3 Percent Home Loans Available for a Limited Time

By Ryan Dosen

 

Federal government funds still remain available to help Pennsylvanians get 30-year loans to buy homes with rates as low as 3 percent. However, these shockingly low rates and ultra-friendly terms won’t be around forever. Once the federal funds have been used up, they’ll be gone for good.

 

Keystone Home Loan Program

Local mortgage expert Karen Jackson of Waterstone Mortgage in West Chester, PA says that one of the most attractive opportunities out there right now is the federally-funded Keystone Home Loan Program, available through the Pennsylvania Housing Finance Agency (“PHFA”). The PHFA says that it “works to provide affordable homeownership and rental apartment options for senior adults, low- and moderate-income families, and people with special housing needs.”

Those that qualify for the PHFA’s Keystone Home Loan Program can enjoy rates as low as 3 percent. Since this program doesn’t accommodate conventional loans with PMI, it can be used only with government loans – such as FHA, VA and USDA – along with conventional loans that have at least 20% down.

With many experts saying that rates will be going up as soon as September, this program could allow buyers the opportunity to afford housing now rather than being forced to the sidelines as rates rise.

 

The Catch

The catch for the Keystone Home Loan Program is that there are income and purchase price limits. The income limits had been $95,000 for 1-2 person households and $110,000 for 3-4 person households. Unfortunately for some buyers, the limits just dropped in Chester, Delaware, and Montgomery Counties. Now, 1-2 member households in Chester, Delaware, and Montgomery Counties cannot qualify for the program with a combined income greater than $87,500. Similarly, 3-4 member households cannot qualify for the program with a combined income greater than $100,500. In our area, buyers will also face a program purchase price limit of $362,000.

 

Down Payment Assistance

PHFA also offers an interesting down payment assistance program. Jackson says that the down payment assistance comes in the form of a second mortgage that is paid back, interest-free over 10 years. This second mortgage can be up to 4 percent of the purchase price, with a maximum assistance of $6,000. For those that are especially cash poor, you could negotiate your contract with a seller assist, get the down payment assistance, and wind up having to bring very little money to closing.

 

A Fleeting Opportunity for Buyers

While these federally-backed loan programs are still available, it is possible for a buyer to get a 3 percent fixed-rate 30-year loan.  If you’re playing the waiting game, there are two contingencies that can and will eventually trip you up. Whether it’s the Fed raising rates or the federal subsidy dollars running out, a domino will be falling soon. When one or both of the dominoes fall, they will be taking with them a truly remarkable opportunity for lower- to moderate- income buyers.

 

 

– Ryan Dosen manages The Wayne Megill Real Estate Team of Keller Williams – Brandywine Valley in West Chester, PA. Contact Ryan Dosen to inquire about buyer or seller representation or to learn more about a career in real estate by emailing ryan@waynemegillteam.com or calling 610-399-0338.

 

This article was published by 21st Century Media and the Daily Local News (West Chester, PA). To read this article on the the newspaper’s site, please visit the Daily Local News.

To view all of Ryan Dosen’s 21st Century Media real estate columns, visit http://www.dailylocal.com/search?text=dosen.