If becoming a first time home buyer is on your 2018 to-do list, you are in luck. The Federal Housing Authority (FHA) recently announced an increase to FHA loan limits in Salt Lake County. This means that you may be able to afford more home in 2018, while enjoying the benefits of FHA financing.
According to an article from Ali Wolf, Manager of Housing Economics at Myers Research, FHA loan limits are going up $27,600. In 2017 buyers seeking a FHA loan could only be approved up to $328,900 in 2018 that number will rise to $356,500. Read the full article, here.
Here’s How a FHA Loan Works
A FHA loan is a mortgage that is insured by the Federal Housing Authority. First time home buyers like FHA loans because they allow down payments of 3.5% for credit scores of 580+. This means you get to keep more of your savings in your pocket at closing time.
If you have a credit score of lower than 580 you aren’t necessarily excluded from a FHA loan eligibility, your down payment percentage will just be higher.
- Steady employment history or worked for same employer for past two years.
- Must have a valid Social Security number and be a resident of the U.S. .
- FHA loans are only available on primary residence occupancy.
- Borrowers must pay mortgage insurance premium, which protect the lender if a borrower defaults.
- Monetary gifts can be used towards your FHA loan down payment or closing cost. (Tell Mom & Dad this is what you want for Christmas!)
What Do You Want to Spend Your Money On?
For example, if you were buying a new home in Daybreak for $356,500 using a FHA loan you would only be required to bring approx. $12,000 to closing. With a conventional loan, you could be required to bring 10-20% of the home purchase price to closing–$35,650 to $71,300, so the new FHA program means you’ll have more funds available to furnish that new home, and allows many more first time buyers to purchase a home than before.
Qualifying for a FHA loan can mean the difference between being able to purchase a home now or having to continue to live in your in-law’s basement.
All you need to do is choose from our incredible selection of move-in ready homes or meet with a Daybreak builder. Builders in Daybreak can coordinate approval for your FHA loan with preferred lenders as part of the homebuying process. The builders’ representative or their preferred lender can answer all your questions before you get started when you stop into any of our 30+ model homes. The model homes in Daybreak are open Monday through Saturday from 10am-6pm.
Looking for more related info? Check out this piece below!