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Marabeth Gildersleeve's Central Ct Blog

Articles will be posted that will be of interest to you as a buyer or seller or renter, including mortgage information, insurance information, market statistics for Glastonbury, Portland and Middletown, listings, open houses.
Mortgage Downpayment Options

This article was written by our mortgage officer and I thought it was worth sharing , since mortgage requirements keep changing.



Changes to Mortgage Downpayment Options for Different Programs


Here is a summary of down payment options available:


0%   (100% financing) VA (Veteran's) or USDA Rural Housing, use this website to see if an address is eligible:  http://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do   (then click on Single Family Housing and enter the address)


3.5%  CHFA or FHA. ($8000 tax credit can be used for CHFA loans now, the previous $7500 tax credit could not)

            CHFA is at 5.0% while FHA is at 5.5% ( These rates change daily)   If your buyer is struggling to come up with 3.5% down, then FHA is better because no required 1% origination upfront.

            Just about every lender is requiring a FICO of 620 or higher now for FHA


10% or more. Conventional Financing with PMI (private mortgage insurance up to 20% down)


There is only one Mortgage Insurance company that will allow 5% down in CT and they are very strict on FICO score (700+)  and debt ratio (41%).  Also keep in mind with conventional financing that when putting down less than 20%, 5% of the funds must be the borrowers own funds (meaning no large deposits on 2 months of bank statements).  If borrowers do not have 5% of their own money, they need to go FHA where the entire down payment can be a gift.



Sean R. Smith, CMPS

Mortgage Planner

Connecticut Home Mortgage





Published Thursday, March 12, 2009 11:41 AM by Marabeth Gildersleeve

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