Benefits of an FHA Loan
FHA loans offer an advantage to first time home buyers that commercial banks cannot. Most commerical banks require a minimum 10% down payment. On a $300,000 house that would translate into a $30,000 down payment. However, FHA allows for a 3.5% down payment which would translate into only $10,500 on a purchase of $300,000. Due to this lowered percentage, people are able to save more money on their down payment.
The benefits are as follows:
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- Credit requirements are less stringent than conventional loans
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- 100% of the money for a purchase can come from a gift for an FHA loan
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- Closing costs may be gifted as well
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- 6% of the closing costs can come from a seller contribution allowing greater flexiblity to structure a purchase transaction
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- Use of alternative credit is allowed to complement a credit history tha may be bruised
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- FHA loans are available up to $729,000
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- Condominium financing is available with only 3.5% down
We also are licensed and work in the states of Pennsylvania and Florida.