Destin, FL Realtor Can Guide Home Buyers through Maze of New Loan Requirements

Posted by Destin Real Estate Sales on Thursday, March 22nd, 2012 at 9:00pm.

 In the past 5 years, the mortgage industry has undergone a major overhaul. If you’re planning to buy a primary or vacation home in the popular Destin-South Walton area on Florida’s scenic Gulf Coast, you should be aware of the changes in the mortgage process. South Walton Realtors say home buyers can expect to deal with more paperwork, undergo a more thorough financial review, pay more money up front, and wait longer for their mortgage to be approved. An experienced Destin Realtor can help home buyers navigate their way through the maze of new paperwork and other requirements.


Here’s what to expect when you apply for a mortgage to purchase a vacation home or condo in the Beaches of South Walton:

  • More paperwork. Be prepared for a flurry of paperwork. Lenders are now asking buyers to produce 2 years of tax returns and 3 to 6 months of pay stubs and bank statements. Because banking regulations now require lenders to verify information provided by home buyers, buyers should expect the loan approval process to take an additional 2 to 3 weeks.
  • Financial scrutiny. Mortgage lenders are holding home buyers to higher standards than in the past. Buyers are urged to review and correct their credit report and take steps to raise their credit score a year to 6 months before buying a home. The best interest rates are being offered to buyers with credit scores above 720. You may still be able to get a mortgage if you have a lower score, but you’ll pay a higher interest rate.
  • Higher down payments. Florida home buyers should expect to pay more money up front. Veterans may still qualify for a zero down payment loan, but the normal minimum down payment is 3.5% for FHA loans and 5% for conventional loans. Buyers who put down 20% (25% for jumbo loans over $417,000) will receive the best loan terms.

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