There are several loan options available to home buyers and your lender will be able to explain and review each program with you. THIS IS A SIMPLIFIED overview of the FHA program for you to consider. PLEASE VIEW THE VIDEO I'VE INCLUDED ON THE FHA PROGRAM.
The Dept of Housing and Urban Development oversees the Federal Housing Administration. An FHA loan is one that is insured by the government and the program helps first time buyers who otherwise may not qualify for a loan.
Whether you're a first time home buyer, a move up buyer or are refinancing, FHA allows you to purchase a home with a low down payment and flexible fha guidelines. No income limits or credit scoring, as long as you have reasonable credit many buyers will qualify for an FHA loan.
Getting pre-qualified is the first step in finding your new home. You'll need to verify income, employment, assets, liabilities, etc. Some of the documentation you may need include:
Purchase Money Transaction as required by HUD:
· One full month's worth of paystubs showing Year to Date earnings
· Last 2 years W-2's (salaried income)
· For Self Employed Borrowers; Last 2 years tax returns with all schedules (commission, dividend, rental income)
· Copies of social security, pension, and/or retirement award letters (if applicable)
· Last two months bank statement for all accounts with all pages
· Current statements for all investment accounts with all pages
· Written explanation for any credit derogatories
· Copy of Bankruptcy and discharge paperwork (if applicable)
· Divorce decree and any settlement paperwork (if applicable)
· Copy of your Drivers License and Social Security Cards.
· Name, Address and phone number of your Landlord for the past 12 months.
· Copy of your Sales Contract with Listing and Selling Agent phone Numbers
· Clear Termite Report
· Well and Septic Certifications (if applicable)
I'M READY TO BUY A HOME. WHAT IS MY FIRST STEP?
- CALL YOUR LENDER TO SCHEDULE AN APPOINTMENT- before you start your home search. There's nothing worse than finding the home of your dreams only to be disappointed when you don't qualify to purchase it.
- CONTACT A REALTOR (R) WHO IS AN ACCREDITED BUYERS AGENT. An ABR Realtor has gone through extra certification to earn the designation and will represent your best interest in the home buying process.
- I'LL GET PRE-QUALIFIED BEFORE I MAKE AN OFFER. Many sellers require a pre-qualification letter to be submitted with all offers on their home. If two offers were presented to a seller and one included a pre-qual, it gives more weight to that buyer's position.
- HOW LONG WILL PRE-QUALIFICATION TAKE? In about a half hour, a loan officer will be able to determine the price range you can afford. They will be able to answer all of your financing questions and qualify you for the loan that best suits your family.
Still have questions? Give me a call at (434) 546-0369 and I'll be glad to answer questions or provide you with my first time buyers guide.
The prequal part is definitely the first step. So many want to guess and look at houses that they can't evey qualify for.
So many people do not know where to start the home buying process. But thats what we are here for. Lot of people buying houses for sale in areas that I write my real estate market reports in Washington DC are using FHA loans. Great post Debbie.
Hi Naoma and Lanre, IMHO, getting the buyer to the lender prior to showing the first home is the only way to work. Thanks for stopping by to comment!
Very informative Debbie - With the wealth of information a buyer does not have to be in the dark about loans!
Debbie - did you see the post i did last week with YOU on it? (About Last Week)
Hi Diane! SO many of the first time buyers I'm working with have no idea of the process, what loans are available to them. (P.S.- I'm heading over to your blog now- it's been a hectic couple of days! Thanks pal!)
Deb: Great step-by-step primer for first-time homebuyers! Good job!
I am with Kim, this is a great primer for buyers. In my opinion FHA, VA, and USDA loans are the best out there for prospective homebuyers who are looking for a primary residence.
Hi Kim, thanks, so many first time buyers have no idea what's available to them and I love the NAR has these video's available.
Hi Rich, with the $8,000 tax credit I'm seeing an increase in buyer interest. FHA and USDA are popular financing options here in Lynchburg. Thanks for commenting.
Debbie, this is great advice for buyers. Getting pre-qualified removes a lot of the guess work and puts you in a better negotiating position.
Hi Lara, thanks, it's best for all parties if the buyer gets that pre-qual up front. Thanks for stopping by.