The Florida FHA mortgage has become the first solution to many first time homebuyers in Florida. Florida’s FHA home loan program presents several advantages, paying attention to the budget constraints of many homeowners who are considering buying their first home. In comparison to most traditional home mortgages, the FHA mortgage loan eases the process for the loan applicant. On top of that the FHA mortgage requires a very low down payment, which makes it quite a bit easier for homeowners that may have a tough time saving up the large down payment required by common mortgage loans.
What are the major benefits to choosing an FHA mortgage loan in Sewall’s Point?
• 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 rate of interest. In contrast with other basic loans where the interest rates change, the rate continues to be the same for the entire length of the loan. This period is generally for 30 years. Because of this provision the consumer can prepare their specific predetermined monthly payment in advance.
• Minimum down payment – The Federal government insures or supports FHA loans, which means the borrower incurs very minimal fees in the process. FHA secured loans call for a minimum 3.5% financial commitment from the borrower. The mortgage does allow for the property seller to pay all closing costs, all the way to 6% which is typically enough to cover virtually any property sale.
• Not Difficult to Qualify – Prequalifying for a Florida FHA mortgage loan is very effortless. Since it is the FHA that covers your home loan, the financial institutions and lending institutions make it easy for anybody to qualify when they meet the simple requirements. The biggest components in qualifying are generally credit history, earnings and employment.
• Adjustable Interest Rate Option – The FHA mortgage loan began due to the small financial restrictions of first time home owners. For that reason the FHA features an adjustable rate option for home buyers, which calls for a rather low monthly repayment and interest rate.
• There are no cash reserves required – In comparison to most standard home loan programs, Florida’s FHA mortgage is a really appealing option for Sewall’s Point, FL first-time homeowners that have a small amount of funds saved up.
First Time purchasers have to know what to expect prior to starting the FHA mortgage loan application process. Simply being prepared will often improve your odds in successfully having your FHA mortgage loan accepted. Below we have listed some steps and some things to consider.
Prior to application:
1. Debt-to-income ratio
Cautious evaluation has to be done at this point. Lenders can vary on actual amounts, but a debts load thatâ€™s greater than 41 to 45 percent is high risk for an FHA loan. You will need two years of consistent employment without having any unexplained interruptions in job history.
2. Credit History
It is normally the small things which may damage your credit score. Examine your income source, credit standing, as well as rent history that might show up on a credit score. Get all the details handled, aiming towards a thoroughly clean record.
3. Credit rating
In 2013, a credit rating of 620 or greater is required for a 3.5% downpayment with the FHA. In the event you came out of a bankruptcy or foreclosure, you would have to have retained a perfect credit standing since then (4 years and 5 years respectively) irrespective of current credit worthiness.
FHA Mortgage Application:
• Fill out the Buyer Information request, that lets us know just what you have and what you require. It will allow the FHA mortgage loan specialist to call you to discuss your goals. Soon after a full mortgage application will need to be filled out that highlights all about you, the borrower, which is used for trying to figure out whether you are qualified for a mortgage loan or otherwise. The rate and loan terms may also be determined largely by the details in your mortgage application form, credit scores, etc.
• In the event the application is pre-approved, you get the disclosure docs which are essentially initial loan documents that have all the minute details in connection with terms, home interest rates, cost and installments of the mortgage loan.
• This needs to be signed and returned along with other records such as your bank account records, IDs, individual references, etc., for validation purposes. These documents are prepared and readied prior to when the mortgage loan application is submitted to the lender.
• The processor reviews all validating records and may request missing documents from you if necessary.
• Upon completion, the records are sent to the underwriter.
• The loan underwriter will be sending a Conditions List of other missing elements or records to the home buyer.
• Once the buyer finishes the requested items on the list, it is delivered back to the lender for final acceptance. A closing day is then established.
Note: When you are in contract on a residence, the overall loan closure process can take roughly three weeks to a month.
Have Questions? Please make sure to call us, 7 days a week at 800-871-2636 or simply just submit the short info request form on the right side of our home page at http://fivestarsmortgage.com. Homeowners that presently have an FHA loan can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Home buyers located in more rural areas in Florida can learn more about the 100% USDA home loan at www.usdamortgagesource.com