FHA Purchase Loans
First time buyer? Looking to move? An FHA loan
can help
you afford more, and pay less.
 FHA
loan requirements:
In order to purchase a home with an FHA loan, there are a few, basic
loan requirements that the borrower must meet. Generally speaking,
the FHA wants borrowers to be able to document their income. The
FHA also wants to see verifiable rental history, or if the
borrower already owns a home, good mortgage payment history.
Basically, the FHA wants to ensure that borrowers can pay their
obligations. The FHA will often take a letter of explanation in
extenuating circumstances, if there is a problem with the
borrower’s payment history. The FHA also attempts to make sure
that a borrower looking to purchase a home with an FHA loan will
not have a debt-to-income ratio above 31% if their loan is
approved.
In the event that a borrower has had to file a bankruptcy, the
FHA requires that the borrower be two years out of the bankruptcy
in a Chapter 7 or one year out in a Chapter 13.
For alternative options if you are in bankruptcy, check our
Bankruptcy Options page.
Apply Today and get into the home of your dreams with an FHA
mortgage.
First time homebuyer (someone who has not owned for 3
years prior to purchase date) benefits:
An FHA loan purchase has many benefits, both for first time
homebuyers and for homeowners moving into another home.
First time homebuyers are entitled to an $8,000 tax
credit if they purchase a home between January 1, 2009, and
April 30, 2010. This tax credit is 10% of the home’s
value, with a cap at $8,000. Unlike tax deductions, this
benefit is a tax credit, a dollar-for-dollar return on your
taxes.
CNN Money explains this credit with three scenarios.
“Scenario 1: Your final tax liability is normally $6,000. You’ve
had taxes withheld from every paycheck and at the end of the year
you’ve paid Uncle Sam $6,000. Since you’ve already paid him all
you owe, you get the entire $8,000 tax credit as a refund check.
Scenario 2: Your final tax liability is $6,000, but you’ve
overpaid by $1,000 through your payroll withholding. Normally you
would get a $1,000 refund check. In this scenario, you get $9,000,
the $8,000 credit plus the $1,000 you overpaid.
Scenario 3: Your final tax liability is $6,000, but
you’ve underpaid through your payroll withholding by $1,000.
Normally, you would have to write the IRS a $1,000 check.
This time, the first $1,000 of the tax credit pays your
bill, and you get the remaining $7,000 as a refund.”
The
FHA is now allowing this tax credit to be used to cover any
closing costs, as well.
If this tax credit is not enough, there are more benefits of
buying a home with an FHA loan. Unlike most other loans, FHA loans
have incredibly low mortgage insurance, and an additionally low
rate. This low, fixed rate helps keep your monthly payments low.
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What Clients Say
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Why are FHA Rates Lower?
The difference between FHA loans and
conventional loans is that FHA loans are
government insured. This enables FHA approved
lenders to offer homeowners lower interest rates
than would otherwise be available. With FHA,
homeowners can afford more, and enjoy greater
security too! |
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