Delaware Mortgage Loans

Fannie Mae made significant changes to its Desktop Underwriting (DU) for My Community programs.  The guidelines have changed to make it harder for first time home buyers to qualify for a mortgage to purchase a home with little to no money down.  The guidelines took effect May 19th.  Borrowers who qualified before May 19th, may no longer qualify under the new guidelines.

This effects people trying to qualify for the Delaware Bond Program loans for first time home buyers because these loans must qualify through Fannie Mae’s DU.  Fannie Mae wasn’t specific about what exactly won’t qualify but it seems aybody with a credit score below 620 certainly won’t qualify anymore. 

So what are the best options now for first time home buyers in Delaware?  The answer is FHA.  FHA is not credit score driven and can be manually underwritten so borrowers are allowed to make their case for recieving financing.  FHA will lend up to 97% LTV and only requires borrower to bring 3% to the transaction.  This 3% can be a gift.  The seller is allowed to pay up to 6% towards closing costs.  FHA also has a streamline refinance option which makes it very easy to refinance to a lower interest rate.

For more information about your loan options for buying a home in delaware please feel free to contact me at 302-368-7132.