Guest Mortgage Expert Yousif Mohamed, Loan Officer at Movement Mortgage hosted by Bernie on IG Live #MortgageMonday
An FHA loan is a federally-insured mortgage issued by a qualified lender. The program is chosen by many first time home buyers as well as favorable to those with lower tier credit scores. FHA-approved condominium projects in Miami are few.
#1 FHA Loan Financing Terms
Borrowers may finance purchase with down payments as low as 3.5%, minimum 580 score and debt-to-income ratio 50% or less.
#2 Advantages, Additional Fees & Considerations
The key advantages are lower interest rates than a conventional loan depending on borrower profile and lenient credit score guidelines.
Separate from closing costs, additional fees are upfront mortgage insurance premium (UFMIP) equal to 1.75% of loan paid at closing along with private mortgage insurance (PMI) 0.85% paid monthly for duration of loan.
In selecting this mortgage vehicle, the considerations are must be primary residence or owner-occupied multi-unit property, loan limit of $460,000 and many condo buildings are not approved.
#3 Association Documentation
Few condominium projects in any market area appear on FHA-approved list because most projects bypass as the full review process is complex plus labor and time intensive.
Most mortgage lenders prefer conventional loan limited review of three documentation requirements from the Association: questionnaire, fiscal budget and master insurance policy.
For this reason, FHA loans represent less than 5% of mortgages for condos.
Please contact me to discuss more.