Hall Lending Group was created by Hope Hall with one mission in mind: to provide customers with the best home loan experience possible. For nearly two decades, we have been helping families meet their goals of home ownership with the best interest rates and loan programs available. We care about more than just your home loan. We take pride in making lending easy. We understand that family is important and that you want what is best for them. We make lending easy because you want to be the hero that gave your child their own backyard. We make lending easy because you want to spend more time with your family and less time on paperwork. We make lending easy because YOUR TIME MATTERS.
FHA loans are government-backed mortgages that are insured by the Federal Housing Administration. Many potential home buyers may not know that these types of loans have looser qualifying standards. Applicants are not locked into having flawless or nearly perfect credit scores. First-time home buyers in Cedar Rapids, Iowa City, Waterloo or other surrounding areas in Iowa would have a better chance of being approved. Even borrowers who cannot afford a hefty down payment on a home could afford to choose a residence that will make them happy for years to come. FHA loans are among the most affordable home loans for potential buyers from all financial backgrounds. Research these types of loans thoroughly, and you will be sure to find the one that is right for your financial situation.
Borrowers will never pay more than 3.5 percent for a down payment with FHA loans. It is truly simple for potential home buyers to figure out the down payment for the home they are interested in purchasing. All they need to know is the purchasing price for the home. The price of the home times 3.5 percent equals the down payment for the purchase of the home. However, potential buyers using this financing method should be aware that most sellers may be hesitant to accept your purchase offer as they have the impression that these types of loans take a long time to complete and move to the closing. However, this is not the case. If all the borrower’s paperwork is in order and everything about the transaction is out in the open, this type of loan will not take any longer than any other type.
Some FHA loans have fixed interest rates, while others have adjustable rates. Once the loan is approved, a fixed interest rate will not change through the duration of the loan, regardless of the changing circumstances. An adjustable interest rate means it can go up or down based on different variables in the loan agreement. Before you apply for a loan with this type of rate, it will be helpful to know how high your interest rate and monthly payments can go with each adjustment. Of course, the tip of the iceberg is knowing how often the rate will adjust. If the rate adjusts itself frequently, it is extremely important for the borrower to find out how soon the payments will increase. Borrowers should also ask their lenders if there is a cap on how high the rate can go. Sometimes, there may also be a limit on how low the rate can go. Once the adjustable rate reaches its lowest threshold, it is likely a given that it will begin to increase shortly after.
Fully understanding all parts of FHA loans can mean the difference between fully completing the requirements or falling into default. If you cannot fulfill all the requirements under an adjustable interest rate, it is important to know this before entering into a permanent agreement. It is important to ask your lender the important questions and read all the fine print contained within the agreement. As the borrower, it is very important for you to know if you will still be able to afford the loan if the rates and the payments go up to the maximums allowed under the loan contract. If your financial situation is tight, it may be safe to say that loans with an adjustable interest rate are not right for you.
The main advantages of FHA loans are that you will never pay more than 3.5 percent for a down payment and your credit history does not have to be flawless to be approved. A credit score of 580 is the minimum required. However, if you are living in a tight financial situation, there are some definite drawbacks. Mortgage insurance premiums are required through the duration of the loan. This could be an additional cost that borrowers may not be able to afford if they are not used to careful financial planning. There are property restrictions too. If you have your heart set on buying a condominium, it may be possible if it is on a list of approved neighborhoods. While the condominium needs to be on a list of approved neighborhoods, it does not necessarily mean that you need to buy a condominium that is part of a homeowner’s association. Cedar Rapids, Iowa City, Waterloo and other surrounding areas in Iowa may be full of available condominiums, but just be sure you have chosen to purchase one that would fit the neighborhood requirements of your particular loan.
FHA loans make it possible for borrowers to take advantage of a reverse mortgage. A reverse mortgage makes it possible for borrowers to take back some of the equity they have accrued in their home. As you live in your home and make improvements or additions, it gains value, or equity. What is the point of owning a home if you cannot get the full worth out of it? A reverse mortgage allows you to make payments from your home’s equity back to yourself. This can occur instead of making payments to the lender. However, you need to keep in mind that any payments you have made back to yourself from your home’s equity need to be repaid if your home is sold or you choose to move out. If you know you are looking to sell your home or move quickly, you may want to consider not setting up a reverse mortgage. It is never a good idea to reduce the amount of equity in your home before you sell it.