FHA or Conventional
#2
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aaaaaaaaaaaaaaa basically the financing groups that fund the mortgage. The big difference I believe is the standards the house is put through. FHA is better because of two main items. It holds the higher standard for checking out a house, and the money originates from the government so usually if your house qualifies .....the interest will be lower and house proven sound.
#3
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Talk to a cerified Mortgage Officer on this one. This crap is so confusing, it'll make you're head spin.
Even as a vet, I can get a better loan without using VA, or FHA....
It'* just freakin wierd stuff, man. Income taxes make more sense than home loans.
Even as a vet, I can get a better loan without using VA, or FHA....
It'* just freakin wierd stuff, man. Income taxes make more sense than home loans.
#4
Right up my alley since I'm a system administrator on mortgage orignation software and the mortgage processing system...not to mention I'm a real estate investor on the side!
No, not exactly.
FHA is a government backed loan for borrowers who have less than a desired amount of a downpayment. Typically you need 5% down to buy a primary residence. If you don't have the 5% down then you have to go FHA. Conventional programs require at least 5% down.
FHA (or HUD....HUD is a division of FHA) insures that the lender gets repaid if you default on the mortgage. Seeing how there would be a little down payment you wouldn't have as much of a vested interest in paying your mortgage on time. Plus, you have little to loose if your home gets repossesed by the lender.
FHA/HUD does require a thorough inspection of the property before they'll back the loan. And, the interest rate on an FHA loan is typically higher than a conventional loan due to the "built in insurance" being issued by the government. The one other thing to keep in mind is that an FHA loan is not exempt from MIP (mortgage insurance premiums). Depending on amount lent, the premiums can easily exceed $100 per month. Those premiums are NOT tax deductible.
If possible, don't go FHA unless you absolutely have to. There are a lot of hoops to jump through and the end result is a higher interest rate. Closing costs are typically higher on FHA loans as well (more documents that require a signature at closing).
Originally Posted by gxp rules
aaaaaaaaaaaaaaa basically the financing groups that fund the mortgage. The big difference I believe is the standards the house is put through. FHA is better because of two main items. It holds the higher standard for checking out a house, and the money originates from the government so usually if your house qualifies .....the interest will be lower and house proven sound.
FHA is a government backed loan for borrowers who have less than a desired amount of a downpayment. Typically you need 5% down to buy a primary residence. If you don't have the 5% down then you have to go FHA. Conventional programs require at least 5% down.
FHA (or HUD....HUD is a division of FHA) insures that the lender gets repaid if you default on the mortgage. Seeing how there would be a little down payment you wouldn't have as much of a vested interest in paying your mortgage on time. Plus, you have little to loose if your home gets repossesed by the lender.
FHA/HUD does require a thorough inspection of the property before they'll back the loan. And, the interest rate on an FHA loan is typically higher than a conventional loan due to the "built in insurance" being issued by the government. The one other thing to keep in mind is that an FHA loan is not exempt from MIP (mortgage insurance premiums). Depending on amount lent, the premiums can easily exceed $100 per month. Those premiums are NOT tax deductible.
If possible, don't go FHA unless you absolutely have to. There are a lot of hoops to jump through and the end result is a higher interest rate. Closing costs are typically higher on FHA loans as well (more documents that require a signature at closing).
#5
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Not trying to argue, since I've already admitted I don't understand this crap, but I was already approved for a $240,000 mortgage with nothing down. Unfortunately, that would have put the payments way out of my budget.....
#6
Originally Posted by MOS95B
Not trying to argue, since I've already admitted I don't understand this crap, but I was already approved for a $240,000 mortgage with nothing down. Unfortunately, that would have put the payments way out of my budget.....
#7
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Originally Posted by vital49
Originally Posted by MOS95B
Not trying to argue, since I've already admitted I don't understand this crap, but I was already approved for a $240,000 mortgage with nothing down. Unfortunately, that would have put the payments way out of my budget.....
We're still shopping for a house we can afford, and that'* enough to make my brain hurt.
#8
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If possible, don't go FHA unless you absolutely have to. There are a lot of hoops to jump through and the end result is a higher interest rate. Closing costs are typically higher on FHA loans as well (more documents that require a signature at closing).
#9
Originally Posted by J Wikoff
If possible, don't go FHA unless you absolutely have to. There are a lot of hoops to jump through and the end result is a higher interest rate. Closing costs are typically higher on FHA loans as well (more documents that require a signature at closing).
Keep mind...those loan officers are nothing more than salespeople. It'* in their best interest to get you to spend more; forcing you to borrow more. That lines their pockets with more commissions.
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Talk to a couple of loan people, or get references. We trust the guy we're going with because he has done several loans for our landlord over the years.
They do work on commision, so some will be selling you thier commission, some will actually want to help you.
Sad, ain't it? Knowing it'* the largest, most important purchase the average person will make in their lives, and people will still try and screw you.....
They do work on commision, so some will be selling you thier commission, some will actually want to help you.
Sad, ain't it? Knowing it'* the largest, most important purchase the average person will make in their lives, and people will still try and screw you.....