First-Time Homebuyers = Expansive Term; Maximum Age For Mortgage; Competitors Come to Us

    Competitors Come To Us For A Mortgage

    We frequently have individuals from competing mortgage lenders come to us for mortgage financing because (1) we have more loan programs than they do, particularly with respect to low down payment programs; (2) our rates are lower; (3) we can close much faster; and/or (4) they don’t want their co-workers to see their income (this was much more common prior to 2008 though when every loan officer I knew greatly embellished his income, but he knew his secret was safe with me 😊). In any case, we have received several loan applications from competitors in recent weeks, and I always think that is a reminder that we are probably doing something right.

    Maximum Age For Mortgage

    His name was Harry Gemignani, and he would come by my office all the time back in the 1990s in his tennis clothes (he played every day) to discuss financing options. It was usually after 5 PM though because he also worked full-time as a bag boy at a grocery store. He didn’t have to work but he just loved staying busy and engaging people. He also loved to discuss mortgage financing. Interestingly, Harry was 88 years old and he never had any trouble qualifying for 30-year mortgages, despite his very advanced age. I share this story simply to remind everyone that there is no maximum age for qualifying for any type of mortgage. This is also a reminder to be more like Harry, as he was probably the happiest person I ever met.

    “First-Time Homebuyer” Is A Much Broader Term Than Most People Realize

    The advantages of being a “FIRST-TIME HOMEBUYER” are many, and they include: (1) much lower rates from Fannie Mae; (2) access to low down payment (only 3%) programs from Fannie and Freddie; and (3) access to down payment assistance programs.

    FHA Exceptions: As a quick sidebar/reminder: borrowers do not have to be first-time homebuyers to qualify for FHA financing.

    And – 45% of all homebuyers were “first timers” in 2022 – so this is not a segment of the market to be ignored.

    DEFINITION: A FIRST-TIME HOMEBUYER is anyone who hasn’t owned a real property over the previous three years – as most everyone knows.

    BUT – there are important nuances that most people don’t know.

    1. HOW DO THE DATES RUN? The three years run from the date of the sale of the last home through the future closing date of the new home. The dates on the mortgage application and the purchase contract are irrelevant.

    2. ONLY ONE SPOUSE: Only one spouse needs to be a first-time homebuyer. So, if one spouse owned a home last week, the couple together can still take advantage of first-time homebuyer specials as long as the other spouse has not owned a home for three years.

    3. RECENTLY DIVORCED: Recently divorced individuals usually qualify as first-time homebuyers too – even if they owned a home while they were married.

    4. MOBILE HOME OWNERS: Borrowers who recently owned a mobile home also qualify for first-time homebuyer status, as mobile homes are not considered “real property” in most cases.

    5. INVESTMENT PROPERTY OWNERS: Investment property owners, however, usually do not qualify for first-time homebuyer status.

    I will discuss the best loans for first-time homebuyers in future blogs.

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