The Florida FHA mortgage has become the best choice to many first time homebuyers in Florida. The Florida FHA home loan program provides several advantages, bearing in mind the financial constraints of many homeowners who are considering purchasing their very first residence. Compared to most conventional mortgage loans, the FHA home loan facilitates the purchasing process for the loan applicant. Aside from that the FHA mortgage loan consists of a very low down payment, which makes it less difficult for homeowners that may have difficulties saving for the substantial down payment expected by typical home loans.
What are the important pros in acquiring an FHA mortgage loan in Dade City, FL?
• Secure fixed interest rates – One of the largest advantages of your Florida FHA home loan is the benefit of paying a fixed 15 or 30 year interest rate. Compared to the other standard loans where the interest rates fluctuate, the rate continues to be the same for the full span of the loan. This timeframe is normally for 30 years. Due to this provision the consumer can plan out their specific predetermined monthly installment in advance.
• Minimum down payment – The Government insures or backs FHA loans, therefore the borrower incurs very minimal charges in the process. FHA home loans call for a minimum 3.5% investment from the applicant. The mortgage does support the home seller to pay all costs of closing, as much as 6% which can be normally enough to handle just about any home sale.
• Not Hard to Qualify – Pre-Qualifying for a Florida FHA loan is pretty straight forward. Since it is the FHA that covers your house loan, the lenders and lending institutions make it simple for anybody to qualify that meets the necessary requirements. The most important components of qualifying usually are credit reports, source of income and employment.
• Adjustable Rate Option – The FHA mortgage loan began due to stretched budget constraints of first time homeowners. This is why the FHA has got an adjustable rate option for home buyers, which has a relatively low payment amount and interest rate.
• There are not any cash reserves required – As compared with numerous standard loan programs, the Florida FHA mortgage loan is a particularly attractive option for Dade City, FL first time home owners that have a little funds in the bank.
First Time buyers must know what to expect before starting the FHA loan application process. Being prepared will often improve your odds in successfully getting your FHA loan approved. Here we have listed a few basic steps and items to consider.
1. Debt-to-income ratio
Cautious researching must be done at this point. Mortgage companies fluctuate on actual amounts, but a financial debt load that is above 41 to 45 percent is high risk for an FHA loan. You absolutely need two years of consistent employment without any unexplained gaps in employment.
2. Credit Check
It is usually the small things which may damage your credit score. Look at your income, credit, together with rental history which might show on a credit file. Get all of it on the up and up, aiming towards a fully clean record.
3. Overall credit score
In 2013, a credit score of 620 or greater is required for a 3.5% down payment with the FHA. In case you have had a bankruptcy or foreclosure, you would have to have retained a perfect credit worthiness since then (4 years and 5 years respectively) irregardless of present credit score.
FHA Mortgage Loan Application:
• Complete the Buyer Information request, that tells us what you have along with what you require. It will permit the FHA mortgage loan professional to get hold of you to discuss your primary goal. Later a full application must be filled out that highlights everything about you, the applicant, which is used for determining whether you are qualified for a home loan or otherwise. The interest rate and loan terms will also be determined largely by the information in your loan application form, credit scores, etc.
• In the event the loan application is pre-approved, you get the disclosure docs that are essentially preliminary loan documents that contain all the minute details with regards to the terms, interest rates, cost and installment payments of the mortgage loan.
• This has to be signed and brought back along with other records like bank statements, IDs, references, etc., for verification purposes. These documents are prepared and readied well before the loan application is sent to the lender.
• The processor double checks all confirming documents and might request absent paperwork from the borrower if required.
• When completed, the written documents will be sent to the underwriter.
• The underwriter sends a Conditions List of even more missing elements or docs to the home buyer.
• When the buyer finishes the needed items detailed, it is delivered back to the lender for final acceptance. A closing day is then set.
Notice: Once you are in contract on a home, the overall loan closure process usually takes close to 3 weeks to a month.
A lot of questions? Please be sure to call us, 7 days a week at 800-871-2636 or simply submit the easy information request form on the right side of our home page at http://fivestarsmortgage.com. Home owners that currently have an FHA home loan can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers living in more rural locations in The state of Florida can learn more about the 100% USDA loan at www.usdamortgagesource.com