FHA Loans

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FHA Loans


 

FHA loans are just like every other loan in the sense that there are 30 year, 20 year, 15 year, and 10 year loans.  There are fixed rate FHA loans and there are adjustable rate FHA loans.  FHA loans are made by and held by the same banks and financial institutions that make and service every other type of loan.  What makes the FHA loan different from other loans is that the underwriting guidelines and guarantee to financial institutions comes from the federal government's Department of Housing and Urban Development (HUD).

Many people mistakenly think that FHA loans are "first-time buyer loans" or that they are loans for consumers with "poor credit history" but the truth is that they are just another viable mortgage product available to all consumers.  There are many advantages to FHA loans which make them one of the most popular loan products available today. 

Maximum FHA loan limits vary by county. 

 

Advantages of FHA Loans

Underwriting Guidelines.  FHA underwriting guidelines are often less cumbersome than conventional loans.  FHA lockout periods following a bankruptcy, foreclosure or short-sale are all shorter with FHA loans compared with any other loan product.  Debt-to-income ratios are higher with FHA loans allowing borrowers to finance more house and employment guidelines are less stringent.  There are no maximum income amounts and there are no location restrictions with FHA loans. 

Down Payment.  FHA loans can be obtained with as little as 3.5% down.

No cash-out pricing adjustment.  FHA do not have the secondary pricing adjustment for pulling cash-out of your home like conventional loans do.

Streamline Refinance.  FHA offers a streamline refinance option that allows FHA loan holders to refinance their homes without having to re-qualify for the new loan.

 

Disadvantages of FHA Loans

Loan Limits.  There are maximum loan amounts that limit the amount of money a consumer can borrower on an FHA guaranteed mortgage.  These loan limits are often less than conventional loan limits.

Mortgage Insurance.  All loans carry mortgage insurance in certain circumstances.  FHA mortgage insurance is the most expensive amongst poplar loan products.  FHA charges every consumer an upfront mortgage insurance premium of 1.75% of the loan amount as an upfront fee that FHA adds to your initial loan balance.  Additionally, FHA charges 0.85% of the unpaid principal loan balance monthly.  FHA mortgage insurance never discontinues.  You will have FHA mortgage insurance as long as you have an FHA loan.

 

 

Other Notable FHA Guidelines

Seller Credit.  A seller can credit a borrower up to 6% of the purchase price on purchases.

Maximum DTI.  The maximum debt-to-income ration (DTI) is 56.99% on FHA loans compared to 50% on conventional loans.

Gift Funds.  Gift funds can be used for the entire down payment, closing costs, etc.

 

 

 

 

 

Cornerstone Mortgage

MAIN OFFICE:
5940 S. Rainbow Blvd., Suite 201
Las Vegas, NV 89118
(702) 840-1500
NMLS ID 340311
NV: DML License: 4814
CA: DOC License: 60DBO86761
CA: DRE License: 01848420

NEVADA:
5940 S. Rainbow Blvd., Suite 201
Las Vegas, NV 89118
(702) 840-1500
NMLS ID 340311
NV: DML License: 4814
CA: DOC License: 60DBO86761
CA: DRE License 01848420

CALIFORNIA:
1500 Standiford Ave., Suite A1
Modesto, CA 95350
(209) 578-9000
NMLS ID: 1741490
CalDRE License: 01848420

200 Tampa St.
Turlock, CA 95382
(209) 633-3222
NMLS ID: 1739798
CalDRE License: 01848420

HAWAII:
91-110 Hanua St., Suite 201
Kapolei, HI 96707
(808) 784-1239
NMLS ID: 1669660
HI: MLOC Liense HI-340311

Legal

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is an equal opportunity lender.

Nationwide Multistate Licensing System (NMLS) ID: 340311. Additional NMLS branch licenses: 1739798, 1741490, 1669660.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed by the Nevada Division of Mortgage Lending, license number 4814.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed by the California Department of Corporations under the Residential Mortgage Lending Act and Finance Lenders Law. CA Finance Lender #60DBO86761.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed by the California Department of Real Estate, License number 01848420.

Cornerstone Equity Group, Inc., dba Cornerstone Mortgage is licensed as a Mortgage Loan Originator Company by the Hawaii Department of Commerce and Consumer Affairs, license number HI-340311.

Any concerns, complaints or suspicions regarding the misuse of any personal data should be directed to our Operations Manager by telephone at (702) 780-1500 or by email at admin@cornerstone.us.com.