The Florida FHA mortgage is the first choice to many first time home buyers in Florida. The Florida FHA home loan program provides several benefits, keeping in mind the budget difficulties of many homeowners who are considering purchasing their first home. Compared to most traditional mortgage loans, the FHA mortgage loan facilitates the process for the applicant. Besides that the FHA mortgage loan consists of a very low down payment, which makes it a lot easier for homeowners that may have problems saving for the large down payment necessary by common home loans.
What are the most important advantages to choosing an FHA loan in Cocoa?
• Secure fixed loan interest rates – One of the big advantages of your Florida FHA loan is the benefit of having a fixed 15 or 30 year interest rate. In comparison to other regular loans in which the loan interest rates change, the rate remains the same for the total length of the loan. This timeframe is typically for 30 years. Because of this provision the consumer can budget their predetermined monthly installment ahead of time.
• Minimum down payment – The Federal government insures or supports FHA loans, therefore the borrower has very minimal charges in the process. FHA mortgages require a minimum 3.5% financial commitment from the applicant. The loan does allow for the home seller to pay for all closing costs, up to 6% which is frequently enough to take care of almost any property sale.
• Not Hard to Qualify – Prequalifying for a Florida FHA home loan is rather straightforward. Because it’s the FHA that insures your home loan, the creditors and lending institutions make it feasible for anybody to qualify when they meet the base requirements. The primary components of qualifying are history of credit, earnings and employment history.
• Adjustable Rate Option – The FHA mortgage loan started due to the stretched budget constraints of first time buyers. That’s the reason the FHA features an adjustable rate option for home buyers, which calls for a relatively low payment and interest rate.
• There won’t be cash reserves required – In contrast to most conventional home loan programs, Florida’s FHA home loan is a very tempting option for Cocoa, FL first-time home owners which have a little revenue saved.
First Time buyers should find out what to expect before starting the FHA mortgage loan application process. Being prepared will always boost your opportunities in successfully getting the FHA mortgage approved. Here we list a few steps and some things to consider.
In advance of application:
1. Debt-to-income ratio
Careful study needs to be done at this point. Mortgage lenders differ on precise amounts, but a financial debt load that is greater than 41 to 45 percent is high risk for an FHA loan. You will need 2 years of continual employment with no unexplained breaks in job history.
2. Credit History
It is generally the tiny problems which may damage your consumer credit. Check your income source, credit worthiness, together with rent history which may show up on a credit score. Get everything taken care of, aiming towards a spotless record.
3. Credit ratings
In 2013, a FICO score of 620 or better is required for the 3.5% down payment with the FHA. If you have had a bankruptcy or foreclosure, you will have to have maintained a perfect credit score since then (4 years and 5 years respectively) irregardless of recent credit worthiness.
FHA Mortgage Application:
• Complete the Buyer Information request, that lets us know what you have and just what you need. It will permit the FHA mortgage professional to call you to discuss your primary goal. Subsequently a full mortgage application will need to be completed that details everything about you, the borrower, which is used for determining whether you are qualified for a mortgage loan or otherwise. The interest rate and terms of the loan will also be identified largely by the data in your loan application form, credit scores, etc.
• In the event the application is preapproved, you will get the disclosure records that are essentially initial loan documents which have all the minute details in connection with terms and conditions, loan rates, cost and installment payments of the home loan.
• This has to be agreed upon and returned along with documents such as your bank account statements, IDs, personal references, etc., for validation purposes. Usually these documents are prepped and readied before the loan application is submitted to the loan provider.
• The processor double checks all validating papers and may request absent documentation from the borrower if needed.
• When completed, the documents are sent to the underwriter.
• The underwriter will be sending a Conditions List of further missing elements or documents to the purchaser.
• After the buyer completes the requested items on the list, it is returned to the mortgage lender for final authorization. A closing date is then scheduled.
Notice: When you are in contract on a residence, the entire loan closing process takes roughly three weeks to a month.
A lot of questions? 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 presently have an FHA mortgage 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 more about the 100% USDA mortgage loan at www.usdamortgagesource.com