What is an FHA Loan?
Annette Bui| Updated May 13, 2020 | Mortgage Programs 101
An FHA loan is a program offered by the Federal Housing Administration, designed to help consumers with imperfect credit rating or little down payment to qualify for affordable and accessible aid when buying their first home. Borrowers with lower credit scores from 580 and up, may have the opportunity to apply for financing with a down payment as little as 3.5% of the total purchase price of the house. For prospects that have credit rating from 500-579, a minimum of 10% down payment would be required along with additional compensating factors.
What are the Advantages and Criteria?
FHA programs are one of the more attainable products for home buyers in the market, particularly for first time home buyers. Designed to aid buyers with a more lenient guidelines and requirements for credit, income and ability to repay. From buyers searching for their first home or looking to get federal aid for renovating their existing home. FHA products provide more flexibility for financing your residential needs. The first in considering an FHA mortgage is to understand the criteria and process for acquiring an FHA loan. While certain general guidelines are more lenient, the department of FHA may be stricter toward other aspects of compensating factors to an approval such as employment history, consistency in debts, or number of existing credit trade lines. Following an approval on the loan, an appraisal and credit review is conducted. Any closing costs from title, escrow, recording to 12 months of insurance, property taxes are considered payable by the home buyer and often can be requested for the seller to pay up to 6%.
How to get started?
Once you obtain your FHA mortgage and finalize the purchase of your home, it may seem like you are on your own, but with the Annette’s Team, you will maintain ongoing guidance on mortgage knowledge, the advantages of refinancing down the line once you have built enough equity, your income changes or qualified to remove private mortgage insurance.
The process of acquiring and maintaining a home mortgage is a form of artistry, no one story is the same and thus each client deserves a custom tailor road map to ensure the best fit to meet their financial goals. The mortgage artistry is a simple road map to aid in your home ownership journey. Provided to empower you with the necessary tools and resources to perfect your home loan experience, proactively built your home equity to maximize its appreciation rate and design the best game plan for your financial future. Congratulations on completing the first step in your journey to mastering the artistry with Annette”.
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