Top 5 Reasons to Consider An FHA Mortgage

Reblogger Carla Harbert
Real Estate Agent with www.LorainCountyHomeSales.com

Larry Bettag of Cherry Creek Mortgage shares tips on why to consider an FHA Mortgage. Interest Rates are still very good - thinking of buying? Want to know more? Give me a call - 440-309-5209 if you are in the North Central Ohio Area.

Original content by Larry Bettag NMLS ID# 158606

There are many things that people should know about FHA loans. They're great for a variety of reasons, but I'm going to give you my list of favorite reasons for considering and FHA mortgage.

  1. First time homebuyers can generally come in with less of a downpayment. Truthfully, conforming or conventional loans generally want 5% down. FHA loans only need 3.5% down. How cool is that?
  2. The entire downpayment for an FHA loan can be in the form of a gift. There are gift restrictions as to who can give you a gift, but generally, if you're related, you can help someone out by gifting them the entire downpayment and closing costs. Borrowers can put zero of their own money into the transaction. You know that with conventional loans no matter what the borrower needs to put 5% of the purchase price into the transaction, unless the borrower were to A lot of Reasons To Smile When Using FHAreceive a gift of at least twenty (yes 20) percent. Makes FHA so much more attactive.
  3. Credit scores and credit in general. - While FHA is slowly inching to mirror the credit requirements of conventional loans, for now, FHA still allows lower credit scores. In fact, scores alone, can't be used to make a credit decision. Also, when you're coming out of a Bankruptcy, FHA is so much more forgiving as to the time lines as to when someone can buy a house. Credit scores and credit requirements are so much more lenient with FHA.
  4. Non-Occupant Co-Borrowers- THIS IS A BIGGEE! I do this all the time. The borrower can have someone co-sign with them even if the person who is cosigning isn't going to live within the property. The loan gets qualified on the income and debt on the borrower and the non-occupant co-borrower together. And still only 3.5% is needed for the downpayment. On conventional loans, 10% down is needed and the borrower still needs to put 5% down against the entire transaction and still qualify for carrying a significant part of the mortgage payment. For FHA, the borrower can not be earning a penny all year, but so long as the borrower and non-occupant co-borrowers combine to qualify together, we're good to go! I have dads and mom buying homes with kids in college. The kid is the borrower and mom and dad co-sign. Do em every year out at Northern Illinois University.
  5. Appraisals - Appraisals used to be so difficult when going FHA. That's no longer the case. FHA, for the most part, mirrors those of Fannie Mae and Freddie Mac. They do also protect the borrower in that if there were substantial and material defects that would cost the borrower a lot of money in the first year of ownership to fix up, they'll address those issues, but the same can now be said of conforming loans.
  6. And How about 1 for the ditch - MORTGAGE INSURANCE.....HOT OFF THE PRESS......FHA will soon be dropping mortgage insurance once it hit's the 78% LTV just like conforming loans as well.  This is JUST BREAKING NEWS and puts a bit back in the pocket for the consumer with this new announcement.

If you choose, you can find me here:

          Follow The Twittering Tweets on Twitter        Follow Bettag's Blabs on Facebook        Google Me If You'd Like        Follow Me On Linked In

 

Cherry Creek Mortgage Company       Path 2 Buy Certified Coach Follow me on Pinterest                 

                      NMLS ID#158606          Equal Housing Logo     An Illinois Residential Mortgage Licensee

 

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At

Post a Comment
Spam prevention
Spam prevention
Post a Comment
Spam prevention

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
373,550

Carla Harbert

RE/MAX Omega: Lorain-Medina County Area
Ask me a question
*
*
*
*
Spam prevention

Additional Information