FHA Mortgage Requirements 2013
The Federal Housing Administration is constantly adjusting their guidelines for First Time Home Buyers as well as FHA Streamline Refinance borrowers in order to maintain the integrity of the mortgage insurance pool.
Documentation Needed for FHA Pre-Approval 2013
- Primary and Co-Borrower income, current and full two year history
- Asset account balances including checking, savings and retirement accounts
- County where you are planning on purchasing the home
- Desired property characteristics, single family or multi-family
- Primary and Co-Borrower Social Security Numbers for Credit Report
If your file needs a boost, remember, FHA does allow for non occupying co-borrowers such as parents, grandparents, aunts and uncles, brothers and sisters or any direct family member who can strengthen the file.
Co-Borrowers can bring more income or a stronger credit profile to the file and help you immensely in qualifying.
There have been some changes this year and it’s important that not only your mortgage originator is up to date on these changes but, it is also helpful for you to be aware of these updates.
As always if you have detailed questions about the program or would like to apply for a loan and get pre-approved for a mortgage you should contact a mortgage professional at one of our Poli branches.
First time home buyers should remember that FHA is a great option for not only Single Family purchase but, multi-family purchases as well. As always FHA requirements state that all homes purchased using the insurance will need to be your Primary Residence.
FHA remains the best way to buy a two family property or a three family property for first timers or repeat buyers. FHA Guidelines will allow us to use up to 85% of the gross rental income to qualify for the mortgage.
The FHA First Time Home Buyer Program
FHA continues to be one of the most popular programs for first time home buyers. The changes from previous years are hardly noticeable and FHA will be your choice if you plan to buy a home with less than a 5% down payment.
FHA mortgage requirements for 2013, in terms of downpayment, have remained unchanged at 3.5% of the purchase price.
The Annual Premiums for all purchase transactions with a loan to value of 95% or higher, in other words less than 5% down payment, will be increased to 1.25% annually.
The UFMIP will be 1.75% of the loan amount.
The FHA Traditional Refinance
The traditional refinance into an FHA insured mortgage remains largely unchanged for 2013. This type of refinance is commonly referred to as a “Credit Qualifying Refinance”.
A borrower can utilize a credit qualifying refinance to get into a FHA mortgage from a conventional mortgage or they can choose to credit qualify from a FHA loan to a new FHA loan.
Annual Premium will be 1.25% of the loan amount for all loans traditionally underwritten and originated after May 31, 2009.
The FHA Streamline Refinance
In 2013 there is very good news for Streamline Refinance transaction that were originated prior to May 31, 2009.
If your mortgage was “endorsed” or insured, by FHA prior to May 31, 2009 your going to get a great break on your annual mortgage insurance premium.
The new annual premium will be reduced to .55% or 55 basis points.
This is a significant savings over the previous annual amount, and amount for all other transactions, of 1.25% or 125 basis points.
The new Up Front Mortgage Insurance Premium for all Streamline refinances will be .01% instead of the previous 1.00%.
HUD wants to see as many people as possible, particularly those with excellent payment histories under the program, benefit from historically low interest rates.
Basic documentation required for FHA Streamline includes:
- Original Mortgage Note
- Payoff Statement from Current Lender
- FHA Case Number Pulled by Poli
- 6 Full Payment Cycles Since First Payment Due Date
- 210 Days Should Have Passed Since Original Closing Date
- 2 Months Bank Statements (if Funds are Needed for Closing)
FHA Loan Sizes
Overall FHA Loan Limits are remaining unchanged for 2013 from 2012. Loan limits are set on a county by county basis and prior to hunting for your first home, you should check with a Poli Mortgage Professional to be sure that your home purchase qualifies for FHA financing.
FHA Mortgage requirements are fundamentally based on the the borrowers' ability to repay the mortgage and less on having a perfect credit history. FHA and HUD are in place to serve the very large portion of the population that can afford their monthly mortgage obligations but, for one reason or another, do not have a pristine credit score.