The Florida FHA mortgage is the first solution to the majority of first time homebuyers in the State of Florida. The Florida FHA mortgage loan program features several benefits, paying attention to the financial difficulties of most homeowners who are considering buying their first home. When compared with most conventional home mortgages, the FHA mortgage loan eases the purchasing process for the loan applicant. On top of that the FHA mortgage involves a very low down payment, which makes it quite a bit easier for homeowners that may have difficulty saving money for the sizeable down payment required by conventional loans.
What are the most valuable pros to acquiring an FHA mortgage loan in Hollywood, FL?
• Secure fixed loan interest rates – One of the big advantages of your Florida FHA mortgage loan is the benefit of paying a fixed 15 or 30 year rate of interest. In comparison with other traditional loans in which the loan interest rates vary, the rate stays the same for the full length of the mortgage. This period is normally for 30 years. Because of this provision the borrower can plan their fixed monthly installment up-front.
• Minimal down payment – The Federal government guarantees or supports FHA loans, therefore the applicant has very little fees in the process. FHA financial loans must have a minimum 3.5% investment from the borrower. The mortgage does support the property seller to pay all closing costs, anywhere up to 6% which is often enough to cover just about any property purchase.
• Easy to Qualify – Prequalifying for a Florida FHA mortgage loan is very simple. Since it is the FHA that covers your home loan, the creditors and lending institutions make it easier for everyone to qualify when they meet the central requirements. The biggest elements of qualifying are credit history, cash flow and employment history.
• Adjustable Rate Option – The FHA mortgage loan began due to the small financial restrictions of first-time home buyers. This is why the FHA has an adjustable rate option for home buyers, which will incorporate a rather low monthly payment and interest rate.
• There won’t be cash reserves required – Compared to many traditional home loan programs, the Florida FHA mortgage is a very attractive option for Hollywood, FL first-time homeowners who have a small amount of funds in the bank.
First Time home buyers should find out what to expect before beginning the FHA mortgage loan application process. Being prepared will often better your odds in successfully getting the FHA home loan accepted. Here we list a few guidelines and points to consider.
Prior to application:
1. Debt-to-income ratio
Thorough research must be done here. Mortgage companies differ on specific amounts, still a financial debt load that is more than 41 to 45 percent is high-risk for an FHA loan. You need two years of steady employment without having any unexplainable interruptions in job history.
2. Credit Check
It is usually the small things which could damage your credit score. Examine your earnings, credit standing, along with rental history that could show up on a credit file. Get all the things handled, aiming towards a completely clean record.
3. Credit scores
In 2013, a FICO score of 620 or higher is necessary for the 3.5% down payment with the FHA. If you came out of a bankruptcy or foreclosure, you will have to have retained a perfect FICO score since then (4 years and 5 years respectively) irregardless of recent credit score.
FHA Mortgage Loan Application:
• Complete the Buyer Information form, that lets us know what you have along with what you need. This will permit the FHA mortgage specialist to call you to discuss your goals. Subsequently a full application will have to be submitted that details all about yourself, the borrower, which is used in finding out whether you are eligible for a home loan or otherwise. The rate and loan terms will also be driven largely by the info in the application form, credit history, etc.
• In case the loan application is preapproved, you will get the disclosure docs that are essentially preliminary loan documents that have all the minute details regarding the terms and conditions, interest rates, selling price and installments of the loan.
• This must be agreed upon and returned along with records like you bank account documents, IDs, individual references, etc., for validation purposes. Usually these documents are prepared and readied before the loan application is sent to the loan provider.
• The processor double checks all validating records and might request missing documentation from the borrower if needed.
• When completed, the records are then sent to the loan underwriter.
• The underwriter sends a Conditions List of additional missing items or documents to the purchaser.
• Whenever the buyer completes the required items outlined, it is sent back to the lender for final acceptance. A closing date is then scheduled.
Note: Once you are in contract on a home, the overall loan closure process takes around three weeks to a month.
Questions or concerns? Be sure to call us, 7 days a week at 800-871-2636 or just submit the quick info request form on the right side of our home page at http://fivestarsmortgage.com. Property owners that presently have an FHA loan can learn about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Home buyers located in more rural areas in The state of Florida can learn more about the 100% USDA loan at www.usdamortgagesource.com