Tip #1: Borrowers with less than stellar credit can get government backed financing. Just as quick as the conventional loan market for processing applicants. Borrowers can put down as little as 3.5%. You might get your loan processed in as little as 2 weeks! The downside of this is that their is a 1.5% fee up front plus a monthly payment of one-half of 1% of the loan amount. If you have larger than 20% downpayment the fees and monthly payments are excluded. Also current tax laws allow borrowers to deduct FHA and private mortgage insurance.
Tip #2: first time home buyers can take advantage of the tax credit. If you have not owned a home in at least 3 years you also qualify to take the maximum of $7,500 tax credit or 10% of the home amount against your 2009 tax return. You have to act soon because the program ends July 1st of this year. Income limits are $75,000 for individuals and $150,000 for households but if your income is higher you may get a smaller credit. This credit may be paid back over 15 years so it acts like a zero interest loan.
