Why should I choose an FHA Mortgage to finance my home purchase?

Affordibility. FHA requires the buyer to have only 3% in the deal. That means you can buy a home listed at $218,000 with only a $5,000 down payment. Your down payment can be a Gift from family or an employer, a loan from your 401K, or a variety of other sources.

Options. FHA not only offers 15- and 30-year Fixed Rate Loans, but also offers one-year ARMs and now a three-year ARM in which the buyer could qualify for a larger loan amount and a higher sale price.

Assurance. FHA appraisals are intended to ensure the home is worth the sales price and has no obvious health or safety defects. New revisions to the FHA appraisal process make it no more difficult than a conventional transaction. Paramount Mortgage has an FHA-Approved Appraiser on-staff, making it easy to be responsive.

Flexibility. FHA loans have more flexible credit guidelines which increases your ability to purchase the right home for you. FHA loans increase the price range of the homes you can qualify for. The FHA loan limit has been significantly raised recently.

Savings. Buying a home with an FHA loan can save thousands in out-of-pocket expenses compared to a conventional loan.

Why should I work with the FHA Mortgage Experts to help me purchase my home?

Experience. Paramount Mortgage Company Loan Consultants are experts in FHA loans and have been since we opened our doors 38 years ago.

Answers. We have seven FHA direct-endorsement underwriters on staff, which means we make the credit decisions in-house for FHA loans.

Assistance. Seller-sponsored down payment programs, like our Paramount Mortgage Assistance Program (MAP) can help potential buyers meet down payment requirements. The MHDC “First Place” program can be used with FHA for a great rate and/or a down payment grant.

Call Paramount Mortgage - your FHA experts. We are your trusted guide throughout the process of securing your FHA Home Loan.

What are some things I need to know regarding my FHA Loan?

FHA FACTS

• Minimum funds required from the buyer are 3% of sales price.

• 100% of the buyers’ contribution can be in the form of a gift.

• No reserves are required.

• Personal property such as a refrigerator, can not be included in the loan.

• The seller can contribute 6% of the sales price to closing costs, prepaids, or points.

• Income (such as a pay raise) that will start before the first loan payment may be counted in qualifying.

• In most cases, underwriters do not have to count any debt with 10 or less payments remaining.

• Condominiums now have up-front MIP and monthly MIP -- the same as single family homes.

• Non-permanent resident aliens are eligible for maximum financing.

• FHA has no minimum score requirements - or even traditionally established credit.

• Debt to income ratio is 43-45% or approved through automated underwriting.

• A two-year income/employment history is established to determine effective and stable income.

• Insist on a Good faith estimate to show what you would need under certain scenarios.

• Borrowers funds can come from a variety of acceptable sources- gift from family- 401K loan- sell personal property- insurance settlement- with proper documentation

FHA MYTHS

• You have to be “low income” to qualify
• Sellers don’t like FHA or VA loans
• You need more paperwork 
• Many repairs have to be done to house
• It takes FOREVER

There are many myths that go along with FHA loan programs. Many believe that these are section 8 housing programs or impossible to qualify. In fact, FHA has streamlined procedures over the years to mirror conventional or bank paperwork requirements. Houses can be appraised “AS IS” unless there is a major health or safety violation on both programs. Processing time for the loan is the same as long as work with a “Direct Endorsement” (FHA) Lender. This means the lender with whom you apply will process, underwrite and fund your home loan.

What about Bankruptcy?

• As long as the proper amount of time has elapsed, this is an acceptable situation. It is important to have either NO new credit, or reestablished good credit.

• A letter explaining why the bankruptcy happened with any accompanying documentation is usually helpful, and required by the lender.