The Florida FHA mortgage has become the best solution to the majority of first time homebuyers in the State of Florida. The Florida FHA home loan program offers several advantages, keeping in mind the financial constraints of most homeowners who are interested in buying their first residence. When compared with other conventional mortgage loans, the FHA loan facilitates the buying process for the applicant. Also the FHA loan involves a fairly low down payment, which makes it much easier for homeowners that may have challenges saving up the sizeable down payment expected by old fashioned loans.
What are the most valuable benefits in getting an FHA mortgage loan in Hilliard?
• Secure fixed interest rates – One of the best advantages for the Florida FHA loan is the provision of having a fixed 15 or 30 year rate of interest. Compared to the other basic loans where the interest rates fluctuate, the rate continues to be the same for the total lifetime of the mortgage loan. This period is typically for 30 years. Due to this provision the consumer can map out their fixed monthly payment up-front.
• Small down payment – The Government insures or backs FHA loans, therefore the applicant has very nominal fees along the way. FHA secured loans call for a minimum 3.5% investment from the borrower. The loan does permit the property seller to cover all costs of closing, anywhere up to 6% which can be usually enough to take care of almost any home sale.
• Not Difficult to Qualify – Prequalifying for a Florida FHA home loan is quite straightforward. Because it’s the FHA that insures your house loan, the lenders and mortgage lenders make it easier for anyone to qualify that meets the central requirements. The biggest components of qualifying are usually credit scores, income source and employment records.
• Adjustable Rate Option – The FHA loan began because of the stretched budget restrictions of first time homeowners. That’s the reason the FHA features an adjustable rate option for home buyers, which calls for a remarkably low payment and interest rate.
• There are no cash reserves required – Compared to other conventional home loan programs, the Florida FHA mortgage is a highly appealing option for Hilliard, FL first-time property owners which have a small amount of funds saved up.
First-time buyers must know what to expect before starting the FHA home loan application process. Being prepared will often boost your chances in successfully having your FHA home loan approved. Here we have listed a few basic steps and some points to consider.
1. Debt-to-income ratio
Thorough assessment should be done at this point. Mortgage lenders differ on specific amounts, still a debt load thatâ€™s more than 41 to 45 percent is high risk for an FHA loan. You will need 2 years of steady employment devoid of unexplainable breaks in job history.
2. Credit Check
It is usually the tiny problems that may harm your consumer credit. Look at your income source, credit score, in addition to rent history that can show up on a credit score. Get all the details on the up and up, focusing on a good record.
3. Credit score
In 2013, a credit rating of 620 or better is required for the 3.5% down payment with the FHA. In case you came out of a bankruptcy or foreclosure, you would have to have maintained a perfect credit rating since that time (4 years and 5 years respectively) irrespective of current credit standing.
FHA Loan Application:
• Complete the Buyer Information form, that tells us what you have along with what you may need. It will allow the FHA loan consultant to contact you to discuss your objectives. Later on a full application should be filled out that details all things about you, the applicant, which will be used for figuring out whether you are qualified for a loan or otherwise. The interest rate and terms of the loan can also be identified largely by the details in the loan application form, credit history, etc.
• In case the application is pre-approved, you get the disclosure documents that are essentially preliminary loan documents that have all the minute details in connection with the terms, rates, cost and installments of the mortgage loan.
• This must be signed and brought back along with records such as your bank statements, IDs, individual references, etc., for verification purposes. These documents are prepared and readied well before the mortgage loan application is sent to the lender.
• The processor double checks all verifying documents and might request missing paperwork from the borrower if need be.
• Upon completion, the docs are submitted to the loan underwriter.
• The underwriter will be sending a Conditions List of more missing items or docs to the purchaser.
• Once the buyer completes the desired items detailed, it is delivered back to the lender for final authorization. A closing day is then scheduled.
Please Note: When you are in contract on a property, the whole loan closing process can take around 3 weeks to a month.
Questions? Be sure to call us, 7 days a week at 800-871-2636 or just fill out the fast info 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 refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Homebuyers residing in more rural locations in Florida can learn more about the 100% USDA home loan at www.usdamortgagesource.com