May 21, 2015
Thinking of buying a home, learn more about Florida mortgages.
Are you short funds to close?
The FHA no closing cost loan allows all of your closing cost to be rolled into your loan including your appraisal fee, hazard insurance premium and even your escrow account.
Maybe you want to refinance?
Florida Mortgages - Florida FHA loan
The FHA program was created as part of the National Housing Act on June 28, 1934. FHA was created to help stimulate
the housing market making loans more accessible and more affordable. The FHA program was created as a result of The Great Depression to help anyone including families, the elderly, people on disability and lower-income families be able to buy a home.
After the financial crisis of 2008 all the major banks raised their credit standards for approving FHA loans. Because the banks make the rules for loans they will approve, they may require a minimum credit score of 640 for their loans. These guidelines are the bank's guidelines. What this means is, all the major banks including Wells Fargo, Bank of America, Chase, Citigroup, etc. banks make the rules for loans they will approve.
When you apply for an FHA loan at a major bank and they tell you their minimum credit score requirement is 640. This does not mean that it's FHA's minimum credit score requirement. It means that they are the bank's credit score requirements.
Credit score - On January 20, 2010 FHA announced a new policy to address risk. FHA changed the minimum credit score for new borrowers.
This has allowed the FHA to better balance its risk and continue to provide financing for home buyers.
Debt-to-income ratio - April 1, 2013 FHA loan requirements include a maximum debt to income ratio. When a borrower applies for an FHA mortgage, they are required to disclose all debts, open lines of credit, and all possible approved sources of regular income. Using this data, the lender and FHA can calculate the borrower's debt-to-income ratio.
FHA Back to Work Program - August 15, 2013 new borrowers may also be eligible for an FHA insured loan on a purchase transaction after 12 months from the completion, discharge, trustee's sale if the borrower meets the requirements for extenuating circumstances Economic Event.
Borrowers with a prior bankruptcy, foreclosure, deed-in-lieu, or short sale may be eligible for an FHA insured loan if the bankruptcy, foreclosure, deed-in-lieu, short sale was the result of a documented extenuating circumstance.
Collection accounts - October 15, 2013 the FHA does not require collection accounts to be paid off as a condition of mortgage approval. However, FHA does recognize that collection efforts by the creditor for unpaid collections could affect the borrower’s ability to repay the mortgage.
Mortgage Insurance - On January 9, 2015 the Federal Housing Administration (FHA) announced the reduction of it's annual Mortgage Insurance Premium (MIP) rates.
Effective on or after January 26, 2015 FHA will reduce the premium from 1.35% to .85% a reduction of .5%.
Combined with low interest rates and the reduction of MIP rates means that it is a great time to buy a home or refinance your mortgage.
Florida Mortgages - Florida FHA loan
Closing cost - FHA allows the seller to pay up to 6% of your closing cost.
If you are buying a $100,000.00 house FHA allows the seller to pay up to $6,000.00 for your closing cost. It must be in writing in the sales contract, "Seller will pay up to 6% of buyer's closing cost."
If you do not write it into the sales contract then you will be paying the closing cost. In the state of Florida closing cost for a $100,000.00 house average around $4,300.00 depending on taxes, insurance and who's paying the transfer tax and owner's title insurance.
By allowing the seller to pay for your closing cost you will decrease the amount of money required to buy a home. Buying a $100,000.00 property requires $3,500.00 down payment and if the seller pays up to $6,000.00 for your closing cost you will only need around $4,000.00 to buy a $100,000.00 in Florida.
Are you a Florida first time home buyer? Need to get pre-approved?
Call us 888.958.5382
Mortgage World Home Loans of New Jersey is a licensed residential mortgage broker in the state of Florida and will match you with the lender that will approve your Florida mortgages down to a 500 credit score.
We look forward to working with you.
What's the minimum credit score needed to buy a house or refinance in Florida?
FHA loans require a minimum 500 credit score to buy a house or refinance
VA loans require a minimum 500 credit score to buy a house or refinance
Fannie Mae loans require a minimum 620 credit score to buy a house or refinance
USDA loans require a minimum 580 credit score to buy a house or refinance
HomePath loans require a minimum 620 credit score to buy a house
HARP loans require no minimum credit score to refinance
Freddie Mac loans require a minimum 620 credit score to buy a house or refinance
Want to know if you qualify for an FHA loan? Get pre-approved for an FHA loan online.
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