Am I qualified to buy a home? What does my credit score need to be? Where is affordable housing located in Fairfax County?
Those were just a few of the many questions that Gail Lee of the Fairfax County Department of Housing and Community Development answered at the 2014 NOVA Housing Expo at Lee High School on March 27.
Lee was stationed at Fairfax County’s table, one of the dozens of booths with information on buying or renting a house set up at the fair. She passed out information on the Fairfax County First-Time Homebuyers program, which helps families with moderate incomes find a home in the county.
“I got a lot of questions on what the process is for enrolling in this program,” Lee said.
In order to be eligible for the First-Time Homebuyers program, applicants have to be first-time homebuyers, have an income of at least $25,000 and less than the maximum income limits, have a credit score of 640 and above, and meet additional criteria including conditional lender approval and a three percent down payment, closing costs and one month of savings.
THOSE INTERESTED in enrolling in the program have to attend an orientation session and a certified homeownership class, meet with a lender, and attend an application session.
Xiomara Fleming, a housing service specialist for the Fairfax County Department of Housing and Urban Development, said she was kept busy at the expo answering questions on renting in Fairfax County. The county offers programs such as the Workforce Dwelling Unit Rental program, which helps people with modest incomes find an affordable place to live.
The event also included free workshops that offered practical advice on buying or renting in the area, including household budgeting and finance, condominium 101, maximizing energy efficiency, and “Are you ready to rent?”
Noel Shepherd, a home lending officer for CitiBank, taught one of the three “Are You Ready to Buy?” workshops. Shepherd has been a loan officer for over 17 years.
“I’ve seen the good, the bad and the ugly,” Shepherd said.
According to Shepherd, prospective homeowners need to be pre-approved for a loan before beginning the search for a house and to be taken seriously as a homebuyer.
“There is a big difference between being pre-approved and being pre-qualified,” Shepherd said. “In order to be pre-approved, you need to have completed a full application. You need to have supplied the lender with your income documentation and your asset documentation, so that they can be reviewed by the underwriter and you can be issued a pre-approval.”
Shepherd said that in today’s home buying environment, pre-approval is the way to go. Everything on the application is scrutinized, and honesty is important.
“As a loan officer, I become your very best friend while you go through this process,” Shepherd said.
After being pre-approved for a loan, potential homebuyers can begin the process of finding a property for purchase.
Shepherd then asked those present at the workshop what they saw as the major pros of home ownership.
“The American dream,” answered Johnny Alexander, an employee of the City of Alexandria.
According to Shepherd, however, tax benefits are a major plus to being a homeowner.
The cons include home maintenance, which Shepherd says potential homeowners need to budget in when beginning the process of buying a home.
THE WORKSHOP also gave advice on credit scores and reports. According to Shepherd, the minimum credit score people looking to purchase a home can have is 350, and the maximum is 850.
“Typically, lenders will not lend to you if you’re under a 620 credit score. It is very difficult to do a loan with a credit score below 620,” Shepherd said.
Shepherd recommended that individuals with a credit score below 620 should meet with a counseling agency to increase their score.
In addition, before consulting a loan officer, potential homebuyers should know what is on their credit report. Everyone is entitled to a free credit report annually, Shepherd said.
“Do not go with that commercial that you see on TV with the lovely jingles. You have to pay for that. The place to go is annualcreditreport.com where you get your credit report free,” Shepherd said.
Shepherd also advised the class to keep balances on credit cards below 50 percent of the credit limit.
After learning about types of loans, credit scores and more, Johnny Alexander, who attended Shepherd’s class, said he is more informed about the process of buying a home.
“Really, everything that he taught was helpful,” Alexander said.
And despite the rainy weekend, Abdi Hamud of the Fairfax County Department of Housing and Community Development said the turnout was pretty high.
“The event went really well. We had people from all income spectrums attend,” he said.