FHA Mortgage Loan

1. Conventional and FHA mortgages

Hi my name’s alex college with dustin cho calm i want to compare fha with conventional we got a conventional 3% down and up a 2 a 3 and a percent down now with the conventional 3% down if you’re not a first-time homebuyer that comes with a little stipulations is he can’t make a lot of money or you know if there’s a lot of little rules so let’s say you’re first-time

Homebuyer conventional 3% down fha 3 that percent down let’s compare those two fha is going to be more forgiving on your credit so if you got a 640 credit you can still probably at a conventional loan no guarantees but you’re gonna get really high interest rate you’ll get high private mortgage insurance so everything below 682 620 which you’re eligible for

Conventional may nail you with high rates and high high pmi below 620 you’re not eligible for a much loan you have to go up h a so keep that mind if you are below 580 fha you gotta put 10% down and now fha pmi factors are always the same three and a percent down is 0.85 factor it put 5% down or more it’s a point a factor it’s always the same eventual you could

Be at 1.5 with a with a 620 credit score your pmi factor might be 1.5 now with is at 1.5 mean you take 1.5 times your loan amount 8% divided by 12 that would be your monthly payment for a pmi so it’s almost half as much for up h a that would be for conventional wits with a 620 credit score so keep that in mind you know conventional you know it if you have to

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Go conventional because the condition of the property your get the you have to pay those higher rates and the higher pmi i always push below 680 for an fha loan unless the property’s got some issues with it because fha is definitely more forgiving with rates than pmi below 680 now if you’re above 680 i’m not even thinking of h a there will be some thinking fha

Is if you’re buying $100,000 house and you need all six percent closing cost credits because fha allows the 6% closing cost credit from the seller to meant only allows 3 so if i need those 6% that i’m gonna say fha is the only way cuz you can only come up with a 3 net percent down or you can only go up to 3% down you need the sellers to credit all the closing

Costs and that baiji allows for a larger closing cost credit from the seller so that’s one reason i would only go fha buys above 680 again below 680 i think an fha all day long but if the property won’t go because fha appraisal stricter i’m going to let you go conventional now one thing that pay change the downside if you’re let’s say you’re above 680 you just

Want to go up a chair for some reason for no other reason i’m going to say no commercials better because i page i pay chase could i charge you an upfront 1.75 percent of the loan amount and they’re gonna add it back to the loan amount you’re gonna borrow that so it’s almost 2 percent added to your purchase price because you owe that money now so it’s you almost

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Paid 2 percent more for your house when you do that that’s the only downside for fha but again if anything pops up during the underwriting process fh is a little more forgiving than conventional so that’s so it’s they choose a safe place to be you’re definitely paying for all the other foreclosures with that upfront charge okay so that upfront charge it goes to

A pool of money that pays for foreclosures and that’s fha allows for more risky loans so that’s what you’re helping out people pay for us that’s what that charge is going for it’s the downside about fha it’s the really bad part of it again also the strict appraisals or the another bad part but when it comes to comparing fha conventional i’ll help you make the

Right decision you give me a call anytime and i’ll tell you which direction we should go i’ll let you make the decision you pick up a chair conventional if you have the option okay my phone number six three zero nine one five seven five five zero please subscribe

Transcribed from video
FHA Mortgage Loan By GCA – Mortgage Bankers