09
Aug
14

Broomfield CO Information on Real Estate Loans for Homebuying

Broomfield Agent with experienceIf you are looking to buy a home in Broomfield Westminster Brighton or even Arvada and Lakewood areas, you will more than likely need to get a home loan through a bank or a mortgage lender. Although you are dealing with a lending institution, you might wonder where all the money domes from for all the loans that are approved for people buying real estate in Broomfield and, well, just about everywhere else.

There are two entities that handle getting money into the hands of people who need to secure a loan for a real estate purchase. They are:

  • Fannie Mae, short for Federal National Mortgage Association
  • Freddie Mac, short for Federal Home Loan Mortgage Corporation

Since the main function of these two is to get money into the hands of the public, this is how the process is laid out:

  • Your lender sells you a mortgage for your real estate purchase
  • The lender sells the loan after you close on your home to Fannie Mae or Freddie Mac
  • Fannie Mae and Freddie Mac bundles many mortgages together and then issues bonds that are secured by the mortgages, or  in other words, the house you will live in
  • Large investors buy the bonds, many of these investors are foreign governments

By doing this, both Fannie Mae and Freddie Mac are able to buy more secured mortgage loans from the lenders that give you, the consumer, a real estate home mortgage. This loosens up the amount of money that is available for loans for everyone.

To ensure that Fannie Mae and Freddie Mac get paid back on the money that is loaned out to the public, there are rules that are set to help protect and reduce the default of home loans that are distributed. The lenders that give you money for your mortgage must follow guidelines that are set. In the real estate world, these are called underwriting guidelines. These rules follow what credit score is required for your home loan, how much money you have to have in the bank for the down payment, how much you need to make annually with your occupation, and many other guidelines that must be met to qualify for your loan.

This is how money is invested by the wealthy and is put into the hands of anyone looking to buy a home. Home loans are underwritten on primary residence homes, secondary homes, investment properties, and vacation homes. Check with a few great lenders in Broomfield Westminster Arvada or any other Denver area lending instituation.

Feel free to call Homewerks at 303-250-4735 with any real estate question you might have. Buying a home is one of the biggest financial decisions you will make in your life. It is very important that you have a professional working to protect your interests and guide you through the real estate transaction. Although a real estate purchase in Broomfield is motivated by emotional wants and needs, it still is a business transaction. At Homewerks, we are professional Realtors in Broomfield trained to handle the business side of your transaction. Keep in mind that when you have a buyer’s agent work FOR YOU, you do not pay them. You need a buyer’s agent that is a Broomfield Realtor and since it does not cost you anything to have them represent you, it is extremely beneficial to you. Please call with any question you might have.

Shaun Werkele

303-250-4735

 

 

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