The Florida FHA mortgage has become the first option to many first time buyers in Florida. The Florida FHA loan program presents several benefits, bearing in mind the financial constraints of most homeowners who are interested in buying their very first residence. In comparison to other traditional mortgage loans, the FHA loan facilitates the buying process for the loan applicant. In addition the FHA loan consists of a very low down payment, which makes it much easier for homeowners that may have trouble saving up the huge down payment expected by traditional loans.
What are the major advantages to acquiring an FHA mortgage loan in Cross City?
• Secure fixed interest rate – One of the greatest advantages of the Florida FHA mortgage loan is the benefit of having a fixed 15 or 30 year rate of interest. Compared with other traditional loans where the loan interest rates change, the rate remains the same for the total duration of the mortgage loan. This period is commonly for 30 years. Due to this provision the borrower can map out their specific fixed monthly installment beforehand.
• Minimum down payment – The Government insures or backs FHA loans, therefore the applicant incurs very minimal fees during the process. FHA secured loans need a minimum 3.5% investment from the borrower. The mortgage does make it possible for the property seller to pay all closing costs, up to 6% which is usually enough to take care of virtually any property purchase.
• Not Difficult to Qualify – Prequalifying for a Florida FHA loan is rather effortless. Because it’s the FHA that insures the home loan, the financial institutions and banks make it feasible for everyone to qualify that meets the basic requirements. The most important components of qualifying are usually credit scores, source of income and job history.
• Adjustable Rate Option – The FHA loan originated as a result of tight budget constraints of first time buyers. This is why the FHA has got an adjustable rate option for home buyers, which will incorporate a very low payment and interest rate.
• There are no cash reserves required – In contrast with other conventional home loan programs, Florida’s FHA home loan is a very enticing option for Cross City first-time homeowners that have just a little funds saved.
First Time purchasers have to know what to expect before beginning the FHA home loan application process. Being prepared will often better your opportunities in successfully getting the FHA loan accepted. Here we have listed a few steps and some points to consider.
1. Debt-to-income ratio
Cautious analysis should be done here. Loan providers vary on precise amounts, but a financial debt load thatâ€™s greater than 41 to 45 percent is high-risk for an FHA loan. You will need two years of steady employment without having unexplained interruptions in employment.
2. Credit History
It is normally the small things which may harm your credit rating. Look at your earnings, credit worthiness, as well as rent history which can be displayed on a credit file. Get every aspect taken care of, concentrating on a good record.
3. Credit rating
As of 2013, a FICO score of 620 or higher is necessary for a 3.5% down payment with the FHA. In the event you have had a bankruptcy or foreclosure, you will have to have preserved a perfect credit ranking since that time (4 years and 5 years respectively) regardless of existing credit rating.
FHA Loan Application:
• Fill out the Buyer Information request, which lets us know what you have and what you will want. This will allow the FHA loan specialist get in touch with you to discuss your objectives. Soon after a full application will have to be filled out that details all things about you, the purchaser, which is to be used for deciding whether you are qualified to receive a loan or otherwise. The interest rate and loan terms can also be identified largely by the info in your mortgage application form, credit standing, etc.
• In case the application is pre-approved, you get the disclosure docs that are essentially preliminary loan documents which have all the minute details concerning the terms and conditions, interest levels, cost and repayments of the loan.
• This should be agreed upon and returned along with documents like bank account statements, IDs, references, etc., for validation purposes. Usually these documents are prepped and readied prior to when the mortgage loan application is submitted to the lender.
• The processor reviews all verifying records and may ask for missing paperwork from the borrower if needed.
• Upon completion, the written documents are submitted to the underwriter.
• The loan underwriter will send a Conditions List of further missing elements or documents to the purchaser.
• When the buyer finishes the needed items on the list, it is sent back to the lender for final consent. A closing day is then set.
Please Note: When you are in contract on a home, the full loan closing process takes around 3 weeks to a month.
Have Questions? Be sure to call us, 7 days a week at 800-871-2636 or simply just fill out the easy info request form on the right side of our home page at http://fivestarsmortgage.com. Property owners that currently have an FHA loan can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Homebuyers residing in more rural places in Florida can read about the 100% USDA mortgage loan at www.usdamortgagesource.com