The Florida FHA mortgage has become the best solution to the majority of first time homebuyers in the State of Florida. The Florida FHA loan program gives several benefits, keeping in mind the funding limitations of most homeowners who are considering purchasing their first residence. In comparison with most conventional home mortgages, the FHA loan facilitates the process for the loan applicant. Furthermore the FHA loan consists of a very low down payment, which makes it quite a bit easier for homeowners that may have challenges saving for the big down payment necessary by old fashioned loans.
What are the main benefits to choosing an FHA loan in Lake Buena Vista?
• Secure fixed loan interest rates – One of the greatest advantages of a Florida FHA loan is the provision of paying a fixed 15 or 30 year interest rate. In comparison with other traditional loans where the loan interest rates change, the rate continues to be the same for the total duration of the loan. This period is commonly for 30 years. Due to this provision the consumer can prepare their specific fixed monthly payment in advance.
• Low down payment – The Federal government guarantees or supports FHA loans, which means the applicant has very minimal fees in the process. FHA loans need a minimum 3.5% financial commitment from the applicant. The loan does allow for the home seller to pay all closing costs, as much as 6% which can be usually enough to handle almost any property purchase.
• Easy to Qualify – Pre-Qualifying for a Florida FHA loan is quite straight forward. Since it is the FHA that insures your house loan, the creditors and mortgage lenders make it easy for anyone to qualify that meets the necessary requirements. The key components in qualifying are generally credit history, income source and employment history.
• Adjustable Rate Option – The FHA loan originated mainly because of the limited financial restrictions of first-time home owners. For that reason the FHA has an adjustable rate option for home buyers, which will incorporate a remarkably low monthly payment and interest rate.
• No cash reserves required – When compared to many traditional mortgage programs, the Florida FHA mortgage is a pretty enticing option for Lake Buena Vista, FL first-time homeowners which have a little bit of revenue in the bank.
First Time home buyers have to know what to expect before starting the FHA loan application process. Simply being prepared will often enhance your chances in successfully having your FHA mortgage loan approved. Below we have listed some simple steps and items to consider.
Prior to application:
1. Debt-to-income ratio
Cautious assessment must be done here. Mortgage lenders can vary on actual amounts, but a debt load that is higher than 41 to 45 percent is high risk for an FHA loan. You should have two years of continual employment devoid of unexplainable interruptions in job history.
2. Credit History
It is all of the tiny problems which will hurt your credit score. Look at your income, credit ranking, in addition to rent history which can be displayed on a credit report. Get all things handled, shooting for a thoroughly clean record.
3. Overall credit score
In 2013, a credit score of 620 or greater is needed for a 3.5% down payment with the FHA. If you have had a bankruptcy or foreclosure, you must have maintained a perfect credit ranking since then (4 years and 5 years respectively) irregardless of recent credit score.
FHA Mortgage Application:
• Fill out the Buyer Information form, that tells us just what you have and what you require. It will permit the FHA loan specialist get in touch with you to discuss your primary goal. Afterwards a full mortgage application must be filled out that highlights everything about you, the borrower, which is used for figuring out whether you are qualified for a mortgage or otherwise. The interest rate and terms of the loan may also be driven largely by the info in the application form, credit standing, etc.
• In the event the loan application is preapproved, you get the disclosure documents that are essentially initial loan records that contain all the minute details with regards to the terms and conditions, rates of interest, selling price and installment payments of the mortgage.
• This should be signed and brought back along with other documents like you bank account records, IDs, individual references, etc., for validation purposes. Usually these documents are prepared and readied well before the loan application is submitted to the mortgage company.
• The processor reviews all verifying papers and may ask for missing records and documents from you if need be.
• When completed, the written documents are sent to the loan underwriter.
• The underwriter will send a Conditions List of additional missing items or records to the home buyer.
• After the buyer completes the needed items listed, it is sent back to the mortgage lender for final approval. A closing day is then set.
Please Note: After in contract on a home, the overall loan closure process usually takes close to 3 weeks to a month.
Questions? Be sure to call us, 7 days a week at 800-871-2636 or simply complete the easy info request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that currently have an FHA mortgage can read about the FHA streamline refinance program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers residing in more rural locations in Florida can learn more about the 100% USDA loan at www.usdamortgagesource.com