FHA mortgages, why are they still not talked about as much as they should be?
- Many mortgage companies are not FHA approved.
- Many loan officers do not truly understand the difference between FHA mortgages and Conventional mortgages.
Overall, what a great time to purchase a home or to refinance your mortgage. Mortgage rates right now are the lowest that they have been in over 2 years.
So, with that said, let's check out why many times, FHA financing is better than conventional financing.....
Top 10 Reasons why FHA mortgages are better than Conventional mortgages
10. Your monthly MMI vs PMI (monthly mortgage insurance) is lower monthly with 10% or less down.
9. You can get 100% gifted to you from a family member for down payment and closing costs.
8. You can be in a Ch. 13 bankruptcy after 1 year and buy a home or refinance.
7. You can have a non-occupant co-borrower help you qualify to purchase your home.
6. You can get up to 6% seller help for closing costs.
5. FHA mortgages for damage credit with credit scores as low as 500 and still put just 2.25% down.
4. With credit scores under 680, your FHA rate would be lower than a conventional rate.
3. Declining market areas do not affect FHA mortgages as they do conventional mortgages.
2. FHA Debt to income ratios of 31%/43% compared to Conventional of 28%/36% -- And these can exceed sometimes up to 40%/50% with a manual underwrite.
And the number 1 reason why FHA mortgages could be your best option is…..
– Because I said so….. but seriously, the proof is in the pudding. You can find out why I can make this statement by following these links & then you can form your own opinion :
For those that are in the home buying process or possibly in the middle, please read this series.
The Mortgage Process Series :
______________________________________________________________________________________________________________________________________________
For more information on FHA loans, please go to this link. The FHA Expert
For more information on how you can obtain your dream home, please click here : Mortgage Financing Options
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!!
Copyright © 2008 by Jeff Belonger
Jeff,
You know...I'm a believer!!! Thanks, Fran
APRIL.... well, FHA should have never left. The only complete in the last 4 years was because in several areas, the median priced home out paced the maximum FHA loan limit. But I even saw many loan officers put clients in another program other than FHA, just because it was easier for the loan officer.
On another note, where is Brookfield, WI? My dad was born and raised in Two Rivers, WI, about 2 hours south of Green Bay. And thanks for the compliment.
AJ....... just as I stated to April, this was a good option for many in the last 3 to 4 years, but it was more work for the average loan officer. Thanks for the polite comment.
MELINA..... same here.... I have been doing mortgages for 15 1/2 years and my first FHA deal was 1 1/2 years into the business. I love when loan officers still argue with me even today, how overall, conventional is better. But they never give me an example why they say this. Go figure... I highlight proof in one of my links. You can't beat or argue real numbers.
FRAN.... yes, you have said this before... thanks for stopping by. Wondering where you have been. Did you miss my 3 part series on marketing?
BRIAN.... bah humbug about CW... lol Seriously, it's good to make people aware of these differences. Even those lenders that put clients in a FHA loan, they don't know all the differences or the reason why.
TREVOR..... yes, numbers speak for themselves.. thanks for the compliment.
DANNY..... I am assuming it was through DO, the automated system? We'll manually underwrite up to a 50% back. I have closed several with mid 50s, but through the system. Hey, I closed one that was a 95% cash-out refinance with a 41% front and a 53% back.
SALLY.... to the point... lol seriously though, thanks for the compliment.
RANDY..... hey, look, it's the Hawain tandem, back to back. ;o) In regards to your statement? Well, FHA was better than several of these programs that were dropped previously in my opinion.
LARRY.... please do... share it. And it was voted a YES to raise the limits, but the limits have not been put on paper as of yet. I think they have until this coming week. So we should know something very soon.
BARBARA.... my pleasure. in regards to my number 1... lol Thanks and thanks for stopping by.
THESA.... yes, so true... but you need to be careful and define easy. Many of mine are hard or take time, because they are credit challenged. And for the fact that I need to help them not only get their credit in line, but help with the credit explanation letters... so, they might seem easy to the real estate agent, but they can be very tedious. But with a very good to great loan officer, some loans that many would deny, would be approved. I closed 2 in the last 30 days that were denied by other lenders.
You missed one....
The "StreamlineK" version of the standard FHA loan enabling you to purchase or refinance and include money for repairs, upgrades, appliances, etc. What conventional program will do everything you mentioned above AND provide you money for new carpet, retiling the bathroom and a new refrigerator?
DANNY..... well,in either case, you are running them through one system or another. It just comes down to the compensating factors, typically assets.
JASON...... thank you very much for the kind words and for the compliment.
KEN..... darn... how about I missed about 5 more... lol I thought about another one the other day, but I can't remember now... lol But yes, that's a good one that you chose. thanks