Getting An Fha Purchase Loan
Getting an FHA Purchase Loan
There are so many reasons to choose an FHA purchase loan, before looking at other options. One of the main reasons is when you are a first time homebuyer, you may not have a lot of money to put down on the house. With FHA you can put down as little as 3.5% down, and the seller can also contribute up to 3% as well. With the rates as low as 5.75%, you can definitely keep your payments low and more manageable.
Why Choose FHA Over Conventional?
An FHA purchase loan gives you benefits that you cant with other conventional loans. The main one is the competitive low interest rates. Rates have not been this low in 50 years, and the average FHA rate is around 5.75%. The rates are lower because the government insures these loans for lenders.
FHA purchase loans also give you the option of a lower down payment, being as low as 3.5% down, versus a conventional loan which requires a minimum of 10% down or more. Your down payment can be the result of gifted funds from a family member or friend, or even a charitable organization. With a conventional loan, everything must be verified which can make for a hectic paper trail.
In addition, you dont have to be perfect to get an FHA loan. While you still have to qualify you wont have to have perfect credit. In fact, it is easier for you to qualify after having had a bankruptcy in your past or even medical collections. Dont let that deter you from applying for a loan, and if you dont qualify I will tell you why so that you know what steps you need to take in order to do so. FHA structures their guidelines so that it uses commonsense underwriting guidelines.
What Types of Purchase Loans are Available?
Almost all FHA purchase loans are fixed rate mortgages, so your rate will never ever change during the life of your loan. FHA has a long history in fact they have been around since 1934, so they are in this for the long haul. Its nice to know that if you come upon hard times, that there is assistance with FHA. Hopefully, that is something that you will never encounter, but FHA makes those options available for you just in case.
What are the Steps for an FHA Purchase?
The most important step when considering an FHA purchase loan is to know how much you can afford. There is a very specific calculation that is used to compare your current gross income to your existing debts in order to determine the maximum loan amount that you qualify for. Determining what you can afford, will also be determined by your down payment and interest rate.
Trying to determine just how much you can get for a maximum loan amount may not be the wisest consideration, but you need to be realistic about the monthly payment that you are comfortable with. It is all about having a personal budget and if you dont have that worked out it cause you a lot of problems. When you visit our website, you should really take the time to use our FHA mortgage calculator. That will show you what numbers to plug in so you can accurately determine what you qualify for. In addition, double check the county you live in for the FHA lending limits.
The next step is to get prequalified before you start shopping for a home. This is the essential step, and realtors wont work with you until they know that you have a prequalification in hand. Once you have that, you can begin the process of searching through a wide array of homes. Then, once you have found one you are interested in you can make an offer.
For more information on FHA, or to being your FHA purchase loan qualification, just visit www.fhaloansnow.net, and fill out the form today. It only takes a few minutes to complete.
by: Mayer Dallal
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