Buyers Focus on Florida Home Mortgages, Overcome Credit/Monetary Obstacles

In an ideal world, your credit score would perfect and you’d be approved for any type of Florida home mortgage loan you wanted. As many readers know, however, this is rarely the case for hopeful owners.

The good news, at least, is this: in today’s market, there’s a home loan for almost everyone, regardless of credit, payment history or type of house you wish to own. Let’s delve into the reasons why and what you can do to find out more …
Check your credit … right now. As savvy home buyers and their agents know, it’s smart to check your credit reports before shopping for a home. Fix any errors before applying for a Florida mortgage loan so you’ll get the best possible interest rate and terms.

Today’s mortgage lenders look primarily at your FICO score when qualifying borrowers. For the most part, mortgage underwriters don’t even read the applicant’s credit reports if the FICO score is at least 680.

If you’re curious about where you stand, at least consider the factors FICO looks at: the length of your credit history (the longer the better); the percentage of available total credit currently being used (try to stay below 50 percent), and your on-time payment history. Due to the latter aspect, it’s not a terrible thing to have some debts because those payments could prove you’re a worthy candidate for a Florida home mortgage.

Receive pre-approval on your Florida home loan. After checking on your credit, the next step is to get pre-approved in writing by an actual mortgage lender. If your FICO score is below 620, look for a mortgage lender specializing in subprime Florida home loans.

Also, make sure you obtain a pre-approval letter from an actual lender, not just a so-called “pre-qualification letter” from a mortgage broker. A pre-qualification letter means: “We think you can get a mortgage but we haven’t checked out your loan application yet.” If you have a low FICO score, a mortgage broker can obtain a pre-approval certificate from a lender who specializes in low credit Florida mortgages.

Why does this even matter? It’s so important to obtain mortgage pre-approval because then you know what price range home you can afford and the maximum Florida home loan available.

A lack of cash shouldn’t get in the way of a home purchase. If you’re short on down payment cash, don’t let that stop you from buying property. This is a buyer’s market, folks. Therefore, there are more residences listed for sale than there are qualified buyers; sellers and lenders are becoming very flexible in their quest to make sales.

Prospective home buyers who have good income and good credit - but little cash - should consider a no money down Florida home loan. Some lenders even offer 103 and 107 percent mortgages to include closing costs in the mortgage amount. FHA and VA mortgages also offer low- and zero-down-payment alternatives.

Bear in mind - and be wary - that monthly payments on low-down-payment Florida home loans can be high. However, buyers who plan to fix up their purchases to increase the market value might want to proceed anyway and then consider a Florida mortgage refinance in a year or two.

Whenever possible, low- or zero-down-payment home buyers should avoid PMI (private mortgage insurance) mortgages. PMI premiums, which cost $100 or more per month, protect the lender if the borrower defaults. But PMI premiums are not tax deductible.

Alternatives to applying for a new mortgage. If you possess a poor credit score, or just don’t want to jump through a mortgage lender’s numerous confusing hoops, there are alternatives available.

For example, there’s lease-option financing is the lease with option to buy. Because many landlords would prefer to sell, they’ll gladly agree to a lease-option with a partial rent credit toward the purchase price.

Another alternative to obtaining a new Florida home mortgage is to offer to buy a house “subject to” its existing mortgage. Many of these residences are advertised as “assume existing mortgage” or “take over mortgage payments.” However, buyers should be careful that the home is not over-encumbered for more than its market value.

You wanna make sure you’re receiving a fair deal. Overall, if you wish to be a home owner, just do it. Speak with our staff, let us work out the best Florida home loan for your needs and goals and look forward to a prosperous future starting today.