In the Real Estate and mortgage atmosphere of the today, finding a mortgage program that allows the least down payment possible is sought after now maybe more than ever before. The way you use the cash assets you have toward buying a house has more strategy than in previous years. In the last decade home value increases followed by mortgage rate hikes means matching up a payment you are comfortable with as it relates to a house you are looking for is tough. In this program, you can use more of your cash assets to buy your rate down. This program isn’t just for First Time Buyers.
Axia Advantage FHA Mortgage Program
As you may know, FHA requires a minimum down payment of 3.5%. When you buy a house, your cash to close includes closing costs plus down payment. So, you could easily find yourself forking out $20,000 at closing to pay for closing costs and down payment on a $300k home. The Axia Advantage Program allows you to get a 2nd lien with the FHA mortgage that covers the 3.5% down payment. Now, you only come to close with the closing costs.
Payment Benefit Axia Advantage Program
Piggybacking on the previous scenario of a $300k purchase price, you now have extra money that you can use toward buying down your interest rate. It is possible that using the extra $10k that you save from using the 2nd lien to cover your down payment requirement, you can buy down your interest rate. For every half a point in interest rate you buy it down, you save nearly $100 a month. When you have a 2nd lien that is amortized fixed over 10yrs, more of your payment on that loan goes toward principle than interest, so you are rapidly paying that down. If you receive large bonuses, or commissions, you could easily apply extra to that loan and pay it off in a very short time. Then when that payment goes away, you begin to rapidly save money vs the down payment option where that higher interest rate never changes.
Axia Advantage vs Down Payment Assistance
There are a couple differences between these two programs. This program is does not have income restrictions like many of the down payment assistance programs. The down payment assistance is a forgivable loan that you do not pay on. Axia’s Advantage is a 2nd lien amortized over 10yrs. Now the important part is the total of payments, right? The down payment assistance programs come with a higher rate than the average FHA rate, so even if you are using an FHA mortgage with down payment assistance, that 1st mortgage with FHA that is very large is going to have a higher rate. On the Axia Advantage, you can use the normal FHA rate of the day Axia is offering. In most cases, when you “blend” the payments, the total of payments on the Axia Advantage are less than the single payment on a typical down payment assistance loan.
2nd Lien On Axia Advantage Program
The 2nd lien is going to be exactly 2% higher than the rate you lock on your FHA mortgage. If you buydown your rate a half of percent, then you calculate your 2nd lien rate off that new bought down rate.
Call me to get preapproved for the purchase of your next home using the Axia Advantage at 469-450-2723. It is important you know the difference and purpose behind Preapproval vs Prequalification.
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