FHA Loans - West Palm Beach
in West Palm Beach, Florida.
It appears FHA mortgages are still keeping the Housing Market alive. FHA now offers interest rates that are much lower than conventional financing otherwise known as Fannie Mae mortgages.
FHA requires that the property being financed is your primary residence and it also requires mortgage insurance no matter what loan to value you choose. Typically FHA id for high loan to value loans such as 96.5% financing.
NewsFlash March 2013: Corelogic released data stating home prices nationwide, including distressed sales, increased on a year-over-year basis by 9.7 percent in January year-to-year. It’s the biggest increase since April 2006, and the eleventh consecutive monthly increase in national home prices.
What I am finding no matter which area of Florida you are looking in, that inventory in the $100,000-$200,000 range is very tight but still predominately the program that is keeping offers coming in is FHA. It also sounds like 50% of the business is cash and the other 50% is predominately FHA.
Now that home prices are on the move again it is important to know the FHA loan limits in your County. Here are the loan limits that FHA allows for Palm Beach County:
Single Family Home - $423,750
Duplex - $542,450
Tri-Plex - $655,700
A Fourplex - $814,900
Here are some typical rules of thumb to think about when you are getting FHA financing.
Assume 3.5% down or 5% down if you are getting a gift from a family member
There is mandatory mortgage insurance, financed in the loan as well as a monthly surcharge. You will have this for at least five years and then you are only elligible to remove it when the mortgage balance on the property gets as low as 78% of the value of the home. Now that our markets are on the move this seems like less of an obstacle.
Your loan is assumable which is actually a great feature in todays world. If you want a family member to take over your mortgage 5 years from now, you can approach your servicer and transfer the obligation and the property rights to them
You can finance as much as 6% closing costs which reduces your out of pocket expense. This technique works to a certain extent but it created pressure for the realtor and the appraiser on your deal. (Ask me about this) 3-1-2013, Nowadays we don't see too much of this because it has become a sellers market again.
FHA rates are currently lower than Fannie Mae rates and there are not a lot of pricing adjustments based on credit score like Fannie Mae/freddie Mac Financing. Typically there is one for a 640 middle credit score. I can do FHA A Minus pricing with credit scores as low as 580.
Most Condominiums do not qualify for FHA financing.
Here is a graph of home prices in the West Palm Beach area. I also created an example of a typical Good Faith Estimate based on the median value of $150,000. This estimate is at least 1.5 years old so the rate is higher but you get the idea. For a detailed estimate at today's prices email me at Preston@prestonware.com or call me at 561-329-0075
See attached: FHA Mortgage West Palm Beach.pdf