What is FHA? Benefits of using FHA & BASIC requirements скачать в хорошем качестве

What is FHA? Benefits of using FHA & BASIC requirements

History: https://www.hud.gov/program_offices/h... To be CLEAR, FHA IS NOT A LENDER, they INSURE MORTGAGE Lenders that ORIGINATE FHA Loans.FHA’s mission is to expand and increase national homeownership opportunities. Mortgage Insurance: upfront & monthly with a 3.5% down you’re paying .85% monthly & 1.75% upfront, financed into your loan. Residency: Borrower must be a lawful legal resident in the US. You must be a Citizen, permanent residency or have a legal US work permit -Valid US social Security number -Legal Age: 18 years old -Only One FHA loan per person: exceptions apply Occupancy: Property must be borrower’s primary residence for majority of the year. Military Personnel, exceptions provided. Credit: FHA requires a 580 FICO to secure maximum financing, meaning 3.5% down, their guide also states if you have more than 10% down, your FICO can be as low as 500. While this is true, MOST LENDERS will want your scores to be in the mid 600’s. -Judgements: NOT allowed & must be paid in full or payment arrangement established. -Collections: Medical collections are not considered. Collections in general over $2,000 aggregate MUST be accounted for. 5% payment on the balance is used against your debt to income ratio -Student Loans: 1% of the balance must be counted as payment when not fully amortized even if in deferment or forbearance -Non purchasing spouse debt in Community state properties are considered Waiting period after major derogatory event: 1 year for Chapter 13 2 years for Chapter 7 or Chapter 11 Preforeclosure & Foreclosure 3 years (extenuating circumstances allow shorter time frames when documented & beyond your control) -If credit report used with TOTAL indicates borrower has $1,000 or more collectively in disputed derogatory accounts, loan must be downgraded to manual underwriting. -Exclusion from cumulative balances include: medical accounts & acts resulting from identity/credit card theft or unauthorized use. Documentation needed. Minimum downpayment (MIR): The minimum downpayment with a 580 FICO score is 3.5% but you want to be in the mid 600’s since most lenders are currently requiring. Maximum loan amount -County specific The maximum loan amount depends on the type of property you’re buying, how many units & the county it’s in. ExampleS: San Bernardino County/Riverside $477,250 SFR vs $917,800 4 Units LA/Orange County $822,375 SFR vs $1,581,750 4 units FHA Loan Limits: https://entp.hud.gov/idapp/html/hicos... Property types allowed-RESIDENTIAL side 1-4 units, townhome, condo (must be FHA approved), manufactured housing -Properties being resold within 90 days are ineligible for FHA financing -manufactured housing must meet certain age & size requirements Condos must be FHA approved If not your lender can submit a single condo approval or full complex approval -FHA Appraisals are initially good for 120 days. FHA APPROVED CONDOS: https://entp.hud.gov/idapp/html/condl... Co-signers & Coborrowers (Allowed) -Co-borrower : Are obligated on the mortgage note, tame title to the property at settlement Must sign all loan documents INCLUDING the security instruments -Co-Signer : Are obligated on the mortgage note and liable for repaying the obligation. Do NOT hold ownership interest in property. Must complete and sign all loan documents EXCEPT security Instruments Debt to income ratios: -Manual Underwriting: 31/43 with minor exceptions when compensating factors are documented -Automated Approval: 46/56 Keep in mind, your LENDER may set different boundaries Employment: -2 yr work history (higher education can help meet this requirement) -1 year Self employment allowed if in the same line of work Gift funds: allowed for Down payment & closing cost Reserves: NOT required UNLESS DU asks for them, you’re doing manual underwriting & need a compensating factor and/or if you’re buying units (2-4) Downpayment assistance: Allowed Seller Credit: Up to 6% Other income: Child support, alimony, automobile allowance, rental income, social security, MCC & pension income may be used Refinancing: -FHA streamline. Quick & simple way to refinance by lowering your monthly payment & rate -cash out, debt consolidation, change in your term & no prepayment penalty are also allowed & features Ineligible Borrowers: Borrower’s with delinquent federal non-tax debt, including deficiency judgments and other debts associated with past FHA-insured Mortgages. Borrowers with Delinquent Federal Tax Debt unless paid in full or payment agreement is established