Texas FHA mortgages are a great choice for many first time home buyers in Dallas, Houston, San Antonio, etc. The FHA program provides several benefits, keeping in mind the budget difficulties of many homeowners who are considering purchasing their first home. Compared to most traditional mortgage loans, the FHA loan eases the process for the home buyer. Besides that the FHA mortgage loan consists of a very low down payment, which makes it a lot easier for homeowners that may have problems saving for the large down payment necessary by common conventional mortgages.
What are the most important advantages of choosing an FHA loan in TX?
- Low down payment – The Federal government backs FHA loans, therefore the borrower has very minimal charges in the process. FHA loans require a minimum of 3.5% financial down payment from the applicant. The loan does allow for the home seller to pay for all closing costs, up to 6% which is frequently enough to take care of almost any property sale.
- Secure fixed loan interest rates – One of the big advantages the FHA loan is the benefit of having a fixed 15 or 30-year interest rate. In comparison to other regular loans in which the loan interest rates change, the rate remains the same for the total length of the loan. This timeframe is typically for 30 years. Because of this provision, the consumer can budget their predetermined monthly installment ahead of time. FHA also do not have a prepayment or early payoff clause, homeowners can move or sell their home anytime.
- Easier to qualify – Prequalifying for a Texas FHA home loan is pretty simple. Because it’s the FHA backs your home loan, the lenders and banks make it feasible for most buyers to qualify when they meet the basic requirements. The primary components of qualifying are the strength of credit, earnings and employment history.
- No large savings or cash reserves needed – In contrast to most conventional home loan programs, FHA home loans remain a great option for Texas homebuyers that have little savings.
First Time buyers should find out what to expect before starting the FHA loan application process. Being prepared will always boost your opportunities in successfully getting the FHA mortgage approved. Here we list a few steps and some things to consider.
FHA Application Preparation:
- Debt-to-income ratio
- Mortgage companies differ on precise amounts, but a financial debt load that is greater than 41 to 45 percent is high risk for an FHA loan. You will need 2 years of continuous employment with no unexplained breaks in job history.
- Credit History
- It’s generally the small issues which may damage your consumer credit. Check your income source, creditworthiness, together with rent history which may show up on a credit score. Get everything taken care of and work towards a clean credit record.
- Bank Savings and Deposits
- Make sure you document any abnormal bank deposit from the previous 2 months. Copies of checks, deposit slip, and appropriate gift letter will be needed for those buyers receiving gift funds from friends or family.
Buyers that want to learn more about all the program highlights can call us at the number above, or just submit the Quick Request Form on this page.