FHA (Federal Housing Administration) Loans

FirstHomeBuyers.net offers the FHA loan program thru Direct Lenders who specializes in loans for first time home buyers. FHA home loans can offer low interest rates and more flexible underwriting guidelines for borrowers who have less than perfect credit. However, there are mortgage amount limitations for each county in the United States. Please check limits for fha mortgage loans here. These loans requires 3.5% down payment but it can be a 100% gift or you can use grant programs. Also, the seller can pay up to 6% of the purchase price in closing costs and the monthly PMI is lower than most 3% down conventional loans. Finally, it is one of the few loan programs left which allows an underwriter to take into account extenuating circumstances such as job loss, long-term illness, and death in the family as legitimate reasons for credit issues and they can manually approve a file on a case-by-case basis. See official Federal Housing Administration website for more detailed information and check out 100 questions and answers about buying a new home.

Let's take a look at a few FHA Loans:

2-1 Buydown FHA Program

This program is an FHA 30 year fixed program with a temporary decrease in rates for the first 2 years. The mortgage payments are pre-determined with the initial payment being calculated at a rate which is 2% below the final rate. The interest rate will increase 1% per year for the next 2 years and will remain at that final rate for the duration of the 30 year term. Here is an example:

Assumptions: 2-1 buydown with 3.25% rate (APR 3.37%) check today's loan rates: $200,000 purchase price, $2,400 real estate taxes, and $600 year home insurance.  

In this case you would be able to purchase $50,000 more house on the
2-1 buydown program than the traditional 30 year fixed program at 5.25% (APR 5.30%), which can get you an extra bedroom and den! This loan is well-suited for a first time home buyer or young professional whose income situation will improve over the next few years, but they want the best home they can afford today. 

FHA Kiddie Condo Program

If you are a parent, FHA has made it easier for you to help your son or daughter purchase a new home. Instead of paying rent on an apartment, your son or daughter may be eligible to purchase an FHA eligible property (single family residence, townhome, or condo, etc.) with the assistance of his or her parent(s). Furthermore, your son or daughter does not need a a job or sufficient funds in his or her bank account for the down payment.  The parents, however, must have sufficient credit, income, and funds to pay for the closing costs and down payment but they do not have to live in the property. Finally, this program is available to borrowers, other than parents,  related by blood (siblings, aunts & uncles, etc..), or for unrelated individuals that can document evidence of a family-type longstanding and substantial relationship not arising out of the loan transaction.   

FHA $100 Down Loan Program for FHA Foreclosures

Eligible states include: Alabama, Arizona, Colorado, Delaware, Florida, Georgia, Idaho, Illinois, Indiana,  Kansas, Kentucky, Michigan, Mississippi, Missouri,. Nevada, New Mexico, Ohio, Oregon, Pennsylvania, Tennessee, Texas, Utah, Washington, and Wyoming.

Single family, 2-4 unit, PUD, and HUD or FHA condo projects, and homes located in disaster areas are eligible.

Please contact Gerald Tribuzio at 847-516-5743 or email jtrib@firsthomebuyers.net if you have questions or want more details on these great programs. Please apply for fha mortgage if you would like to get pre-approved today for this program.     

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