Tag: Payment

FHA Facts…


FHA Facts….

via FHA Facts….

acts you probably didn’t know about FHA loansFHA

Traditionally FHA mortgages were used to help first time home buyers with non-traditional credit backgrounds.  However FHA mortgages have increased in popularity over the last few years.  The low 3.5% down payment has helped buyers with limited savings to get into a new home.  Move up buyers are using FHA mortgages more as they sell a home and may need to help offset money needed to bring in on the sale of their current home.    If they owe money on their current home, it’s much easier to come up with 3.5% than 5% or more for a down payment.

Did you know FHA mortgages are assumable?  This could definitely help sellers with the current interest rates being as low as they are.  As rates climb, it may help to be able to sell a home with an interest rate of 3.25% that someone can assume.  The new buyer will have to qualify for the mortgage, but the current owner will be able to get a release of liability so they can buy a new home without worrying about the current mortgage.

Some other facts that aren’t as well known:

  • After  a chapter 7 bankruptcy you only need 2 years from the discharge date.  If there were extenuating circumstances, you may only need 1 year.  Conventional loans typically require at least 4 years.
  • If you are in a chapter 13 bankruptcy, you can buy a new home as long as the trustee agrees and you have a year of on time bankruptcy payments.
  • You can use assets from savings clubs, wedding registries, employer gifts and down payment assistance programs.
  • You can have a non-0ccupying co-borrower help you qualify if your income is not high enough.  Frequently parents will help a college student buy their first home this way.

FHA loans can be a great way for many buyers to get into a home.  If you are considering buying a new home and aren’t sure what is the best option for you, contact me or your loan officer and see if FHA may be a good program for you to use.

Related Articles

Louisville Kentucky Down Payment Assistance and Closing Costs


Louisville Kentucky Down Payment and Closing Costs Assistance

  

Louisville Kentucky Kentucky Housing recognizes that down payments, closing costs and prepaids are stumbling blocks for many potential home buyers. Here are several loan programs to help. Your KHC-approved lender can help you apply for the program that meets your needs.

Louisville Kentucky Regular Down payment Assistance Program (DAP)

  • Purchase price up to $243,000.
  • Assistance in the form of a loan up to $6,000 in $100 increments.
  • Repayable over a ten-year term at 6 percent.  A DAP of $6,000 over ten years at 6 percent interest would equal a payment of $66.61.
  • Available to all KHC first-mortgage loan recipients who are first-time home buyers in non-targeted counties and first and second-time home buyers in targeted counties.

HOME-DAP

  • Purchase price up to $195,700.
  • Assistance up to $4,500
  • No monthly repayment; forgiven over five years.
  • Existing homes only.
  • Borrowers must meet HOME-income guidelines.

HOME Special Program

  • Purchase price up to $195,700.
  • Assistance up to $10,000
  • No monthly repayment; forgiven over five years.
  • Existing homes only.
  • Borrowers must meet HOME-income guidelines.
  • Eligible borrowers include:
    • Households that include a person with a permanent disability and who receives disability income (SSI, SSDI, Veterans Disability etc.).
    • Households where at least one of the home buyers is age 62 or older.

HOME Family Program

  • Purchase price up to $195,700.
  • Assistance up to $10,000
  • No monthly repayment; forgiven over five years.
  • Existing homes only.
  • Borrowers must meet HOME-income guidelines.
  • Eligible borrowers include:
    • Single- and two-parent households that have at least one dependent child under the age of 18 living in the household and that are first-time home buyers (have not owned a home or had an ownership interest in a home in the last 3 years).

More about Louisville Kentucky down payment and closing costs

  • No liquid asset review and no limit on borrower reserves for Regular DAP.
  • Borrowers may retain two months’ house payments in reserve while using available funds first before looking for any form of HOME DAP assistance.
  • Specific credit underwriting standards may apply to down payment programs.
Related articles