The Florida FHA mortgage has become the first choice to most first time homebuyers in the State of Florida. Florida’s FHA home loan program gives several advantages, paying attention to the financial limitations of most homeowners who are considering purchasing their very first residence. Compared to most traditional home mortgages, the FHA mortgage loan facilitates the purchasing process to the applicant. In addition the FHA mortgage requires a rather low down payment, which makes it easier for homeowners that may have a tough time saving up the substantial down payment expected by typical loans.
What are the primary advantages to acquiring an FHA loan in Jasper, FL?
• Secure fixed interest rates – One of the largest advantages of a Florida FHA home loan is the provision of having a fixed 15 or 30 year interest rate. Compared to the other conventional loans where the loan interest rates can vary, the rate stays the same for the full length of the mortgage loan. This timeframe is normally for 30 years. Because of this provision the borrower can plan out their specific fixed monthly installment ahead of time.
• Low down payment – The Government guarantees or backs FHA loans, therefore the borrower incurs very little fees in the process. FHA mortgage loans need a minimum 3.5% investment from the borrower. The loan does make it possible for the home seller to pay for all costs of closing, up to 6% which is generally enough to take care of just about any home purchase.
• Not Hard to Qualify – Pre-Qualifying for a Florida FHA home loan is very effortless. Because it’s the FHA that covers the home loan, the financial institutions and banks make it straightforward for anyone to qualify when they meet the base requirements. The most important components of qualifying usually are credit history, income and employment.
• Adjustable Interest Rate Option – The FHA loan began due to the small budget constraints of first-time home owners. Because of this the FHA features an adjustable rate option for home buyers, which entails a rather low monthly repayment and interest rate.
• There aren’t cash reserves required – In contrast to numerous traditional mortgage programs, Florida’s FHA home loan is a highly appealing option for Jasper first-time property owners who have just a little funds in the bank.
First Time buyers need to know what to expect before starting the FHA mortgage loan application process. Being prepared will always enhance your chances in successfully having your FHA mortgage accepted. Here we list some steps and points to consider.
1. Debt-to-income ratio
Careful study must be done at this point. Lenders vary on specific amounts, but a debts load that is above 41 to 45 percent is risky for an FHA loan. You absolutely need 2 years of regular employment with no unexplained gaps in employment.
2. Credit Check
It is typically the tiny problems which will hurt your credit score. Look at your income source, credit history, together with rent history which could show on a credit score. Get all things on the up and up, shooting for a clean record.
3. Overall credit score
As of 2013, a credit rating of 620 or higher is necessary for a 3.5% downpayment with the FHA. For those who have had a bankruptcy or foreclosure, you must have kept a perfect credit score since then (4 years and 5 years respectively) irrespective of present credit worthiness.
FHA Loan Application:
• Fill out the Buyer Information form, which tells us just what you have and what you need. This will allow the FHA loan consultant to get hold of you to discuss your goals. Later on a full application should be submitted that details everything about yourself, the purchaser, which will be used in finding out whether you are eligible for a home loan or otherwise. The interest rate and terms of the loan will also be driven 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 records that are essentially preliminary loan records that contain all the minute details regarding the terms and conditions, interest levels, selling price and repayments of the mortgage.
• This must be agreed upon and brought back along with records such as your bank records, IDs, references, etc., for verification purposes. Usually these documents are prepared and readied before the loan application is sent to the lender.
• The processor reviews all verifying documents and may ask for absent documentation from you if required.
• When completed, the written documents will be submitted to the loan underwriter.
• The underwriter will send a Conditions List of even more missing elements or records to the purchaser.
• Once the buyer completes the necessary items outlined, it is delivered back to the mortgage lender for final consent. A closing date is then set.
Note: When you are in contract on a home, the full loan closure process takes close to 3 weeks to a month.
A lot of questions? Be sure to call us, 7 days a week at 800-871-2636 or simply submit the brief info request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that presently have an FHA mortgage can learn about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Homebuyers located in more rural places in The state of Florida can learn more about the 100% USDA loan at www.usdamortgagesource.com