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New Frontier Financial is your advocate and guide through the entire mortgage process. For more than 20 years, we have helped people with home loans in Dallas and across Texas.

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Buyer’s Market vs. Seller’s Market: Which One Are You In?

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Buy a Home in Dallas

Real estate agents and mortgage brokers typically describe an area as a buyer’s or seller’s market, depending on whether supply or demand is more significant in that location. There are also divides depending on the price point, location, or time, tipping the advantage to either side.

In a seller’s market, there are more buyers than available properties. This situation could be because of job growth or similar attractors that make people move to an area. Meanwhile, buyer’s markets are areas where there are fewer buyers than sellers. The advantage is with buyers since they could negotiate deals favorable to them. Keep reading to learn more about the factors determining what type of real estate market an area finds itself in.

House Location

Factors related to the location could give either side an advantage. High-performing school districts, an accessible work commute, and a high-quality neighborhood could all tip the balance and turn an area into a buyer’s or a seller’s market.

Neighborhoods with these features are likely to sell quicker or command a higher price. However, location isn’t the only crucial factor. Homes in less popular neighborhoods can sell if amenities, safe places to walk, and decent schools are nearby. Consulting a real estate professional should be your first step if you aren’t sure what features to prioritize.

Price Point

One of the most significant factors is a home’s price point. Realtors often advise homeowners to list their property slightly under the market value in seller’s markets. They know that competition is tough in that environment, and having below-market-value listings attracts buyers and drives up the bids. Meanwhile, homes listed at a higher price risk getting fewer offers, if at all.

The Amount of Time the House is Listed

The best indicator for whether you’re in a buyer’s or seller’s market is the amount of time a home stays on listings. In a seller’s market, contracts move quickly since buyers want to prevent others from snapping up the property. In this environment, getting pre-approved for a mortgage is a must. Speak to a mortgage lender if you want to maximize your chances of getting a home in a seller’s market. Meanwhile, slower markets belong to buyers. You could have second showings, request repairs, or open options for negotiating prices.

The Season When You’re Buying

In North America, summer is the busiest season for buying or selling real estate. If you’re looking to buy a home in the warmer months, expect plenty of competition. At times, buyers have an advantage if they start shopping around in the late fall since sellers are more motivated to sell. They will be more flexible and accommodating during the last months before winter.

Your Dallas and Houston Loan Specialist

The real estate industry cycles between having buyer’s and seller’s markets. Whether you’re throwing your hat in the ring during a seller’s market or waiting until things lean toward the opposite direction, consulting a mortgage broker should be top of your list. Having a real estate expert in your corner will help you navigate the financial aspects of buying a home.

At New Frontier Financial, we aim to help people find the best property for their needs. We serve Dallas, Houston and throughout the state of Texas with more than 20 years of experience providing expert service and customer care. Contact us today at (469) 886-8300 for information!

What Should Your Credit Score Be to Qualify for a Mortgage?

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Home Buying in Dallas

Purchasing a new home is undoubtedly a milestone for every American. After all, who doesn’t want to have a place they can call their own?

However, buying a new house is a big investment. It will undoubtedly be one of the most important decisions you will make in your life, and you need to have financial resources to pay for it.

If you would like to qualify for a home mortgage, it’s essential to have a good credit history and a sparkling credit report. But before we discuss in detail what your credit score should be, we need to break down the different types of credit first.

List of Credit

  1. Installment Debt. This type of credit or loan is repaid in regular installments, usually monthly. The borrower usually gets a lump sum of money used for big-time purchases, such as a house or a car. If you want your credit score to remain sound and healthy, you must pay the loan on time.
  2. Open Credit. This type of credit loan is ideal for paying services and goods monthly. You can use the loan repeatedly up until a specific limit. It is ideally used for goods and services, such as rent, utilities, data plans, subscription services, and more. You may have noticed that most of the payments are for bills. You can build your credit score over time by using this type of loan.
  3. Revolving Credit. This kind of credit enables an individual to borrow and repay the money from a credit line constantly. An excellent example of this is using a credit card to pay for your expenses. Keep in mind that revolving credit has a limit. Make sure to keep the borrowed money against your revolving credit line under 30 percent of the maximum limit. You can also build your credit score by paying on time.

What Should Your Credit Score Be?

  1. Credit Score for the Best Interest Rates. A full-service mortgage broker in Dallas can help you build an excellent credit score and get the best interest rates on your loan. The goal is for you to have a 740 FICO credit score or higher. This score range will help you qualify for a better interest rate in many loan situations.
  2. Credit Score for Bureau Reports. Your FICO credit report will have three types of scores, one from every USA credit bureau. However, there are instances when the creditors fail to submit their reports, causing changes in your credit score. Mortgage lenders will use the middle score of the three reports found in your FICO report. If only two companies submitted their reports, the lower score between them will be considered for your mortgage qualification.
  3. Credit Score of a Spouse. Your spouse’s credit score can affect your mortgage qualification. After all, lenders always take into consideration the credit reports of all their applicants. What will be considered for qualification is the middle score in the FICO credit report of the spouse with the lower credit rating. So if you plan on including your spouse’s income in your mortgage application, make sure that you are both in good standing.
  4. Minimum Credit Score for Mortgages.
  5. Federally backed mortgage choices require a minimum credit score for an individual to qualify. For loans of this nature, you must have a 620 FICO credit score or higher. This will help you qualify for any conventional and government-backed mortgages.

Conclusion

Mortgage applications and building a good credit score can be quite tricky at first. However, by relying on a broker who can explain the basics of a mortgage in Dallas, you can easily find a way to buy that new home you’ve always wanted or refinance your current one.

New Frontier Financial is a full-service mortgage company in Dallas and Houston committed to helping you buy or refinance any property of your choice. As the trusted mortgage broker of Houston, Dallas and throughout the state of Texas, we do our best to meet your demands and exceed your expectations. For details, call us at (469) 886-8300.

Everything You Need to Know About Jumbo Loans

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Do you want to buy a house in a more affluent community? If that’s the case, you have to know that a conforming mortgage loan might not be adequate. However, before you give up hope, keep in mind that you still have choices for purchasing the home of your dreams.

If you require a larger loan than the local conforming loan limit and don’t have the cash flow to put down a higher down payment, jumbo loans may be a viable alternative for you. Here’s all you need to know about jumbo loans.

What Are Jumbo Loans?

A jumbo loan, often known as a jumbo mortgage, is a loan that exceeds the Federal Housing Finance Agency (FHFA)’s borrowing restrictions. They are considered non-conforming loans because they cover a larger-than-normal loan amount.

Because jumbo mortgages don’t come with the same assurances as conforming loans, applicants are subject to more scrutiny and may face higher borrowing rates. A jumbo loan may appeal to investors who aren’t normally interested in regular mortgage bonds. It can be used for primary homes as well as for investment properties and vacation homes.

How Can I Get a Jumbo Loan?

Jumbo loans, like conventional mortgages, come in a wide range of terms and repayment schedules, largely depending on your lender. It can either be fixed-rate or adjustable-rate. However, you must first meet certain requirements which are usually stricter and more selective than regular loans.

To begin with, jumbo loans are designed for people who earn a lot of money but do not yet have millions of dollars in cash or other assets. They are suitable for people with yearly earnings between $250,000 and $500,000.

Martha Walters of New Frontier Financial Inc. quoted “Aside from that, jumbo loans usually need a considerably larger down payment than conforming loans. For jumbo loans for single-family properties, lenders frequently request at least a 20 percent down payment.”

 Furthermore, when applying for a jumbo mortgage, your credit score plays a significant role. FICO scores must be higher to qualify for a jumbo loan. The typical credit score is approximately 740, but a credit score of 700 will qualify you for a home with a loan maximum of $1 million. Finally, when applying for a jumbo loan, a low debt-to-income ratio is critical since it assures lenders that you will be able to handle your mortgage payments for years to come.

What are the Limits of a Jumbo Loan?

In much of the country, the conforming loan ceiling for Fannie Mae and Freddie Mac is $548,250 in 2021. In more costly locations, however, borrowing restrictions are significantly higher. The loan maximum is $822,375 for much of California, New York, and Washington, D.C.

What Properties Can I Get with a Jumbo Loan?

Because there are no government limitations on how you may utilize your jumbo loan, you can acquire a wide range of properties. Most jumbo mortgages can be used for primary residences, vacation homes, and investment properties as long as you fulfill your lender’s other requirements.

Home Buying in Dallas With New Frontier Financial Inc.

Jumbo loans have several advantages, and they are sought after by many people who want to live more comfortably. However, not everyone is eligible for it. If you have any questions, you can always seek the guidance of local mortgage specialists who can provide you with knowledge on how to secure the loan.

If you are looking for jumbo loans in Dallas or anywhere in Texas, New Frontier Financial Inc. is here for you. We actually have a program with as little as 5% down payment on a Jumbo Loan.  We are a full-service Mortgage Broker Service, and we are excited to help you achieve your goal to purchase or refinance a home or invest in TX real estate. Talk to us now by calling (469) 886-8300.

A Quick Guide to Non-Qualified Mortgages: What to Know

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Buy a Home in Dallas TX

If you need a home loan but cannot meet the lender’s stringent borrower requirements, a non-qualified mortgage may be the solution. Non-qualified mortgages are discussed in-depth, as well as who they are designed for.

Read on to know everything about understanding non-qualified mortgages.

Non-qualified Mortgage, by Definition

In applying for a qualifying mortgage, a borrower must meet certain conditions, but if you are self-employed or lack the necessary documentation for a conventional mortgage, you may need to consider a non-qualified mortgage.

Traditional qualifying mortgages are the greatest lens through which to view non-qualifying mortgages. To be eligible for a conventional mortgage, you must meet the following requirements:

  • Income documentation, such as pay stubs, W-2s, and tax returns, is required.
  • Your debt-to-income ratio (DTI) must be less than 43%, which pertains to the percentage of your monthly income dedicated to debt repayment.
  • Fees cannot be more than 3% of the loan balance.
  • The loan length cannot exceed 30 years.

Mortgage lenders want to know that you’ll be able to pay back your loan. However, if you cannot meet the criteria mentioned above, you may need to apply for a non-qualifying mortgage. Furthermore, the 2010 Consumer Protection Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act set these minimum mortgage standards to shield buyers from hazardous loans.

The Rules

Almost anyone could get a mortgage in the years leading up to the Great Recession. In light of this, certain mortgages did not require proof of income, and mortgage lenders would unethically force homebuyers to take out expensive mortgages. This reckless attitude aggravated the recession and resulted in the ability of millions of debtors to meet their monthly obligations.

Today, lenders are no longer liable if they follow strict lending laws. Loans cannot be repaid if borrowers later allege lenders were aware of their inability to pay. Non-qualified mortgages (non-QM) are not insured, guaranteed, or guaranteed by the FHA, VA, Fannie Mae, or Freddie Mac.

A non-QM loan allows people with bad credit to buy a house. Self-employed people, business owners, and non-traditional employees need less proof of income. The application for a non-QM loan is nearly identical.

Applying for a Non-qualified Mortgage

If you are unable to obtain a qualifying mortgage, you should consider getting a non-QM. Borrowers who may benefit from non-QM loans include the following:

  • A retiree
  • A self-employed individual
  • A foreigner invests in a genuine entrepreneur
  • A buyer with substantial assets but a low income
  • A buyer who has a high debt-to-income ratio
  • A buyer with an inadequate credit history

Non-qualified mortgages show that mortgages are accessible to all homeowners. Even though you may not have the highest credit score, your salary is low, or your debt-to-income ratio is high, you can get a mortgage.

Conclusion

In understanding non-QMs, you should know that they’re not the same as subprime mortgages. Many individuals feel that non-QM loans are subprime because of the housing crisis. Non-QMs are now subject to their own set of standards. Aside from the loan documents, the manner of financing is nearly the same.

The “Ability to Repay Rule” applies to both categories. Lenders risk facing lawsuits unless they go above and above to verify a borrower’s ability to repay. Ultimately, non-QM mortgages are precisely as secure as any other form of a loan. If you want to get a non-QM loan, shop around for the best rates—choosing the right loan might save you hundreds of dollars.

Are you interested in purchasing home loans in Dallas? New Frontier Financial Inc. is a full-service mortgage brokerage firm based in Dallas, TX. We provide individual and customized financial strategies, low rates, and fast loan approval. Start a new chapter of your life and contact us at (469) 886-8300 today!

What You Need to Know About Fix and Flip Loans in Dallas

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Buy a Home in Dallas TX

House flipping has grown in popularity over the last decade or so, and some people have even been able to make a living out of it. If flipping is something you’re interested in, it’s an investment option that just may help you grow your portfolio and bring home a good payday in a relatively short period.

Unfortunately, most individuals assume flipping is something only those with a lot of capital can do. This isn’t the case! There are financial instruments designed to help. A fix and flip loan is one of the simplest methods to get your home flipping project started.

Defining a Fix and Flip Loan

A fix and flip loan is a short-term, higher-interest loan that investors may use to pay both the cost of buying a property and the cost of repairs and improvements. These loans are similar to bridge loans in that they are often utilized in the short-term until a more permanent funding solution is in place.

These short-term loans, often known as hard money or private money loans, are quite different from traditional mortgage loans. They are intended to assist the investor in covering the initial expenses of purchasing and upgrading a property. It is then repaid when the property is sold or refinanced.

What Makes a Fix and Flip Loan Different?

The usage of collateral is one of the most significant distinctions between hard money and fix and flip loans. They usually regard the real estate as collateral and do not spend much time assessing the borrower’s creditworthiness to lend the money. The property alone contains all of the value.

Fix and flip loans are often for a relatively brief period. The majority varies from six months to three years. Flippers who utilize hard money loans often plan to repay the debt using the proceeds from the sale of the property. The sooner they can renovate and sell the home, the sooner they will pay off the debt.

The most significant advantage of obtaining a hard money loan is fast access to cash. Many loans may be approved on the same day and paid back within a week. That is in striking contrast to a conventional mortgage, which may take anywhere between 30 and 45 days to finance.

Why Do You Need to Use This Loan?

A fix and the flip loan may help you obtain the cash you need to purchase your home, as well as the additional money you’ll need to spend on repairs and improvements. If you don’t have enough funds for the project, a fix and flip loan is an excellent option. The majority of these loans have a lower loan to value (LTV) ratio of approximately 70% of the property’s value, with an extra value of 70% of the renovation expenses thrown in. You can also do it. However, these conditions vary from one lender to the next. Some hard money lenders may lend up to 90% of the property’s worth and 90% of the cost of repairs. That provides you, the investor, with money not just to purchase the property but also to renovate it. When you don’t have the money upfront, this is the next best thing.

How Do Fix and Flip Loans Work in Dallas?

The process of qualifying for a fix and flip loan in Dallas is much simpler than for other types of loans. Businesses that provide these loans are more concerned with the collateral for the loan or the real property than with the borrowers. That means that even if you have poor credit, you may get a hard money loan.

Typically, the lender will have an appraiser come out and evaluate the property to ensure that it is worth what the borrower is asking for. After the property has been assessed, the lender will produce a loan considerably less time, typically within the same week. Lenders are less concerned with the borrower’s creditworthiness than they are with the collateral. They understand that if the property sells, the borrowers will pay off the loan in full.

As further incentive for these hard money lenders, they understand that they may profit from this kind of loan even if the borrower fails on their payments. They may take control of the property and sell it for a profit or convert it into another rental property for their portfolio. Even after paying off the debt, you should earn a good profit when selling your flipped home.

Conclusion

Because you are uncertain of what the future will bring, new possibilities may present themselves. Learn as much as you can about hard money lenders and fix and flip loans now so that you are well prepared for when such changes arise. The ability to raise money doesn’t have to be a barrier no matter where you are on your real estate investing path. Because hard money lending has grown into a lucrative industry in its own right, you have more choices than ever.

Are you looking for a reliable mortgage lender in Dallas? New Frontier Financial can be your best option. We provide financial services that can help you achieve goals in your real estate journey. Call us today at (469) 886-8300 to learn more and for us to assist you further!