FHA loans fell out of favor due to the relaxed rules of conventional loans in the past several years. FHA had many rules that made it difficult for homebuyers, and more expensive for home sellers. Those days are gone!
FHA is now going to be the loan product of choice for many people looking to buy homes in South Florida and across the United States.
The down payment requirements are favorable to today's buyers, requiring buyers to have a down payment of only 3.5%, and the down payment can be a gift from a relative.
Sellers can pay up to 6% towards the buyer's closing costs and pre-paids.
No inspections are now required although the home cannot be a health hazard. This means that FHA loans are wonderful for people looking to buy foreclosed homes, short sales and distressed properties. They can even take the FHA 203 loan and repair costs can be financed into the loan and then completed after closing.
Non-occupant homebuyers can also participate; for instance, someone buying a home for a child or a parent can take advantage of the FHA programs, even if they currently own another home. This does not mean that the home can be an investment, because FHA will not loan on investment properties.
There are no cash reserves required. FHA does want to make sure that the homebuyer is educated about the home buying process and will often give a discount in fees to the buyer for attending a Home Education Workshop.
FHA wants to see two years of income, but may be flexible if they can verify you have been a full time student for the past two years.
FHA is also not credit score driven and will often allow you to close on a property without paying off all collections; they are especially compassionate about medical collections.
It is very important that, if you choose to look into an FHA loan, you work with someone who is very experienced as the rules have changed drastically. The appraiser should have recent FHA experience so that they are familiar with the new guidelines, as well as the lender and realtor. The realtor will have to have an FHA Addendum signed by the buyer, seller and the agent for the sale to close.
Mark Cornwell of Chase Manhattan Mortgage is someone that I have worked with for many years and who has the experience to help navigate buyers through this great program with ease.
If you would like to receive a daily list of homes as they hit the market please visit: www.getsouthfloridalistings.com.
It would be my pleasure to assist you in all of your South Florida Real Estate needs, from Miami to Fort Lauderdale, serving both Dade and Broward Counties; I am here to be of service.
ELLEN BITHELL
CRS, CERTIFIED REO SPECIALIST, HOUSING OPPORTUNITIES SPECIALIST
SELLING SOUTH FLORIDA
Posted in: National
