The real estate market has hit the ground running with plenty of signs that this is going to be a good year.  Most people are aware now that it’s a buyer’s market in Northwest Arkansas with historically low interest rates and housing prices.  However, most potential buyers may not be aware of the financial loans that are available to them.  A simple reference chart of all the loans that are available for potential home buyers and investors will be provided below.  

Buyers interested in owner occupied properties have four options: Rural Development (RD), Veterans Administration (VA), Federal Housing Administration (FHA), and Conventional.  Notice the RD, VA, and FHA chart below are listed side-by-side for easy comparison between their set down payments and fico credit score requirements.  The Conventional chart is separated due to the correlation between the fico credit score and the down payment (a better credit score allows a lower down payment.)  

 

 

RD

VA

FHA

Financing

100%

100%

N/A

Down Payment Required

None

None

3.5%

Min. Fico Credit Score Required

620-640

620

640

 

   

 

Conventional

 

Down Payment Required

Min. Fico Credit Score

Number of Units

 

3%

720

1

 

5%

660

1

 

20%

620

1

 

20%

640

2

 

25%

640

3-4

 

Notes:  Conventional bonds do not offer 100% financing. Units refer to the type of property.  For example, a one unit is a typical home; a two unit is a duplex; and a three or four unit is a multiplex.

 

For investors, conventional loans are your only option.  Notice that the loan requirements are different for first time investors and veteran investors.  Two charts are provided for each scenario.

First Time Investors

 

Conventional

Down Payment Required

Min. Fico Credit Score

Number of Units

20%

660

1

25%

660

2

35%

660

3-4

 

Veteran Investors 

Conventional

Down Payment Required

Min. Fico Credit Score

Number of Units

10%

720

1

20%

620

1

 

Do not miss this opportunity to buy at the bottom of the market here in Northwest Arkansas.  For a free list of the listings available in NWA, check out our website.  For more information on loans, call our good friend Kelly Franks at Priority Bank.