Comments on: First Time Homebuyers and 100% Financing http://njmortgagerep.com/2007/07/02/first-time-homebuyers-and-100-financing/ FHA Loans | "Your Mortgage Professional for Life" Specializing in FHA, First Time Home Buyers and Refinancing | FHA 203K Loans Tue, 06 Jan 2009 15:07:46 +0000 http://wordpress.org/?v=2.0.4 by: <ADMINNICENAME> http://njmortgagerep.com/2007/07/02/first-time-homebuyers-and-100-financing/#comment-1193 Mon, 27 Aug 2007 17:50:13 +0000 http://njmortgagerep.com/2007/07/02/first-time-homebuyers-and-100-financing/#comment-1193 Well, Chalene, that is a great question. Sub-prime loans were typically given to the people with lower credit scores, unverifiable income and/or no down payment. With all of the changes that have recently happened in the market place, it’s very difficult to get a sub-prime loan without having more money to put down, and most lenders are now requiring you to verify all of your income. With typical sub-prime loans, came higher interest rates. FHA loans are government backed loans. This doesn’t mean that you have to have great credit…just fair credit. FHA allows you to obtain financing while still in a Chapter 13 BK, or if a Chapter 7 BK was discharged at least 2 years ago. FHA allows a person with NO credit to obtain a mortgage. So, it’s a really good way to finance your home. FHA does require that you have a minimum of 3% into the loan. However, you may obtain a gift for the 3%. FHA’s rates are very competitive (much lower than sub-prime loans), but they do require an upfront mortgage insurance premium (which can be financed) and a monthly mortgage insurance premium. FHA does not allow unverifiable income, and you can only finance an owner occupied home. But, it is a really great program. Many lenders are not approved to do FHA loans, so many uneducated borrowers end up getting a high interest rate sub-prime loans. Well, Chalene, that is a great question.

Sub-prime loans were typically given to the people with lower credit scores, unverifiable income and/or no down payment. With all of the changes that have recently happened in the market place, it’s very difficult to get a sub-prime loan without having more money to put down, and most lenders are now requiring you to verify all of your income. With typical sub-prime loans, came higher interest rates.

FHA loans are government backed loans. This doesn’t mean that you have to have great credit…just fair credit. FHA allows you to obtain financing while still in a Chapter 13 BK, or if a Chapter 7 BK was discharged at least 2 years ago. FHA allows a person with NO credit to obtain a mortgage. So, it’s a really good way to finance your home. FHA does require that you have a minimum of 3% into the loan. However, you may obtain a gift for the 3%. FHA’s rates are very competitive (much lower than sub-prime loans), but they do require an upfront mortgage insurance premium (which can be financed) and a monthly mortgage insurance premium.

FHA does not allow unverifiable income, and you can only finance an owner occupied home. But, it is a really great program. Many lenders are not approved to do FHA loans, so many uneducated borrowers end up getting a high interest rate sub-prime loans.

]]> by: charlene http://njmortgagerep.com/2007/07/02/first-time-homebuyers-and-100-financing/#comment-1016 Tue, 14 Aug 2007 20:23:15 +0000 http://njmortgagerep.com/2007/07/02/first-time-homebuyers-and-100-financing/#comment-1016 We've all heard a lot of stories on the news lately about mortgage companies going out of business, and the companies that are going to survive are companies that are doing FHA loans. What exactly is the difference between an FHA loan and a sub-prime loan? What is the benefit of an FHA loan? We’ve all heard a lot of stories on the news lately about mortgage companies going out of business, and the companies that are going to survive are companies that are doing FHA loans. What exactly is the difference between an FHA loan and a sub-prime loan? What is the benefit of an FHA loan?

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