Why Choose an FHA Loan?

 An FHA loan is a mortgage loan the Federal Housing Administration (FHA) insures. The FHA is part of the U.S. Department of Housing and Urban Development (HUD). This protects the lender if the borrower defaults on the loan, making it less risky for lenders to extend mortgages to individuals who might not qualify for conventional loans.

FHA loans have lower financial requirements, which can help borrowers get the mortgage they need to finance a home purchase with a lower down payment. First-time home buyers and low-to-moderate-income households typically obtain an FHA loan when they don’t qualify for a conventional loan.

Benefits Of An FHA Loan

FHA loans offer borrowers advantages to increase accessibility and affordability. Here are the benefits of an FHA loan to expect:

1. Lower Minimum Credit Scores

FHA loan credit score minimum requirements are typically lower than conventional financing, depending on the lender. This can help credit-challenged borrowers qualify for a mortgage.

2. Low Down Payments

The down payment requirements for FHA loans are 3.5% of the loan amount for borrowers with credit scores of 580 or higher. For comparison’s sake, conventional loans usually require 5% down unless you’re a first-time home buyer or make not more than 80% of the median income in your area.

Remember, the down payment is separate from closing costs, which cost 3% to 6% of the purchase price. So, you’ll need funds to cover both the down payment and the closing costs, including origination fees, MIP fees and appraisal fees. Fortunately, the reduced down payment could help you afford the closing costs.

3. Favorable Interest Rates

FHA loans have backing from the federal government, meaning your lender will still receive payment if you default on your loan. For this reason, FHA loans have competitive interest rates, increasing the affordability of your monthly mortgage payment.

4. Compensating Factors for Applications

FHA loans help borrowers with blemished financial situations, such as a lower credit score or income. Compensating factors increase the likelihood of approval when you apply for a loan. Specifically, lenders consider your cash reserves, income from other sources, monthly debt payments, how much the loan increases your housing costs and your desired home’s energy-efficiency. These aspects of your application can offset a DTI or credit score that isn’t ideal as long as DTI is still within the product limits.

5. Repeated Use

FHA loans are advantageous for first-time home buyers because of the relaxed financial constraints. However, borrowers can use them as often as they wish. As a result, you can apply for an FHA loan whether you’re buying your first home or downsizing for retirement.

Other FHA Loan Requirements

1. Appraisal and Inspections

Because the government requires homes to meet several minimum quality standards, borrowers must pay for an appraisal. The FHA appraiser will come to the home and spend a few hours inspecting it for issues. If they discover any, it’s up to the buyer to negotiate with the seller over fixing the problems.

2. Mortgage Insurance Premiums

FHA loans require borrowers to pay mortgage insurance premiums (MIPs) at closing and throughout the life of the loan. Specifically, you’ll pay 1.75% of the loan amount at closing as your upfront MIP. There will be an additional MIP included each month in your mortgage payment. The upfront MIP can be included in your loan amount instead of paying the lump sum at closing.

The Bottom Line

An FHA loan allows first time home buyers with low to moderate incomes and less than 20% down payment funds to achieve homeownership. The appeal of FHA loans lies in their lower financial requirements, including a reduced down payment, more flexible credit score criteria and less strict debt-to-income ratio requirements. These features make homeownership more accessible to individuals who are unable to qualify for conventional loans.

As with any financial decision, borrowers should explore all loan options to make an informed choice that aligns with their homeownership goals.

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell: (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org

 

VA Loans

 

Why Should You Choose VA?    

At Flat Branch Home Loans, we strive to provide homes for those who have sacrificed everything so we can live peacefully. If you’re an active, discharged or medically discharged veteran, and have ever thought to yourself: “I’d like to use my benefits for a home loan,” we have a great, in-house opportunity as a thank you for your service:

Designed to promote homeownership, the U.S. Department of Veteran Affairs (VA) loan is made by lenders and guaranteed for eligible veterans to purchase their dream home.

Despite its broad resources, only 10% of the 25 million veterans have taken advantage of this benefit. This loan is meant to honor our heroes, and we want to make sure every eligible veteran and active member know how this loan works and when it works best, so they can live the life they deserve.

What Is It?

The U.S. Department of Veterans Affairs wants to help service members, veterans, and surviving spouses become homeowners. VA provides a home loan guarantee benefit and other housing-related programs to help you build, repair and retain your dream home. And with less stringent rules, 80% of VA borrowers who otherwise could not be covered by conventional loans were able to purchase their home.

This gift has built-in protections for those who’ve protected us, which leads to more competitive rates and terms for our nation’s heroes.

What Makes It So Great?

No Down Payment / 100% Financing

It’s nearly impossible to find a loan product that gives the borrower full financing. This is the most significant benefit of the VA as it gives the borrower the power to purchase a home with no money down.

No Monthly Mortgage Insurance

No private mortgage insurance (PMI) means monthly payments are more affordable.

Not Limited to First-Time Home Buyers

A VA loan can be used to finance your entire purchase or refinance. This hard-working loan can even help repair and improve your home, too, with energy-saving features such as solar heating, water heaters, insulation, storm windows, and other efficiency improvement loans approved by both the lender and the VA.

And there’s even more:

• No prepayment penalties
   
• Counseling and assistance in the event of financial difficulty
   
• Lower credit score requirement
   
• Higher allowable debt-to-income ratios than most other loans
   
• Potential for two VA loans at the same time  
   

But Do I Qualify?

Both veterans and active-duty service members may qualify.

But fitting into just one or more of these categories will be enough:

• Military members who have served 181 days on active duty or three months during war time
   
• People who have spent at least a half-dozen years in the National Guard or Reserves
   
• Spouses of fallen heroes
   

We work hard to ensure that we are able to give back to as many of our heroes as possible, so their dream home is achievable and within reach. Even if you think you’re not qualified for an VA loan, contact Michael Lasson or Michelle Lasson, with Team Lasson, at Flat Branch Home Loans (who are VA-approved) to find out for sure.

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell:  (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org

USDA Loans

 

Why Choose a USDA Loan

 The USDA loan is one of the most beneficial programs for homebuyers wishing to purchase a home in rural areas.

Designed to help buyers achieve the dream of homeownership, the USDA loan comes loaded with benefits that open the doors to many who may not otherwise qualify for conventional home financing.

Advantages of USDA Loans

This loan program offers several advantages over other mortgage options, largely because the USDA guarantees all loans against default. This means that lenders can take on more risk and offer homebuyers favorable loan terms.

No Down Payment

The most common is the ability to obtain 100% financing without having to spend years saving for a down payment. This government-backed loan option is one of the last remaining $0 down payment mortgage options out there.

Competitive Interest Rates

Due to the USDA guarantee, lenders are able to offer some of the lowest interest rates on the market. While actual rates will vary by lender due to other contributing factors, know that your credit profile and current market conditions play a vital role in your mortgage rate.

Low Monthly Mortgage Insurance

With a conventional loan, you typically pay "private mortgage insurance" (PMI) if you don't have a 20% down payment. FHA loans also have high annual mortgage insurance fees.

USDA loans, on the other hand, don't have PMI. Instead, the USDA uses two fees: an upfront guarantee fee that is paid at closing and can be included in your loan amount, and an annual fee, which gets included in your monthly mortgage payment. The upfront fee is 1% of the total financed amount while the annual fee is 0.35% of the loan's current balance.

USDA loans have the lowest funding fee of all government-backed loan products.

Flexible Credit Guidelines 

Most conventional lenders look for a credit score of at least 640, however you'll need something closer to 720 to qualify for the lowest interest rates. Luckily, USDA loans will allow for lower credit scores, sometimes as low as 580.

Eligibility

The vast majority of the United States falls within what the USDA considers an eligible, rural area. While the goal is to boost population in non-urban areas, the USDA's definition of rural areas casts a broad net. In fact, a "rural" area is defined as any area with a population of less than 35,000 people. That means that an estimated 97 percent of the country could qualify for a USDA loan.

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell:  (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org

 

A Guide to Your Mortgage Interest Rate

 

A Guide to Your Mortgage Interest Rate  

Mortgage interest rates are a reflection of how much risk a borrower and their new home can possibly carry. The less risk your lender feels, the likelihood of you receiving a positive interest rate will increase.

But hey, no worries, you’re more in control than you think. Beyond external forces like the housing market and general inflation, listed below are the ingredients of a mortgage interest rate that you have complete control over.

Credit Scores

The best-known detail of a mortgage rate is your FICO credit score. Before you start any mortgage shopping, check it out and review your credit reports for errors. Certain slip-ups can lead to a lower score, preventing you from qualifying for better loan rates and terms. Make sure to check this early in the process. Lenders are looking to offer mortgages to those with high credit scores, and the higher your score, the lower the rate you might qualify for.

Below is a recap of what affects your score:

• Late payments: If you don’t pay things on time, had an account sent to collection or declared bankruptcy, these all can negatively impact your credit score.
   
• Length of time on open trade lines: Sometimes a short history can have a negative impact, but if you’re making payments on time and have low balances, you can offset that negative impact
   
• Number of inquiries in a short period of time: It might sound ruthless, but too much uncertainty about the state of your score can affect it negatively.
   
• Sprawling debt: If you’re spending too close to the limits, this could negatively affect your score as well. A healthy expenditure means you should use less than 20-30% of your available credit, keep good-standing accounts open for long periods of time and avoid opening too many new accounts.

Total Loan Amount

The size of a mortgage loan and, to a degree, the price of a home, is another influencer. Loans too large or small are perceived as bigger risks.

• Danger zone: If your loan exists in the sweet spot between $100,000 and $766,550, then you’ll have fewer chances of a spike in your interest rate. Living outside those lines might cost an extra nickel. 

Home Location

One of the more overlooked factors is the health of the housing market within a state or county. If a lender is less worried about the area’s risk of default, you’ll likely see a lower rate. The surrounding house prices can also make an impact. Living near water (more expensive) or in a rural area (less expensive) could change the amount of your mortgage and put you into the zone where lenders may charge a higher rate.

Loan Term & Type

Or, in other words, promptness and assistance.

Your loan’s term is how long you have to pay back the loan. Usually, you'll find that short-term loans have lower interest rates but do have higher monthly payments.

Regarding the types of loans, there are several broad categories of assistance, such as conventional, FHA, USDA and VA loans. Rates significantly differ based on which type you choose. Conventional loans require anything between a 3-20% down payment, while FHA needs as little as 3.5%, and it can offer more attractive interest rates. A similarity between the two is that conventional loans and FHA loans require homeowners to purchase private mortgage insurance (PMI), but with conventional loans, you only need PMI if you don’t pay the full 20% down payment. PMI helps protect the lender against default should a buyer not make a payment. Different loans can yield different rates and results.

For both terms and types, be sure to ask your lender to compare the options for you.

Finally...

When shopping for mortgage rates, be aware that the one you get over the phone could be completely different in a matter of minutes. Lenders can’t always guarantee a locked-in rate until they have a fully executed contract on the home you’re purchasing.

It’s not just one ingredient over the other — each factor contributes to the overall recipe that’s personally refined by you. All you need to do is keep these five major components under your scrutiny and your long-term wealth will rest much easier.

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell:  (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org

 

Property Taxes - How They're Determined & What You Need to Know

 

Property Taxes | How They're Determined & What You Need to Know

Property taxes are a significant consideration for homeowners and potential buyers, as they contribute to the cost of owning a home. These taxes are typically used to fund local services such as schools, public safety, infrastructure, and community development. Understanding how property taxes are determined can help homeowners plan their finances better and avoid surprises.   

How Property Taxes Are Determined

Property taxes are generally calculated based on the assessed value of your property, which includes both the land and any structures on it. Local government assessors evaluate the property’s market value, considering factors such as location, size, use, and comparable property sales in the area. The assessment process may vary depending on the jurisdiction, but it usually involves a periodic appraisal, often conducted annually or biannually.

Once the assessed value is determined, local tax rates, known as millage or mill rates, are applied. These rates are set by local government entities, such as city councils or school boards, and can vary widely depending on the area’s budgetary needs. The mill rate is typically expressed as a dollar amount per $1,000 of assessed value. For example, if the mill rate is 20 and your property is assessed at $200,000, your annual property tax would be $4,000. It’s important to note that these rates can change over time, reflecting the financial needs of the local government or changes in property values.

Factors Influencing Property Taxes

Several factors can influence the amount of property taxes you pay:

1.      Property Location: Taxes can vary significantly based on where the property is located, as different municipalities have different tax rates and levies.

2.     Property Improvements: Any improvements or additions to the property, such as building a new room or upgrading the kitchen, can increase the assessed value and, consequently, the tax amount.

3.     Market Conditions: Property values fluctuate based on real estate market conditions. In a booming market, property values—and taxes—may rise, while a downturn could lower them.

4.     Local Government Budget: The tax rates are influenced by the financial needs of local government services. If there is a need for increased funding, tax rates may rise accordingly.

5.     Exemptions and Relief Programs: Many areas offer property tax exemptions or relief programs for certain groups, such as senior citizens, veterans, or low-income homeowners. These can significantly reduce the overall tax burden.

Understanding Your Property Tax Bill  

Your property tax bill will detail how your taxes are calculated and provide a breakdown of where the funds are allocated. It’s crucial to review this bill carefully and understand each component. If you believe your property has been overvalued or the tax amount is incorrect, you have the right to appeal the assessment.

Understanding property taxes is essential for homeowners to effectively manage their finances and avoid unexpected costs. By understanding how property taxes are determined and what factors influence them, you can make informed decisions about buying, maintaining, or improving your property. Keeping an eye on local government activities and budgetary needs can also help anticipate potential changes in your tax obligations.

Sources:

TaxFoundation.org

Investopedia

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell:  (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org

Mastering Financial Literacy: A Guide To Smart Money Management

 

Mastering Financial Literacy: A Guide to Smart Money Management

In today's world, financial literacy is more important than ever. Yet, many people struggle with financial concepts, leading to financial stress and insecurity. Whether you're just starting your journey to financial independence or looking to enhance your money management skills, there are many simple and easy changes you can make to take control of your finances.

Before diving into financial strategies, it's essential to learn the fundamentals. This includes understanding concepts such as:

· Budgeting

· Saving

· Investing

· Managing debt

Budgeting creates the foundation of financial stability, helping you track your income and expenses to ensure you're living within your means.

Saving allows you to build an emergency fund and work towards your long-term financial goals, while investing helps grow your wealth over time.

Managing debt wisely is crucial to avoiding high-interest payments that can derail your financial progress.

A comprehensive financial plan that aligns with your goals and values is essential to having a good long-term financial strategy. Start by setting specific, measurable, achievable, relevant, and time-bound (SMART) financial goals. Whether it's buying a home, saving for retirement, or starting a business, having clear objectives will guide your financial decisions and keep you focused.

Next, establish an emergency fund to cover unexpected expenses such as medical bills or car repairs. Aim to save three to six months' worth of living expenses in a savings account or within other assets. Additionally, prioritize paying off high-interest debt, such as credit card balances, to reduce interest payments and free up more money for savings and investments.

Investing is a powerful tool for building wealth over the long term, but it can be intimidating to start. Begin by educating yourself about the different investment options available, such as stocks, bonds, mutual funds, and exchange-traded funds (ETFs), or consider working with a financial advisor who can help you develop an investment strategy.

Financial literacy is essential for achieving financial security and independence. By understanding the basics of budgeting, saving, investing, and managing debt, you can build a solid financial foundation and work towards your long-term goals. Remember that financial literacy is a lifelong journey, so continue to educate yourself and adapt your strategies as needed. With dedication and discipline, you can take control of your finances and create the future you want!

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell:  (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org

Choosing the Right Mortgage Lender

 

Choosing the Right Mortgage Lender: Your Financial Partner for Life

Embarking on the journey to homeownership is an exciting and significant time in your life. While it may seem like a minor detail in the grand scheme of things during the homebuying journey, your choice of lender can make all the difference in the mortgage process and overall homebuying experience. This choice isn't just about finding someone to fund your home purchase; it's about choosing a financial partner who will be with you for the long haul.

Here's how to ensure you're making the best choice for your financial future:

Assess Your Needs: Understand your financial situation, including your credit score, income, and savings. Determine what type of mortgage you need and what terms are most suitable for your circumstances.

Research Lenders: Take the time to research different lenders. Look beyond just interest rates and fees; consider their reputation, customer service, and expertise in the industry.

Seek Recommendations: Ask friends, family, and real estate agents for recommendations. Personal referrals can provide valuable insights into a lender's reliability and service quality.

Transparency Matters: Choose a lender who is transparent about their rates, fees, and closing costs. Avoid hidden charges or unclear terms that could lead to financial surprises down the road.

Think Long-Term Relationship: Remember that your relationship with your lender extends beyond the closing process. Look for a lender who views you as a long-term financial partner, offering support and guidance beyond the initial transaction.

Evaluate Communication: Effective communication is key to a smooth mortgage process. Choose a lender who is responsive, communicative, and willing to address your concerns promptly.

Check Reviews: Read reviews and testimonials from past clients to gauge their satisfaction with the lender's services. Positive reviews indicate a track record of reliability and customer satisfaction.

Trust Your Instincts: Ultimately, trust your instincts when choosing a lender. If something doesn't feel right or if you're not comfortable with the terms, don't hesitate to explore other options.

Remember, your mortgage lender is more than just a financial institution; they are your partner in achieving homeownership and securing your financial future. Our team possess the expertise and have well-rounded experience within the mortgage industry to serve you with a loan product that is cost-effective and best fits your lifestyle. We work diligently with everyone involved in any transaction to make it a seamless process and further improve the customer experience.  

Let’s Get You Home.  

Team Lasson is here for all of your home buying needs!  If you’re thinking about making the leap into home ownership in the near future, please contact us today to get started.  We can help you determine what loan program works best for your financial goals.  The first step in preparing for your big purchase is to get pre-approved for a mortgage at Lake of the Ozarks.  Please visit www.yourlakeloan.com or give us a call at (573) 216-7258 to get started.

Michael Lasson

Senior Mortgage Banker

NMLS #:  493712

Flat Branch Home Loans – Team Lasson

2882 Bagnell Dam Blvd

Lake Ozark, MO 65049

Cell:  (573) 216-7258

Email:  teamlasson@fbhl.com

Website:  www.yourlakeloan.com

**The postings on this site are my own and do not necessarily represent Flat Branch Home Loans positions, strategies, or opinions.

Flat Branch Home Loans NMLS 224149. A Division of Flat Branch Mortgage Inc. For more licensing information, visit NMLSConsumerAccess.org