I’m purchasing my first home and my available investment cash is minimal.  This means that I must get an FHA loan, right?

There are several advantages to an FHA loan: 1) it is possible to add some of the costs of financing to you loan amount, 2) the mortgage insurance premium can also be added to your loan amount, 3) FHA underwriting guidelines are more liberal on your debt to income ratio (you can possible qualify for a slightly higher loan amount), 4) interest rates are typically more attractive than conventional mortgage rates.  Notice that most of the advantages increase how much you can borrow.  You are (essentially) leveraging yourself into a higher debt position just to compensate for a couple of factors.  Even if you go with conventional financing, there is a good chance you can negotiate with the seller of a property to pay closing costs when negotiating the purchase of a property.

 

As noted previously, lenders are constantly creating new loan programs. One of the current focal points for new programs is related to the first time homebuyers market.  Many barriers to home financing for the first time purchasers have been removed from the process to the extent that first time purchasers should definitely examine the

benefits to conventional financing.  There are even a few conventional products which require only 3.5% down payment with the option of the lender helping out with the closing costs and prepaid expenses.

To get pre-approved, contact us at 215-576-8666 or go to www.MontgomeryLoansNow.com!