The Florida FHA mortgage has become the first choice to many first time home buyers in Florida. Florida’s FHA mortgage loan program offers several benefits, keeping in mind the funding limits of most homeowners who are considering purchasing their very first home. When compared with most conventional mortgage loans, the FHA mortgage loan facilitates the buying process to the loan applicant. On top of that the FHA mortgage loan involves a fairly low down payment, which makes it quite a bit easier for homeowners that may have difficulties saving for the big down payment expected by traditional loans.
What are the most common advantages to getting an FHA mortgage loan in Venice?
• Secure fixed loan interest rate – One of the best advantages of the Florida FHA home loan is the benefit of having a fixed 15 or 30 year interest rate. In comparison with other regular loans where the interest rates can vary, the rate continues to be the same for the full span of the loan. This period is commonly for 30 years. Because of this provision the consumer can plan out their predetermined monthly installment before hand.
• Small down payment – The Federal government guarantees or supports FHA loans, therefore the borrower incurs very little fees in the process. FHA mortgage loans must have a minimum 3.5% investment from the applicant. The loan does support the property seller to cover all costs of closing, all the way to 6% which is often enough to handle virtually any home sale.
• Easy to Qualify – Pre-Qualifying for a Florida FHA home loan is quite simple and easy. Because it’s the FHA that covers your house loan, the creditors and banks make it easier for everyone to qualify when they meet the primary requirements. The most important aspects of qualifying usually are credit history, income and employment.
• Adjustable Interest Rate Option – The FHA mortgage loan started due to stretched financial restrictions of first time buyers. This is exactly why the FHA features an adjustable rate option for home buyers, which has a surprisingly low payment and interest rate.
• There are no cash reserves required – Compared to most traditional home loan programs, Florida’s FHA home loan is a particularly tempting option for Venice first time homeowners who have a little income saved up.
First-time home buyers have to know what to expect prior to starting the FHA loan application process. Simply being prepared will always improve your chances in successfully getting the FHA loan accepted. Here we have listed a few steps and things to consider.
1. Debt-to-income ratio
Careful researching needs to be done at this stage. Loan providers fluctuate on precise amounts, but a debts load thatâ€™s greater than 41 to 45 percent is high risk for an FHA loan. You will need two years of regular employment with no unexplainable interruptions in employment history.
2. Credit History
It is all of the tiny problems that may harm your consumer credit. Check your income source, credit score, along with rental history which can be displayed on a credit file. Get all things on the up and up, shooting for a fully clean record.
3. Credit worthiness
In 2013, a credit score of 620 or greater is required for a 3.5% downpayment with the FHA. If you came out of a bankruptcy or foreclosure, you will have to have maintained a perfect credit rating since then (4 years and 5 years respectively) irrespective of existing credit score.
FHA Loan Application:
• Fill out the Buyer Information form, which tells us what you have and just what you want. This will allow the FHA loan consultant to call you to discuss your objectives. Later on a full application must be submitted that highlights all about yourself, the borrower, which is to be used in deciding whether you are eligible for a mortgage or otherwise. The interest rate and terms of the loan will also be identified largely by the information in the application form, credit report, etc.
• In the event the loan application is pre-approved, you will get the disclosure docs that are essentially initial loan documents which have all the minute details concerning the terms, loan rates, cost and installment payments of the loan.
• This has to be signed and brought back along with other documents like you bank records, IDs, references, etc., for verification purposes. These documents are prepped and readied way before the mortgage loan application is submitted to the loan provider.
• The processor reviews all validating papers and might request absent documentation from the borrower if need be.
• When completed, the docs are submitted to the loan underwriter.
• The loan underwriter will send a Conditions List of further missing items or docs to the buyer.
• Whenever the buyer completes the necessary items detailed, it is delivered back to the lender for final approval. A closing day is then scheduled.
Please Note: Once you are in contract on a home, the entire loan closure process can take roughly three weeks to a month.
Questions? Please make 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 home loan can read about the FHA streamline refinance program here – http://fivestarsmortgage.com/florida-fha-loan/. Homebuyers living in more rural locations in The state of Florida can learn about the 100% USDA mortgage loan at www.usdamortgagesource.com