Music teacher buys Hamden condo she previously rented

Mortgage banker: Patricia

Leary

Property type: Condominium in Hamden

Purchase price: $135,400

Loan amount: $130,661

Appraised value: $136,000.

Loan type: FHA (Federal Housing Administration)

Backstory: Leary often works with Federal Housing Administration buyers who are looking for guidance on how to purchase their first homes.

Leary met with the buyer who was currently renting a condominium in Hamden and was paying $1,650 per month for rent on the unit. The buyer was concerned because the owner was going to list the unit for sale and she wanted to know if there would be a way for her to purchase the unit. She was happy there and didn’t want to move.

Leary told her that the first step was to look at her 3 FICO scores to see if she was credit qualified to purchase. The second step was to income qualify the buyer by looking at her income statements for the past two years. The buyer had two incomes — one as a full-time teaching position and the second as a self-employed music teacher.

Once the buyer was both credit and income qualified, Leary told the buyer the FHA program with 3.5 percent down payment would be her best option. Leary then went onto the HUD website at www.HUD.gov to see if the condominium was on their approved list and eligible for FHA financing.

The project was listed so the buyer could buy the unit with FHA financing.

The next step was to look at what the buyer had for down payment and closing cost money. She had very little to work with. Leary then told the buyer that FHA allowed the down payment money to be gifted by a family member.

FHA also allows the seller to pay up to 6 percent of the purchase price toward the buyer’s closing costs. The buyer’s aunt was kind enough to gift her enough to cover her down payment and part of her closing costs.

Leary next contacted the buyer’s Realtor to let her know what was needed to bring this buyer to contract.

This meant putting in an offer and asking the seller to give the buyer a credit of $6,500 toward her closing costs and pre-paid items.

The buyer came to contract and her new monthly payment including her monthly condominium fee would be $1,318.59, which is less than her monthly rent and she is building equity with every monthly mortgage payment that she pays.

According to Leary, the FHA loan is a great loan with a low, down payment. It is not just for first time home buyers. Anyone can apply for the FHA financing. FHA buyers will pay a monthly private mortgage fee which insures the loan for the government.

Leary obtains great satisfaction helping her FHA buyers become homeowners. The FHA loan is a government loan to help people become homebuyers.