The Florida FHA mortgage has become the best solution to the majority of first time homebuyers in Florida. Florida’s FHA loan program gives several benefits, paying attention to the financial constraints of many homeowners who are considering buying their first home. In comparison to other traditional home mortgages, the FHA mortgage loan eases the purchasing process for the loan applicant. Besides that the FHA loan involves a rather low down payment, which makes it quite a bit easier for homeowners that may have a tough time saving money for the big down payment necessary by standard loans.
What are the most important benefits to acquiring an FHA mortgage loan in Tarpon Springs, FL?
• Secure fixed interest rate – One of the largest advantages for the Florida FHA home loan is the provision of paying a fixed 15 or 30 year rate of interest. Compared with other regular loans in which the interest rates vary, the rate remains the same for the entire span of the loan. This period is commonly for 30 years. Due to this provision the consumer can map out their predetermined monthly installment beforehand.
• Small down payment – The Federal government insures or supports FHA loans, therefore the applicant has very little charges in the process. FHA home loans require a minimum 3.5% financial commitment from the borrower. The mortgage loan does allow for the home seller to pay for all costs of closing, all the way to 6% which is frequently enough to handle virtually any home sale.
• Simple to Qualify – Prequalifying for a Florida FHA mortgage loan is pretty effortless. Because it’s the FHA that insures your house loan, the loan providers and lending institutions make it straightforward for anyone to qualify when they meet the simple requirements. The primary components in qualifying are generally credit scores, source of income and job history.
• Adjustable Rate Option – The FHA loan originated due to the tight financial restrictions of first time home owners. That’s the reason the FHA has an adjustable rate option for home buyers, which has a very low monthly repayment and interest rate.
• There are no cash reserves required – Compared to many conventional mortgage programs, the Florida FHA home mortgage is a highly tempting option for Tarpon Springs, FL first time homeowners that have a small amount of funds saved.
First Time buyers must know what to expect before beginning the FHA home loan application process. Simply being prepared will usually increase your odds in successfully having your FHA mortgage accepted. Here we have listed a number of tips and factors to consider.
In advance of application:
1. Debt-to-income ratio
Thorough assessment has to be done at this stage. Creditors vary on precise amounts, still a debts load that is greater than 41 to 45 percent is high-risk for an FHA loan. You need two years of continuous employment devoid of unexplained interruptions in job history.
2. Credit Check
It is generally the tiny problems which will damage your consumer credit. Check your income source, credit, together with rental history which could show on a credit file. Get everything on the up and up, aiming towards a fully clean record.
3. Overall credit score
As of 2013, a FICO score of 620 or greater is necessary for a 3.5% downpayment with the FHA. For those who have had a bankruptcy or foreclosure, you would have to have maintained a perfect credit standing since then (4 years and 5 years respectively) regardless of current credit score.
FHA Mortgage Application:
• Complete the Buyer Information form, that tells us what you have along with what you require. It will permit the FHA loan consultant to contact you to discuss your objectives. Later on a full mortgage application will need to be completed that details all things about yourself, the borrower, which will be used for finding out whether you are qualified to receive a loan or otherwise. The interest rate and terms of the loan will also be identified largely by the information in your loan application form, credit standing, etc.
• In the event the application is pre-approved, you get the disclosure records that are essentially initial loan documents that contain all the minute details in connection with terms and conditions, rates of interest, selling price and payments of the mortgage.
• This must be agreed upon and returned along with documents like bank records, IDs, personal references, etc., for verification purposes. These documents are prepared and readied ahead of the mortgage loan application is submitted to the mortgage lender.
• The processor reviews all confirming documents and may request missing documents from the borrower if required.
• Upon completion, the written documents are submitted to the loan underwriter.
• The loan underwriter sends a Conditions List of further missing items or docs to the home buyer.
• Once the buyer completes the required items detailed, it is delivered back to the mortgage lender for final acceptance. A closing date is then scheduled.
Note: Once you are in contract on a property, the whole loan closing process can take around three weeks to a month.
A lot of questions? Please call us, 7 days a week at 800-871-2636 or just submit the easy information request form on the right side of our home page at http://fivestarsmortgage.com. Property owners that currently have an FHA mortgage can read about the FHA streamline refinancing program here – http://fivestarsmortgage.com/florida-fha-loan/. Homebuyers residing in more rural areas in The state of Florida can read about the 100% USDA home loan at www.usdamortgagesource.com