The Florida FHA mortgage is the first solution to many first time homeowners in the State of Florida. The Florida FHA home loan program presents several benefits, bearing in mind the financial difficulties of most homeowners who are considering purchasing their first home. In comparison with most traditional mortgage loans, the FHA mortgage loan facilitates the buying process for the applicant. Also the FHA mortgage involves a fairly low down payment, which makes it easier for homeowners that may have difficulty saving for the large down payment required by typical loans.
What are the primary advantages to obtaining an FHA mortgage loan in North Miami?
• Secure fixed loan interest rate – One of the best advantages for the Florida FHA loan is the benefit of paying a fixed 15 or 30 year interest rate. In contrast to other traditional loans where the loan interest rates can vary, the rate remains the same for the total length of the mortgage. This timeframe is commonly for 30 years. Because of this provision the borrower can prepare their fixed monthly payment beforehand.
• Small down payment – The Federal government insures or backs FHA loans, which means the applicant has very nominal charges along the way. FHA mortgages require a minimum 3.5% financial commitment from the borrower. The loan does support the home seller to cover all costs of closing, up to 6% which is usually enough to handle just about any home sale.
• Easy to Qualify – Prequalifying for a Florida FHA loan is very effortless. Because it’s the FHA that covers the home loan, the loan providers and banks make it simple for everyone to qualify that meets the straightforward requirements. The main aspects of qualifying are generally credit ranking, cash flow and employment records.
• Adjustable Interest Rate Option – The FHA mortgage loan originated due to stretched budget restrictions of first-time homeowners. That’s why the FHA has an adjustable rate option for home buyers, which entails a very low payment amount and interest rate.
• No cash reserves required – When compared to most standard loan programs, the Florida FHA mortgage is a very tempting option for North Miami, FL first-time home-owners which have a little bit of money saved up.
First Time buyers have to know what to expect prior to starting the FHA mortgage loan application process. Simply being prepared will usually better your opportunities in successfully getting the FHA mortgage loan approved. Here we list a few tips and issues to consider.
In advance of application:
1. Debt-to-income ratio
Careful research has to be done at this point. Lenders vary on exact amounts, but a debt load thatâ€™s more than 41 to 45 percent is risky for an FHA loan. You should have 2 years of consistent employment without having any unexplained breaks in job history.
2. Credit Check
It is typically the tiny problems which will harm your credit scores. Look at your income, credit score, along with rent history which can show on a credit file. Get every aspect taken care of, shooting for a thoroughly clean record.
3. Credit score
In 2013, a FICO score of 620 or better is needed for a 3.5% downpayment with the FHA. If you have had a bankruptcy or foreclosure, you will have to have preserved a perfect credit worthiness since that time (4 years and 5 years respectively) regardless of existing credit standing.
FHA Loan Application:
• Complete the Buyer Information request, which lets us know what you have along with what you want. This will allow the FHA mortgage consultant to contact you to discuss your goals. Later a full application should be filled out that highlights everything about you, the applicant, which is to be used in finding out whether you are eligible for a mortgage loan or otherwise. The interest rate and terms of the loan may also be determined largely by the details in your mortgage application form, credit rating, etc.
• In case the loan application is pre-approved, you will get the disclosure documents which are essentially preliminary loan documents that contain all the minute details concerning the terms and conditions, interest levels, selling price and monthly payments of the home loan.
• This must be signed and returned along with other records like you bank account statements, IDs, references, etc., for verification purposes. These documents are prepped and readied ahead of the loan application is submitted to the mortgage lender.
• The processor reviews all validating papers and may ask for absent docs from you if needed.
• When completed, the records and documents are sent to the underwriter.
• The loan underwriter will be sending a Conditions List of other missing items or docs to the home buyer.
• Once the buyer completes the necessary items on the list, it is returned to the mortgage lender for final approval. A closing day is then set.
Notice: Once you are in contract on a residence, the entire loan closing process takes about 3 weeks to a month.
A lot of questions? Please make sure to call us, 7 days a week at 800-871-2636 or just submit the quick info request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that currently have an FHA loan can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Home buyers residing in more rural areas in The state of Florida can learn more about the 100% USDA loan at www.usdamortgagesource.com