First-time home buyers in Clemson

Check the condominium project before you fall for the unit

A conventional loan on a condominium is underwritten twice: once on you, and once on the project. The review looks at the association budget and reserve contribution, the share of units that are owner-occupied, how concentrated the ownership is, deferred maintenance and any active litigation. Near a campus, the owner-occupancy share is frequently what fails, and FHA applies a similar test through its own project approval list.

A well-run, fully occupied building can still be unwarrantable, and there is nothing you can do about it as a borrower. A fee-simple townhome — where you own the land under the unit — is generally underwritten as a single-family house and avoids the whole question. The deed tells you which one you are looking at. I can find out in a day.

The 20 percent myth, retired

Conventional loans start at 3 percent down for qualifying first-time buyers and 5 percent otherwise. FHA starts at 3.5 percent. VA can be zero for eligible veterans. Twenty percent avoids mortgage insurance — it was never a requirement to qualify.

USDA is worth a check even here. It does not usually reach inside the developed corridor, but parts of Pickens and Anderson counties nearby are eligible, and zero down with a lower annual fee changes what you can afford.

HOA dues are part of your qualifying

On attached housing, the monthly assessment counts in your housing expense exactly like a payment, so a higher dues figure lowers the loan you can support. In a market with a lot of managed attached inventory, that is a real factor rather than a rounding error, and it belongs in your budget from the first conversation.

The tax figure on the listing is probably not yours

South Carolina assesses an owner-occupied primary residence at a lower ratio than a second home or a rental, and primary residences receive relief from part of the school operating tax. Around Clemson a great many properties are rentals, so the taxes shown on a listing frequently reflect a classification that will not be yours. Taxes reach your payment through escrow, so I estimate from a properly classified figure — and filing for the owner-occupied classification after closing is on you.

The mistakes that cost first-time buyers their approval

• Financing furniture before closing — a new payment changes your debt ratios at exactly the wrong moment.
• Depositing cash without a paper trail. Move money by transfer so it can be sourced.
• Changing jobs mid-transaction without telling anyone. It is often fine; it is never fine as a surprise.
• Letting a credit card balance spike. Credit is re-checked shortly before closing.
• Writing an offer on a condo before anyone has looked at the project.