Hire an Experienced FHA Loan Officer
Experience matters! Financing a home with an FHA Loan requires more than gathering documents and filling out information, it requires knowledge of the lending product and how to pair the product to the financial situation and goals of the borrower and done with an eye toward customer service excellence. That’s where Debbie Mishko comes in as your choice for a mortgage loan officer for FHA loans in the states of Washington and Oregon. Debbie has over 25 years of lending experience and has seen nearly every financial situation and closed loans from simple to complex. Don’t make the mortgage process more difficult on yourself, contact Debbie for all of your home lending needs.
What is an FHA Loan?
The Federal Housing Administration insures FHA loans. With this government insurance protection, lenders are more willing to lend money and do so with more lenient qualifying requirements. This program, created in 1934, was designed to help people realize the American Dream of homeownership.
Advantages of a FHA Mortgage Loans
With more flexible guidelines, FHA loans are well received by First-Time Home Buyers. Down payments on conventional loans can require 10% – 20% down, but with an FHA loan, first-time home buyers can put as little as 3.5%*down and, better yet, this money can be a gift from a family member.
FHA loans accept lower Credit or FICO scores (down to around 600) making these mortgage loans accessible to more people who may have some had some ups and downs in their credit history. Lower debt-to-income ratios are accepted and seller contributions are allowed when taking out an FHA loan. Whether you are purchasing or refinancing a home, or choose a fixed or adjustable interest rate, FHA loans may be an option for you.
FHA Loan Eligibility
Property Requirements: Because the whole idea behind the FHA program is to help people become homeowners, an FHA backed mortgage must be the primary residence of the borrower.
Credit Score and Down Payment: Borrowers with a FICO score around 600 can qualify for the 3.5%* down payment. Lower scores will increase your down payment percentage and will likely reduce the number of lenders who are interested in lending to you.
Debt-to-Income Ratio (DTI): Including the home loan payment, a borrower’s DTI ratio should be 50% or less.
Income Requirements: While FHA loans do not have a minimum or maximum income requirement, you will need to show that you do have income and a steady job history. You will need to have established some credit history – a minimum of two credit cards and/or loans are required and you cannot have delinquent federal debts or taxes. Cash gifts for down payments must be verified in writing by the donor.
Mortgage Insurance Premium (MIP): Borrowers must pay MIP equal to 1.75% of the loan amount. This can be added to the loan amount or you can pay it upfront. An annual premium is due and payable each month with the amount determined by your loan term, the amount borrowed, and your DTI ratio.
Mortgage Insurance Premium (MIP)
Mortgage insurance protects lenders against the risk of a homeowner defaulting on their FHA loan. Mortgage Insurance is required when the down payment on a home is less than 20% on a purchase loan or if the home has less than 20% in equity if refinancing. Mortgage Insurance must be held for a minimum of five years. MIPs typically are paid monthly and the premium is included in the borrower’s monthly mortgage payments. Upfront Mortgage Insurance Premiums (UFMIP) require borrowers to pay 1.75% of the base loan amount. This amount can be paid up front or included in the loan amount and paid monthly.
Example FHA: Loan amount $300,000, 3.5% down, monthly Principal and Interest payment $1,501.74, Annual Percentage Rate 5.395%, FHA monthly MIP is $211.00.
FHA Loan Limits
The Federal Housing Administration updated the schedule of loan limits for 2018. The national loan limit for one-unit homes is $294,515 and in high-cost areas, loan limits can go up to $679,650. Loan limits vary by county. You can calculate your FHA loan limit by using this form on HUD.GOV
Work With an Expert FHA Mortgage Lender
With over 25 years in the mortgage industry, Debbie Mishko has closed thousands of FHA loans for first-time home buyers, seasoned home buyers, and FHA refinance loans. Choose with confidence; American Pacific Mortgage and Debbie Mishko as your FHA mortgage lender and mortgage loan adviser. You can start your mortgage application or Contact Debbie today!
* Qualifying factors may apply
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