Purchase Information
There are many reasons to choose an FHA home loan when buying a home, especially if one or more of the following apply to you:
- You're a first-time homebuyer.
- You don't have a lot of money to put down on a house.
- You want to keep your monthly payments as low as possible.
- You're worried about qualifying for a mortgage.
- You don't have perfect credit.
If any of these things describe you, then an FHA loan may be right for you. Why? FHA loans offer many benefits and a level of security that you won't find in other mortgages including:
- Low Interest rates: The federal government insures the mortgage performance (guarantees the payments) for all FHA home loans. With this guarantee in place lenders are not taking as much risk and therefore offer lower interest rates FHA home loans. the
- Lower Down payment requirements: FHA home loans require a 3.5% down payment and the money can come be gifted from a family member, employer or charitable organization.
- Easier Qualification: Because the federal government insures the mortgage performance (guarantees the payments) for all FHA home loans, FHA loan guidelines are not as stringent as conventional loans and a make sense underwriting approach is adopted.
- Less Than Perfect Credit: You don't have to have perfect credit to get an FHA home loan. In fact, even if you have had credit problems, such as a bankruptcy, it's easier for you to qualify for an FHA mortgage than a conventional mortgage. A minimum credit score of 640 is required.
- Fixed Rate Mortgages: Most FHA loans are fixed-rate mortgages. The advantage of a fixed-rate mortgage is that your interest rate stays the same during the mortgage. FHA home loans do not carry any pre payment penalty either.
- Help You Keep Your Home: The FHA has been around since 1934and will continue to be here to protect you when the others walk away. Should you encounter hard-times after buying your home, FHA has many options to help keep you in your home and avoid foreclosure. An FHA home loan will help you buy your house and keep it too.
Step 1.Figure Out How Much You Can Afford.
FHA loan guidelines have a specific calculation that compares your current gross income to your existing debts in order to provide a maximum loan amount that you can qualify for. What you can afford also depends on your down payment and interest rate.
Our experience has shown that it is not wise just to find out what is the maximum amount for which you qualify. It is essential that you determine, what is the maximum monthly mortgage payment that you are comfortable with, based on your personal monthly budget. You can go to our FHA mortgage calculator and see what you qualify for and what your payments would be. There are several FHA loan calculators available to choose from. It is also a smart idea to check the FHA loan limits in the country that you want to purchase your home in. Please click here FHA loan limits to find out the loan limits in your area.
Step 2.Get Prequalified
Contact mayer@mayerdallal.com for an FHA prequalification or by clicking get an FHA loan quote and apply for a free non binding quote and pre approval or by calling one of our mortgage specialists that are standing by at 800-871-9326.
Step 3.Shop for a Home
Once you have your FHA home loan prequalification, you should contact a real estate agent that is experienced in home purchases using FHA financing in order to discuss available homes and options in your target area. If you do not have a real estate agent we can refer one to you. We work with the top realtors throughout the country.
Using a real estate agent with a solid understanding of FHA loan guidelines regarding approved home types and seller concessions in critical to help you save time and money.
Step 4.Make an Offer
Upon finding a home that you feel is right for you and your family, your agent will then submit an offer to purchase the home. Discuss the process with your real estate agent. If the seller counters your offer, you may need to negotiate until you both agree to the terms of the sale. Your offer becomes a legally binding contract if the seller accepts it. Because of this, you need to make sure the offer includes all of the contingencies, concessions, and other details you need it to cover.
Step 5.Get a Home Inspection
Make sure that the offer that you make is contingent on a home inspection. A home inspection gives you more detailed information about the overall condition of the home prior to purchase. In a home inspection, a qualified inspector takes an in-depth, unbiased look at your potential new home to:
- Evaluate the physical condition: structure, construction, and mechanical systems;
- Identify items that need to be repaired or replaced; and
- Estimate the remaining useful life of the major systems, equipment, structure, and finishes.
The home inspector does not estimate the value of the home. An appraisal is different from a home inspection. Appraisals are for lenders; home inspections are for buyers.
An appraisal is required to:
- Estimate the market value of a house;
- Make sure that the house meets FHA guidelines minimum property standards/requirements; and
- Make sure that the house is marketable.
FHA does not guarantee the value of the condition of your potential home. If you find problems with your new home after closing, FHA cannot give or lend you money for repairs, and FHA cannot buy the home back from you. That is why it is so important for you, the buyer, to get an independent home inspection.
It is your responsibility to be an informed buyer. Make sure that you are satisfied in every respect with the home you are going to buy. You have the right to carefully examine your potential new home with a qualified home inspector.
Step 6.Shop for Homeowners Insurance
FHA loans require that you have homeowners insurance. This is an insurance policy that combines liability coverage and Insurance to protect you against physical damage to a property from fire, wind, vandalism or other hazards.
Step 7.Sign Papers
When your final FHA home loan documents ready for you, your closing appointment will be set to finalize your home purchase transaction. Make sure you read everything before you sign.