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How To Qualify For First Time Home Buyers Fha Home Loan Programs
By John Williams, Thu Dec 8th
FHA offers the most popular home loan programs among first timehome buyers. This is mainly because of the low down payment andeasy qualifying criteria's. FHA, which stands for FederalHousing Administration, is a governments backed loan. Mostpeople are not aware that FHA does not provide loans. Instead,the loan which your lender provides to you, will be backed upand insured by FHA. In other words, if you default on your loan, your lender will becovered by FHA insurance funding. This represents the mainreason why it's easier to qualify for the FHA Loan Program. Normally the only criteria's that a lender will request in orderto qualify for the program include:
* 1. Credit Score. A credit score above 575, which is poor butmoderate credit. Also, they will expect you not to have anyderogatory accounts on your credit report. All past collectionsshould be paid off upon submission of loan application. * 2. Good and stable employment history. You will need at theleast two years at your current position and or two years ofemployment history in the same line of work. * 3. Down payment. You need funding to pay for closing cost anddown payment cost. The closing cost normally range from 2-3% ofhome value and the down payment averages around 3% or more ofthe home value. There are FHA programs
that offer zero downloans. The amount your lender will lend to you depends on yourincome and the amount of your current debt. FHA figures yourloan amount based on your monthly income and total debt combinedwith future mortgage expenses. They request that all of yourdebt not exceed 45% of your monthly income. This amount includesPITI (principal, interest, tax, and insurance. For example: If your gross monthly income is 4500.00, your monthly mortgageand debts can not exceed 2025.00. If you current debt averages1000.00, you will only qualify for a monthly mortgage not toexceed 1025.00 including PITI. Most lenders are strict with this criterion and will ask to seetwo years of W2's and six months to a year of pay stubs; inorder to verify your monthly income is stable and does notfluctuate per month. To get the best benefits of the FHA loan program find a lenderthat is most compatible with your current financial and creditsituation. ================================================= A great, lowinterest mortgage rate can be found, if you know where to look.Discover useful information and advice on Mortgages for homeloans. Click ==> http://www.mortgagerates-info.com/ About the author:** Attn Ezine editors / Site Owners ** Feel free to reprint thisarticle in its entirety in your ezine or on your site so long asyou leave all links in place, do not modify the content andinclude my resource box as listed above.
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