PURCHASE

PURCHASE
The process of acquiring a property for the purpose of primary residence, second home or investment property.
Advantages:

Establishes credit history
Secured investment
Builds equity
Can be used to borrow against

*Merit Lending is not a licensed CPA or Tax consultant and therefore, cannot determine if your mortgage interest will be eligible as a tax deduction per IRS code. You are advised to contact a tax professional. This in no way implies you are guaranteed a tax credit.

CASH OUT REFINANCE
In simple terms, a cash-out refinance replaces your current mortgage with another loan that:

INVESTMENT PROPERTY
A real estate property that is not occupied by the owner and has been purchased with the intention of earning a return on the investment either through rent, the future resale of the property, or both. An investment property can be a long-term endeavor, such as a rental home, or an intended short-term investment in the case of rehabilitation (where a property is bought, remodeled or renovated, and sold at a profit).
Advantages:

Capital growth
Rental income and yield
May be tax shelter deductible*

*Merit Lending is not a licensed CPA or Tax consultant and therefore, cannot determine if your mortgage interest will be eligible as a tax deduction per IRS code. You are advised to contact a tax professional. This in no way implies you are guaranteed a tax credit.

HOMESTYLE® RENOVATION
The process of acquiring a property for the purpose of primary residence, second home or investment property.

Cosmetic Improvements – Interiors, Kitchens, Baths, Flooring, and Remodeling
Energy Conservation Improvements
Structural Alterations such as Repair or Replacement of Structural Damage, Additions to Structure and Finished Attics and/or Basements
Eliminating Health and Safety Hazards
Changes for Improved Functions and Modernization
Repairing or Adding Roofing, Gutters and Downspouts
Landscaping, Grading, Repairing Patios and Terraces that Improve the Property
Decks / Fences
Rehabilitation or Improvements to a Detached Garage, a New Detached Garage, or the Addition of an Attached Unit(s) (if allowed by the local zoning ordinances)
Swimming Pools

Program Highlights:

Loan is based on after improved value
Owner occupied- second homes and Investment properties
One loan, one closing and one monthly payment
Project completion times up to 6 months
Purchase
Available on Refinance
Minimum Credit Score 620
Consultant required if repairs exceed $15,000

FHA 203(K) REHAB LOANS
Create the home of your dreams with the FHA 30 Year Fixed Rate 203(k) Rehabilitation Loan Program. Rehab loans help homeowners improve their existing home or even buy a home that in need of updates or repairs. With this program, you can finance both the purchase or refinance along with the renovation of your home through a single mortgage, instead of applying for multiple loans.
Program Highlights:

Minimum Credit Score is 620 for all Borrowers
Maximum 55% DTI for credit scores > 640
Maximum 50% DTI for credit scores 620-639
Funds are Disbursed to the Contractor as work is completed and inspected
An FHA 203(k) Consultant is Required
No Funds are Disbursed in Advance
Up to 5 Disbursements can be made
No Maximum Rehabilitation Escrow Amount

RATE TERM REFINANCE
The process of paying off one loan with the proceeds from a new loan, using the same property as security. Cash received by the borrower at closing may not exceed $2,000 (not allowed in Texas). Status varies depending upon State Law. The purpose is, as the name implies, to reduce the interest rate, payment, and/or overall term of the mortgage.

Advantages: