In this tighter credit environment, FHA remains to be a great alternative for buyers with limited resources for a down payment and closing costs or past credit problems. Underwriting guidelines are more lenient than conventional guidelines.
Highlights of FHA financing:
- Minimum funds required from the buyer are 3.5% of sales price. 100% of the buyers’ contribution can be in the form of a gift.
- No reserves are required.
- The seller can contribute 6% of the sales price to closing costs, prepaids, or points.
- Debt to Income ratios are 31%/43% (A ratio exceeding 43 percent may be acceptable with compensating factors)
- In most cases, underwriters do not have to count any debt with 10 or less payments remaining.
- Non-permanent resident aliens are eligible for maximum financing.
- A Chapter 7 bankruptcy will not disqualify a borrower if 2 years have passed since the bankruptcy was discharged.
- A borrower could obtain financing during a Chapter 13 bankruptcy if at least 1 year has passed since it was filed, all Chapter 13 payments have been on time, and the court gives permission to the borrower to incur additional debt.
For further information about FHA loans click here.
St. Louis MORTGAGE INTEREST RATES for March 30, 2011:
- Conventional 30-Year Fixed 4.875%/ 5.402% APR
- Conventional 15-Year Fixed 4.125%/ 4.607% APR
- Conventional 5/1 ARM 3.500%/ 3.277% APR
- FHA/VA 30 Year Fixed 4.750%/ 5.375% APR
- Jumbo 5/1 ARM 3.375%/ 3.252% APR
- Jumbo 15 yr Fixed 4.125%/ 4.40% APR
- Jumbo 30 yr Fixed 5.250%/ 5.625% APR
Paramount Mortgage is a locally owned Mortgage Banker; we just celebrated our 40th anniversary. Great rates and programs are secondary to what is most desired in a lender relationship. The most sought-after aspects in this industry cannot be easily translated onto paper…learn more about us here.
For more information or if you have questions on mortgage rates you may contact me by phone at my direct line, (314) 372-4319, email at rfishel@paramountmortgage.com or you can visit our company website at http://www.paramountmortgage.com.
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