, Netflix, Hulu, cable, cell phone bills, utility bills, rent, gym membership and Amazon.

If you need help financing your home, programs are out there to help. Burks discussed types of mortgage programs available including:

FHA loans
VA loans
Conventional loans
USDA Rural Development
In-house portfolio loans

Guidelines for a FHA loan include:

3.5 % down payment required
Seller can pay up to 6% of closing cost and pre-paids
These have the HUD mortgage premium that FHA will allow you to finance
15-30 year financing available
Credit scores can be as low as 580 but most mortgage companies will be 620.
Monthly MIP (mortgage insurance premium)
House should not be a “fixer-upper”

VA loan requirements:

100% financing
Must have your certificate of eligibility
Credit score of 620
Veterans must credit qualify
Home does not need to be a fixer upper
15-30 year fixed terms
Seller can pay 6% of buyers closing costs and pre-paids
There is a funding fee that can be financed into your loan

USDA Rural Development loans

100% financing
30-year fixed term
Seller can pay up to 6% of closing

Conventional loans

Conventional loans can be used to finance a primary residence, a second home, vacation property or a rental property. This is in contrast to government-backed loan programs, which can only be used to finance a primary residence.
Income will be verified by reviewing recent paycheck stubs, tax returns and W2s. Debt-to-income ratio must not exceed 43%.
Bank and investment statements will be verified to ensure the borrower has sufficient assets to close. These funds must be able to cover a down payment plus associated closing costs.
Conventional loans are not insured by the government but by private mortgage insurance companies.

In-house portfolio loans

Serviced by your bank
Do not have to meet same standards as the government backed insured loans
Down payments vary-First Citizens’ requirement is 15% down
Several options for terms
Can be used to purchase a home that does not meet requirements for government loan programs.

Having good credit can make or break your odds of being approved for a home loan. In closing, Burks explained the importance of understanding your credit score and saving money for the purchase of a new home. Burks says keeping a low balance on credit cards, making payments on time, and accepting only a small number of credit cards are all great ways to ensure your credit score stays in good shape.