FHA recently announced that home buyers can purchase a home with an FHA loan one year after a foreclosure, short sale, bankruptcy or judgment. There are a few rules to go with the program so I am going to let Eddie Fairchild from Summit Funding explain it for you.
FHA loans have some very useful options, but the fees for an FHA loan have continued to rise over the past few years and now most FHA loans have an upfront charge for mortgage insurance and a monthly charge for mortgage insurance that will last for the life of the loan. This is a big change. Previous FHA guidelines allowed borrowers to drop the monthly mortgage insurance fee after 5 years or when they had 21% equity in their homes. Since the costs of an FHA loan have risen so much, ask your lender about a conventional 3% loan. Generally, you need a higher credit score to qualify for a 3% conventional loan.
If you have any questions or need help finding a home in the Elk Grove or Sacramento areas, give me a call. I am always glad to help.