Guy Bocicaut Real Estate's Blog
If you’re hoping to buy your first home in the near future, you’re likely wondering about the different types of mortgages that you may qualify for. Since the 1930s, the Federal Housing Administration (FHA) has been insuring home loans for first-time homeowners across America.
This program helps people achieve homeownership who typically wouldn’t be able to afford the down payment or pass the credit score requirements to secure a traditional mortgage.
In today’s post, we’re going to answer some frequently asked questions about FHA loans to help you decide if this is the best option for your first home.
Does the FHA issue loans?
Although they’re called “FHA loans,” mortgages are not actually issued by the FHA. Rather, they’re issued by mortgage lenders across the country and insured by the FHA.
Will I have to make a down payment?
With an FHA loan, your down payment can be as low as 3.5%, significantly lower than traditional loans at 20% down payment. However, you will be required to pay private mortgage insurance (PMI) in addition to your monthly mortgage payments until you have paid off 20% of the home. So, the best case scenario would be to save as much as possible for a down payment to reduce the amount of mortgage insurance you have to pay.
What are the benefits of an FHA loan?
The three main reasons to secure an FHA loan are:
You can qualify with a low credit score
You can make a smaller down payment than traditional mortgages
Your closer costs will be less expensive
Where do I apply for an FHA loan?
You can apply for an FHA loan through a mortgage lender. You can also work with a mortgage broker to help choose a lender.
Is an FHA loan the only loan option for low down payments?
There are multiple loan programs offered at the state and federal level to help individuals secure a mortgage with a lower down payment. They can be provided by the Department of Veterans Affairs, the USDA, or state-sponsored programs. Lenders also often sponsor their own programs to attract potential borrowers. However, always make sure you compare these programs to make sure you’re making the best long-term financial decision.
Do all FHA loans offer the same interest rates and costs?
No. Since the loans are only insured by the FHA, it’s up to the lender to determine your interest rate and fees. So, it’s a good idea to shop around for the best lender.
How high does my credit score have to be to qualify for an FHA loan?
You can secure a mortgage with a down payment as low as 3.5% with a credit score of 580 or higher. However, if you can afford to make a larger down payment, you can secure an FHA loan with a credit score as low as 500.
If your score is in the 500-600 range, it’s typically a better idea to spend a few months building credit before applying for a home loan.
What information will I need to apply?
You’ll need to gather all of the same information that you would for a typical mortgage. This includes W2s from your employer(s), two years of submitted tax forms, your current and former addresses from the past two years, and your gross monthly salary.
I’ve owned a house before, can I still qualify for FHA loans?
Even if you’re not a first-time homebuyer you can still qualify for an FHA loan. However, you cannot qualify if you’ve had a foreclosure within the last three years or have filed for bankruptcy within the last two years.
Selling your home may prove to be a long, arduous process, particularly if you're unable to distinguish your residence from others on the housing market. Fortunately, there are many great household items that you can leave behind to differentiate your home from others and improve your chances of a quick sale.
Leaving various household items behind can serve you well in a number of ways. First, you'll be able to give homebuyers an incentive to purchase your residence if you leave custom or high-priced items that they might struggle to purchase elsewhere. You also will be able to simplify the moving process, as you won't have to worry about relocating numerous items that you leave behind when you move out of your current home.
There are many wonderful items that you can leave behind to boost your chances of a quick home sale, including:
If your refrigerator complements your kitchen décor beautifully, it may enhance the appearance of your kitchen. Plus, this appliance could become a key component in a negotiation with a homebuyer that may make it easier for you to maximize the value of your residence.
Your refrigerator may have served you well for years, but you won't have to worry about investing substantial time and resources to move it to your new address if you leave this appliance behind. Also, if you offer your refrigerator as part of your home purchase, it may prove to be the difference between selling your home and keeping it on the real estate market for an extended period of time.
2. Big-Screen TV
The big-screen TV in your den, man cave or living room has helped transformed your ordinary living space into a fun, exciting area. Now, you'll want to consider including your big-screen TV in your home sale, as this could help you streamline the process of selling your house.
By offering your big-screen TV, you'll make it easy for a homebuyer to move in and enjoy a high-quality TV instantly. Furthermore, the big-screen TV may help a homebuyer save time and money, as he or she won't have to worry about finding a new television after purchasing your residence.
3. Washer or Dryer
Let's face it – un-installing and relocating a washer or dryer can be a time-consuming endeavor. And in some cases, you may even need to hire a plumber to perform this task properly.
Lucky for you, leaving your washer or dryer behind could prove to be mutually beneficial for you and a homebuyer.
As a home seller, you won't have to worry about allocating time and resources to move a large, heavy washer or dryer from your residence. For a homebuyer, he or she will be able to reap the benefits of a superior washer or dryer immediately.
Consider the household items that you'll leave behind before you add your house to the real estate market. By doing so, you can include these items in your home listing and improve your chances of selling your house quickly.
MondayToday is pick-up day. After the weekend your home is likely to have a lot of things laying around out of place. Do a quick tidying up in each room of your home. That includes: picking up clothes, clearing off tables and surfaces, and putting away any children's or pet toys that might be on the floor.
TuesdayDusting. With your duster in hand, run through each room of your house hitting all of the surfaces. Grab a microfiber cloth for things like TVs and computer screens that might have fingerprints and put it in your back pocket. In your other pocket, keep a lint roller or lint brush for your sofa, bed, chairs, etc.
WednesdayFloors. Get out your Swiffer, mop, vacuum cleaner and whatever else you use to clean the floors of your home. Sweep each room into a pile, starting from the walls and working your way in. Once all rooms are swept, grab your dustpan and pick up each pile. From there you can run your Swiffer or mop through your rooms with wood floors or tile. Finally, vacuum any carpets or rugs you have.
ThursdayKitchen day. Mix some white vinegar and water, toss in a few drops of lemon or lime juice, and you've got an all-purpose kitchen cleaner that's free of any harsh chemicals that you don't want going near your food. For areas that need to be scrubbed, like your sink or countertop, sprinkle some baking soda down after you spray the vinegar solution. Once you're done, tuck your spray bottle and baking soda within reach under your sink--you'll need it again tomorrow.
FridayBathroom day. There's no denying it--it's the worst room in the house to clean. But, think about how you'll have the next two days off from work and cleaning and you'll have the motivation to get through it. First, go grab your rubber globes, vinegar spray, and baking soda from yesterday. Today, you'll need them for the sink, tub, and toilet. Other useful items to keep for cleaning your bathroom: an old toothbrush for scrubbing tile grout and baby oil for polishing the chrome on your sinks. Follow this schedule and you'll be on your way to cleaning the whole house in just 5-10 minutes per day so you don't have to dread those marathon cleaning days.
Choose your plants wiselyAll plants are different. Some flower for different lengths of time or even at completely opposite times of the year. When it comes to cut flowers, they too last varying lengths depending on the species. The time a cut flower lasts before wilting is called its vase life. The vase life is a hard life. But certain flowers withstand it better than others.
- Chrysanthemums (25-30 days) - They're not a flashy flower, and they don't need much to survive in a vase other than fresh water each day
- Orchids (10-30 days) - There are countless varieties of orchids available. Aside from their unique form and appearance, orchids can also be surprisingly hardy
- Anthurium or "flamingo flower" (15-45 days) - Flamingo flowers are a rare sight, and last quite a long time if maintained properly. But pet owners beware: they're considered toxic to dogs and cats
Preparing the vaseThe first thing to remember is to clean a vase thoroughly before you put flowers in it. Once clean, start to prepare your water. Plants need food too. If your flowers came with plant food this is the best option for preserving your flower. Otherwise, there are homemade recipes for plant solution that usually involve something acidic and something sugary. Lemon juice and sugar work well mixed with water. Or you can mix one part lemon-lime soda (not diet soda) with three parts water. Next, cut the flowers slightly longer than the length of the vase and pop them in.
Caring for your flowerThe job's not over once you put the flowers in the vase. The real trick to making flowers last longer is caring for them once in the vase.
- Trim a centimeter or less off of the stems every other day
- Add water as needed and refresh the water after a few days. Be sure to add your plant food solution as well
- The flowers themselves can be maintained as well. Most flowers benefit from being misted with water once every day or two. Others recommend spraying things like hair spray which acts as a preservative directly onto the petals. Though it seems do defeat the purpose of taking such care to keep the flowers healthy.
- Be sure to keep the flowers in a temperate place. If the flowers or water heat up or cool down too much the flowers could wilt