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Wanting to buy a home but afraid you won’t qualify for a mortgage because of student loan debt, poor credit or a dismal savings account?
Buying a house can leave you feeling overwhelmed and under-informed. Not only are you spending every waking hour searching for your perfect home, you also have to think about how you're going to pay for it. And when choosing a mortgage, it's important to find one that works with your budget now, and also 15- to 30-years down the road as well. Because the world of home financing can be a confusing one, let's take a look at two of the most popular loans in the housing market: Conventional and FHA.
A home buyer called me the other day to ask a great question about buying a foreclosed home and taking care of some of the work on it. Have you seen these vacant houses? Some of them need a lot of love. This house in particular had a driveway issue that was affecting the foundation of the house. Of course I immediately thought of the Full FHA 203k. This home improvement loan must be used when the work involves the structure of the house. The caller asked if the 203k would pay for a new driveway. Since I didn't have the answer at the top of my mind, I leaned on our expert.
FHA loans are one option for home buyers in today's market. In fact it's often a popular route for first time home buyers. One main reason for the desire to go FHA is the low down payment requirement. Home buyers need 3.5% of the purchase price as cash-on-hand for the down payment. This means if you're buying an $80,000 house you'll need less than $3,000 for the down payment.
You may think that as a first time home buyer you are limited to one or two home loan options. In reality, that's just not the case. If you're like many people looking to buy their first place, however, you may not have a lot of money in the bank or have flawed credit. For this reason, you may be interested in learning about home loans that offer low and no-down payment options and have flexible lending requirements. One of these is the FHA loan. Let's take a closer look.