No Bank Qualifying
Looking for an assumable should be used as a last resort.
Here's why. With today's ultra-low interest rates, you will likely save yourself tens of thousands of dollars over a 25 year mortgage. Most assumables which are available today have higher interest rates than what you can currently get from the banks. It makes no sense to assume a mortgage at 6.23 % when you can get one of your own at 4.25%.
There are several reasons why a lender will turn down a mortgage application.
While traditional lenders have relaxed their qualification policies considerably in recent years, it's still pretty much standard that you will require a minimum of 2 years employment history with the same employer, and a fairly clean credit record. If you've had a foreclosure or bankruptcy in the past 3 years, this will also disqualify you (some lenders require only two years since your bankruptcy or foreclosure, however their interest rate will be slightly higher).
Assuming may be better than rent!
Check it out in the Calculators section. Calculate the value of buying over renting, at the assumable rates (use the current 5 year interest rate in your calculation - 6.23%)! Would you be better off owning your own home? If we can find you a home with an interest rate equal to or less than the current 5 year closed rate, posted at the bank - would you be interested? Build equity in your own home or pay rent? If you can get into a home today with seller assisted financing, in two years or less you may qualify for your own mortgage.
Give us a call.
