We've saved up some money over the last year and want to move into a home using the FHA loan. We want to know how much is required for the down payment.
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3.5% of the price. Plus any closing costs not covered by the seller. Sometimes the lender can cover some or all closing costs for you if needed but this typically leads to a higher interest rate.
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The downpayment minimum is 3.5%, but the mortgage company may ask you to have even more in the bank before lending the money. When I bought my home, I was asked to have $11,000 in the bank even though the downpayment was only around $4000. There's a lot of costs associated with closing beyond just down payment. Even if you plan on asking the seller to help pay some, the mortgage company may still ask for proof you have enough to cover 100% of closing before they lend. If you receive a gift from others to reach that amount, be prepared to provide written statements stating the gift was not you borrowing money in any way.
FHA loan rules specify 3.5% but in some cases the lender may require a higher down payment--this is true when a borrower's FICO scores are marginal according to either lender standards or FHA standards. Also in some cases it may make sense to make a higher down payment depending on your financial goals. It's true that some closing costs may be covered by the seller, but only up to six percent. Also, the down payment is considered separate from closing costs and other investments required as part of the FHA loan transaction. Those expenses cannot count toward the down payment.
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If it is a HUD REO, www.hudhomestore.com, $100 is the minimum down payment. Otherwise it is 3.5%. As a federal savings bank we offer up to a 4.5% lender credit to assist with closing costs based on your final loan amount. This will help reduce the out of pocket expense!
We had a loan modification on our last mortgage, we sold the house and moved out of state and relocated. Does the previous loan modification affect our ability to get a new mortgage?
I believe it's 3%
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