If you’re looking to purchase a home in Florida this year, there are a few different loan options you can access. The tricky part is determining which loan is best for your current situation.
One type of loan worth considering is an FHA loan. Whether you’ve heard of a Federal Housing Administration Loan, it’s worth considering while you house hunt. Even though there are FHA loan limits in Florida, there are many advantages to this loan that make it an appealing option.
Lower Down Payment Requirements
When you’re buying a home, the down payment can sometimes be too much to put up. There are loans that require a significant portion of the loan in a down payment to ensure you can afford what you’re asking for. By going with an FHA loan, the down payment requirements are lower than your traditional housing loans, which makes it a more affordable option.
Lower Credit Score
Another issue many face when applying for a loan is not having a high enough credit score. A low credit score won’t look good for bankers and anyone you’re looking to get a loan from. That is because a low credit score tends to mean that you’ve struggled to make your payments.
FHA Loans Are Assumable
The fact that an FHA loan is assumable makes it a big perk when the time comes to sell a house. When a loan is assumable, that means that you as the buyer can take over the FHA loan already on the potential home.
Being able to take over an existing loan comes in handy when interest rates fluctuate. Whatever the interest rates are for the FHA loan on the house, you can take over that loan without changing the rates.
Life-Long Loan Insurance
Although this can be looked at as an additional expense, it is comforting to know that your FHA loan has insurance on it for the life of the loan. You don’t have to go looking for an insurance policy as it is already there for you.
Qualifications Are Flexible
If you’ve ever gone for a traditional loan from the bank, there is a strict criteria you must meet before you can get approved for the loan. For some, the requirements may be too tight for them to access a loan for buying a house.
An FHA loan has qualification criteria. However, it can be more flexible than conventional home loans. Since the lenders receive government insurance, they are protected from any losses if you defaulted on the loan. Because of this, it makes an FHA loan quite appealing to first-time home buyers and an excellent last resort for those with credit issues.
Consider an FHA loan when you’re buying your next house. It’s an option that can help you find your forever home.