What is an FHA Loan?
An FHA loan also known as the Federal Housing Administration has the primary goal of protecting lenders from borrower default and improving the US housing market. By insuring home loans offered by approved lenders, the FHA makes it possible for buyers to purchase homes at great rates and with low down payment and credit score requirements. This has allowed the FHA to become the largest insurer of mortgages in the world, having insured over 34 million mortgages since being created in 1934. Associates Home Loan of Florida, Inc. offers some of Florida’s best rates and terms on Tampa FHA loans. There are various FHA loan programs available to meet a wide range of borrower needs including the purchase of a new home, refinancing current home loans, financing renovation, and rehabilitation projects, and reverse mortgages.
First-time homebuyers are prime candidates for FHA loans. Homeowners with existing FHA loans can benefit from FHA refinance programs as well. People who have an FHA loan are eligible to both cash-out refinance and streamline refinance programs. Buyer currently looking into financing and restoration project can utilize FHA 203k loan to combine the purchase of a home and the amount it costs to make any improvements into one single loan. Relaxed credit requirements and low-down payment options are the biggest reasons why first-time homebuyers are interested in FHA loans in Florida. First-time homebuyers could potentially qualify for FHA loans with down payments as low as 3.5% and a minimum credit score of 580. Family members are even able to offer the down payment as a gift if the applicant does not have this on hand.
Palm Beach, Florida FHA Loan Requirements
Credit Score – The minimum credit score requirement is 580. Applicants with scores between 500 and 579 may still be able to qualify, but a higher down payment may be needed.
Debt-to-Income Requirements – A debt-to-income ratio of 43% or less is typically required although ratios as high as 50% may be approved in special circumstances.
Down Payment – 3.5% is the minimum down payment needed. If minimum credit score requirements are not met, the borrower may be asked to provide a larger down payment.
Property Requirements – All properties must meet certain safety, security, and soundness (structural integrity) requirements.
FHA Home Loan
With every FHA loan, there will be two mortgage insurance premiums (MIP) due. FHA loans will automatically add an up-front premium to the balance equal to 1.75% of the purchase price. But don’t worry, this addition to your balance will not affect your loan-to-value (LTV) ratio. The second premium is an annual premium that is paid as part of your monthly payment. This premium is calculated at .70% to 1.05% of your annual mortgage balance. The exact amount will be calculated based on different factors including loan amount, your LTV ratio, and the length of your mortgage.
Who are the ideal candidates for an FHA loan?
- Applicants who experienced foreclosures or short sales
- Borrowers without a big down payment
- First-time homebuyers
- Applicants with high debt
- Borrowers with low credit scores
- Those needing a higher loan amount
Contact us to find out if you qualify!
Who we are?
Mortgages Done Right Inc is the best mortgage broker company in Boynton Beach, Florida. Greg Hayden the President of Mortgages Done Right Inc. created the business to give thousands of clients and hundreds of realtors more mortgage choices in the marketplace. The days of going to one lender for a mortgage are gone. Mortgage brokering is better for the consumer.
Before buyers would wait 2-3 weeks for a bank to get back to me on an approval and if it was a no, I didn’t have time to go elsewhere. No more. If one lender says no, I have 25+ more that can say yes within days. More lenders, more options with better rates and service then the Banks or the Quicken mortgages of the world. We have programs for just about any type of borrower. Loans for the regular W2 wage earner to the self-employed person who can’t verify income.
“My goal as president of Mortgages Done Right Inc. is “to make sure my customers have as much opportunity to get the American dream of homeownership.”