Ohio First Time HomeBuyer Program Comparison

Ohio Home BuyerNow that summer is here, experts predict that home buying will pick up. A combination of factors are motivating home buyers, including home prices remaining low and Ohio mortgage interest rates remaining at or near all time lows.

If you are in the market to buy a home in Ohio, chances are that you will face information overload when trying to decide which type of home loan is best for you. If you would like to check some of your options you can complete the simple Ohio Pre-Qualification Rate Quote Request form.

Lets take a look at some of the different options and how they differ.

Ohio Conforming Home Loans

(also referred to a Conventional financing), generally are a good option for borrowers that meet the following:

  • 5% down payment saved, plus extra money to cover closing costs
  • Housing Payment to Income ratio of 35% or less (new house payment including taxes/insurance divided by their gross monthly income.
  • Total Debt to Income ratio of 43% or less (all monthly payments appearing on their credit report plus the new housing payment divided by their gross monthly income)
  • Credit scores of 700 or higher (recommended to have 740 or higher credit scores

Ohio Conforming Home Loan Differences

  • Requires monthly Private Mortgage Insurance (PMI) based on the level of financing and credit scores. 5% down payment with credit scores above 740 would require PMI of 0.59%
  • Offers alternatives to monthly paid PMI, such as Single Premium which is paid at closing or Lender Paid Mortgage Insurance (LPMI)
  • Monthly PMI falls off once your principal loan balance reaches 78% of the purchase price

Ohio FHA home loans

generally are a good option for borrowers that meet the following:

  • Credit scores between 620 and 700
  • 3.5% down payment saved, plus extra money to cover closing costs
  • Credit issues in the past (bankruptcy must be at least 2 years old and foreclosure must be at least 3 years old)
  • Housing Payment to Income ratio of 39% or less (new house payment including taxes/insurance divided by their gross monthly income.
  • Total Debt to Income ratio of 50% or less (all monthly payments appearing on their credit report plus the new housing payment divided by their gross monthly income)

Ohio FHA Home Loan differences

  • Requires a 1.75% Up Front Mortgage Insurance Premium (UFMIP) which is added to your loan amount
  • Requires monthly Mortgage Insurance Premiums (MIP) of 1.20% (95% financing or less) or 1.25% (financing above 95%)
  • Must pay the mortgage insurance for a minimum of 60 months

Ohio USDA home loans

generally are a good option for borrowers that meet the following:

  • Credit scores above 640
  • No down payment required, and if the property appraised value is higher than the purchase price you may be able to finance your closing costs
  • Housing Payment to Income ratio of 29% or less (new house payment including taxes/insurance divided by their gross monthly income.
  • Total Debt to Income ratio of 43% or less (all monthly payments appearing on their credit report plus the new housing payment divided by their gross monthly income)
  • Cannot own other suitable housing

Ohio USDA Home Loan differences

  • The main difference is there is No Down Payment required for Ohio USDA mortgages
  • Requires a 2% Rural Development Guarantee Fee, which is added to your loan amount
  • Requires monthly mortgage insurance of 0.30% for the life of the loan
  • Must buy a property in an eligible area and be under predetermined Ohio USDA Income Limits

This should aid you in your initial research on Ohio mortgage options for First Time Homebuyers. When you are ready to speak to an expert on Ohio First Time Homebuyer mortgages you can contact T.C. Strait at 513-777-8383.

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