Again… You Do Not Need 20% Down Payment to Buy Now!

Again… You Do Not Need 20% Down Payment to Buy Now!

A survey by Ipsos found that the American home buyers are still somewhat confused about what is required to qualify for a home mortgage loan in today’s housing market. There are two major misconceptions that I would like to address today: Down Payment and FICO® Scores.

1. Down Payment

The survey revealed that consumers overestimate the down payment funds needed to qualify for a home loan. According to the report, 40% of real estate buyers think a 20% down payment is always required. In actuality, there are many loans written with a down payment of 3% or less. For example, if you are a first time home buyer, with Federal Housing Administration or FHA loan, your down payment can be as low as 3.5% of the purchase price.

Many renters may actually be able to enter the housing market sooner than they ever imagined with new programs that have emerged allowing less cash out of pocket.

Also Read:

What is PMI? Get All the Facts Today.

2. FICO® Scores 

The survey also revealed that 62% of respondents believe they need excellent credit to buy a home, with 43% thinking a “good credit score” is over 780. In actuality, the average FICO® scores of approved conventional and FHA mortgages are much lower.

The average conventional loan closed in February had a credit score of 752, while FHA mortgages closed with a score of 686. The average across all loans closed in February was 720. The chart below shows the distribution of FICO® Scores for all loans approved in February.


In addition, to help make purchasing a home more affordable, The Virginia Housing Development Authority or VHDA, has rolled out a new Mortgage Credit Certificate program that gives Virginia’s qualified home buyers another option.


  • Be first-time buyers (waived in federally-targeted areas), or not have owned a home as a primary residence in the past three years.
  • Have income at or below VHDA’s maximum household income limit for the area.
  • Purchase a home below VHDA’s maximum sales price.
  • Use the home as their principal residence.


  • Credit is equal to 20 percent of the annual mortgage interest paid. Remaining  80 percent remains an eligible itemized deduction.
  • MCC is effective for the life of the mortgage, as long as the borrower continues to live in the home.
  • Borrower must have a federal tax liability. This is not a “refundable” tax credit. However, unused credit may be carried forward for up to three years.
  • Does not apply to state income tax.
  • MCC borrowers who sell their home in the first nine years of homeownership may be subject to federal recapture tax.

For the latest information, program updates and a list of participating lenders, check out

Bottom Line

If you are a prospective buyer who is ‘ready’ and ‘willing’ to act now, but are not sure if you are ‘able’ to, let’s sit down to help you understand your true options. Ready to talk? Schedule buyer consultation here.

And please, don’t forget to download

My Buyers’ Guide:

“Things to Consider When Buying a Home”

As a home buyer, there’s plenty you need to know. You’re about to make the largest financial investment of your life, but with my Home Buyers Guide, you’ll have the information you need about buying a home, right at your fingertips.

Here’s what you will find inside:

  • The Cost of Renting vs Buying
  • 2 Myths That Might be Holding You from Buying
  • Why Pre-Approval Should be Your First Step
  • What You Need to Know About Mortgage Process
  • What to Expect When Home Inspecting
  • And More!

The best part is, our Guide is free and available to download right now. All we need is your name and email, and we’ll send it directly to you.


Renting or Buying… Either Way You’re Paying a Mortgage

In an uncertain economy during changing times, many would-be homeowners are rejecting the idea of investing in their own homes because they are uncomfortable taking on the obligation of a multi-decade mortgage. But what many people don’t realize is that as long as you are paying rent, you are paying a mortgage – just not your own.

As Entrepreneur Magazine, a premier source for small business, explained this month in their article, “12 Practical Steps to Getting Rich”:

While renting on a temporary basis isn’t terrible, you should most certainly own the roof over your head if you’re serious about your finances.

It won’t make you rich overnight, but by renting, you’re paying someone else’s mortgage. In effect, you’re making someone else rich.

Christina Boyle, Senior Vice President and head of the Single-Family Sales & Relationship Management organization at Freddie Mac, explains another benefit of securing a mortgage versus paying rent:

With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.

As a home owner, your mortgage payment is a form of ‘forced savings’ which allows you to build equity in your home that you can tap into later in life. As a renter, you won’t ever again see the money you are investing in rent, and it’s a guarantee that the landlord is the person with that growing equity.

Many of the excuses consumers make for not investing in a home include the expense of a mortgage, worry over not being able to pay off that mortgage quickly enough, the concern of not getting the money back out of their property at the time of resale, or the responsibility that comes with owning and managing a home.

For those renters concerned that a mortgage is too expensive, it’s often less than the cost of your rent. And the beauty of a mortgage is that your payments go towards paying down the principle of what you owe that can later be recouped during the resale.

In well-performing markets, experts are also seeing equity rise year after year, so it may be that you even will make money at the time of resale. And with options like renting out your property at a higher rate than your mortgage or offering it up through services like Airbnb, you’re safe from life events that could keep you from being able to pay your mortgage.

More importantly, interest rates are still at historic lows, making it one of the best times to secure a mortgage and make a move into your dream home. Freddie Mac’s latest report shows that rates across the country were at 4.23% last week.

Bottom Line

Whether you are looking for a primary residence for the first time or are considering a vacation home on the shore, now may be the time to buy.

Not only can you benefit from rising equity and falling interest rates, with the popularity of renting and home-sharing websites like Airbnb on the rise, you’re still making a sound investment in your future.

And please, don’t forget to download

My Buyers’ Guide:

“Things to Consider When Buying a Home”

As a home buyer, there’s plenty you need to know. You’re about to make the largest financial investment of your life, but with my Home Buyers Guide, you’ll have the information you need about buying a home, right at your fingertips.

Here’s what you will find inside:

  • The Cost of Renting vs Buying
  • 2 Myths That Might be Holding You from Buying
  • Why Pre-Approval Should be Your First Step
  • What You Need to Know About Mortgage Process
  • What to Expect When Home Inspecting
  • And More!

The best part is, our Guide is free and available to download right now. All we need is your name and email, and we’ll send it directly to you.


How to Price Your Home for Sale: CMA and Beyond

Pricing your home accurately is the most effective way to ensure a successful sale.

Innovative marketing plan will help to bring the buyers through the front door, but no amount of marketing can sell an overpriced home. Please keep in mind, the agent will evaluate the price of your home to determine the current market value, but at the end, the agent doesn’t set the price, the seller doesn’t set the price – the market will set the price, or value, for your home.

Comparative Market Analysis

So, how will the right sales price will be determined? Real estate agents frequently use a Comparative Market Analysis (CMA) to estimate a property’s probable selling price. CMAs help sellers decide on a listing price, whereas buyers will use them to determine how much they want to offer for a property.

While sellers and buyers have naturally opposing price preferences, a CMA is designed to be a completely  objective evaluation, and it’s based on recent and actual selling prices for comparable properties. Since real estate markets can change quickly, it’s essential to recognize that a CMA only provides a “snapshot” for a particular point in time.

The comparable properties included in a CMA should be similar recently sold homes. When selecting “comps,” the date of sale, location, and size of a home are the most important factors, but amenities, floor plan/style, age, number of bedrooms/bathrooms, garage size, improvements, and potential negatives may also be considered.

Also Read:

Insider Home Staging Tips: Here’s How To Sell Your Home Fast and For The Best Price

When reviewing a CMA to determine sales price on a particular property, it’s also helpful to examine the following:

Competing properties:

These are substantially similar homes that are currently listed for sale. Since they haven’t been sold yet, they’re usually distinguished from other “comps” in a CMA. Buyers know that sellers are competing against these properties, so it’s important to factor currently listed homes into the pricing strategy.

Days on market:

May indicate how appropriately a property has been priced for sale, especially when compared to absorption rates. If, for example, the absorption rate is two months, but a competing property has been listed for over three months, a potential buyer of that property might have a stronger negotiating position.

Absorption rates:

Are used to analyze the strength of a market, in terms of the supply and demand for current competing properties (the number of homes on the market relative to the number of homes sold). A low absorption rate indicates that sellers are in a stronger position, whereas a high absorption rate is favorable for buyers.

Sales price/List price ratios:

For specific categories of homes, statistics for Sales price to List price ratios will help you understand how much less than the listing price you can realistically expect to achieve.

Advantages of CMAs for



  • Sellers receive a fact-based, objective assessment of their home’s value
  • Sellers don’t experience the stress and disruption that can occur when homes languish on the market.
  • Sellers are protected from undervaluing their home, to their financial disadvantage.
  • Sellers avoid the delay that occurs when they accept a high offer and the property does not appraise.

Buyers (experienced buyers’ agent will create CMA for their clients)

  • Buyers receive fact-based, objective information about homes where they might not be familiar with the local market.
  • Buyers are less likely to lose the home they really want because their offer is too low.
  • Buyers are less likely to encounter problems obtaining a mortgage because the house appraises below offer price.
  • Buyers are less likely to overpay for a home, thus preserving financial resources for other important home and life expenses.

Professional Home Appraisal

As a special service to my clients, I offer another very effective method of pricing your home – Professional Home Appraisal. When you list – and close – your home with me, I’ll pay for a pre-listing appraisal.

Benefits of having a professional appraisal:

  • You receive an unbiased third party opinion of the market value of your home by a trained professional.
  • You are positioned to quickly recognize and respond to a market offer.
  • You are positioned to effectively challenge a low lender’s appraisal of your home, maintaining your higher contract price. A lender will consider a well-known appraisers valuation – they will not consider an estimate provided by a real estate agent.
  • You avoid the common practice of a real estate agent “buying your listing” by suggesting a higher price than can be achieved. Because the agent would then be reluctant to suggest a price reduction early in the marketing process, you lose valuable time during those critical first several weeks on the market.

Your real estate agent is your best resource for professional insights on current market conditions. With your agent’s assistance, you’ll be in a better position to make an informed and realistic decision on  the sales price of your home.

If you are ready to make a move, please contact me to schedule a free no obligation Seller Consultation.

Natasha Lingle Your Pricing Strategy Advisor (PSA).

And please, don’t forget to download

My Sellers’ Guide:

“Learn How to Have a Successful Home Sale”

This guide is a supplement to the information provided above, and it describes in detail traditional and modern marketing techniques and lists my real estate services you can expect me to provide including:

  • Accurately pricing your home.
  • Enhancing the perceived and real value of your home, enabling you to command a higher asking price by using latest marketing techniques.
  • Providing unmatched marketing including professional staging, photography, video and custom property web sites.
  • Showing latest statistics on how buyers search for homes today.
  • Securing a qualified buyer within your specific time frame.
  • And More!

The best part is, my Guide is free and available to download right now.

Just provide your name and email, and I’ll send it directly to you.

[red-button url=””]Download Your Seller’s Guide HERE[/red-button]

What Makes Your New Home Truly Energy Efficient?

What Makes Your New Home Truly Energy Efficient?

Because many municipalities’ building codes require energy-efficiency features in new homes, buyers assume that the newer a home, the more energy efficient it is. Two certifications that actually certify the energy efficiency of homes are Energy Star and LEED for homes.

Energy Star

Energy Star is very familiar to American consumers as a mark of energy-efficient home appliances. It is also awarded to homes constructed by Energy Star certified builders, referred to as Partners. Since its inception in 1995, the Energy Star Homes program has achieved a market share of more than 20 percent in over 15 states. As of 2013, there are approximately 1.46 million Energy Star homes. About 100,000 new certified homes are constructed every year.

An Energy Star home must meet guidelines for energy efficiency set by the U.S. Environmental Protection Agency. These homes are at least 15 percent more energy efficient than homes built to the 2009 International Energy Conservation Code (IECC) and include additional energy-saving features that typically make them 20–30 percent more efficient than standard homes.

Energy Star Partner builders commit to working with credentialed contractors, such as for HVAC, and raters to meet EPA standards, which are adjusted for regions and climate conditions. Builders who use a collection of standard building plans may submit plans for review and approval by the EPA. “Approved plans are recognized nationally and include the necessary notes, details, specifications, and checklists that are required for acquiring the Energy Star certification. To achieve the Energy Star certification, homes must be built to comply with Energy Star requirements and involve a minimum of two HERS inspections; one during construction and one at the completion of construction.”

When a home has been certified, an Energy Star label is affixed to the circuit breaker box of the home and a certificate is provided for the homeowner.

LEED for Homes

The U.S. Green Building Council (USGBC) awards the Leadership in Energy and Environmental Design (LEED) certification to homes that meet rigorous standards for energy efficiency. “Given the time, expense, and team commitment involved in achieving a LEED certification, even the first award level—Certified—is a major accomplishment. Qualifying for LEED certification is a time-intensive and complex process requiring detailed documentation and independent verification by a LEED Accredited Professional (AP). A property owner who wishes to achieve LEED status should consider hiring a consultant who specializes in LEED certification.”

LEED Certification for Homes, which was launched in 2007, is awarded at four levels: Certified, Silver, Gold, and Platinum. According to the USGBC, as of 2012 there are about 23,000 LEED certified homes in the United States and about 1,000 new single-family homes are certified each year.

To find more information about New Construction Homes, please click HERE.