The Florida FHA mortgage has become the first solution to many first time homeowners in Florida. The Florida FHA loan program provides several benefits, bearing in mind the funding limitations of most homeowners who are considering buying their very first residence. In comparison with other conventional home mortgages, the FHA mortgage loan facilitates the process to the loan applicant. Besides that the FHA mortgage calls for a fairly low down payment, which makes it much easier for homeowners that may have a tough time saving up the substantial down payment expected by typical home loans.
What are the most common benefits to acquiring an FHA mortgage loan in Pembroke Park, FL?
• Secure fixed loan interest rates – One of the leading advantages of the Florida FHA mortgage loan is the benefit of paying a fixed 15 or 30 year rate of interest. As compared with other regular loans where the interest rates can vary, the rate stays the same for the full duration of the mortgage loan. This timeframe is generally for 30 years. Because of this provision the consumer can prepare their predetermined monthly payment up-front.
• Low down payment – The Federal government guarantees or backs FHA loans, which means the borrower incurs very minimal fees in the process. FHA loans call for a minimum 3.5% financial commitment from the borrower. The mortgage loan does permit the property seller to pay for all costs of closing, all the way to 6% which is usually enough to take care of almost any home sale.
• Easy to Qualify – Pre-Qualifying for a Florida FHA mortgage loan is very simple. Since it is the FHA that insures your mortgage loan, the lenders and mortgage lenders make it feasible for anybody to qualify that meets the main requirements. The primary components of qualifying usually are credit ratings, cash flow and job history.
• Adjustable Interest Rate Option – The FHA mortgage loan began as a result of tight financial restrictions of first time home buyers. That’s why the FHA features an adjustable rate option for home buyers, which will incorporate a rather low payment amount and interest rate.
• There aren’t cash reserves required – Compared to many conventional mortgage programs, the Florida FHA home mortgage is a highly appealing option for Pembroke Park, FL first time home owners which have a little revenue in the bank.
First Time buyers need to know what to expect prior to starting the FHA loan application process. Being prepared will always better your opportunities in successfully getting your FHA mortgage loan accepted. Here we list some basic steps and items to consider.
1. Debt-to-income ratio
Mindful analysis must be done here. Mortgage companies differ on exact amounts, despite the fact that a debts load that is greater than 41 to 45 percent is high-risk for an FHA loan. You will need 2 years of continuous employment devoid of unexplained gaps in employment history.
2. Credit Check
It is all of the tiny problems that may hurt your credit. Check your earnings, overall credit score, together with rental history that can show up on a credit report. Get all the details taken care of, focusing on a spotless record.
3. Credit score
In 2013, a FICO score of 620 or greater is necessary for the 3.5% down payment with the FHA. If you came out of a bankruptcy or foreclosure, you would have to have maintained a perfect FICO score since then (4 years and 5 years respectively) in spite of present credit standing.
FHA Mortgage Loan Application:
• Fill out the Buyer Information form, which tells us what you have and just what you want. It will permit the FHA mortgage consultant to contact you to discuss your goals. Subsequently a full mortgage application will need to be submitted that highlights everything about yourself, the borrower, which will be used for determining whether you are qualified for a loan or otherwise. The interest rate and terms of the loan will also be determined largely by the info in your mortgage application form, credit score, etc.
• In the event the loan application is preapproved, you get the disclosure records which are essentially initial loan documents which have all the minute details regarding the terms and conditions, rates, cost and installments of the home loan.
• This must be agreed upon and brought back along with documents like bank statements, IDs, references, etc., for verification purposes. Usually these documents are prepped and readied well before the mortgage loan application is submitted to the loan provider.
• The processor reviews all verifying documents and might request missing records and documents from the borrower if need be.
• When completed, the docs are then sent to the underwriter.
• The underwriter will be sending a Conditions List of even more missing items or records to the home buyer.
• When the buyer finishes the necessary items on the list, it is sent back to the lender for final approval. A closing date is then established.
Note: After in contract on a home, the full loan closing process normally takes about 3 weeks to a month.
A lot of questions? Please be sure to call us, 7 days a week at 800-871-2636 or simply just complete the brief 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/. Homebuyers residing in more rural locations in Florida can read about the 100% USDA home loan at www.usdamortgagesource.com