The Florida FHA mortgage has become the first choice to many first time home buyers in Florida. The Florida FHA mortgage loan program presents several advantages, keeping in mind the budget limitations of many homeowners who are considering purchasing their first home. Compared to most conventional home mortgages, the FHA home loan eases the process to the loan applicant. Furthermore the FHA mortgage requires a rather low down payment, which makes it simplier and easier for homeowners that may have problems saving up the large down payment necessary by standard home loans.
What are the main advantages to choosing an FHA mortgage loan in Boynton Beach, FL?
• Secure fixed loan interest rate – One of the leading advantages of your Florida FHA mortgage loan is the provision of having a fixed 15 or 30 year interest rate. Compared to other conventional loans in which the loan interest rates change, the rate stays the same for the full course of the loan. This period is often for 30 years. Due to this provision the borrower can pre-plan their specific fixed monthly installment before hand.
• Minimum down payment – The Government insures or backs FHA loans, therefore the borrower has very little fees during the process. FHA home loans must have a minimum 3.5% financial commitment from the applicant. The mortgage does permit the property seller to cover all closing costs, up to 6% which can be typically enough to cover just about any property sale.
• Quick to Qualify – Pre-Qualifying for a Florida FHA loan is very simple. Because it’s the FHA that covers the home loan, the creditors and mortgage lenders make it straightforward for everyone to qualify that meets the simple requirements. The primary aspects of qualifying are credit reports, income and job history.
• Adjustable Interest Rate Option – The FHA home loan began mainly because of the stretched budget constraints of first-time home owners. Because of this the FHA features an adjustable rate option for home buyers, which will incorporate a very low payment and interest rate.
• There won’t be cash reserves required – As compared with many standard mortgage programs, the Florida FHA home mortgage is a pretty tempting option for Boynton Beach first time home-owners who have a small amount of revenue in the bank.
First-time home buyers have to know what to expect before beginning the FHA mortgage loan application process. Being prepared will often improve your chances in successfully getting the FHA mortgage accepted. Below we list a few simple steps and some points to consider.
In advance of application:
1. Debt-to-income ratio
Careful assessment must be done at this point. Creditors can vary on specific amounts, despite the fact that a financial debt load that is above 41 to 45 percent is risky for an FHA loan. You should have two years of consistent employment with no unexplained interruptions in employment history.
2. Credit History
It is typically the small things that can damage your credit. Check your income, overall credit score, together with rental history which could show up on a credit score. Get all the things on the up and up, shooting for a spotless record.
3. Credit ratings
In 2013, a credit rating of 620 or higher is required for a 3.5% down payment with the FHA. For those who came out of a bankruptcy or foreclosure, you will have to have maintained a perfect credit ranking since then (4 years and 5 years respectively) irrespective of existing credit rating.
FHA Mortgage Loan Application:
• Fill out the Buyer Information request, that lets us know just what you have along with what you will want. This will allow the FHA loan professional to get hold of you to discuss your goals. Later a full application must be submitted that details all things about yourself, the borrower, which will be used in deciding whether you are eligible for a loan or otherwise. The rate and loan terms may also be determined largely by the info in the mortgage application form, credit history, etc.
• In case the loan application is preapproved, you will get the disclosure docs which are essentially initial loan documents which have all the minute details in connection with terms and conditions, rates, cost and monthly payments of the mortgage.
• This needs to be signed and returned along with records such as your bank statements, IDs, personal references, etc., for validation purposes. These documents are prepared and readied before the loan application is submitted to the mortgage lender.
• The processor reviews all validating documents and may request missing documentation from the borrower if needed.
• Upon completion, the docs are then submitted to the underwriter.
• The underwriter will be sending a Conditions List of other missing items or documents to the home buyer.
• When the buyer finishes the required items outlined, it is sent back to the lender for final acceptance. A closing date is then established.
Please Note: After in contract on a residence, the full loan closure process normally takes about three weeks to a month.
Questions or concerns? Be sure to call us, 7 days a week at 800-871-2636 or just complete the easy information request form on the right side of our home page at http://fivestarsmortgage.com. Property owners that currently have an FHA home loan can read about the FHA streamline refinance program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers residing in more rural places in Florida can learn about the 100% USDA home loan at www.usdamortgagesource.com