FHA Loans For Ventura County Home Buyers

In Ventura County’s current real estate market FHA home loans are becoming a popular means of obtaining a mortgage loan for home buyers. For many years the intricacy and difficulty associated with FHA loans made many lenders and home sellers frown at home buyers who could only obtain an FHA loan.

What Is an FHA Loan?

An FHA loan is a type of loan offered by conventional lenders where the Federal government agrees to insure the loan. This insurance by the Federal Housing Administration (FHA) presents less risk to lenders who participate in FHA mortgage loan programs.

In Ventura County many home buyers are taking advantage of the lower down payments (3.5%) and less than perfect credit scores required by FHA insured loans. With no income limits on FHA loans, most home buyers and especially most first time home buyers in Ventura County can qualify for an FHA loan.

What Are FHA Loan Limits?

FHA loan limits vary from state to state and even county by county. The loan limits on FHA loans are set by the Department of Housing and Urban Development (HUD). Currently in Ventura County the FHA loan limit is set at $598,000. This means that a Ventura County home buyer can borrow up to $598,000 for the purchase of a single family home.

FHA Rates

Since FHA loans are insured by the Federal Government, it is possible for Ventura County home buyers to find an FHA loan rate lower than the rates offered on conventional loans.

FHA insured loans require that a monthly mortgage insurance premium be paid into the cost of the loan. Ventura County home buyers with FHA loans will have a 1.5% premium added to their loan balance. The monthly mortgage premium is paid for 5 years or until 78% of the home value has been paid off. Nevertheless, the FHA mortgage insurance premium is much less than the mortgage premiums asked by private mortgage insurance premiums.

Down Payment on FHA Loans

As of January 1, 2009, Ventura County home buyers interested in obtaining an FHA loan need to provide a down payment of 3.5% . The new FHA terms prohibit home sellers from contributing any funds or incentives towards home buyers’ down payment. However, there are many venues for home buyers to explore including HUD down payment assistant grants.

Closing Costs on FHA Loans

A typical FHA loan’s closing costs for the home buyer is between 2-3% of the total loan. Some of Ventura County home buyers’ closing costs associated with an FHA loans include, but not limited to: appraisal fees, origination fees, and lender’s inspection fees. To keep the home buyer’s closing cost to a minimum HUD has set some closing cost guidelines. The HUD guidelines have limits on how much lenders can charge borrowers for loan origination fees. Again, FHA loan closing costs differ from region to region. Nevertheless, borrowers of FHA backed loans can ask the home seller to pay up to 6% of the home buyer’s closing costs.

FHA secured loans have been around since 1934 and because they are insured by the Federal Government these loans will be here long after all conventional or any other type of loan.

Ventura County home buyers who are interested in obtaining an FHA loan need to interview more than one FHA lender. By visiting the Department of Housing and Urban Development you can search for an FHA Lender in your area.

Once you have obtained information on your loan please feel free to contact me to start searching for your new home in Ventura County.

Share and Enjoy: