FHA home loans have been helping Florida homebuyers become homeowners since 1934. How does FHA help? The Federal Housing Administration (FHA) – which is part of (HUD), provides FHA mortgage insurance to insure private FHA mortgage lenders to protect them against loss. The mortgage insurance allows private Florida lenders to lend up to 97% of the purchase price and allows financing with No Minimum credit score requirement for Florida homebuyers.
Easy Qualification – The FHA mortgage loans insure private FHA lenders against loss for loans made to properly qualified FHA home loan mortgage applicants. So you’re likely to find FHA loans with terms that make it easier for you to qualify.
Minimal Down payment Requirements – FHA mortgage loan can work with as little as 3.5% down and those funds can come from a family, grant , or your employer. Although the FHA loan does not have a zero down mortgage option yet, you will find that there are many Florida down payment assistance programs to help you with the down payment.
Less than A-1 Credit is Okay – The FHA home loan program exists to expand the pool of home buyers. Even borrowers with prior bankruptcies or mortgage loan lates get approved every day for FHA loans to buy or Refinance homes in. The FHA loan program uses credit quality, not credit score!
Lower Cost Over the Life of the Loan – Florida FHA loan rates are extraordinarily competitive. FHA’s lower risk to the lender means a better rate for the Florida borrower.
Safeguards for Borrowers Who Get Behind – FHA loans also allow the lender more options in helping borrowers who fall behind keep their homes are get current again: special forbearance, workouts, even free mortgage counseling. Further, HUD can allow the lender to take past due payments and move them to the end of the loan and in some instance will actually pay your past due payments for you. Options to save your home you’ll never get from a conventional loan! In an uncertain world, this is another excellent reason for you to get an FHA loan.
Options for Manufactured Housing – Under certain conditions, you can even secure an FHA loan for a Mobile Home or manufactured home using a Florida FHA mortgage loan.
FHA Loans Are Fully Assumable – When you are ready to sell your Miami home, you can offer buyers FHA financing! All FHA loans can be assumed by qualified buyers.
Other FHA loan Advantages Include:
Minimal Down Payment and Closing Costs.
Down payment less than 3.5% of Sales Price Gift for down payment and closing costs allowed. No reserves or required. FHA regulated closing costs. Seller can credit up to 6% of sales price towards buyers costs.
Easier Credit Qualifying Guidelines such as:
Minimum FICO credit score of 540. FHA will allow a home purchase 2 years after a Bankruptcy. FHA will allow a home purchase 3 years after a Foreclosure.
Easier Debt Ratio & Job Requirement Guidelines such as:
Higher Debt Ratio’s than other home loan programs. Less than two years on the job is allowed. Self-Employed individuals o.k.
(An exception shall be made for a seller on the GSA list when the property being sold is the seller’s principal residence.)
Although eligibility for an FHA-insured mortgage may be established by performing the actions described above, the overall analysis of the creditworthiness must include consideration of a borrower’s previous failure to make payments to the Federal agency in the agreed-to manner and must document its analysis of how the previous failure does not represent a risk of mortgage default.
Exceptions to this rule may be granted under the following situations: If the FHA mortgage applicant sold the property, with or without a release of liability, to an FHA mortgage applicant who subsequently defaulted, the borrower is eligible, provided he or she can prove the loan was not in default at the time of assumption. However, if a claim was paid on a mortgage in default prior to the divorce, the FHA mortgage applicant is not eligible. When the property was included in a bankruptcy that was caused by circumstances beyond the FHA mortgage applicant control (such as the death of the principal wage earner or serious long-term uninsured illness), the FHA mortgage applicant may be eligible if the FHA mortgage applicant meets the requirements in Paragraph 2-3 E.
While FHA may delete erroneous information regarding a FHA mortgage applicant falsely indicated as having defaulted on a FHA mortgage, such as incorrect social security number reporting, it will not remove correct CAIVRS information even if the borrower is judged eligible under the conditions described above.
FHA mortgage Lenders may not rely upon a clear CAIVRS approval when in possession of independent evidence of delinquent federal obligations and must document the resolution of any conflicting information. If the FHA mortgage lender has reason to believe the CAIVRS message is erroneous or needs to establish the date of claim payment, the FHA mortgage lender must contact the appropriate HOC for instructions or documentation to support the FHA mortgage applicant eligibility. The appropriate HOC can provide information when the three-year waiting period will elapse or if the social security number in CAIVRS is erroneous. The HOC will also provide instructions to lenders regarding processing requirements for other HUD-related defaults and claims (e.g., Title I loans).
FHA cannot alter or delete CAIVRS information reported from other Federal agencies, such as the Department of Education, Veterans Affairs, etc. The FHA mortgage applicant and/or the FHA mortgage lender must contact those agencies to correct or remove erroneous or outdated information. We do not require a “clear” CAIVRS authorization number as a condition for mortgage endorsement, but the lender must document and justify its approval based on the exceptions described above.