FHA Loan Specialists
FHA loans make it easier for aspiring homeowners to achieve homeownership without the need for a large down payment. This flexible and more attainable loan program is a popular choice for first-time homebuyers, by enabling borrowers to make down payments of as little as 3.5 percent.
This type of loan not only allows for a smaller down payment but less stringent credit score requirements, thus making it ideal for borrowers with little cash saved up and those who have less-than-ideal credit and cannot qualify for a conventional loan. Contact the FHA Loan Specialists at Dovetail Mortgage today to learn more about FHA loans and how you can use one to buy your next home!
What is the best option for me?
When choosing a mortgage, you need to consider a wide range of personal factors and balance them with the economic realities of an ever-changing marketplace. That is why it is important to partner with the right mortgage broker in Braintree, MA that can understand your background. Individuals’ personal finances often experience periods of advance and decline, interest rates rise and fall, and the strength of the economy waxes and wanes. To put your loan selection into the context of these factors, consider the following questions:
- How large a mortgage payment can you afford today?
- Could you still afford an ARM if interest rates rise?
- How long do you intend to live on the property?
- In what direction are interest rates heading, and do you anticipate that trend to continue?
Frequently Asked Questions Regarding FHA Loans
Provided By Dovetail Mortgage: Your FHA Loan Specialists in Braintree, MA
One of the best ways to improve your credit rating before applying for an FHA loan is to take advantage of time. If your credit rating could benefit from significant improvement, make sure that you establish payment reliability over a period of time (one year at least) before applying for the loan.
We also recommend that you do your best to eliminate debt potential. Try to pay as many of your credit cards off as possible, and even consider getting rid of one or two if you do in fact have multiple credit cards. This will improve your credit rating as it shows that there is now a lower likelihood of you accruing large amounts of debt.
The biggest mistake homeowners make when applying for an FHA loan is making a major purchase right beforehand. This clouds your debt-to-income ratio and will significantly alter your balance history. Since a lender is looking at your current expenses and debts as they relate to your income, making a big purchase that may result in debt could ruin your chances of receiving your loan.
There has been a steady increase in availability for FHA loans to homeowners in recent years. This means that right now, you have more of a chance of receiving an FHA loan than ever before.
The FHA has a maximum loan amount, known as the FHA Lending Limit. The lending limits are updated annually and vary based on property type, type of home, and location.
Ideally, you want to make all of your payments on time, but life can tend to get in the way sometimes. If you do fall behind on your FHA payments, do not ignore it. Failure to make your payments can result in foreclosure. Only under special circumstances will your mortgage be protected from foreclosure for 90 days. These can be things like reduction or loss of income from natural disasters. If this is the case, contact your FHA loan officer immediately.
FHA loans do not come directly from FHA. FHA guarantees loans, meaning they reduce the lender’s risk and offer more borrowing power to homeowners. The FHA helps you get better interest rates thanks to their home loan insurance.
FHA home loans are for any qualified borrower. There is no minimum or maximum income limit for FHA mortgages. Qualifying for an FHA loan depends on your credit and FICO score, as well as your 12-month payment history for all financial responsibilities.
Borrowers with FICO scores of 580 and above will most likely be eligible for maximum financing. Borrowers with FICO scores between 500 and 579 are required to put down 10%. If your FICO score is below 500, you are not eligible for FHA financing.
The FHA has anti-flipping requirements that state that you are not eligible for an FHA insured mortgage for a home that is being resold within 90 days of acquisition. Homes that were purchased within a period of 90 to 180 days may be subject to a second appraisal.
One of the biggest benefits of FHA loans is that unlike conventional loans, FHA loans are insured by the government. These loans are guaranteed with government funds and provide homeowners with extra protections. Since the risk to lenders is lower, this makes FHA loans much easier to qualify for.
FHA loans are designed for homeowners that occupy the property. You are not eligible for an FHA loan to finance a home that you are not residing in.