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Loans Tailored to First-Timers

April 19, 1998|EARL PEATTIE

Here's a sampling of special loans for first-time home buyers:

* California Housing Finance Agency (CHFA). Thirty-year fixed and adjustable loans made through 44 major lenders and backed by state bonds. Offers liberal qualifying requirements, including 3% down, good interest rates and special mortgage insurance. Contact CHFA for package of information, including list of lenders, at (800) 789-2432.

* Mortgage Credit Certificate Program (MCC). Offered by various cities, local housing and redevelopment agencies. The program allows a special federal income-tax credit to first-time buyers. There are borrower-income and purchase-price limitations. Contact cities, redevelopment agencies or local real estate brokers for information.

* Federal Housing Administration (FHA). FHA loans are widely available from most lenders and mortgage brokers. Qualifying requirements are more liberal than conventional loans, with higher debt ratios, 3% down and even a prior bankruptcy allowed. Rates vary by lender. Contact major local lenders and mortgage companies, or call the Department of Housing and Urban Development at (800) 217-6970 or visit its Web site at http://www.hud.gov/fha/res/respa_hm.html.

* Veterans Affairs (VA). VA loans for veterans are available through major lenders and mortgage companies. Loans can be made with no down payment, and you can finance most of the fees. There are limitations on loan size and the government-appraised home value. Rates are competitive, so shop around. Contact local lenders, your local VA office or (800) 827-1000.

* Community Redevelopment Act (CRA). Most major lenders offer CRA loans, also known as the Community Homebuyer Program. Most of these loan programs vary slightly from lender to lender, but all offer about the same benefits. In general, borrowers need 3% down from their funds with an additional 2% obtained from an outside source, such as a family member. Other qualifying requirements are more lenient than standard loans, and some lenders offer special credits for closing costs. Contact most major lenders and mortgage companies.

* Neighborhood Advantage Zero Down. Offered by Bank of America in 23 states, including California, the program is a true no-down loan. The borrower only needs closing costs. Limitations include a $227,150 maximum loan amount and a maximum annual income of $39,840 for Los Angeles-area home buyers. There is no income limit for borrowers purchasing or refinancing a home in low-income census tracts. Borrowers must have an excellent credit record. Contact Bank of America at (800) 642-2244.

* Triple Play Mortgage (TPM). Similar to CRA loans, except borrowers are allowed higher outside contributions--in the form of gifts--for down payment and closing costs. A unique feature is a liberal qualifying method that is not based on income ratios. The program is limited to certain areas. Contact PNC Mortgage at (800) 743-3646.

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