Purchasing a house is one of the largest investments people make. There are a lot of options to consider and research. It can seem daunting, but there are plenty of resources for first-time homebuyers. The key is knowing where to look, for both a home and financing.
First-timers in Wyoming can find help with the homebuying and lending process from the housing development authority, among other organizations. Wyoming has programs offering eligible homebuyers financial assistance and low-interest, fixed-rate mortgage loans to buy their home. Check out this step-by-step guide to getting a mortgage in Wyoming, as we explore what options are offered in the state.
How Are Mortgage Rates in Wyoming?
Currently, mortgage rates in Wyoming are at or below national average rates. There are multiple variants that dictate rates by state. Competition in the area, state foreclosure rates and laws in Wyoming, along with the cost of doing business are reflected in the rates lenders offer. Wyoming's market conditions, such as the track record of loan repayment by borrowers in Wyoming can also affect rates. But the borrower's individual situation and property location are the primary factors. Click here to find a centralized explanation of what drives mortgage rates in general.
Get Help with Homebuying in Wyoming
Wyoming has an array of resources for homebuyers, including the first-time homebuyer program, which offers financial and education assistance to purchasers in the state. There are also federal outreach programs for mortgage help such as those through the Federal Housing Administration (FHA), U.S. Department of Veterans Affairs (VA) loans and U.S. Department of Agriculture's Rural Development.
At the state level, there is help for eligible homebuyers through the Wyoming Community Development Authority (WCDA). For qualified buyers, state programs could result in reduced loan rates, and financial assistance. Spruce Up Wyoming Programs offer financial help to buy and rehabilitate homes. Before any cosmetic changes, Spruce Up Wyoming requires the plumbing, heating, electrical systems, foundation and structural components, or roof of the home are safe and in good working condition.
The Home$tretch Loan Program provides assistance with down payment and closing costs to WCDA homebuyers. This program places a second mortgage on the property of up to $10,000.
A Mortgage Credit Certificate (MCC) offers tax credits for first-time homebuyers. With an MCC, a qualified borrower can get a credit based on mortgage interest paid toward his federal income tax liability.
There are so many resources out there for today's home buyer. You just need to know where to look. Visit MoneyGeek's comprehensive homebuyer's guide for an in-depth explanation of the homebuying process.
Wyoming First-Time Buyer Financial Assistance
Check here to see what you qualify for and how you can get financial assistance buying your first home in Wyoming.
Find a Housing Counselor in Wyoming
Home Affordability in Wyoming
Home values in Wyoming are increasing. According to Zillow, values have increased 2.6 percent in the past year with an anticipated increase of another 2.3 percent over the next year. In May 2012, the median home value was $78,500, which has increased to currently $113,500.
Much of home affordability depends on interest rates, local economy and unemployment rates. Wyoming's unemployment rate hit 5.7 percent in June, above the national average of 4.9 percent job growth is projected to be slow through 2024, according to the latest long-term projection from the research and planning section of the Wyoming Department of Workforce Services. It estimates the state will experience net growth of 4,327 jobs, or 1.5 percent, between 2014 and 2024.
New home seekers need to assess their own situation regarding stable employment, their debts-to-income, and what their finances will look like both short and long term when deciding how much house they can afford.
Maximum Loan Limits in Wyoming
Conventional and Federal Housing Administration (FHA) loans have maximum limits due to the potential loss should a borrower default. FHA has a maximum limit simply because it insures the loan. In the event a borrower is unable to repay the loan, FHA is responsible for debt repayment. Conventional loans are not guaranteed or insured by the federal government. However, they follow guidelines of government-sponsored enterprises such as Fannie Mae or Freddie Mac.
Check the table below for the limits in Wyoming, which can vary from county to county.
Homebuying in Wyoming: Experts Weigh In
Bob Squier is a Branch Manager for Wells Fargo Home Mortgage in Cheyenne, Wyoming.
Carol Wilson is director of single-family programs at the Wyoming Community Development Authority.
Scott Bice is director of the U.S. Department of Housing and Urban Development's Denver Homeownership Center.
Sarah Johnson is the owner/broker of Stillwater Mortgage in Casper, Wyoming.
How have home values in Wyoming changed since the housing crisis?
Home values in Wyoming are slightly higher now than in 2007-2008 when values started declining.
Although the market has softened in areas impacted heavily with residents who are/were employed in the energy sector, I have not seen a sharp decline in market values. Values have dropped slightly and the number of days on the market has increased slightly, but I feel the housing market in Wyoming is stable.
Prior to the housing crises of 2008 the median home price peaked in Wyoming during the third quarter of 2007 at $198,673, according to the Federal Housing Finance Agency (FHFA). Median prices fell to $178,503 during the first quarter of 2010. FHA data for Wyoming show that the median purchase price of a home was $169,950 in 2008 rising to $187,500 this fiscal year.
Is the housing market healthy in the major cities?
There are ups and downs over time in housing markets across Wyoming, and we haven't seen the boom that other places have, but overall, prices are healthy. Certain areas, such as Cheyenne and the valley between Jackson and Evanston, are doing well. Other areas have been hurt more by layoffs in the oil, gas and coal industries.
For potential homebuyers, prices for homes in Wyoming are competitive when you consider factors like property taxes and energy costs, and the fact that Wyoming has no state income tax.
Economic conditions strengthened in the Rocky Mountain Region during the first quarter of 2016. In Wyoming, home sales declined 1 percent year over year to 9,450 homes sold, according to HUD Office of Policy Development and Research Rocky Mountain Regional Report for First Quarter 2016.
In Wyoming, the rate of seriously delinquent mortgages and REO (real estate owned, or foreclosed properties owned by banks and lenders) properties edged down 0.2 percentage points from a year earlier, to 1.7 percent, but Wyoming now has the highest rate among the states in the region. Every state in the region continued to have a rate well below the 3.2 percent national average. Expect slowing demand and weaker prices in Wyoming. Weakness in the energy sector in a state with a small number of housing units will dampen sales and sale prices.
I would say as in any economic downturn, there is definitely more inventory out there; however, I think that the housing market is still doing well. We are seeing offers over asking price, not often, but I feel that is an indication of a healthy market.
What do first-time homebuyers in your state need to know about buying a home? Are there resources available to help with financial assistance?
The most important thing for aspiring homeowners to do is to talk with a lender about their options and get preapproved, which helps them understand what they qualify for. Different loan programs have different requirements, such as income limits. It's also important to know your credit profile.
First-time homebuyers may have options for loans with low down payments and other features to help qualified buyers achieve sustainable homeownership. For homes in rural areas, which Wyoming has a lot of, USDA Rural Development home loans may offer 100 percent financing (no down payment). We also do a lot of conventional low down payment loans (for example, Wells Fargo's program called yourFirst Mortgage offers down payments as low as 3 percent for fixed-rate loans), VA loans for veterans, and FHA (Federal Housing Administration) loans.
The key to homeownership is to start the conversation with a lender - don't rule yourself out before learning what options you may have, because all individual circumstances are different. Professionals like our Home Mortgage Consultants at Wells Fargo are here to help you every step of the way.
WCDA does require all of our first-time homebuyers to take the first-time homebuyer education class offered through the Wyoming Housing Network. It is imperative our buyers understand the biggest financial decision and obligation of their life. The education also offers them information on what to do after the loan closes, if they run into tough financial times. The education teaches them everything from budgeting to have inspections done.
Before a homebuyer purchases their first home they should learn all they can about homebuying and the financing process. A homebuyer should be asking questions like "Is this the right time to buy a house?", "How much do I want to spend?", and "How much can I afford?" A HUD-approved housing counseling agency can help the homebuyer through the process by either providing one-on-one counseling or through a homebuyer education class. A housing counselor can assess credit habits and provide useful strategies to improve the odds of achieving homeownership. To help prospective homebuyers find a counseling agency near them, they can call the HUD Automated Counselor Locator at 1-800-569-4287 or go to www.hud.gov/fha.
Don't Forget Wyoming Closing Costs
Closing costs vary by state and sometimes county due to different policies and regulated rates. For example, title insurance in Wyoming for a $160,000 loan policy would run $370 while in Montana, its neighbor to the north, the same policy would cost $256. Title insurance is just one of several third-party service fees. Others include closing fee, credit report, appraisal, survey and recording fees.
Average total closing costs in Wyoming of $1689 are about 8.5 percent less than the national average ($1847) and almost 12 percent less than its neighboring state of Montana ($1917), according to a 2015 Bankrate survey. (Bankrate's survey reflects minimal third party costs such as credit report and appraisal fees.)
Lender origination fees were 16 percent lower than the national average while third-party fees were almost less than one percent higher. Click here to get a full explanation of closing costs and what you should expect.
Average Closing Costs in Wyoming
Source: Bankrate's 2015 survey of closing costs.
Mortgage Refinancing in Wyoming
Nationwide interest rates are currently low, making refinancing a great idea if your mortgage is at a higher rate from years ago. Some people can go from a 30-year mortgage to a 15-year with about the same payment if their rate was a couple points higher than current levels.
Whether or not you have lost equity in your home since the housing crisis is another story, though. Low home equity can make refinancing trickier, but it may still be worthwhile to look because there are options available for those with little to no equity in their homes. Refinancing data from the Federal Housing Finance Agency shows refinancing in Wyoming rose 26 percent from 2014 through the fourth quarter of 2015. Out of the 8,550 refis last year. only 162 or less than 2 percent of homeowners used the HARP (Home Affordable Refinance Program). HARP was established in 2009 to assist homeowners who are unable to refinance due to decreased home values.
For a comprehensive overview of refinancing and to see if it's the right move for you to make, check out see our tools, tips and resources here.
Mortgage Resources in Wyoming
The U.S. Department of Housing and Urban Development offers educational information, housing counselors, real estate search, foreclosure avoidance help, homeownership assistance and more.
Habitat for Humanity builds homes with families who can make a down payment, help with sweat equity building their home and make a monthly mortgage payment.
The U.S. Department of Agriculture's Rural Development Agency offers loans, grants and loan guarantees to those who qualify for their assistance in home buying.
The Wyoming Community Development Authority offers low-interest single family mortgages, homebuyer education and counseling, down payment assistance and other local resources through partnerships with developers and non-profit community organizations.
The Home Buyer Assistance Program offers moderate- to low-income families become homeowners by providing educational classes and grants for financial assistance.
The State of Wyoming offers an inside look at detailed information about relocation and living in Wyoming, such as labor market, climate, residency questions and other related information.