The Florida FHA mortgage is the best option to the majority of first time buyers in Florida. The Florida FHA home loan program features several advantages, keeping in mind the financial constraints of many homeowners who are considering buying their first home. When compared with most conventional home mortgages, the FHA home loan facilitates the purchasing process to the loan applicant. Aside from that the FHA mortgage loan calls for a fairly low down payment, which makes it much easier for homeowners that may have a tough time saving money for the large down payment needed by conventional mortgage loans.
What are the important advantages in choosing an FHA loan in Plantation, FL?
• Secure fixed interest rates – One of the leading advantages of a Florida FHA mortgage loan is the provision of paying a fixed 15 or 30 year interest rate. In contrast to other basic loans where the interest rates vary, the rate remains the same for the full duration of the mortgage. This period is typically for 30 years. Because of this provision the borrower can plan out their fixed monthly installment up-front.
• Small down payment – The Government insures or backs FHA loans, which means the applicant has very nominal charges along the way. FHA financial loans need a minimum 3.5% financial commitment from the applicant. The mortgage does support the home seller to pay for all costs of closing, anywhere up to 6% which can be normally enough to cover virtually any property purchase.
• Not Hard to Qualify – Pre-Qualifying for a Florida FHA home loan is pretty straight forward. Since it is the FHA that covers the home loan, the lenders and lending institutions make it easier for anyone to qualify that meets the basic requirements. The key elements of qualifying are credit history, income and job history.
• Adjustable Rate Option – The FHA mortgage loan began due to the stretched budget restrictions of first time home buyers. This is why the FHA has an adjustable rate option for home buyers, which has a rather low monthly payment and interest rate.
• There aren’t any cash reserves required – As compared with other traditional home loan programs, the Florida FHA home mortgage is a pretty tempting option for Plantation first time property owners that have a little bit of revenue saved.
First-time purchasers need to know what to expect before beginning the FHA mortgage application process. Being prepared will usually enhance your opportunities in successfully having your FHA loan approved. Here we have listed some guidelines and some points to consider.
Prior to application:
1. Debt-to-income ratio
Cautious examination has to be done here. Loan providers vary on precise amounts, despite the fact that a debts load that is higher than 41 to 45 percent is high-risk for an FHA loan. You will need 2 years of continual employment without having any unexplained gaps in employment history.
2. Credit History
It is normally the tiny problems that could hurt your credit ratings. Check your income, credit worthiness, in addition to rental history that may show on a credit file. Get every aspect taken care of, concentrating on a completely clean record.
3. Credit score
As of 2013, a credit score of 620 or higher is necessary for a 3.5% down payment with the FHA. For those who came out of a bankruptcy or foreclosure, you would need to have retained a perfect credit rating since then (4 years and 5 years respectively) irregardless of existing credit score.
FHA Loan Application:
• Fill out the Buyer Information form, which tells us just what you have along with what you require. It will permit the FHA loan professional to contact you to discuss your goals. Afterwards a full application must be done that highlights all about yourself, the borrower, which is used for determining whether you are qualified to receive a home loan or otherwise. The rate and terms of the loan will also be identified largely by the information in your application form, credit score, etc.
• In the event the loan application is preapproved, you get the disclosure docs that are essentially preliminary loan documents which have all the minute details concerning the terms, rates, cost and repayments of the mortgage loan.
• This needs to be agreed upon and returned along with other records such as your bank statements, IDs, personal references, etc., for verification purposes. Usually these documents are prepared and readied ahead of the mortgage loan application is submitted to the lender.
• The processor double checks all verifying papers and may request absent documents from the borrower if required.
• Upon completion, the records are sent to the underwriter.
• The loan underwriter will send a Conditions List of more missing elements or docs to the home buyer.
• When the buyer finishes the necessary items listed, it is sent back to the lender for final authorization. A closing date is then scheduled.
Notice: Once you are in contract on a home, the overall loan closing process usually takes around 3 weeks to a month.
Questions? Please be sure to call us, 7 days a week at 800-871-2636 or simply just fill out the fast information request form on the right side of our home page at http://fivestarsmortgage.com. Property owners that presently have an FHA home loan can read about the FHA streamline refinance program here – http://fivestarsmortgage.com/florida-fha-loan/. Buyers living in more rural places in The state of Florida can read about the 100% USDA mortgage at www.usdamortgagesource.com