The Florida FHA mortgage has become the best solution to most first time homebuyers in Florida. Florida’s FHA loan program gives several benefits, keeping in mind the financial difficulties of many homeowners who are considering buying their first home. Compared to other traditional mortgage loans, the FHA home loan eases the purchasing process to the applicant. Furthermore the FHA mortgage loan consists of a very low down payment, which makes it quite a bit easier for homeowners that may have trouble saving for the considerable down payment necessary by customary home loans.
What are the most important pros in getting an FHA mortgage loan in Englewood?
• Secure fixed interest rates – One of the leading advantages of the Florida FHA loan is the provision of paying a fixed 15 or 30 year rate of interest. In contrast to other regular loans where the loan interest rates vary, the rate stays the same for the entire lifetime of the mortgage. This period is typically for 30 years. Due to this provision the consumer can plan out their specific predetermined monthly installment before hand.
• Minimum down payment – The Government insures or supports FHA loans, which means the borrower incurs very minimal fees in the process. FHA mortgages must have a minimum 3.5% financial commitment from the applicant. The mortgage loan does permit the home seller to cover all costs of closing, as much as 6% which can be normally enough to cover virtually any home sale.
• Not Hard to Qualify – Prequalifying for a Florida FHA home loan is pretty easy. Because it’s the FHA that insures your home loan, the loan providers and mortgage lenders make it feasible for everyone to qualify that meets the simple requirements. The primary aspects of qualifying are history of credit, cash flow and employment records.
• Adjustable Rate Option – The FHA loan started due to the small budget constraints of first time home buyers. That’s why the FHA has got an adjustable rate option for home buyers, which entails a really low payment amount and interest rate.
• There are not any cash reserves required – In comparison to many traditional mortgage programs, the Florida FHA mortgage loan is a particularly attractive option for Englewood first time home owners which have just a little funds saved up.
First Time purchasers must know what to expect before beginning the FHA loan application process. Being prepared will always enhance your opportunities in successfully having your FHA mortgage loan approved. Below we have listed some guidelines and some things to consider.
Prior to application:
1. Debt-to-income ratio
Thorough evaluation must be done here. Creditors vary on actual amounts, but a financial debt load that is higher than 41 to 45 percent is risky for an FHA loan. You absolutely need 2 years of consistent employment devoid of unexplained interruptions in employment.
2. Credit History
It is usually the tiny problems which will hurt your credit rating. Look at your income source, credit worthiness, in addition to rent history that can be displayed on a credit report. Get all of it on the up and up, shooting for a good record.
3. Credit rating
As of 2013, a credit rating of 620 or greater is required for the 3.5% downpayment with the FHA. In case you have had a bankruptcy or foreclosure, you would have to have kept a perfect credit score since then (4 years and 5 years respectively) irregardless of current credit standing.
FHA Loan Application:
• Fill out the Buyer Information form, which lets us know what you have and just what you want. This will permit the FHA loan consultant to contact you to discuss your primary goal. Soon after a full application should be filled out that details all things about yourself, the purchaser, which will be used for trying to figure out whether you are qualified for a loan or otherwise. The interest rate and terms of the loan will also be determined largely by the details in your loan application form, credit scores, etc.
• In case the loan application is pre-approved, you will get the disclosure documents which are essentially initial loan documents that have all the minute details in connection with terms, loan rates, selling price and installment payments of the mortgage loan.
• This has to be signed and returned along with other records like you bank account records, IDs, individual references, etc., for verification purposes. These documents are prepped and readied way before the loan application is submitted to the mortgage lender.
• The processor double checks all verifying records and might request absent documents from the borrower if required.
• When completed, the documents will be submitted to the loan underwriter.
• The loan underwriter will be sending a Conditions List of other missing elements or documents to the home buyer.
• Once the buyer completes the desired items listed, it is sent back to the mortgage lender for final acceptance. A closing date is then scheduled.
Note: After in contract on a residence, the full loan closing process usually takes about three weeks to a month.
Questions? Please be sure to call us, 7 days a week at 800-871-2636 or simply just complete the brief information request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that currently have an FHA loan can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers located in more rural areas in Florida can read about the 100% USDA loan at www.usdamortgagesource.com