✅ - Get a Referral to a Mortgage Lender or Realtor - www.jebsmith.net/referral 🏠 - First Time Home Buyer Course - www.becominghomewise.com ⏩ Watch This Next ⏩ - NEW FHA Loan Requirements 2023 - czcams.com/video/dmuCCC0WCcg/video.html
Awesome info, ty! Maybe you could do a similar video for investors looking to purchase rental property and what loan options are available. Great stuff as always, love your channel!
FHA loans isn’t always low credit scores that people go with FHA loans for. In our case our DTI was high, but our credit scores are in the high 700’s this is because I have our twins student loans/parent plus loans. So, this put us in a high DTI of 51 percent, where on a conventional loan the max DTI is 42-45 percent. This makes it difficult for someone to qualify for a conventional loan. I call the student loan debt a ball and chain. It’s pretty sad that parents plus loan percentage rate is so high…
First time homebuyer here and I have to say THANK YOU for this info you give it is helping me understand more and gather information to better myself for the home buying process . A quick funny story .. I follow a podcast called “The Educated Homebuyer “ and I never knew you were the same person ! I thought I was gathering amazing information from two separate sources this whole time 😅 But Once again thank you for the content
The better your score, the better your rate........the loan level price adjustments will hit those with higher credit scores based on the current set up but you'll still end up with a better rate than those with lower scores.
Love this man so detailed so unbiased so much advice one way or another im always soaking up information and my wife doesn’t and it’s hard for me to explain lol I think this will be perfect for her I know it was for me and I really hope we can get the house we want and not just what’s there you know. Wish we would’ve been did it but looking at this I know it’s possible. Thanks I really appreciate it.
It looks like Conventional will works best for someone with 775 credit score and able to put 5% down comfortably. I was trying to go for 20% but it is a lot.
Here I’m working getting excellent credit to get better approval, and the government wants to reward bad credit. Is the government talking to these banks then? Banks want bigger down payments as well. I guess we will see what comes with these changes.
Paying $3500 per month for ANY mortgage is a HUGE payment out of a net. When you make $175,000 you are in a VERY HIGH tax bracket unless you have a basket full of kids. OVER 40% to taxes, California STATE and required INSURANCE payments which you get ZERO break on at that salary is VERY HIGH). UTILITIES in California are HUGE! Transportation costs (auto/auto insurance/license,registrations etc and gas or electric charges and maintenance on vehicle) is HIGH in California! Most people earning that kind of money have student loan debt/payments! If you are paying $3500/month for a home....HOW WILL YOU EAT, SAVE and maintain LIFE!
The credit score required for a mortgage loan is not different from your regular credit score, they refer to the same thing. However, the minimum credit score for a mortgage loan may vary depending on the type of loan and the lender. These scores influence your loan terms and interest rates. So when we talk about credit scores in the context of housing, we are referring to your standard FICO score.
If fha maxes out in my area at $472,000 and my house is $500,000. Doesn't that mean I need to bring more than 3.5% to reach 500k? Was your scenario for an fha loan not limited at 472000? My other question - if I do live in an area limited at 472000. I put 28k down to get to 500k. Can I still finance the upfront PMi, since that would put me over the 472k? Or, do I have to pay the entire 1.75% at closing?
great video. For the 3% conv vs 3.5 FHA, even tho the FHA payment is lower you are going to be about a 9k (FHA funding fee estimate) difference in equity? so does the conventional in that situation make more sense than the FHA at 3.5 even with the lower payment?
My DTI is 2% with a pretty good income but my mortgage Fico 2 credit score is 640 eventhough my overall Fico 8 is 660 and I was rejected for conventional. I was approved for FHA but was shocked that I didn't qualify for both given my income, credit over 620 and my DTI
Good luck getting a 3% down conventional loan approved with a 620 credit score. Most time Fannie and Freddie will not approve it due to risk involved. Not to mention PMI will be double with conventional. FHA is a better loan option in regards to every aspect unless your score is over 680. If the home is in good shape sellers should be afraid of FHA loans.
@@cavemanlefancy3373from what I know, the closing period takes longer with FHA loans. You have to get an FHA appraisal (check the home to see if it’s in good shape) along with the other regular appraisal and home inspection what comes with buying a home. There’s also a few other factors, financial wise that could affect the seller I believe.
I'm confused. I'm not understanding the difference between PMI/MIP with FHA loans versus conventional loans. I was under the impression that when you put 3.5 % down once your property reaches 20% equity you can refinance. But now it seems like you have to put 10% down with an FHA loan in order to refinance out of the mortgage insurance. So are you able to refinance out of mortgage insurance when you put down less than 10% on an FHA loan?
I did not hear anything about renting out the houses that we buy with these loans? Are these one time loans or can we keep using them? I want to buy a duplex that’s already rented on both sides and the 3.5 percent down would be a perfect amount for me.
@@ShagawabJudah yes, when you don’t have much on personal tax returns but your business is doing well, for example. In our case, it is a new business with 1 year of tax returns (but they require 2 for fha/conventional).
@clarencemurray4281 Going through this process now. The bank doesn't count all of your income from the bank statements. The one I'm using only counts 50-70% of those total of 12 months of income. For instance if your statements are $50,000 they will only use $25,000 (50%)... I had to show proof with invoices of cash deposits. Also, how much you have in reserves/savings. Credit scores have to be over 680. The list goes on and on 😅 I hope this helps.
@@thevlogspotwithyolanda345 I agree too much hustle. I gave up on that idea when our loan officer told us the rate was going to be much higher than for conventional. And 20% down required. We decided to wait till next years tax returns. But then the realtor persuaded us to try the builders financing and we got approved for conventional by both builders, Horton and Lennar (with 1 year of tax returns). We tried just in case (because it was same inquiry) to apply at local credit union too. Our loan officer said we would probably be approved too for conventional but asked for too many things so we gave up. Basically they all asked us to link bank accounts. It was optional but we did we did ( personal and business), and were approved based on the total amounts. Our last year personal income wasn’t even that much, so the ratio was still pretty tight and the loan amount wasn’t generous.
Great video! This was an awesome breakdown. I appreciate it. Do you think you could do one comparison with VA FHA and conventional with the same credit score also fha203k
I already purchased a home a year ago and only put down a 3.5% down. I wished I would of known that putting down more money would of saved me money on a conventional loan.
Hey Jeb , really nice video ! I was wondering if I could help you with more Quality Editing in your videos and also make a highly engaging Thumbnail and also help you with the overall youtube strategy and growth ! Pls let me know what do you think ?
Hi Jeb, my mother wants to buy a house, she only makes 25,000 yearly, Amerisave didnt approved her. Is there any lender that will loan her? Please help us.
Their making it harder and harder for us that want to buy a home starting may 1st they are saying that we would be paying more for people with a higher credit score it’s crazy so what’s the since of trying to get our scores higher if that’s the case it’s getting so depressing now because this just shattered a lot of people’s dreams
@Yadira J absolutely my score ain't all that trust me but i did work hard to get it to where i had a possible but its just crazy how they can up the ante all of a sudden the Government is so crooked smh its like they dont care
I need help in refinancing. I just purchased a home on December 6, 2022 and I would like to get it refinanced to lower my interest rate and have a lot and monthly mortgage that is comfortable for myself and my husband. Can you help me in any area direct me?
yes, but if you bought in 12/22 then it may be tough to save any money by refinancing, fyi. Go to jebsmith.net/referral and I'll connect you with a mortgage professional.
Heyyy Jeb!!! Love your videos and of course I am subscribed!!! I am a Maryland resident, but I wonder if you could shed some light on something for me...Why is the FHA wait time after filing much longer for a Chapter 13 Bankruptcy (6 YEARS) than it is for a Chapter 7 (2 YEARS)??? It kind of feels like you actually get penalized for going through a 5 year repayment plan satisfying some of your debt vs a chapter 7 where you just get to wipe all of your debt away.
Hi @okiebaba! I appreciate your input and am glad you found the information useful. I'll definitely take note of your feedback about the closeness of the videography for future videos. We strive to make the viewing experience as comfortable as possible for all our viewers. Thanks so much for watching and for your helpful comment!
Omg. No way..500k fha loans ..after 30 years you will pay 3.8 millions ? Good lord..major rio.iff from the bank at the clst of us hard working oeople .
This information is a bit misleading. You’re failing to address the amortization schedule and how the mortgage and interest paid as a whole looks. You’re like a used car salesman, selling based on the monthly payment, not how much money is paid over the life of the loan for interest and PMI with the FHA vs just interest on the conventional. Long term, conventional is the best option. Do not entertain FHA loans. If you can’t afford conventional, wait, you’re not ready. Don’t buy based on the market, buy when you’re ready and do it the right way. 20% down 15 year fixed, and conventional.
What percentage of people can afford a monthly payment of $3500 plus! VERY VERY FEW! Even if you have 20% down and a good monthly income...MOST are priced OUT OF THE MARKET!
Obama did the same. Made it so credit card companies can’t ding people with late fees and over the limit fees, which made having credit card payments a whole lot more expensive for people that had excellent credit. Democrats love to supplement the irresponsible with people that try much harder in life. Every time you turn around, democrats are punishing the people that have it together, to supplement others. At the same time, the democrats will vote for tax loopholes that help the rich. If you are middle class or upper middle class, and you vote democrat, you’re not intelligent.
@Dragon228833 A Nascar guy, Brandon something, won a race and was getting interviewed after. Crowd was chanting Fxck Joe Biden in the background. Interviewer said, listen to them, they are saying Let's Go Brandon. Obviously that's not what they were saying.
@@JebSmith This is my opinion obviously and there’s really no perfect answer. But me personally, I would move if I couldn’t afford to buy in a particular city/state. Live where the cost of living is reasonable and where the potential for growing your wealth has a better outlook. Why buy an $800k property out there when you could get the same somewhere else for $275k. Personally I’d be willing to sacrifice where I live to grow financially. Granted the value of homes may appreciate at different rates, but I’m looking for financial freedom and passive income. That goal can be reached sooner if you look outside of California and some of these other cities with ridiculous costs of living.
I did not hear anything about renting out the houses that we buy with these loans? Are these one time loans or can we keep using them? I want to buy a duplex that’s already rented on both sides and the 3.5 percent down would be a perfect amount for me.
✅ - Get a Referral to a Mortgage Lender or Realtor - www.jebsmith.net/referral
🏠 - First Time Home Buyer Course - www.becominghomewise.com
⏩ Watch This Next ⏩ - NEW FHA Loan Requirements 2023 - czcams.com/video/dmuCCC0WCcg/video.html
Awesome info, ty! Maybe you could do a similar video for investors looking to purchase rental property and what loan options are available. Great stuff as always, love your channel!
I'll see what I can come up with......this are difficult to do as you're making up credit scores, etc....therefore it only applies to a few.
@@JebSmith No worries then. This video saved me $612 annually as I removed my PMI bc omy house had A LOT of equity. Ty Jeb!
Don’t forget the new changes to fha loan where those with good credit are gettin screwed over
I was about to say this. That is the most cray thing I’ve heard in a while , but not surprised with these people in charge.
That's for conventional loans and I'll be talking about it soon.
You still get good interest rates with a higher credit score
@@daveblackman816you can thank Trump
FHA loans isn’t always low credit scores that people go with FHA loans for. In our case our DTI was high, but our credit scores are in the high 700’s this is because I have our twins student loans/parent plus loans. So, this put us in a high DTI of 51 percent, where on a conventional loan the max DTI is 42-45 percent. This makes it difficult for someone to qualify for a conventional loan. I call the student loan debt a ball and chain. It’s pretty sad that parents plus loan percentage rate is so high…
Very true......FHA is way more lenient on DTI. I also agree on the student loans, it's a broken system.
First time homebuyer here and I have to say THANK YOU for this info you give it is helping me understand more and gather information to better myself for the home buying process .
A quick funny story .. I follow a podcast called “The Educated Homebuyer “ and I never knew you were the same person ! I thought I was gathering amazing information from two separate sources this whole time 😅
But Once again thank you for the content
🤣🤣🤣🤣
With loan level adjustments coming in may, does a better score really mean a better rate?
The better your score, the better your rate........the loan level price adjustments will hit those with higher credit scores based on the current set up but you'll still end up with a better rate than those with lower scores.
Love this man so detailed so unbiased so much advice one way or another im always soaking up information and my wife doesn’t and it’s hard for me to explain lol I think this will be perfect for her I know it was for me and I really hope we can get the house we want and not just what’s there you know. Wish we would’ve been did it but looking at this I know it’s possible. Thanks I really appreciate it.
I appreciate that!
Great, Video jeb. Make things easy to understand.
It looks like Conventional will works best for someone with 775 credit score and able to put 5% down comfortably. I was trying to go for 20% but it is a lot.
Agreed.
So glad he mentioned CA home prices 😅
Here I’m working getting excellent credit to get better approval, and the government wants to reward bad credit. Is the government talking to these banks then? Banks want bigger down payments as well. I guess we will see what comes with these changes.
🤦🏻♂️
Thank you very much for sharing your knowledge and expertise
Thanks for the support
Awesome video! great explanation and easy to understand! 👍🏾
Glad it was helpful!
Great video. Thanks for the information.
Thank you.
🔥 Love your video content!
Paying $3500 per month for ANY mortgage is a HUGE payment out of a net. When you make $175,000 you are in a VERY HIGH tax bracket unless you have a basket full of kids. OVER 40% to taxes, California STATE and required INSURANCE payments which you get ZERO break on at that salary is VERY HIGH). UTILITIES in California are HUGE! Transportation costs (auto/auto insurance/license,registrations etc and gas or electric charges and maintenance on vehicle) is HIGH in California! Most people earning that kind of money have student loan debt/payments! If you are paying $3500/month for a home....HOW WILL YOU EAT, SAVE and maintain LIFE!
What credit score? I was told housing credit score is different than regular credit score. Is that true ? Which one are you talking about .
The credit score required for a mortgage loan is not different from your regular credit score, they refer to the same thing. However, the minimum credit score for a mortgage loan may vary depending on the type of loan and the lender. These scores influence your loan terms and interest rates. So when we talk about credit scores in the context of housing, we are referring to your standard FICO score.
If fha maxes out in my area at $472,000 and my house is $500,000. Doesn't that mean I need to bring more than 3.5% to reach 500k? Was your scenario for an fha loan not limited at 472000? My other question - if I do live in an area limited at 472000. I put 28k down to get to 500k. Can I still finance the upfront PMi, since that would put me over the 472k? Or, do I have to pay the entire 1.75% at closing?
great video. For the 3% conv vs 3.5 FHA, even tho the FHA payment is lower you are going to be about a 9k (FHA funding fee estimate) difference in equity? so does the conventional in that situation make more sense than the FHA at 3.5 even with the lower payment?
This was a great video comparing the two loans
My DTI is 2% with a pretty good income but my mortgage Fico 2 credit score is 640 eventhough my overall Fico 8 is 660 and I was rejected for conventional. I was approved for FHA but was shocked that I didn't qualify for both given my income, credit over 620 and my DTI
So what happened? Where you able to get a conventional loan?
Very good video my friend. Appreciate the breakdown, thorough explanation. Very informative and educational. 👌🏼
Thank you
Good luck getting a 3% down conventional loan approved with a 620 credit score. Most time Fannie and Freddie will not approve it due to risk involved. Not to mention PMI will be double with conventional. FHA is a better loan option in regards to every aspect unless your score is over 680. If the home is in good shape sellers should be afraid of FHA loans.
Why would sellers not like fha?
@@cavemanlefancy3373from what I know, the closing period takes longer with FHA loans. You have to get an FHA appraisal (check the home to see if it’s in good shape) along with the other regular appraisal and home inspection what comes with buying a home. There’s also a few other factors, financial wise that could affect the seller I believe.
What about the new charge coming for people that put 15-20% down, With good credit.
Going to be talking about that soon
How about VA? 🤔 I've read some people would rather go with FHA and Conventional instead.
VA is a better loan imo
Can u do a fha construction loan video
I'm confused. I'm not understanding the difference between PMI/MIP with FHA loans versus conventional loans. I was under the impression that when you put 3.5 % down once your property reaches 20% equity you can refinance. But now it seems like you have to put 10% down with an FHA loan in order to refinance out of the mortgage insurance. So are you able to refinance out of mortgage insurance when you put down less than 10% on an FHA loan?
I did not hear anything about renting out the houses that we buy with these loans? Are these one time loans or can we keep using them? I want to buy a duplex that’s already rented on both sides and the 3.5 percent down would be a perfect amount for me.
Great video 🙏🏽
Thanks.
If you don't need an appraisal for home equity of 22% or higher, how will the lender know to automatically remove your PMI ?
once your balance gets to 78% then the lender will automatically remove the PMI.
Can you please make a video about 12 month bank statement program for self employed people. Thank you!
I'll see what I can come up with.
@anna0630 is that when you don’t have proof of income so you use your bank statements?
@@ShagawabJudah yes, when you don’t have much on personal tax returns but your business is doing well, for example. In our case, it is a new business with 1 year of tax returns (but they require 2 for fha/conventional).
@clarencemurray4281 Going through this process now. The bank doesn't count all of your income from the bank statements. The one I'm using only counts 50-70% of those total of 12 months of income. For instance if your statements are $50,000 they will only use $25,000 (50%)... I had to show proof with invoices of cash deposits. Also, how much you have in reserves/savings. Credit scores have to be over 680. The list goes on and on 😅 I hope this helps.
@@thevlogspotwithyolanda345 I agree too much hustle. I gave up on that idea when our loan officer told us the rate was going to be much higher than for conventional. And 20% down required. We decided to wait till next years tax returns. But then the realtor persuaded us to try the builders financing and we got approved for conventional by both builders, Horton and Lennar (with 1 year of tax returns). We tried just in case (because it was same inquiry) to apply at local credit union too. Our loan officer said we would probably be approved too for conventional but asked for too many things so we gave up.
Basically they all asked us to link bank accounts. It was optional but we did we did ( personal and business), and were approved based on the total amounts. Our last year personal income wasn’t even that much, so the ratio was still pretty tight and the loan amount wasn’t generous.
Are you the same person who hosts the CZcams channel win the house you love?
No.......that's Kyle.
Can you give me those numbers with 20% down? 770 credit score.
Unfortunately not, check with a mortgage professional as there are more questions they need answered to give you accurate info.
Great video! This was an awesome breakdown. I appreciate it. Do you think you could do one comparison with VA FHA and conventional with the same credit score also fha203k
Thanks Tom........I'll see, it's very hard as the videos become much too long.
I already purchased a home a year ago and only put down a 3.5% down. I wished I would of known that putting down more money would of saved me money on a conventional loan.
Did your lender not go over that scenario?
Of course they didn’t because that was the time of peak home buying.
Last time I owned a home was 15 yrs ago.....am I qualified as first time home buyer??
Yes
Yes.
Yes because I think the qualifications just look at the past 3 years.
Are you also a mortgage broker? Thanks for this info
I used to be back in the day.
Please STOP with you can always refinance! You will still have to qualify and it WILL COSTS TO REFINANCE! 11 years of Mortgage Insurance is A LOT!
I was so happy the month Ditech said my PMI is over. Thunk it took like 13 years for it to fully go away.
Hey Jeb , really nice video ! I was wondering if I could help you with more Quality Editing in your videos and also make a highly engaging Thumbnail and also help you with the overall youtube strategy and growth ! Pls let me know what do you think ?
Hi Jeb, my mother wants to buy a house, she only makes 25,000 yearly, Amerisave didnt approved her. Is there any lender that will loan her? Please help us.
Great
Their making it harder and harder for us that want to buy a home starting may 1st they are saying that we would be paying more for people with a higher credit score it’s crazy so what’s the since of trying to get our scores higher if that’s the case it’s getting so depressing now because this just shattered a lot of people’s dreams
People with low credit scores and minimal down payments have dreams too....
@Yadira J absolutely my score ain't all that trust me but i did work hard to get it to where i had a possible but its just crazy how they can up the ante all of a sudden the Government is so crooked smh its like they dont care
Do you have any advice for veterans and VA loans brother? Thank you.
Yes......See this video. czcams.com/video/vkK-7lHC6lE/video.html
Thank you
How fast can I ask for an appraisal after buying the house to remove the PMI in the conventional?
Most lenders will require you to have the loan for a year before removing PMI but you can get an appraisal as soon as you'd like.
@@JebSmith Thanks!
I need help in refinancing. I just purchased a home on December 6, 2022 and I would like to get it refinanced to lower my interest rate and have a lot and monthly mortgage that is comfortable for myself and my husband. Can you help me in any area direct me?
yes, but if you bought in 12/22 then it may be tough to save any money by refinancing, fyi. Go to jebsmith.net/referral and I'll connect you with a mortgage professional.
@@JebSmith I really want to thank you very much for your reply or my question. I will definitely go ahead with the referral that you stated.
Heyyy Jeb!!! Love your videos and of course I am subscribed!!! I am a Maryland resident, but I wonder if you could shed some light on something for me...Why is the FHA wait time after filing much longer for a Chapter 13 Bankruptcy (6 YEARS) than it is for a Chapter 7 (2 YEARS)??? It kind of feels like you actually get penalized for going through a 5 year repayment plan satisfying some of your debt vs a chapter 7 where you just get to wipe all of your debt away.
When did conventional go to 3% down and 620 credit score?
It doesn't......Conventional will do as low as a 620 and it will also do 3% down.
Great info but your videography makes me feel like you are right in my face.
Hi @okiebaba! I appreciate your input and am glad you found the information useful. I'll definitely take note of your feedback about the closeness of the videography for future videos. We strive to make the viewing experience as comfortable as possible for all our viewers. Thanks so much for watching and for your helpful comment!
Really wanted to see 20 percent down comparison
Most people with 20% down aren't doing FHA
I really was looking forward to that as well, We want to know if the extra savings pay off!
@JebSmith what happened to your friend (house value went crazy high), that won't happen again, right?????
I'm confused, what are we talking about?
❤
If you're using a FHA loan does it matter how old the house is?
No
This is not true in this market time if you dont pay 20% down tthe house market price high
huh?
Omg. No way..500k fha loans ..after 30 years you will pay 3.8 millions ? Good lord..major rio.iff from the bank at the clst of us hard working oeople .
This information is a bit misleading. You’re failing to address the amortization schedule and how the mortgage and interest paid as a whole looks. You’re like a used car salesman, selling based on the monthly payment, not how much money is paid over the life of the loan for interest and PMI with the FHA vs just interest on the conventional. Long term, conventional is the best option. Do not entertain FHA loans. If you can’t afford conventional, wait, you’re not ready. Don’t buy based on the market, buy when you’re ready and do it the right way. 20% down 15 year fixed, and conventional.
Do both have pmi? I might ve missed that part!
On FHA yes, on conventional only when you put less than 20% down.
What percentage of people can afford a monthly payment of $3500 plus! VERY VERY FEW! Even if you have 20% down and a good monthly income...MOST are priced OUT OF THE MARKET!
My husband and I pay $2000+ in rent/utilities and $1600+ in daycare... I don't know if we are getting closer to even try to get a house...😢
Talk about Brandon screwing everyone with good credit.
Obama did the same. Made it so credit card companies can’t ding people with late fees and over the limit fees, which made having credit card payments a whole lot more expensive for people that had excellent credit. Democrats love to supplement the irresponsible with people that try much harder in life. Every time you turn around, democrats are punishing the people that have it together, to supplement others. At the same time, the democrats will vote for tax loopholes that help the rich. If you are middle class or upper middle class, and you vote democrat, you’re not intelligent.
Who is Brandon?
@@aaronoetting9129think he’s talking about Joe Biden. No idea where this conservative Brandon joke came from
@Dragon228833 A Nascar guy, Brandon something, won a race and was getting interviewed after. Crowd was chanting Fxck Joe Biden in the background. Interviewer said, listen to
them, they are saying Let's Go Brandon. Obviously that's not what they were saying.
The man name is joe Biden y’all be tripping
Biggest takeaway, don’t live in California.
Where you should live instead?
@@JebSmith This is my opinion obviously and there’s really no perfect answer. But me personally, I would move if I couldn’t afford to buy in a particular city/state. Live where the cost of living is reasonable and where the potential for growing your wealth has a better outlook. Why buy an $800k property out there when you could get the same somewhere else for $275k. Personally I’d be willing to sacrifice where I live to grow financially. Granted the value of homes may appreciate at different rates, but I’m looking for financial freedom and passive income. That goal can be reached sooner if you look outside of California and some of these other cities with ridiculous costs of living.
NO ONE SHOULD BUY at these prices and INTEREST! TELL People they are CAPPED on IRS write-offs too!
I did not hear anything about renting out the houses that we buy with these loans? Are these one time loans or can we keep using them? I want to buy a duplex that’s already rented on both sides and the 3.5 percent down would be a perfect amount for me.