Did You Know?

FHA loans are one of the best options for young, first-time home buyers who have not had as much time to save for a large down payment or establish a high credit score.

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Tips for Buying Your First Home


Tips for Buying Your First Home
Most first-time homebuyers decide on purchasing a home at least a year in advance, sometimes even a couple of years ahead of time. The earlier you make a decision to buy a home, the more time you have to save up for your down payment, prepare for the mortgage process, and becoming a homeowner.  

Here are some valuable tips for getting ready to buy your first home. 

Start Saving NOW
Figure out how much you want to put down on your home. Whether you go for an FHA loan with a 3.5% requirement, or you aim to pay 5%-10% up front for a conventional loan, having a number in mind will give you a measurable goal to work towards. Also keep closing costs in mind, which usually amount to around 2 to 5% of your total loan amount. Saving up for all this takes time, so start by cutting back on luxury expenses, and put that money away in a separate account. 

Work on Your Credit Score
For most people, a mortgage is the largest amount of money they will ever borrow, and lenders need to be somewhat sure that borrowers are able to repay that amount. To show lenders and banks that you are a reliable borrower, you need to start working on establishing and improving your credit score. Your first step is to know where you are starting; you can access your credit score from any of the three major credit bureaus (Experian, TransUnion, and Equifax). 

Research Assistance Programs
Saving up for a home is daunting, so look for assistance wherever possible. Many state and local government agencies offer first-time homebuyer assistance programs that can go a long way in cutting down on the upfront costs of buying a home. Some offer Mortgage Credit Certificates (MCCs), others offer Down Payment Assistance grants and second mortgages.  

Shop for Different Mortgages
Do your own research to see what type of home loan works best for you and your needs. Depending on your financial circumstances, you may benefit from applying for a government-backed mortgage. If you have settled on a specific kind of loan, it helps to request loan estimates of the same loan type from different lenders to compare closing costs and interest rates.  

Get Pre-Approved for a Loan
When you are ready to start shopping for a home, it is important that you get pre-approved. A pre-approval from your lender shows that a lender is willing to loan you a certain amount of money to purchase a home. This goes a long way in showing a potential seller that you are serious about buying their house, and it also tells you how much you will be able to borrow. Applying or a pre-approval multiple times should not hurt your credit score, given that you apply for a loan with the lender within the time period that it is valid (varies by lender). 

Buying your first home can seem like a scary prospect. However, like with most things, the process will go smoother the better prepared and more informed you are.

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FHA Loan Articles

Why Your FHA Loan Transaction Requires Escrow

Escrow is an important feature of most typical FHA loans. An escrow account is a third-party account where borrowers deposit funds designated for property taxes and other uses. Requirements to use escrow accounts typically stems from a need to protect all parties involved in the transaction

Build Or Buy?

When it’s time to consider buying a home, the Federal Housing Administration (FHA) offers two popular options. One is the traditional FHA purchase loan many use to buy a house in the suburbs. But not everyone wants to buy an existing property. Some want more control over the design and configuration of the home.

The other FHA construction loan option, the one-time close mortgage, comes in here. This option is for those who want to approve floor plans, have a say in the types of materials used to build the home and choose its features. 

Factors That Affect Your FHA Home Loan From Start To Finish

When buying a home for the first time, it helps to know how long the process can take. How do you know if your appraisal report is delayed if you don’t know how long the FHA allows for the process to be completed? How long does it take to get from the final offer to closing day? A “typical” FHA loan process may take up to 45 days from start to finish. Several factors can influence this timeline.

How Livable Is Your Dream Home?

Just because an FHA loan is designed to be more lenient with FICO scores and require a lower down payment doesn’t mean the house you buy with that loan is less than ideal. Did you know that FHA loans have minimum property standards to ensure the home is safe and livable? Those standards require the home to have an “economic life” for the entire term of the loan so you can freely sell the property later on if you choose to do so.

Are You Ready To Make An Offer To Buy A Home?

Buying a home with an FHA mortgage is a major life decision, and preparation is essential before you start house hunting or consider making an offer on a property.

How to get started? In the early stages, establishing your budget and how much work you need to do on your credit is key. But once you have gotten past the initial phase of that planning you’ll want to consider the house itself and what you want from it.

FHALoan.com is not a government agency. We do not offer or have any affiliation with loan modification, foreclosure prevention, payday loan, or short term loan services. Neither FHALoan.com nor its advertisers charge a fee or require anything other than a submission of qualifying information for comparison shopping ads. We do not ask users to surrender or transfer title. We do not ask users to bypass their lender. We encourage users to contact their lawyers, credit counselors, lenders, and housing counselors.

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