Downpayment Assistance & First Time Home Buyers

Our segment today is going to cover down payment assistance programs and do you have to be a first-time home buyer to qualify for them? According to the national association of realtors, the most difficult step in the home buying process is saving for the down payment. And as my granddaughter says – ta-dah! Oh, she’s so cute… so is my grandson. They’re both awesome. Enter the down payment assistance programs. Many folks think you still do need 20% down to buy a home. You really don’t. You can if you want, but you really don’t. Another little nugget is many downpayment assistance programs do not require you to be a first-time home buyer. In some cases, you can use the programs over and over again depending on your situation.

What these programs do is they provide money that can be put towards your down payment or closing costs or a combination of both. That way you don’t need as much money up front, which can make the prospect of purchasing your first home or another home, much less daunting. So, the money arrives in one of three ways. It’s a grant where you don’t have to pay it back. Some people call this a gift. It’s really a grant because it’s coming from an entity. The next one would be an interest free loan that typically runs with the term of your first mortgage and it is paid back later. There are no payments or no interest. And the third is a loan that also runs with a term of your first mortgage and has very small payments and very low interest. So, as you can see, there’s a lot of different ways to put this together. No, you don’t have to be a first-time home buyer to qualify for down payment assistance in many cases.

If you have questions, let me know.

What is PMI?

Today we’re going to talk about PMI or private mortgage insurance. When you as a home buyer make a down payment that is less than 20% you are going to be required to purchase private mortgage insurance if you are doing a conventional style loan. This private mortgage insurance or PMI protects the lender in case a foreclosure happens. The cost of PMI is usually between 0.3 and 1.5% of your original loan amount per year. That number does vary based on the size of your down payment and your credit score. On some loans, the PMI doesn’t stay around forever, as on some loans it will cancel so you don’t have to refi-out.

There are four types of mortgage insurance that I’ll go over really quickly.

The first is monthly, which most of you probably know about. It’s a premium that’s included in your monthly mortgage payment. Once you paid your mortgage down to 80% of the original sales price. With conventional financing, you can call to request that it be removed, but as 78% of the original loan amount and purchase price, the mortgage insurance will automatically cancel.

The next is single premium mortgage insurance, which is when you buy out the monthly premium with a flat fee. This is paid as a closing cost, eliminating the need for any kind of monthly mortgage insurance. Depending on your down payment, the premium may be able to be financed into your home loan as well instead of paid in cash at closing.

Then there’s split mortgage insurance, which is a little bit of monthly and a little bit of single premium. You can pay a certain percentage upfront and this will reduce your monthly mortgage insurance payment. So it’s a really great option if you can, uh, put this together this way.

The fourth option is lender paid mortgage insurance, which is when the mortgage insurance premium is paid by the lender and it’s built into an interest rate. And even though it sounds like your payment will be higher, it actually can produce a lower monthly payment because you’re not having this single amount of mortgage insurance included in the payment.

If you have questions, let me know.

Blue Water Navy Vietnam Veterans Act

Here’s a really quick update on something significant that has hit the lending world. The President just signed into law the Blue Water Navy Vietnam Veterans Act, and this is going to allow home buyers to borrow above the 2019 limit of $484,350 without a down payment currently.

If you do a lot of VA purchases, you know, it’s always been a split. There’s the conventional Conforming VA and then there’s the Jumbo VA, which requires 25% down of the difference between the two. So that’s actually a pretty much gone and you can now have the veterans financing above the $484,350 and not have to bring any money down.

Additionally, just so you know, NAR along with other veterans benefits groups who really fought hard to keep from having the VA funding fee increased to offset this. So that’s actually super important because it looks like many folks in Congress wanted to do that and they were pushed back on that. So anyway, some really good news here in the VA lending world, and if you have any questions, give me a shout or shoot me an email.

Understanding Your Home Inspection

If you’re going to spend this much money on something, you want to know exactly what you’re getting. A home inspection is a great way to ensure the largest investment of your life, your home, is worth buying. From the roof to the foundation, a home inspector’s report should cover the overall condition of the home.

How to Get a Home Inspection

The home inspection usually comes after the purchase agreement is signed. Both parties want to make sure they have agreed on a price before anyone spends money on the inspection, which can range anywhere between $350-600 in Washington, depending on the size of the property.

Here are a few of the main areas a home inspector will be checking:

  • They should look for any cracks, dents, or leaks in the foundation, floors, walls, ceilings, siding, windows, doors, and the roof.
  • Inspectors are trained to check the condition of cables, conductors, and panels. They’ll also note the number of installed light fixtures, switches, and outlets.
  • The inspector should check out all the faucets, drains, and pumps. They’ll document things like poor water pressure and corrosion, as well as the age and condition of the water heater.
  • Inspectors will usually note the age and energy rating of furnaces and air conditioners. However, not all inspectors will check solar heating and air conditioning systems.

What to do with the results

It’s unlikely that the home inspector’s report will come back with a perfect score. If you find the damages to be too bad, you still have time to back out of the deal. If not, you can ask the seller to fix it before closing or negotiate a lower purchase price.

Either way, a home inspection is going to give you a better idea of the condition of a home, allowing you to make a better-informed decision to either move in or continue your search for the perfect Washington home.

If you are looking for a home in Washington, give me a call at 360.798.4161 to find out how you can get pre-qualified for a mortgage!

Terms to Watch for in a Purchase Contract

A purchase agreement is a legally binding contract that is signed by homebuyers and sellers that confirms that all parties agree on the purchase price, closing date, and other terms.

Reviewing your purchase contract is crucial as it contains relevant information including how much you’re paying, when you are to pay it, under what conditions you can back out, and more. While it can vary, there are certain things you will want to be familiar with when purchasing your Washington home.

Settlement Date

Also known as your closing date, your settlement date will be the day that all involved parties will meet and officially make the sale. This date is usually negotiated by you and the seller.

When choosing a date, make sure to give yourself plenty of time to fulfill the home inspection, appraisal, and any other contingencies. If you fail to meet the obligations in the purchase agreement by the settlement date you may risk losing the sale.

Possession Date

The possession date is the day when you can actually move into your new home. In general, this day is 30 to 45 days after the closing date but can be as little as the day of.

This date is negotiable and can affect the strength of your offer. For instance, if the seller is still living in the home, allowing a few weeks (or even months) for them to find a new place could make your bid more attractive.

Earnest Money

Earnest, or “good faith,” money is the money the home buyer commits to completing the sale to show the seller that they are serious about buying the home.

A purchase contract will require you to put some money upfront in the form of an Earnest Money Deposit (EMD). This amount is negotiable between both parties and is usually 1-2% of the purchase price. Once accepted, the money is generally held by a title company to be used as credit towards your down payment and/or closing costs. The amount of your EMD may play an important role, especially if the home is receiving many offers.

Fixtures and Appliances

It’s important not to assume anything when purchasing a home. If you’re expecting the home to come with the refrigerator, oven, washing machine or more, these items should be included in the purchase contract.


To continue with the home buying process, you may have a few contingencies listed in your purchase contract such as selling a property you already own, getting a home appraisal, inspection or mortgage approval. Contingencies will protect you by allowing you to back out of a sale if something doesn’t feel right, usually without losing your earnest money deposit.

While you should review the entire purchase contract when purchasing your home, these are a few key points that you are guaranteed to see.

If you are looking for a home in Washington, give me a call at 360.798.4161 to find out how you can get pre-qualified for a mortgage!

5 Tips for First Time Homebuyers

Buyers save for many years before they are able to purchase a home. If you’re like these first time homebuyers, it is important to be ready for the loan process and to do your research. You’ve put a lot of time and money into taking this next big step in your life. I’m here to help you by letting you in on these 5 common mistakes—so you don’t make them too!

According to a survey by Trulia, close to 50 percent of fist time homebuyers in the U.S. experience unforeseen disappointments about certain aspects of their new home. My job is to ensure that you don’t have any regrets about the purchase of your home. A little preparation can prevent that from happening to you. Here are 5 tips that I give to my first time homebuyers:

Ask me more questions!

A lot of firsttime home buyers are apprehensive about asking questions. Don’t be afraid to ask me too many questions! I will do my part to take the time to understand you and your financial situation before suggesting loan options. But don’t hesitate to ask me questions in addition to my suggestions. Ask me about all of the loan options available to you, so that you know you’re getting the best deal. Here are great examples of the questions you should ask me or any lender:

  • What is the interest rate?
  • What are the lender fees?
  • What is the minimum down payment to qualify?
  • What kind of loan is it, and what are the pros and cons of each type?
  • How long will the loan process take?

Take the time you need but not too long!

Many first time buyers don’t make the decision quickly enough to close the deal. I know that deciding on your dream home in Washington is not a choice that you can make easily, but keep in mind that other buyers will be interested in the home you choose. Properties remained on the market for about 27 days in July 2018.[1] But a little over half of homes were sold in less than a month![2]


Make sure you’re working with an experienced real estate professional.

Buying a home comes with complicated forms that first time homebuyers have never previously encountered. A good real estate agent can explain every step of the process and how to fill out each form correctly. Their experience is worth investing in. A real estate professional can also guide you when ready to make an offer on your new home.

Calculate your offer before you make it or risk losing your dream home.

Based on how long the house has been on the market, you must gauge what the seller is willing to accept. In this stage, it is especially important to research prior to making an offer. Compare the property you want with alike homes in the area. Then, make your best offer first.

Think about the resale before you buy.

It may seem far away, but the average first time buyer lives in their home for about 11 years.[3] Consider the location, age, and size of the home before you buy to determine if it’s up to par with what you want to sell it for in the years to come.

Consider these 5 tips to ensure a great start to your home buying process in Washington. If you have any additional questions, please contact me at or visit to pre-qualify today!



If you are looking for a home in Washington, give me a call at 360.798.4161 to find out how you can get pre-qualified for a mortgage!