Whether you are a first-time home buyer or a seasoned investor, the home buying landscape has changed dramatically over the past ten years. This is especially the case here in the Lehigh Valley where we have seen incredible growth in both new business and development. This has translated into a 20,000 + growth in the workforce, or almost a 10% increase from January 2008. This, combined with higher wages and a decrease in unemployment, has led to a boom in real estate. What does all of this mean? More people need mortgages! I recently read an article that said 40% of Americans felt “buying a home was the most stressful event in modern life.” How do you alleviate this problem? You do it by finding a lender you are comfortable with, one you feel a good rapport with.
Having direct communication during the mortgage process is critical. Being accessible seven days a week by phone or email has been essential to my success. Most importantly, taking the time to ask the right questions and to listen when first starting the mortgage process is key. Everyone has different expectations when working with a mortgage professional. You want to find the one who meets yours.
Another necessary component to have in a lender is flexibility. The wide range of diversity here in the Lehigh Valley means your lender needs to have the right program to fit your needs. This is where many people run into challenges. Not all lenders offer the same programs or can structure mortgages in the same ways. One group of people who can benefit from more attention is physicians. Lehigh Valley is considered a regional healthcare mecca with a tremendous amount of healthcare facilities and medical professionals, and these numbers are growing exponentially. Many of these healthcare providers are coming into the housing market with hundreds of thousands of dollars in student loan debt. Under traditional income and debt calculations for determining mortgage eligibility, this level of student loan debt can be prohibitive, even with a physician’s salary. Fortunately, some lenders, myself included, have programs in place to work with physicians in this exact situation. In many cases, we can exclude some or all of the student loan debt from their monthly obligations in order to help them qualify. For medical residents about to complete their residency, often we can use their new higher salary upon completion of their residency program. Physicians account for a huge part of the local economy; it is imperative to offer programs such as these in order to make their dreams of home ownership a reality.
Another area that is underserved in the Lehigh Valley is our self-employed business owners. They have always been a major contributor to our country’s growth and well-being. Unfortunately, they struggle to qualify for mortgages in a lot of instances and are turned down by their banks because they do not meet traditional requirements or guidelines. Recognizing this, there are a handful of mortgage bankers out there who will cater to these folks by using alternative documentation to source their income. By doing this, we can get a very good picture of their overall creditworthiness, ability to repay the mortgage, and are then able to help them buy a home. We offer similar programs for investors who are looking to expand their rental property holdings but are ‘maxed out’ in the number of financed properties they can qualify for through conventional financing. These programs are part of a growing recognition of the importance of being able to help everyone who is financially responsible and can afford a home, even if they don’t fit into the metaphorical box.
Last, but certainly not least, is our veteran population here in the Lehigh Valley. Eligible veterans are in a better position to buy a home than most. The VA mortgage program is by far the most flexible and easiest to qualify for. Surprisingly, there are a lot of veterans who do not take advantage of this opportunity. Like anything else, much of this comes down to lack of awareness and having a reliable source of information that can be trusted. Many new buyers out there, especially millennials, have been misinformed about what is needed to buy a home or to qualify for a mortgage. There are many options to help people buy homes (no down-payment options, down-payment assistance programs, grants, etc.). You just have to know where to look for them.
Basil Leonetti is a Branch Manager with American Financial Network Corp. here in the Lehigh Valley. He has over 20 years of experience in the mortgage and financial industry. He specializes in helping all types of buyers, but truly views working with veterans as an honor and a privilege. Please feel free to contact him directly at 610-442-3331 if you have any questions.