What you need to know about low (or no) down payment Attorney Mortgage programs

First, what is an Attorney mortgage?

A attorney mortgage is a specialized home mortgage financing program available only to attorneys, paralegals and select other professionals in the legal field for the purchase of their primary residence. It is not a conventional mortgage nor a jumbo mortgage.

Let’s take a step back…what is a conventional mortgage?

A conventional mortgage is the most common type of mortgage. It is a conforming mortgage that is eligible for purchase on the secondary market, primarily by government entities Fannie Mae or Freddie Mac. The current limit for conventional mortgages in Houston is $417,000, as is the case in most of the country. Any mortgage over this limit is considered to be a jumbo mortgage.

What is a jumbo mortgage?

For most borrowers, financing more than $417,000 means they are subject to jumbo mortgage approval.Due to the lack of conformity and government insurance, jumbo mortgages are a high risk for lenders and come with very strict credit, down payment and income requirements.

So if a Attorney mortgage is not a conventional mortgage or a jumbo mortgage, then what is it, exactly?

Attorney mortgage are portfolio mortgage products. This means that the lending institution making the mortgage is going to keep and service the mortgage. This allows the bank the flexibility to determine it’s own underwriting and risk thresholds. What does this mean for you? It results in more liberal mortgage guidelines for Attorneys, as your ability to repay your mortgage is higher than the average jumbo mortgage candidate.

Alternatively, conforming mortgages are typically sold on the secondary market, so the originating bank is not likely going to be the one who services the mortgage.

What are other advantages to Attorney mortgages?

• Low, or no down payment. Most Attorney mortgages allow you to finance up to 100% of the value of the home, up to $750,000 for fixed rate mortgages.
• Options for no down payment up to $1,000,000 with an adjustable rate mortgage (ARM).
• No Private Mortgage Insurance (PMI) – Saves you anywhere from .5-1% annually without having to put 20% down.
• Student loans – in some cases, you will not have to count your student loan payments towards your debt to income ratio.
• Greater Chance of Approval – you may have student loans, lack of employment history or an insufficient down payment to qualify for conventional mortgages.
• High borrowing power without the strict credit, income and documentation requirements of Jumbo mortgages.

Is an Attorney mortgage right for you?

Attorneys, especially those who have been in their career for less than seven years, will see rapid and dramatic income increases. There are several mortgage programs that will allow you to make principle reductions without refinancing your mortgage as your income levels rise, and this specialized mortgage product may be the best fit for you.

Want more information?

Fill-out the quick form below and I will connect you with a trusted mortgage lender who specializes in Attorney mortgage. I will also send you my home buying guide so you know what to expect, every step of the way. You can also contact one of great Realtors, Mari Fair at 713-597-6881 or [email protected], if you’d like to talk with someone immediately.