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Coastal Funding Corporation

Myrtle Beach (843) 215-6200 - - Charleston (843) 790-4411 - - Pensacola (850) 725-6200 Your Home Loan Specialists ... Give Us A Call Today For A Free Home Mortgage Quote...
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Annual Property Tax: This varies by locality. We use the actual average property tax rate for your metro area. You can also input your personal property tax rate as a percent of your home's value or a national baseline assumption of 1.35%.

Buying Closing Costs: Include loan origination fees, mortgage points, title insurance, appraisal, escrow deposit, fees for running a credit report, and other closing costs.

Discount Rate: The opportunity cost of your money. It reflects what your money would earn as savings or investments other than housing. The higher the discount rate, the more expensive home ownership is because buying a home involves a big upfront payment.

Down Payment: The share of the purchase price you pay upfront. Our baseline assumption is 20%. Unless you are a Veteran using a VA loan, putting less than 20% down typically requires mortgage insurance.

FHA loan: An FHA insured loan is a US Federal Housing Administration mortgage insurance backed mortgage loan which is provided by a FHA-approved lender. FHA insured loans are a type of federal assistance and have historically allowed lower income Americans to borrow money for the purchase of a home that they would not otherwise be able to afford.

Homeowner Condo/HOA Fees: This is for monthly condominium or homeowners' association fees, or any other additional costs of owning not captured elsewhere.

Homeowner's Insurance: Typically required by mortgage lenders. We assume an annual cost of 0.46% of the home's value. Homeowners insurance could be significantly higher if you pay high premiums for risk factors such as floods or earthquakes.

Inflation: Impacts costs such as utilities and renovations, which we assume increase at the rate of inflation.

Long Term Capital Gains Tax: Assessed if the sale price exceeds the original purchase price by $500,000 if filing as married, or $250,000 if filing as an individual. We have assumed a 15% tax rate. Your tax situation might be different.

Military Service: Many Veterans and active duty service members are eligible for a VA loan. VA loans are issued by private lenders but guaranteed by the Department of Veterans Affairs. VA loans don't require a down payment or private mortgage insurance. However, VA loans are required to pay an upfront fee.

Mortgage Term: The number of years until the mortgage is paid off. Our baseline assumption is 30 years. Some mortgages have shorter terms such as 15 years.

PMI (Private Mortgage Insurance): Private mortgage insurance is percentage of the original loan amount added each year. Included if the down payment is less than 20%, but drops to zero in the year after outstanding loan balance falls under 80% of home value.

Renovations: Both regular maintenance and home improvement. We assume homeowners pay 1% annually of the home's value, although this can run significantly higher.

Rent Appreciation: The amount that your rent is likely to increase each year.

Rent Insurance: A policy that covers your personal possessions against perils such as fire, theft, or vandalism. We assume this is 1.32% of your monthly rent. This is not a required cost.

Price Appreciation: The amount that your home is likely to appreciate in value each year, but – be warned -- appreciation is volatile and unpredictable. We make a conservative assumption for each metro area, based on long-term and recent local trends, typically 2-3% per year. This is nominal, not real, appreciation.

Selling Closing Costs: Include the real estate agents' commissions, transfer taxes, title insurance fees, and other closing costs when selling a home.

Upfront Fee: Percentage of loan amount added to closing costs for VA loans.

Additional Utility Cost for Homeowners: Water, electric, and sewage are often higher for homeowners than for renters. We assume you would pay $100 per month more in utilities as a homeowner than as a renter.

Renters in Fannie Mae-owned properties may be able to stay in their homes

Fannie Mae Tenant-in-Place Rental Policy

To help minimize disruption, eligible renters who want to stay in a home that has been foreclosed can sign a month-to-month lease if the property is owned by Fannie Mae.  The policy, which applies to properties owned by Fannie Mae, will help bring stability to communities affected by high foreclosure rates. 

Eligible renters will be offered a new month-to-month lease with Fannie Mae and Fannie Mae will manage the properties through a real estate broker or a property management company. Renters may also be eligible for financial assistance if they desire to relocate.

Program criteria highlights

  • To qualify, a renter must live in the property when it is acquired by Fannie Mae
  • Any single-family property is eligible including two- to four-unit properties, condos, co-ops, single-family detached homes and manufactured housing.
  • The property must meet state laws and local code requirements for a rental property.
  • Fannie Mae will not require security deposits.
  • Under the Fannie Mae lease, the property may be marketed for sale and if sold the property would be transferred to the new owner subject to the lease
  • Rental rates under the new leases will be comparable to other rents in the same market and subject to any legal rent control restrictions.

Protecting Tenants at Foreclosure Act of 2009 (PTFA)

In addition, pursuant to the Protecting Tenants at Foreclosure Act of 2009 (“PTFA”), bona fide tenants after foreclosure sale may be entitled to remain in the premises under their existing lease or tenancy.  If you are a renter in a Fannie Mae owned property and the property has been foreclosed upon, you should have received the Fannie Mae Knowing Your Options document that sets forth information regarding some of your options.  Please contact the property manager or broker listed in the document to provide information about your lease or tenancy.  Bona fide tenants may also choose to sign month-to-month leases with Fannie Mae pursuant to the rental policy. Contact the property listing broker or the Fannie Mae Resource Center at 1-800-732-6643 for more information.

If you have questions concerning your rights as a tenant under PTFA or other state or federal laws, please seek the advice of an attorney.  Information on legal services in your area is available through the American Bar Association at
Fannie Mae Tenant-in-Place Rental Policy FAQs(20KB)


Fannie Mae’s Deed-for-Lease Program (D4L), allows qualified borrowers (or their tenants) to execute a lease of up to 12 months in conjunction with their deed-in-lieu of foreclosure, allowing them to remain in their home as a renter.   Borrowers interested in exploring this option should discuss it with their mortgage servicer.  To qualify both the property and borrower (or tenant of the borrower) must meet certain general qualifications* such as:

Occupant Eligibility:

  • Income is sufficient to cover rental payments of not more than 31 percent of gross income.  If the current market rent is greater than 31 percent of the occupant’s monthly gross income, a lease will not be offered.
  • Inspection of the property indicates that the occupants have been keeping the property in good condition.
  • The number of occupants is appropriate for the home and in compliance with local laws and homeowner association rules.
  • If pets are present, renter’s insurance is obtained, if required.
  • The occupants signing the lease must agree to a credit review and all occupants over the age of 18 must have an acceptable background check, including receiving clearance from the Office of Foreign Assets Control (“OFAC”).
  • There are no signs or reports of illegal activities conducted at the property.
  • The property is to be used as a primary residence.

Property Eligibility: 

  • There are no zoning or homeowner’s association (HOA) rental limitations that would prohibit a lease.
  • Repairs required to make the property habitable are deemed to be in an acceptable amount based on the property value. 
  • The property is in compliance with local rules and laws or can be brought into compliance within 30 days.
  • The property is not within a target area for any corporate, government or community neighborhood stabilization plan which may need the property as part of the plan for purposes other than residential.
  • The market rental income is anticipated to cover ongoing maintenance and management costs.

Myths About Homeownership

How lenders assess mortgage applications has changed a lot since 2007. What was acceptable a few years ago may not be so today. The following are some common homeownership myths:

Myth: It’s a bad time to buy a house.

Fact: Mortgage rates for fixed-rate mortgages are at historical lows, creating stable payments and long-term savings for today's homebuyers and house prices have fallen at a record pace. Additionally, there is some financial relief for first-time homebuyers through the recently enacted Housing and Economic Recovery Act of 2008 and foreclosures have increased to record levels, leaving lots of housing supply on the market with unequalled demand. The combination of these factors generally equals greater affordability, and makes now a good time for many to consider homeownership.

Myth: Buying a house is just too risky; I'll end up in foreclosure.

Fact:The recent news on foreclosures is understandably frightening. Certainly if you lose your job, go through a divorce, or suffer an illness, you could have real trouble paying your mortgage, or rent for that matter. In recent years, we've even seen an increase in excessive obligation–just too many bills–as a reason for delinquency. While you can't always solve for the unexpected twists and turns of life, good budgeting and responsible credit practices can decrease the likelihood of a foreclosure. Also if you have trouble paying the mortgage, contact your lender immediately!

Myth: You can't buy a home in the U.S. if you're not a citizen.

Fact:If you're a permanent or non-permanent resident alien, you can purchase a home in the U.S. In order to qualify for a loan you typically need to be a permanent resident alien with a valid USCIS card or, a "Green Card" and Social Security number. If you are a temporary resident alien with a valid work permit and Social Security number and have been in the United States continuously for the last 2 years, with steady employment and good credit history you may also qualify for a loan.

Myth: If you don't have a bank account or credit cards, you can't qualify for a mortgage.

Fact: Having a bank account is always a good idea and helps you establish credit. However, lenders can approve you for a mortgage even if you don't have a bank account or credit cards. You'll likely need to keep records showing a history of payments you've made for items such as rent, utilities, and car payments.

Myth: Lenders share your personal financial information with other companies.

Fact: By law, banks and other financial institutions are restricted in their uses and disclosures of information about you. In some situations, you may choose to restrict the disclosure of your information if you don't want it to be shared. If you are unsure how your information will be used, don't be afraid to ask – it's your right to know.

Myth: If you're late on your monthly mortgage payments, you'll lose your house.

Fact: If you have a financial hardship, like the death of your spouse or a medical emergency, and fall behind, it's possible to keep your home and get back on track if you contact your lender early (the organization to whom you make your monthly mortgage payments, sometimes also referred to as your mortgage servicer).

If you experience a change in your financial situation and think that you will fall behind or have fallen behind on your mortgage payment, call your lender immediately.

Despite popular belief, lenders do not want to foreclose on homes. They want to keep you as a customer for life. In fact, lenders typically lose money in the foreclosure process, so they are always looking for ways to help you make ends meet.

Myth: You can't get a mortgage if you've changed jobs several times in the last few years.

Fact: Not true. You can change jobs several times and still get a loan to buy a home. Lenders understand that people change jobs. The important thing is to show that you've had a stable income and good credit.