Why BUYERS, SELLERS and AGENTS Should Consider FHA Loans

For years many FIRST TIME HOMEBUYERS relied on FHA loans for their entry into the home ownership. These loans are attractive because they cater to home buyers with:

 

1.                  Little credit history

2.                  Modest down payments

3.                  Less than perfect credit

4.                  Gaps in employment history

5.                  A history of Bankruptcy

With the disappearance of Sub-Prime and ALT-A financing options, FHA loans have become the loans of choice for not only FIRST TIME HOMEBUYERS but NON FIRST TIME HOMEBUYERS. Many of these buyers either currently own homes they are selling or renting or no longer own their homes. There is a misconception among many buyers that once they have had a FHA loan they can no longer apply for one again. There is no restriction for the number of FHA loans that one buyer may have so long as they only have one at a time and they have not had a foreclosure that caused a loss to FHA.

BUYERS:

 

If you are considering purchasing a home be aware that FHA loans offer very attractive interest rates with relatively low monthly mortgage insurance premiums. The sellers may pay your closing costs to reduce the cash to close. You may accept a GIFT for the DOWN PAYMENT from a relative or a charity. If the seller is willing they may even pay to BUY DOWN the rate from the current rate of 5.5% to 3.5% for the first year to temporarily ease the transition from renting to buying. This is not a permanent BUY DOWN and the payment will go up the first two years on a typical BUY DOWN.

 

SELLERS:

 

If you are having a difficult time selling your home you may want to consider offering FHA Financing in your marketing efforts with your realtors. In the past FHA was very restrictive about the condition of the property being sold. Although, they still are concerned about some items as long as the home is in reasonably good condition and safe there should not be a problem. However, you may have to make some minor repairs if the FHA appraiser conditions for them to be fixed prior to closing.

 

BUYERS, SELLERS, and AGENTS

 

Congress and the President are implementing a Stimulus Program that will increase the loan amounts allowed for FHA loans. These will be published in the near future and should allow the majority of homes in Utah to qualify for FHA Financing.