Nov
28

Affordable Lending Options Available to Buyers

November 28, 2010

Contrary to popular belief, there’s never been a better time to purchase a new home — as evidenced by historically low interest rates and a variety of attractive financing options available.

These loan programs and tax credits are specifically designed to benefit first-time buyers and those with low to moderate incomes — borrowers who can otherwise find it challenging to accomplish their homeownership goals.

“Shoppers who don’t have much of a down payment saved up or who are worried about qualifying for a loan due to a low to moderate income can still share in the great American dream of homeownership, thanks to these programs,” said Dan Graham, president/CEO of Warrenville-based Compass Mortgage. “And with mortgage interest rates currently about as low as we’ve ever seen them, now is the time to capitalize on these opportunities.”

For example, if you’ve not owned a home in the last three years, you may qualify for the Home Start Program, offered through the Illinois Housing Development Authority (IHDA), which works in tandem with a 30-year fixed-rate FHA loan. Home Start requires the borrower to provide a low down payment of $1,000 or 1 percent of the purchase price (whichever is greater), making it easy to get your foot in the door of that home you’ve been dreaming of, Graham said.

Additionally, select borrowers may be eligible to claim a little-publicized but generous incentive provided by the state of Illinois called the MCC tax credit. This allows a 20 percent mortgage interest credit per year for the life of the loan.

Wyndham Deerpoint - River Place - Fieldstone

The Fieldstone at River Place in Wyndham Deerpoint

“This rebate actually works out to be more financially advantageous than the $8,000 federal tax credit that expired earlier in 2010,” said Graham. “State funds for this credit are limited, however, so you need to act fast on this one.”

Applicants for Home Start or the MCC tax credit must make a combined household adjusted gross annual income of approximately $70,000 or less.

Yet another aid offered to is a $1,250 credit applied toward closing costs provided by Compass Mortgage to qualified borrowers who earn $59,500 annually or less.

A borrower who qualifies for all of the above can, for example, purchase a $200,000 townhome at River Place — Wyndham Deerpoint Homes’ community of townhomes in South Elgin — with a down payment of only $2,000 and pay a mortgage principal and interest bill of approximately $950 a month, based on a 30-year fixed rate FHA mortgage at a 4.5 percent interest rate.

“And for those who don’t meet the requirements of these programs, they can still apply for an 30-year fixed-rate FHA loan, which only obligates you to come up with only a three-and-a-half percent down payment — still a great deal,” Graham said.

In this scenario, “say a move-up buyer wants to purchase a more high-end $220,000 townhome. They would only need about $8,000 for the down payment, and assuming a fixed interest rate of four-and-a-quarter percent on a 30-year loan, monthly principal and interest would be around $1,050, still very affordable,” said Graham.

Graham noted that a variety of other mortgage options are also available, including loans with zero closing costs and loans with points that bring down the interest rate even more.

To further sweeten these financing deals, Wyndham Deerpoint Homes will buy down the interest rate to 3.75 percent on any purchaser’s 30-year fixed rate mortgage loan — but only on purchases of move-in ready townhomes at River Place that close before January 1, 2011.

“Combine our incentive with all those available through Compass Mortgage, and it’s easy to see why this is absolutely the best time ever to buy one of our homes,” said Mary Krasner, vice-president of Wyndham Deerpoint Homes. She noted that these same financing deals are also offered to eligible purchasers at Caledonia, the builder’s community of semi-custom single-family homes in Yorkville.

River Place shoppers can select from two distinctive townhome designs:
•       The 1,568-square-foot Waterford, which boasts an open floor plan with a spacious kitchen, dining room, three bedrooms, two-and-a-half baths, full basement, great room and a first-floor powder room.
•       The 2,000-square-foot Fieldstone, which features three bedrooms, two-and-a-half baths, finished lower level, second-floor laundry room, and an optional dual master suite.

Base prices range from $179,000 to $214,000 (all prices subject to change without notice).

Those in a hurry to settle in soon and beat the financing deal deadlines can currently select from 5 different River Place townhomes, each ready for immediate move in and equipped with extras and upgrades, including four Fieldstones (3 of which are end units) priced between $194,500 and $214,000, and one Waterford priced at $179,000.

Luxury touches that come standard in any River Place townhome include a two-car garage, designer light fixtures, custom-quality birch cabinetry in the kitchen, nine-foot first-floor ceiling, Whirlpool appliances, oversize closets, central air conditioning, and 93-percent energy-efficient gas furnaces. Each townhome’s exterior features cedar architectural trim, partial brick and low-maintenance vinyl siding, distinctive pitches, seamless aluminum gutters and down spouts and a professional landscape package.

Nominal association fees are approximately $130 a month, which include lawn care, driveway upkeep, snow removal, association management services, building insurance and maintenance.

“Homebuyers looking for a low-maintenance lifestyle—who never want to shovel snow again—will love this community,” said Krasner. “It’s geared to all types of buyers, from first-time purchases to empty nesters.”

River Place, located on the banks of the Fox River in South Elgin, is situated near a variety of area attractions, including walking and biking on the renowned Prairie Path and the Fox River Trail, canoeing and boating on the Fox River, 175 acres of village parks, numerous forest preserves, plentiful golf courses, and easy access to Randall Road and I-90. The Stearns Road bridge was also recently completed that links Randall Road to Rt. 59, offering easier access and less congestion for area drivers.

To reach River Place, take Lake Street/Route 20. Turn south on Route 31 and travel approximately two miles to the community’s entrance on the left of Melrose Court. Two models are open for touring. Sales hours are 11 a.m. to 4 p.m. Fridays, Saturdays and Sundays or by appointment. For more information about River Place, call (630) 878-5933 or visit www.wydp.com.

About The Author

Read All Stories By Walsh Communications

Lynn Walsh is the President at Walsh Communications, LLC. Walsh Communications is a full-service public relations, marketing and advertising agency for home builders and real estate-related industries.

1 Comments

1

This is fantastic news! I’m going to look into the IHDA Home Start Program. Finally some help for those of us actually willing to buy a home but don’t have 20% to put down!

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