FHA 203(B) Mortgage Loan Program

FHA 203b loans are the government loan program of choice for most home buyers and home owners.  Through this program, HUD’s Federal Housing Administration (FHA) insures mortgages made by qualified lenders to people purchasing or refinancing a home of their own. The FHA loan program was created to help increase homeownership. FHA loans are an excellent option for home buyers who do not have a big down payment. The  FHA programs are  one of the best financing  options for most first time home buyers as well as move-up home buyers. FHA program offers borrowers the opportunity to obtain a mortgage when they may not qualify under conventional guidelines.

What is the purpose of FHA program?

To provide mortgage insurance for a person to purchase or refinance a principal residence. The mortgage loan is funded by a lending institution, such as a mortgage company, bank, savings and loan association and the mortgage is insured by HUD.

What are the benefit to borrower?

•  3.5% Down payment required
•  FHA loans are assumable by credit qualified home buyer
•  Fixed and Adjustable terms
•  Streamlined Refinances with and without appraisals.
•  Cash out refinances up to 85%
•  Seller can pay all closing costs up to 6% of the purchase price
•  No cash reserves required
•  100% Gift from family members for down payment is OK.
•  High Debt-to-ratio up to 55% are ok.
•  Credit doesn’t have to be perfect
•  Non-occupant co-signers with qualified income are okay.
•  Loans now go up to $729,750.00 in many areas and counties. (click here to check your county limit)
•  Mortgage insurance is usually less expensive than on a conventional loan.
•  Gift from relatives for down payment and closing costs allowed.
•  Easier Credit Qualifying Guidelines.
•  Buyers don’t have to be a first time buyer to obtain a FHA loan.
•  Anyone can use a FHA loan program as long as buyers do not have more than one FHA insured loan at any one time.

Eligible FHA Loan Terms:

Fixed Rate:   10, 15, 20, 25 or 30 years

ARMs :  30 years only

Eligible Occupancy requirement

•  Owner Occupied
•  Second Home
•  Investment Property

What are the FHA loan eligibility requirements?

•  The borrower must meet standard FHA credit qualifications.
•  The borrower must have 3.5% down payment own funds or gift from relatives
•  The borrower is eligible for approximately 96.5% financing. The borrower is able to finance the upfront mortgage insurance premium into the mortgage.
•  The borrower will also be responsible for paying an annual premium.
•  Eligible properties are one-to-four unit structures that includes Single Family, Townhouse and Condominium.

Maximum # of FHA loans allowed per borrower

FHA will generally not insure more than one mortgage per borrower. Circumstances in which a borrower may keep his current FHA-insured mortgage are provided below.

Relocating

The borrower is relocating and re-establishing residency to another area that is not within reasonable commuting distance from the current HUD insured home. There is no need to reduce the principal balance or sell the current home. Other items of clarification are shown below.

•  The relocation need not be employer mandated.
•  If the borrower returns to an area where he/she owns a property with an FHA Mortgage, it is not required that the borrower re-establish primary residency in that property in order to obtain another FHA mortgage.

Family Size Increase

•  The borrower’s family has increased in the number of legal dependents and the present home no longer meets the family needs and the following applies.
•  Satisfactory evidence must be provided of the increase in dependents and an explanation of why the property no longer meets the family needs.
•  The outstanding mortgage balance on the present home is paid down to a maximum LTV of 75% (excluding financed mortgage insurance premium (MIP).
•  A current residential appraisal must be used to determine LTV compliance.

Our Certified Mortgage Planner Specialists will guide you through each stage of the process and provide you with expert advice along the way. Whether you are Buying a home or Refinancing your current mortgage we are committed to making the home loan process clear, informative, and simple. At Guardian Mortgage, we understand that buying a home is equally big decision as refinancing your current mortgage. That’s why we are committed to providing you with the information you need to make well informed decisions.

When you are ready, simply Apply Online, Request Personalized Rate Quote or call us at 703-349-1084 to speak with live person.