Financing Your Mammoth Dream Home

Lending varies by area and Mammoth Lakes has some tough rules in order to obtain financing on property here.

There will be a tightening up of the debt-to-income ratio allowed for buyers from 45% to 43% as of January 2014.  Lending has gone back to full documentation requirements even to get a pre-qualification letter.

If you are thinking about making a purchase in Mammoth Lakes, be sure to get a pre-qualification letter before starting your property search to avoid the pitfall of falling in love with a property you cannot afford to purchase.

First Time Buyer Loans:

If you are a first time buyer and purchasing your primary residence you have a few options:

  1. You can obtain an FHA loan in Mammoth Lakes with as little at 3 ½% down.  These loans are available on single family residences only in Mammoth, not on condos. These loans have the most lenient requirements overall and do have income limits.  They are funded by the Federal Housing Association and are not conventional loans funded by Fannie Mae and Freddie Mac.
  2. If you prefer a conventional 30-year or 15-year loan, you can get one with 5% down with a 740 credit score.
  3. With 10% down you can get a conventional loan with a 720 credit score.
  4. With 20% down you can get a conventional loan with a 680 credit score.

Regarding how lenders determine your credit score:

Everyone has 3 different credit scores from the 3 major credit bureaus, Experian, Equifax and Transunion.  Lenders in Mammoth Lakes will use your middle credit score of the 3 as the basis on which to give you financing.  If you are married, they will use the lower of the couple’s middle scores as the score on which to give you financing.

2nd Homeowner Loans in Mammoth Lakes:

Second homeowners who are purchasing in Mammoth Lakes will need a credit score of 620 minimum and have a few options as well:

  1. If you are purchasing a condo, there is a 25% down payment requirement in order to obtain a “streamlined review” of the condo project, which means that the lender will not require a Homeowner Certification.  These pesky documents have precluded lending in many of the local condo associations for years on end in the past.
  2. If you are purchasing a single family residence, you will need only 20% down.