NACA is stressful.
NACA is unorganized.
NACA lacks customer service.
NACA is slow.
NACA puts a $25,000 LIEN on your house to ensure you occupy the property as long as you have the NACA loan.
NACA has many flaws, yet I still chose them and I will explain why.
FHA: 3.5% of the loan balance. So for example, if you are borrowing $250,000, your down payment will be $8,750 ($250,000 x 3.50% = $8,750).
NACA: 0.00% of the loan balance. So for example, if you are borrowing $250,000, your down payment will be $0.00 ($250,000 x 0.00% = $0.00).
FHA: FHA requires a one-time upfront fee (1.75% of the loan) which is wrapped into the loan amount (not paid in cash). It insures lenders so they can approve loans at FHA's lenient standards. So for example, if you are borrowing $241,250 your one-time MIP premium will be $4,222 ($241,250 x 1.75% = $4,222 (rounding up)). In addition to the one-time upfront MIP premium FHA charges, you will have an ongoing monthly MIP. Mortgage Insurance Premium (MIP), is a type of insurance that protect lenders against loss in case the home buyer can't make the payment. The FHA MIP rate is 0.85% of the loan amount per year, but can vary from 0.45% to 1.05% per year depending on your loan amount and down payment. For our example, we will use the most common rate of 0.85%. If you are borrowing $241,250.00 your monthly MIP will be $173.00 every month, for the LIFE OF THE LOAN.
NACA: There are no one-time upfront or ongoing monthly PMI/MIP premiums.
Current FHA 30 Year Fixed from SunTrust: 4.500%
Current 30 Year Fixed from NACA: 4.375%
Let’s break the math down.
For a mortgage with FHA, we started off with a purchase amount of $250,000 but remember we need to pay down 3.5% and add in the upfront MIP. This will bring our loan amount to $245,472 ($250,000-$8,750+$4,222). Not including any escrow (taxes and insurance), the monthly mortgage payment would be $1418.00. $1243 in principal and interest and $173 in monthly MIP fees.
For a mortgage with NACA with a loan amount of $250,000.00, interest rate of 4.375%, NO PMI, you’re looking at $1,248.00 per month (not including taxes or insurance). Let’s say I started saving for a FHA loan and had a $8,750 available. That would be bring my NACA payment to $1,205 per month. Now let’s complicate it a bit. NACA allows you to buy down the rate 1% of the loan total for a 0.25% discount. Let’s take that $8,500 and buy down the rate. If 0.25% discount = $2500, $8,500 could buy me 3 discount points and bring my rate to 3.625%. With $7,500 of the $8,750.00 I could buy my rate down to 3.625% which would give me a monthly principal and interest payment of $1,100 vs. $1,418 with FHA. That’s a saving of $318 per month, $3,816 per year, which is $114,480 FOR 30 YEARS. You get my drift?
I have a love/hate relationship with NACA. I hate that their customer service stinks, I hate that they keep misplacing documents, I hate they are slow as heck working files and most importantly I HATE how they don’t take accountability for their actions. However, I am literally saving thousands of dollars for sticking it out with them so I don’t regret a second of the headache and stress they put me through.
BTW, I DID NOT get any volunteer credit to write this review and NACA never gave me the option to get volunteer credit to write a review. Really wondering where that information came from on this site.
Product or Service Mentioned: Naca Mortgage.
Reason of review: Problems with payment.