pros and cons about FHA loan?
I'm looking in to FHA home loan and was wondering about the pros and cons.... any personal experiences would be great.
- Born againLv 61 decade agoBest Answer
i just bought a house with a FHA loan. The reasons why i thought it was best for me was:
1) only 3.5% for a downpayment requirement versus a 5% downpayment requirement for a conventional loan
2) I was able to receive "gift money" that i could use towards my downpayment requirement
3) 30 year fixed- so no changes in my rate, since i got 4.5% im super relieved and lucky
-sorry can't see any cons at least for a first time buyer like myself
- Anonymous1 decade ago
I love to broker fha loans. If you have a limited amount of cash to put down and ANY hiccups in your credit it is the way to go.
Really the only con with it is the "mortgage insurance premium" that has to be paid up front. It is .75% of your loan amount. It can be added to your loan so it's not out of pocket - and some of it can be refunded if you refinance. There is a small monthly premium as well.
My husband and I just bought a home using the fha 203(k) loan which allows us to rehab a property that wouldn't have passed an inspection for a regular loan. We put 3.5% down and asked the seller (it was a bank owned property) to pay 6% of the closing costs. My husband had a blemish in his credit history that probably would not have been approved through a conventional loan.
The Bulldog Broker,
firstname.lastname@example.orgSource(s): Licensed Florida Mortgage Broker
- 1 decade ago
When applying for a home loan your credit report will be reviewed and you may be required to provide a number of other details, including: Employment and income records, Tax Returns for the last few years List of assets, List of liabilities and what you owe, Your budget showing monthly living expenses so that you can demonstrate an ability to pay.
With this information you and your lender will be able to determine the kind of home loan and size of the right mortgage for you. In some cases, you can obtain a pre-approval or pre-qualified certificate, which shows how much you can borrow so that you can then shop for homes in an appropriate price range.
- nodellLv 43 years ago
i'm a CA approved authentic sources broking service and that i specialise in trading short sales. it truly is the deal. The itemizing agent is incorrect, the different provide isn't "clean". The provide that receives submitted to the commercial corporation will favor to be observed by ability of a HUD-a million that shows how a lot the investor (that national facilities) will internet in the adventure that they settle for the availability (so as that they are all "clean"). Your purely problem with FHA is the time you want to close. hit upon a FHA broking service/lender who can close in 21 days, no longer 40 5 and then ask for 30 days to close. except that, you being FHA has no authentic effect on the availability. also, searching on the investor (economic corporation of lengthy island or wellsfargo) that national is servicing, they're going to enable the three% for last value. what's happening at present's that I wager national closed the document and the itemizing agent resubmitted the quick sale equipment of the different provide and are searching ahead to it to get assigned to a negotiator. If it truly is real, then you're dropping some time because the itemizing agent is transferring ahead with that provide. the subsequent time you desire your provide to adhere, attempt to be the first purchase provide the commercial corporation sees and bribe the owner and/or the itemizing agent to apply purely your purchase provide. in case you do a glance for on my call, you'll see a thanks to purchase a short sales very inexpensive. finally, it really is consumer-friendly that we brokers communicate over with one yet another on a short sale as to no longer waste all people's time. i imagine the itemizing agent changed into attempting to deter the recent provide as he's already invested 3 weeks with the different provide. sturdy success
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- 1 decade ago
Pros: Long term low fixed rates
Lower credit or sub prime borrowers can qualify
Can borrow over the typical 80% LTV
Homes will require extra inspections
The home itself has to qualify
Lots of paperwork