The Florida FHA mortgage is the best choice to many first time homeowners in Florida. The Florida FHA loan program features several benefits, paying attention to the budget constraints of most homeowners who are considering purchasing their very first residence. In comparison with most traditional home mortgages, the FHA mortgage loan eases the buying process to the loan applicant. Aside from that the FHA mortgage loan calls for a rather low down payment, which makes it simpler for homeowners that may have a tough time saving up the large down payment expected by customary mortgage loans.
What are the most valuable advantages to obtaining an FHA mortgage loan in Jacksonville?
• Secure fixed loan interest rate – One of the best advantages of the Florida FHA mortgage loan is the provision of paying a fixed 15 or 30 year rate of interest. When compared to other regular loans in which the interest rates fluctuate, the rate stays the same for the total length of the mortgage. This timeframe is commonly for 30 years. Due to this provision the borrower can map out their fixed monthly payment up-front.
• Minimum down payment – The Federal government insures or supports FHA loans, which means the borrower incurs very little fees along the way. FHA loans need a minimum 3.5% financial commitment from the borrower. The mortgage does support the property seller to cover all closing costs, all the way to 6% which is often enough to handle virtually any home sale.
• Easy to Qualify – Prequalifying for a Florida FHA mortgage loan is pretty effortless. Because it’s the FHA that covers the home loan, the creditors and lending institutions make it feasible for anybody to qualify when they meet the central requirements. The main components in qualifying are generally credit scores, income source and employment history.
• Adjustable Rate Option – The FHA mortgage loan started due to stretched financial restrictions of first-time homeowners. That’s the reason the FHA features an adjustable rate option for home buyers, which has a really low payment amount and interest rate.
• No cash reserves required – Compared to other conventional home loan programs, Florida’s FHA mortgage loan is a very tempting option for Jacksonville, FL first-time home owners that have a small amount of funds saved.
First Time home buyers need to learn what to expect before beginning the FHA loan application process. Being prepared will often improve your opportunities in successfully having your FHA loan approved. Below we have listed a few simple steps and issues to consider.
In advance of application:
1. Debt-to-income ratio
Careful researching has to be done at this stage. Mortgage lenders differ on specific amounts, but a debt load thatâ€™s higher than 41 to 45 percent is high-risk for an FHA loan. You need two years of continual employment with no unexplainable gaps in employment history.
2. Credit History
It is all of the tiny problems that can harm your credit rating. Check your income, credit, as well as rent history which could show up on a credit score. Get all the things taken care of, aiming for a completely clean record.
3. Overall credit score
As of 2013, a credit rating of 620 or greater is required for a 3.5% downpayment with the FHA. In the event you came out of a bankruptcy or foreclosure, you must have maintained a perfect credit standing since then (4 years and 5 years respectively) irregardless of current credit worthiness.
FHA Loan Application:
• Fill out the Buyer Information form, that tells us what you have and what you may need. It will allow the FHA loan consultant to call you to discuss your primary goal. Soon after a full application will have to be completed that highlights all about you, the purchaser, which will be used for figuring out whether you are qualified to receive a loan or otherwise. The rate and terms of the loan can also be determined largely by the details in the loan application form, credit scores, etc.
• In the event the application is preapproved, you get the disclosure documents that are essentially initial loan records that contain all the minute details regarding the terms, interest rates, cost and monthly payments of the home loan.
• This must be signed and returned along with other documents like you bank account statements, IDs, references, etc., for verification purposes. These documents are prepared and readied prior to when the loan application is sent to the loan provider.
• The processor double checks all confirming papers and may request absent docs from the borrower if needed.
• Upon completion, the documents will be submitted to the loan underwriter.
• The loan underwriter will send a Conditions List of further missing items or docs to the buyer.
• Once the buyer completes the requested items detailed, it is returned to the lender for final authorization. A closing date is then established.
Note: When you are in contract on a residence, the full loan closing process can take close to 3 weeks to a month.
Questions about FHA Refinance? Be sure to call us, 7 days a week at 800-871-2636 or simply just submit the quick information request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that presently have an FHA loan can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Home buyers living in more rural places in The state of Florida can learn more about the 100% USDA mortgage loan at www.usdamortgagesource.com