Ohio Mortgage Overview
11 million people call Ohio home and it
could be because of the incredibly low cost of living. The average home price
is $147,000. The 'Buckeye State' has plenty of exciting things for residents
and the land is beautiful, as is the weather.
If you're thinking of buying a home in
Ohio, here are your loan options.
Ohio conventional loans
Borrowers need a 660
credit score or higher for a conventional loan. You'll also need a 36 percent
debt ratio, although some lenders may be more flexible. First-time homebuyers
need 3 percent down and subsequent buyers need 5 percent. You'll pay PMI until
you owe less than 80 percent of the home's value, but you'll get some of the
most attractive interest rates.
Ohio FHA loans
Borrowers who don't qualify for
conventional financing may be a good fit for the FHA loan. You need a 580
credit score and 3.5 percent down, but it can be gift funds or down payment
assistance. Borrowers with a lower credit score may qualify with a 10 percent
down payment, but 3.5 percent must be your own funds. FHA loans charge mortgage
insurance for the life of the loan, but the rates are affordable.
Ohio VA loans
Veterans can secure 100
financing from a VA loan from a Ohio VA lender. You need at least a 620 credit
score and you must prove you can afford the new mortgage plus your existing
debts and the cost of living. You don't need mortgage insurance for the loan,
but most borrowers pay an upfront funding fee.
Ohio USDA loans
If rural living is your thing
and you make less than 115 percent of the median income for your area, the USDA
loan may be what you need. You'll need a 640+ credit score and your debts
shouldn't exceed 41 percent of your income. You don't need a down payment, but
you'll pay mortgage insurance for the loan's term.
First-Time Homebuyer
Programs in Ohio
Your Choice Down Payment Assistance
This
program provides an affordable 30-year fixed mortgage plus down payment
assistance of 2.5 percent or 5 percent of the sales price. You need a 640
credit score or higher and must meet the income limits.
Grants for Grads
If you're a recent grad, you
may get a discounted mortgage interest rate plus 2.5 or 5 percent in down
payment assistance. If you remain in the home for 5 years, the grant is
forgiven. You must have obtained your degree in the last 48 months.
Ohio Heroes
If you serve the public, have a
650 credit score or higher and meet the income limits from above, you may be
eligible for a discounted mortgage rate.
Mortgage Tax Credit
First-time homebuyers who
meet the income guidelines may be eligible for a tax credit of 40 percent of
the mortgage interest paid for the year up to $2,000. This lowers your tax
liability and makes homeownership more affordable.
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