The Florida FHA mortgage has become the first solution to most first time buyers in the State of Florida. Florida’s FHA mortgage loan program features several benefits, bearing in mind the funding limitations of many homeowners who are considering purchasing their first home. When compared with other traditional home mortgages, the FHA home loan facilitates the buying process for the loan applicant. Furthermore the FHA mortgage loan requires a fairly low down payment, which makes it simpler for homeowners that may have a tough time saving for the big down payment needed by traditional loans.
What are the important benefits in choosing an FHA loan in Mexico Beach, FL?
• Secure fixed loan interest rate – One of the biggest advantages for the Florida FHA loan is the provision of having a fixed 15 or 30 year interest rate. As compared with other conventional loans where the loan interest rates change, the rate continues to be the same for the entire span of the mortgage. This period is often for 30 years. Because of this provision the borrower can pre-plan their specific fixed monthly payment beforehand.
• Low down payment – The Government guarantees or backs FHA loans, therefore the applicant incurs very little charges along the way. FHA home loans demand a minimum 3.5% financial commitment from the applicant. The mortgage does support the home seller to cover all costs of closing, anywhere up to 6% which is typically enough to handle just about any home sale.
• Not Difficult to Qualify – Prequalifying for a Florida FHA home loan is rather simple. Because it’s the FHA that insures the home loan, the lenders and banks make it easy for anyone to qualify when they meet the main requirements. The biggest elements of qualifying are credit scores, cash flow and job history.
• Adjustable Rate Option – The FHA mortgage loan began as a result of stretched budget constraints of first-time home buyers. This is why the FHA has an adjustable rate option for home buyers, which features a rather low monthly repayment and interest rate.
• There aren’t cash reserves required – When compared to other standard loan programs, the Florida FHA home mortgage is a particularly appealing option for Mexico Beach first time property owners who have a little money saved.
First Time buyers should find out what to expect before beginning the FHA mortgage loan application process. Simply being prepared will usually boost your chances in successfully getting your FHA loan approved. Here we have listed some guidelines and issues to consider.
Prior to application:
1. Debt-to-income ratio
Careful examination must be done here. Loan providers can vary on exact amounts, despite the fact that a debt load that is greater than 41 to 45 percent is high risk for an FHA loan. You will need 2 years of steady employment with no unexplainable breaks in employment.
2. Credit Check
It is typically the small things that could harm your credit rating. Examine your income, credit score, as well as rent history that can show on a credit report. Get all the things handled, shooting for a clean record.
3. Credit ratings
As of 2013, a credit score of 620 or better is required for the 3.5% downpayment with the FHA. In case you have had a bankruptcy or foreclosure, you would have to have preserved a perfect FICO score since then (4 years and 5 years respectively) irregardless of present credit score.
FHA Loan Application:
• Fill out the Buyer Information form, which tells us just what you have and what you need. It will permit the FHA mortgage specialist get in touch with you to discuss your goals. Soon after a full application must be filled out that details everything about yourself, the applicant, which will be used for figuring out whether you are eligible for a home loan or otherwise. The rate and loan terms may also be determined largely by the data in the application form, credit score, etc.
• In the event the application is pre-approved, you will get the disclosure docs which are essentially preliminary loan documents that have all the minute details concerning the terms, loan rates, selling price and payments of the home loan.
• This should be agreed upon and returned along with other records like you bank account statements, IDs, individual references, etc., for validation purposes. Usually these documents are prepped and readied way before the mortgage loan application is sent to the lender.
• The processor reviews all verifying papers and may request absent documentation from the borrower if need be.
• When completed, the records and documents will be sent to the underwriter.
• The loan underwriter will be sending a Conditions List of other missing elements or documents to the home buyer.
• Once the buyer finishes the desired items detailed, it is returned to the lender for final affirmation. A closing day is then established.
Please Note: After in contract on a property, the full loan closing process normally 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 fill out the quick info request form on the right side of our home page at http://fivestarsmortgage.com. Home owners that currently have an FHA mortgage can learn about the FHA streamline refinance program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers living in more rural locations in The state of Florida can learn about the 100% USDA home loan at www.usdamortgagesource.com