Last week we got an important heads-up from local lender Aaron Nawrocki, at Capital M Lending, about changes that Fannie Mae and Freddie Mac are making in their approach to pricing conventional mortgage loans. These adjustments will be implemented in the next several months. For starters, there will be new pricing tiers for higher credit scores > 760 and > 780 (meaning higher rates for buyers with lower scores) and a pricing adjustment for debt/income ratios over 40% (meaning higher rates for buyers that have higher debt/income ratios).
There is also good news on the lending front. Both the FHA and VA announced this week that they would lower lending costs in the next 45 days. FHA is lowering mortgage insurance premiums, and VA is reducing funding fees.
Like Aaron, we believe that education and communication are incredibly important throughout all stages of the home-buying process; lending is no exception. So this seems like the ideal time to reiterate that we highly recommend talking to a skilled lending professional early and often. Buyers who develop these relationships are more likely to get the best terms possible for their unique situation and avoid unpleasant surprises in their lending journey. They also learn a lot and feel more confident as a result.
Do not hesitate to reach out to us if you have questions about your financing status>>