Because of the current credit crisis and the weak secondary market for non-conforming, jumbo loans, FHA has again become important financing in Silicon Valley.
Here is a summary highlights for FHA Loans:
Loan Amount:Â Up to $729,750 (Santa Clara/San Mateo Counties)
Down Payment:Â 3.5%
Credit Score:Â As low as 600
Debt Ratio:Â 43%
Contingency Time For Financing:Â 17 Days
Closing Time:Â 45 Days
Rates:Â 1/8 to 1/4 More Than Conforming Rates
Mortgage Insurance Required: .550 of Loan Amt (payable monthly)(the 1.75 MI “up front†fee can be put in loan amount)
Other Terms and Conditions:
Gift Funds: From family members “OKâ€
Can be used for closing costs or down payment
Loans are assumable for qualifying Buyer when you are ready to sell
Borrower does not have to be a “first-time†home Buyer
Can use non-occupant co-borrowers to help qualify
Property must be owner-occupied
Termite work to be done (either Buyer or Seller can pay)
Eligible:Â SFR; Townhomes; Condominiums; 2-4 Units
Condominium Project must be approved for FHA Financing. Required: 51% Sold/75% Owner-Occupied
