A Golden Opportunity for Homebuyers

San Luis Obispo County - Two things usually stand in the way for first-time homebuyers -- cash for down payment and closing costs, and other debt. But a few programs are now available in San Luis Obispo County to help potential homebuyers overcome these obstacles.

One, underwritten by a bond program under the California Rural Home Mortgage Finance Authority, is referred to as "Rural Gold" and offers first-time homebuyers a GIFT of 3.25% of their base loan amount that may be used for down payment or closing costs. The new loans must be FHA or VA with a maximum sales price of $169,109 new construction or $178,860 existing construction and guarantee a fixed interest rate of 7.25% for 30 years. With "Rural Gold", buyers may also select a second trust deed to help them get into the program for 2% of the base loan amount - at the same interest rate - amortized over 20 years.

This program is now in its fourth series, the first having been filled July 1998. Funds are limited, first-come, first-served.

Another program is available, monitored by the same Cal Rural Home Mortgage Authority, is called "Rural Access" and is not limited to first-time homebuyers and has no sales price limitations.

In this program, a buyer may select FHA or Conventional financing up to the standard loan limits (95% for Conventional). The second trust deed may be selected for up to 5% of the final loan amount and may be used for any of the buyers' cash necessary to close. "Rural Access" is available until April 1, 1999, and hopefully will be extended.

According to Roxanne Carr, Division President of The Mortgage House in San Obispo, both programs are limited to owner-occupants only and have income caps, and buyers must own no other property. "To the best of my knowledge, we are the only FNMA lender approved for these special programs. We closed a large number of loans in Series A of the Rural Gold Program and have found them to be very, very helpful to homebuyers in our area. We are fortunate to have these programs available, and I would urge potential homebuyers to hurry before the funds are gone."

A third program is being offered under Fannie Mae (Federal National Mortgage Association) auspices for Conventional loans up to $227,150 with only 3% down, and the funds for down payment can come from a gift, grant or unsecured loan from family, employer, government or nonprofit, etc., and an additional 3% contribution from the seller can be used for closing costs, essentially leading the way to no cash from the buyers.

There is no income cap, no first-time homebuyers requirement, and expanded qualifying ratios are allowed. The buyers credit must be above average to qualify for this "Flexible 97" program.

For more details on any of these or other programs, contact a loan consultant at The Mortgage House... Atascadero 805-466-6766 or San Luis Obispo 805-782-6999.