Fair Oaks

BY: Jason Whigham
May 15, 2023

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Mortgage Broker Fair Oaks CA


 

Sacramento first time home buyer

first time buyer

My-Down Payment Fair Oaks Home Loans Options

Loans offered Credit requirements Highlights Good if
Purchase and refinance; conventional, jumbo, FHA, VA, USDA, construction and renovation loans, investment property, interest-only, reverse mortgage, HECM loans, condo and co-op, manufactured home, piggyback (80/10/10) 500 for manual underwrite on a FHA Loan 
620 for conventional loans, FHA loans and VA loans; 680 for jumbo loans; 580 for USDA loans
Offers no-closing-cost option on certain products; free rate watch tool can help you monitor the market You’re looking to refinance or for an FHA loan

Mortgage Broker Fair Oaks
FHA Loan Requirements

Important FHA Guidelines for Borrowers


To qualify for the low down payment benefit, FHA Loan applicants must have a minimum FICO® score of 580. If your credit score is less than 580, the down payment is 10%. You can understand why it is critical to have a solid credit history.

Remember that FHA credit standards take into account more than simply your FICO® score; they also consider a borrower's payment history, bankruptcies, foreclosures, and mitigating circumstances that prevent applicants from making timely payments.

The FICO® score is a number that shows the creditworthiness of a potential borrower. FICO® is a data analytics business that computes credit scores using consumer credit files obtained from various credit agencies.

  • FICO® score at least 580 = 3.5% down payment.
  • FICO® score between 500 and 579 = 10% down payment.
  • MIP (Mortgage Insurance Premium ) is required.
  • Debt-to-Income Ratio < 43%.
  • The home must be the borrower's primary residence.
  • Borrower must have steady income and proof of employment.

Lenders will look at your FICO® score to assess how likely you are to make regular mortgage payments. The higher your credit score, the greater your chances of obtaining a reduced mortgage interest rate.

While underwriting your loan, your FHA lender will look at your credit history. You will most likely be approved for an FHA loan if you have a track record of making on-time payments. The following elements can have a negative impact on your loan eligibility:

  • There is no credit history.
If you don't have a credit history or don't utilize traditional credit, your lender will need to get a non-traditional consolidated credit report or construct a credit history through other ways.
  • Bankruptcy
A borrower's bankruptcy does not preclude them from receiving an FHA-insured mortgage. At least two years must have passed for Chapter 7 bankruptcy to be filed, and the borrower must have either reestablished solid credit or elected not to incur new financial commitments.
  • Payment Delays
When you have a solid 12 months of on-time payments for all financial commitments, you should submit your FHA loan application.
  • Foreclosure
Past foreclosures are not always an impediment to obtaining a new FHA home loan, but it all depends on the circumstances.
Collections, Judgments, and the Federal Government's Debt
In general, FHA loan guidelines require the lender to ensure that any outstanding judgements are addressed or paid off prior to or at the time of closing.
  • Qualification is simpler.
The FHA offers mortgage programs with less criteria. This makes it easier for the majority of applicants to qualify, including those with a shady credit history and poor credit ratings.
  • Interest Rates That Are Competitive
FHA loans provide low interest rates to assist homeowners in making their monthly mortgage payments. When weighed against the disadvantages of subprime mortgages, this is a significant advantage.
  • Insolvency / Foreclosure
If you've had a bankruptcy or foreclosure in the last few years, it doesn't imply you can't get an FHA loan. Reestablishing strong credit and a consistent payment history might assist in meeting FHA standards.
  • Identifying Credit History
A lender can evaluate your credit history in a variety of ways, including looking at your credit card activities. Utility bills, rent, student loans, and other types of payments should all show a consistent history of dependability.

Undecided customers frequently pick FHA loans over conventional loans after learning about various FHA mortgage characteristics, such as lower down payment requirements, better interest rate options, and unique refinancing chances.
  • Requirements for a Down Payment
While FHA loans need as low as 3.5% down, conventional lenders often demand a 20% down payment. These funds must come from FHA-approved sources alone, such as your savings account, money saved at home, investments you have cashed in, gift monies, and so on.
  • Mortgage Protection Insurance
Mortgage Broker Fair Oaks
Mortgage Broker Fair Oaks


Conventional loans often require the borrower to incur Private Mortgage Insurance if a 20% down payment is not provided. FHA mortgages are unique in that they demand an upfront mortgage insurance premium as well as an annual mortgage insurance premium (MIP).

Down payment assistance programs make the mortgage procedure more affordable for qualified candidates who want to buy a house but need financial assistance. Money is typically given as a non-repayable gift, a forgiving loan, or a low-interest loan. Courses in homebuyer education may be necessary.

A property must often serve as the applicant's principal residence and be located inside a certain city, county, or state. It may also need to fall under the maximum purchase price constraints of a program. Income limitations may apply, and they will look something like this (these figures may not match the criteria of your program):

  • $39,050 for a one-person household
  • $44,600 for a two-person family
  • $50,200 for a three-person household
  • $55,750 for a four-person household
  • $60,250 for a five-person household
  • $64,700 for a six-person household
  • $69,150 for a 7-person household
  • $73,600 for an 8-person household
Household income is often defined as all income earned by household members (18 years or older) who will be living in the home, even if they do not have a mortgage.

Borrowers who want to buy a house with an FHA loan may require assistance with the down payment. FHA loan restrictions limit not just the source of cash in this manner, but also who may offer such gifts. Be prepared to submit documents to prove the source of any financial gift involved with your home loan transaction. Gifts may be given by:
  • Family member of the borrower
  • Employer or labor union of the borrower
  • A close friend who has a specific and verified stake in the borrower.
  • A non-profit organization.
  • A governmental body or public institution that offers homeownership help to low- or moderate-income families or first-time homebuyers through a program.

Fair Oaks Mortgage Brokers Near Me


The FHA has determined the maximum loan amounts that it will cover for various regions of the country. These are referred to as the FHA lending restrictions. Annually, these loan limitations are computed and revised. They are impacted by the type of housing, such as a single-family or duplex, as well as the location. Some purchasers prefer to buy in counties with greater loan limitations, while others hunt for properties that fit within the boundaries of where they wish to reside.

limits of the place they want to live.

LOW COST AREA
2022 FHA Limits
Single Duplex Tri-plex Four-plex
$420,680 $538,650 $651,050 $809,150
HIGH COST AREA
2022 FHA Limits
Single Duplex Tri-plex Four-plex
$970,800 $1,243,050 $1,502,475 $1,867,275
While FHA guidelines stipulate which closing fees are acceptable as borrower charges, each local FHA office determines the particular costs and quantities that are deemed fair and usual.

  • The lender's origination charge.
  • Fees for deposit verification.
  • Fees for an attorney.
  • Fees for appraisals and inspections.
  • The lender's origination charge.
  • Title insurance and title examination fees.
  • Preparation of documentation (by a third party).
  • Property inspection.
  • Reports on credit (actual costs).
  • Taxes, transfer stamps, and recording costs.
  • Fees for tests and certification.
  • Home inspections can cost up to $200.

Mortgage Brokers Fair Oaks CA
Mortgage Brokers Fair Oaks CA

As the buyer and borrower, you will have items on your checklist that your lender, the seller, and even the title firm will demand. The closing checklist details all of the costs that must be paid, the paperwork that must be submitted, and the declarations that must be signed before the title is transferred to you.
  • Identification
All parties attending the closure should have appropriate identification.
  • Policy on Title Insurance
You must get title insurance to ensure that the property is clear of prior claims or liens.
  • Policy on Homeowners Insurance
Before you can close on the property, you must first obtain homeowner's insurance, which protects the property in the event of damage.
  • Closed Funds
All agreed-upon monies must be brought in the form of a cashier's check or by electronic wire.

Mortgage insurance is required for FHA insured loans to protect lenders from losses caused by mortgage defaults. Most FHA loans currently demand MIP for either 11 years or the life of the mortgage, depending on the terms and conditions of the loan.

MIP Rates for FHA Loans with a Loan Term of More Than 15 Years
Your yearly mortgage insurance cost will be as follows if you take up a normal 30-year mortgage or anything longer than 15 years:

annual mortgage insurance premium will be as follows:

Base Loan Amount LTV Annual MIP
≤ $625,500 ≤ 95% 80 bps (0.80%)
≤ $625,500 > 95% 85 bps (0.85%)
>$625,500 ≤ 95% 100 bps (1.00%)
> $625,500 > 95% 105 bps (1.05%)

Update: FHA Lowers Mortgage Insurance in 2015
Update: Trump Administration Reverses 2017 MIP Reduction


FHA criteria have been established in place to safeguard homebuyers from entering into a property they cannot afford, requiring borrowers and/or their spouse to qualify based on predetermined debt-to-income ratios.

These ratios are used to determine whether or not a potential borrower is in a financial position to satisfy the responsibilities that come with buying a property.

If you're thinking about purchasing your first home, there are a variety of FHA Loan and other programs that can help you out.

  • Individuals and spouses who have not owned a primary house in the last three years.
  • Single parents who only owned a home with a past spouse when they were married.
  • Individuals who have been uprooted from their homes and have only owned with a spouse.
  • Individuals who have only possessed a primary house that has not been permanently attached to a permanent foundation in compliance with applicable requirements.
  • Individuals who have only held land that does not meet state, municipal, or model building codes and cannot be brought into conformity for less than the cost of erecting a permanent construction.




Fair Oaks


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Call My-Down Payment Assistance 916-413-3967 - Team Whigham service all of Northern California and Southern California! Some areas included are: Sacramento | Natomas | Rosemont | Galt | New Castle | La Riviera | Rancho Cordova | Cameron Park | Fabulous Forties | Florin | Foothill Farms | Orangevale | Rio Linda | Elverta | Citrus Heights | Folsom | El Dorado Hills | Carmichael | Roseville | Lincoln | Loomis | Lodi | Antelope | Auburn | Granite BayWest Roseville | Sun City Lincoln | Sun City Roseville | Auburn | Penryn | Gold River | Land Park | East Sacramento | Elk Grove| Pocket Area | Davis | Woodland | Contra Costa County | San Francisco County | Antelope | San Diego County |  Alameda County | Yuba City | Ione CA | Jackson CA | North Highlands | Los Angeles County| Orange County | Long Beach | Los Angeles County | Placer County | El Dorado County | Amador County | San Diego County | San Bernardino County | Orange County | Alameda County | Sacramento County and many more in the Northern California and Southern California area.

Jason Whigham | NMLS #1448396 | Barrett Financial Group, L.L.C. | NMLS #181106 | 2314 S Val Vista Dr, Suite 201, Gilbert, AZ 85295 | CA 60DBO-46052 & 41DBO-148702 Licensed by Dept. of Financial Protection & Innovation under the California Residential Mortgage Lending Act. Loans made or arranged pursuant to a California Financing Law License | Equal Housing Opportunity | This is not a commitment to lend. All loans are subject to credit approval. | nmlsconsumeraccess.org/EntityDetails.aspx/COMPANY/181106
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