The Florida FHA mortgage has become the best choice to many first time homebuyers in the State of Florida. Florida’s FHA home loan program gives several benefits, bearing in mind the financial constraints of many homeowners who are considering buying their very first home. When compared with most conventional mortgage loans, the FHA loan eases the buying process for the applicant. Additionally the FHA mortgage involves a rather low down payment, which makes it less difficult for homeowners that may have problems saving money for the big down payment necessary by typical home loans.
What are the big pros in getting an FHA mortgage loan in Interlachen?
• Secure fixed loan interest rate – One of the big advantages of the Florida FHA mortgage loan is the provision of having a fixed 15 or 30 year interest rate. When compared to other basic loans where the interest rates can vary, the rate stays the same for the entire course of the mortgage. This period is often for 30 years. Due to this provision the borrower can plan their predetermined monthly installment up-front.
• Small down payment – The Government insures or backs FHA loans, which means the borrower incurs very minimal fees along the way. FHA loans demand a minimum 3.5% investment from the applicant. The loan does make it possible for the property seller to cover all costs of closing, as much as 6% which is normally enough to handle almost any home sale.
• Not Difficult to Qualify – Prequalifying for a Florida FHA mortgage loan is quite straight forward. Because it’s the FHA that covers your house loan, the loan providers and mortgage lenders make it easy for everyone to qualify that meets the straightforward requirements. The most important elements of qualifying are usually credit scores, income source and employment.
• Adjustable Interest Rate Option – The FHA loan originated due to the limited financial restrictions of first time homeowners. This is exactly why the FHA has an adjustable rate option for home buyers, which calls for a rather low payment and interest rate.
• There are no cash reserves required – In comparison with most traditional home loan programs, Florida’s FHA mortgage is a very tempting option for Interlachen, FL first time home-owners who have just a little money saved up.
First-time purchasers should find out what to expect prior to starting the FHA mortgage loan application process. Being prepared will often improve your opportunities in successfully having your FHA mortgage loan approved. Below we list a number of basic steps and considerations.
1. Debt-to-income ratio
Cautious researching should be done at this stage. Lenders vary on specific amounts, despite the fact that a debt load that is more than 41 to 45 percent is risky for an FHA loan. You should have 2 years of continual employment without having any unexplainable breaks in job history.
2. Credit Check
It is typically the small things that may damage your credit. Look at your income source, credit standing, in addition to rent history that could show up on a credit score. Get all the details on the up and up, aiming towards a good record.
3. Overall credit score
In 2013, a credit rating of 620 or better is necessary for the 3.5% downpayment with the FHA. For those who came out of a bankruptcy or foreclosure, you would have to have retained a perfect credit history since then (4 years and 5 years respectively) in spite of current credit standing.
FHA Mortgage Application:
• Fill out the Buyer Information request, which tells us what you have and what you need. This will allow the FHA mortgage loan professional get in touch with you to discuss your goals. Afterwards a full mortgage application will need to be completed that highlights all about yourself, the purchaser, which is used for deciding whether you are eligible for a loan or otherwise. The rate and loan terms will also be determined largely by the info in the mortgage application form, credit score, etc.
• In the event the application is preapproved, you will get the disclosure documents which are essentially preliminary loan documents which have all the minute details in connection with terms, loan rates, cost and installments of the loan.
• This has to be agreed upon and returned along with other records such as your bank statements, IDs, references, etc., for validation purposes. These documents are prepped and readied well before the mortgage loan application is submitted to the lender.
• The processor double checks all validating records and may request absent docs from the borrower if required.
• When completed, the records will be submitted to the underwriter.
• The underwriter will be sending a Conditions List of further missing elements or records to the buyer.
• After the buyer completes the required items on the list, it is delivered back to the mortgage lender for final acceptance. A closing date is then established.
Notice: After in contract on a home, the entire loan closing process usually 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 simply just complete the brief information request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that presently have an FHA mortgage loan can read about the FHA streamline refinance program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers living in more rural locations in Florida can read about the 100% USDA mortgage loan at www.usdamortgagesource.com