Horse Property and Real Estate for sale

Home Buyers Page

  Get Pre-Qualified
Add strength to any offer — and ensure you are looking in the right price range.
  Know the Magic Formula
Learn the simple formula to figure out how much mortgage you qualify for... OR Use our easy mortgage calculator!
  Types of loans
adjustable rate, fixed rate, and interest-only
  Know Your Financing Options
Can you get an FHA loan? VA? What are the other special financing options?
  The "Tax Savings Benefit"
Understand the wealth-building strategy of home ownership.


Get Pre-Qualified (better yet, pre-approved!)

Once you have the right mortgage lender, consider obtaining a pre-approval. In contrast, pre-qualifications are just guesses based on what you tell the lender. They offer no guarantee that you'll get the loan.

With a pre-approval, the lender will actually pull your credit and get more information about you. You could even take it one step further by getting an actual approval before you start home shopping. When you're ready to make an offer, it will make the sale go much quicker. Additionally your offer will look more appealing than other competing offers as your financing is guaranteed.

Castle Realty recommends the following finance professionals. They will be happy to chat with you about your financial goals, answer questions, and help you get pre-approved for a mortgage!

Charles Cuthbert, Branch Manager
Sterling Bank
Office: 253-445-5606
Mobile: 253-221-1115
email Charles Cuthbert
Jason Roberson, Home Mortgage Consultant
NMLSR ID#404683
Wells Fargo
Office: 360-486-3657
Mobile: 360-701-4067
email Jason Roberson

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Know the Magic Formula!

Qualifying Ratios: The underlying basis of how a bank looks at you, the prospective buyer, to determine how much home you can afford, is a simple formula:

28% of your Gross Monthly Income can go toward your house payment (including PITI – Principal, Interest, Taxes and Insurance)

36% of your Gross Monthly Income can go toward your Total Monthly Debt Service (including your house payment).

(28% and 36% are the ratios established by the secondary mortgage market.)

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Types of loans

Get the Right Mortgage for Your Situation

There are actually many different kinds of mortgage programs out there - perhaps as many different programs as there are mortgage lenders. The 3 most typical and popular are the adjustable rate, fixed rate and interest-only mortgage programs.

  • Adjustable rate mortgages (ARMs) are short-term mortgages that offer an interest rate that is fixed for a short period of time, usually between one to seven years. After that, the interest rate can adjust every year up or down, depending on the market. These are good for people who don't plan on living in their home very long and/or are looking for a lower interest rate and payment.
  • Fixed-rate mortgages are more traditional and offer a fixed interest rate; therefore the buyer can be comfortable knowing the exact monthly payment, and knowing that the payment amount will not change; unless renegotiated of course. Fixed-rate mortgages can be for any amount of time (loan duration) but are most typically for 30 years. 15 year mortgages have distinct benefits and are becoming increasingly more popular.
  • Some fixed and adjustable rate mortgages may offer an interest-only option. In these cases the buyer is allowed to pay only enough to cover the interest portion of the payment - at least for a certain time during the loan. One advantage to interest-only mortgages is that buyers keep more of their money longer and use it towards other costs or investments. A buyer may even still be accruing equity while making an interest only payment, if the the market is favorable and the property is appreciating!


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Know Your Financing Options

There are many types of loans available to buyers today, the most common of which are: FHA, VA and Conventional Fixed Rate Loans. While the conventional loan qualifying ratios are set at 28% and 36%, FHA and VA allow greater ratios for easier qualifying.

The following is a list of loan programs that are used when one or more of the qualifying factors do not fall within conventional parameters.

Stated Income Loans –for the self-employed buyer, or the buyer with income that is not documented. 5-25% required down and good or better credit ratings.

100% Loans (also known as ZERO Down Loans) – there are three types of zero down financing available:

V. A. loans - can be Zero Down – Of course you must have V.A. eligibility and by having served in the armed forces or having had a spouse who served.

True 100% loans - are available to people with excellent credit. There are usually two loans at closing: one for the bulk of the purchase, and a second, which makes up a small 5,10 or 20% junior lien. This second mortgage is usually at a higher rate of interest. Although there are two separate loans, one payment is usually made.

Nehemiah Program – Nehemiah is a non-profit corporation based out of California that aids home buyers. A 4% Seller contribution to Nehemiah will yield a 3% down payment gift from Nehemiah to the Buyer. 1% the contribution money is retained by Nehemiah for its operating costs.Castle Realty, We specialize in creative financing and alternative financing, FHA and VA loans

B,C and D loans – Sometimes paying high rates is an acceptable short term solution for buyers who have had recent credit issues.

Seller Carry-backs, Real Estate Contracts, and Lease Purchases - are ways a seller can help make purchases possible for a buyer with credit or qualifying issues. Few homes offer these incentives, and fewer advertise as such. 

First Time Buyer - Yes, there are several programs out there that cater to the first time home buyer and the low-income buyer. “Farm Home” loans( aka Rural Housing loans) have special programs available on certain houses in certain areas. Also there are special grant monies that come available from time to time for certain qualifying buyers. All of these programs offer below market rates, and special qualifying is required. There are usually a few strings attached as well: home buying courses are often required, and sometimes the homes fall under very tight scrutiny, above and beyond the typical lender’s interest.

We can help with creative financing and alternative financing.

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The "Tax Saving Benefit" explained!

One advantage to owning a home is the tax write off. Many buyers do not fully understand this advantage, even if they have owned a home before.

The concept is simple enough:

Mortgage payments consist of principal and interest”. In the beginning of a 30 year loan, these payments are mostly interest. Say your monthly payment is $1000 per month, it would not be unusual for the first few payments for $950 of that payment to be interest, and only the remaining $50 would actually go toward principal reduction.  Half way through a 30 year loan, an average payment will be half and half; about $500 of the payment going towards interest and the other $500 would go towards principle reduction. By the end of 30 years, most of the payment would go towards principal reduction and only a very small portion would be to pay the interest. That’s the bad news.

The good news is that the interest on a loan for a primary residence is fully tax-deductible. This means you can save thousands of dollars every year off of your income tax. That extra money in your tax return could be the savings plan you never got around to making, or a little investment money to add some improvements to you house.  After taking the tax savings into consideration, owning can be cheaper than renting. We can help with creative financing and alternative financing.

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About Thurston County

About Pierce County

Castle Realty

Olympia, Washington

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Real Estate sales in Seattle, Tacoma, Olympia, Yelm, Tumwater and surrounding areas. Homes, horse properties and land for sale.