This article explains some of the key requirements to buy a house in Oregon, and has been fully updated for 2019. It is designed to give you an educational jump start on your home buying process, whether you choose to buy a house in 2018 or 2019.
Basic Requirements to Buy a House in Oregon
Real estate markets across the state of Oregon have changed dramatically over the last few of years, particularly where home prices are concerned. Additionally, we have seen some new mortgage products come onto the market that all home buyers should know about. With that in mind, here are five basic requirements you might need to buy a house in Oregon.
1. An understanding of current real estate market conditions.
According to the latest information reported by Zillow, the median home value in Oregon rose above $330,000 during the fall of 2018. In October, the median price rose to $339,000, marking an increase of 6% from the previous year.
The company’s economists expect prices increases to slow and rise by 1.8% in 2019.
So while prices appear to be slowing down, they are expected to continue rising through 2019. Understanding these market changes is the first “requirement” to buying a house in Oregon.
2. Knowledge of current mortgage programs.
FHA. Conventional. Fixed-rate. Adjustable. You have a lot of mortgage options to choose from when buying a home in Oregon. And there are pros and cons to every choice you make. That’s why it’s important to research the different mortgage loan programs in advance, before making any decisions.
We can help you with this process in two ways.
- First, you could speak to one of our knowledgeable loan officers about mortgage financing options.
- Secondly, we’ve put together a tutorial to help you understand the different home loans.
3. A down payment, unless you are military.
Depending on the type of loan you use, the down payment could be another requirement to buy a house in Oregon. We’ve written about this subject before, offering an overview of minimum down payment requirements.
Depending on what type of mortgage loan you use, you might be required to make a down payment of 3% or more. That’s for a conventional home loan that is not insured by the government. The FHA mortgage program allows for a down payment of 3.5%. Military members and veterans in Oregon may be eligible for VA mortgage financing, which eliminates the need for a down payment entirely.
4. A decent credit score.
A recent report by a widely used mortgage software company showed that most closed loans went to borrowers with credit scores of 600 or above. That number is not written in stone. But it does give you some insight into current industry trends.
Credit scores are another important requirement to buy a house in Oregon. These three-digit numbers give lenders insight into how you have borrowed and repaid money in the past. They are computed based on information found within your credit reports.
Some mortgage programs are more flexible than others when it comes to credit score requirements. Please contact us if you have questions about the subject.
5. A manageable level of debt.
Debt-to-income ratios are another key requirement when buying a house in Oregon. As you might’ve guessed, these ratios compare the amount of money you earn to the amount you spend on your recurring debts.
As with credit scores, there is no single cutoff point or threshold requirement for Oregon home buyers. But some mortgage programs are more “forgiving” than others, when it comes to high debt levels. In some cases, borrowers can have a combined debt-to-income ratio as high as 50% and still qualify for a loan. Fannie Mae (one of the government-controlled corporations that buy loans from lenders) recently increased its debt limit from 45% to 50%.