The Florida FHA mortgage is the first choice to most first time buyers in the State of Florida. Florida’s FHA home loan program offers several advantages, paying attention to the funding limitations of most homeowners who are considering buying their very first home. Compared to most traditional home mortgages, the FHA loan facilitates the purchasing process to the applicant. Also the FHA mortgage loan involves a rather low down payment, which makes it simpler for homeowners that may have difficulties saving for the substantial down payment required by old fashioned loans.
What are the most common benefits in getting an FHA loan in Polk City, FL?
• Secure fixed loan interest rates – One of the largest advantages of a Florida FHA loan is the benefit of having a fixed 15 or 30 year interest rate. When compared to other basic loans in which the interest rates can vary, the rate stays the same for the total length of the loan. This period is usually for 30 years. Due to this provision the consumer can plan out their specific fixed monthly installment ahead of time.
• Low down payment – The Federal government insures or backs FHA loans, therefore the borrower incurs very little charges in the process. FHA secured loans need a minimum 3.5% financial commitment from the borrower. The loan does make it possible for the home seller to pay for all closing costs, all the way to 6% which can be frequently enough to take care of just about any property purchase.
• Not Difficult to Qualify – Prequalifying for a Florida FHA mortgage loan is pretty simple and easy. Since it is the FHA that covers the home loan, the creditors and lending institutions make it simple for anybody to qualify that meets the basic requirements. The primary aspects of qualifying usually are credit rating, earnings and employment.
• Adjustable Interest Rate Option – The FHA loan started because of the limited budget restrictions of first time homeowners. This is the reason the FHA has got an adjustable rate option for home buyers, which features a rather low monthly repayment and interest rate.
• There are no cash reserves required – In comparison with numerous traditional mortgage programs, Florida’s FHA mortgage is a particularly appealing option for Polk City, FL first-time home owners which have just a little income in the bank.
First-time buyers should find out what to expect before starting the FHA home loan application process. Being prepared will always raise your chances in successfully having your FHA mortgage loan approved. Below we list a few tips and considerations.
Prior to application:
1. Debt-to-income ratio
Cautious evaluation should be done at this stage. Mortgage companies vary on exact amounts, but a debts load that is above 41 to 45 percent is high-risk for an FHA loan. You should have two years of continual employment without any unexplainable breaks in job history.
2. Credit History
It is all of the tiny problems which can harm your credit ratings. Examine your income, credit history, as well as rent history which could show up on a credit report. Get every aspect handled, shooting for a spotless record.
3. Credit score
In 2013, a credit rating of 620 or better is needed for the 3.5% downpayment with the FHA. In case you came out of a bankruptcy or foreclosure, you would need to have kept a perfect credit rating since then (4 years and 5 years respectively) in spite of current credit standing.
FHA Mortgage Application:
• Fill out the Buyer Information form, which tells us just what you have along with what you may need. It will allow the FHA loan professional to contact you to discuss your goals. Afterwards a full mortgage application will need to be submitted that details all about you, the applicant, which is to be used in finding out whether you are qualified for a mortgage loan or otherwise. The rate and loan terms will also be determined largely by the info in your loan application form, credit rating, etc.
• In case the loan application is pre-approved, you will get the disclosure records that are essentially preliminary loan records that contain all the minute details concerning the terms and conditions, home interest rates, selling price and payments of the mortgage loan.
• This has to be signed and returned along with other documents like bank account records, IDs, references, etc., for validation purposes. Usually these documents are prepared and readied ahead of the mortgage loan application is submitted to the mortgage lender.
• The processor reviews all confirming documents and may ask for missing documents from the borrower if need be.
• When completed, the docs are sent to the underwriter.
• The loan underwriter sends a Conditions List of other missing items or docs to the purchaser.
• Once the buyer completes the requested items outlined, it is returned to the mortgage lender for final acceptance. A closing date is then established.
Please Note: When you are in contract on a home, the overall loan closing process can take around 3 weeks to a month.
Questions? Please make 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. Homeowners 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 about the 100% USDA mortgage at www.usdamortgagesource.com