Long Beach Homebuyers Can Secure FHA Financing

100% financing has pretty much disappeared for Long Beach properties.  Banks and mortgage lenders are running scared because of the declining market; they're unwilling to lend the full purchase price on Long Beach homes, today.  I have opinions about that policy but what I think doesn't matter.  I live in a realistic world and today, the reality is that I can't get you a zero down payment home loan.

Our old friend, the Federal Housing Administration (FHA) might provide some relief for the current capital drought.  FHA loans allow for:

1- A 3.5% Downpayment.  That downpayment can come as a gift from a family member, employer, or charitable organization.

2- Less than Perfect Credit:  Credit scoring isn't used as a determining factor for your loan approval.  Generally speaking, if you've paid your bills in a timely fashion, for the last twelve months, have no large collection accounts or judgments outstanding, and have foreclosures or bankruptcies that are at least two years old.

3- Generous debt-to-income ratios.  FHA loans allow for monthly debts for  up to 43% of your monthly income.  Compared to the traditional 36% ratio for convetional loans, this can help you get more home.

FHA loans are even more forgiving of credit situations when a larger downpayment is made.  If you are a Long Beach home buyer, with 10% downpayment, and were relying on a sub-prime mortgage (which isn't there anymore), a FHA loan may be a worthy consideration.

Updated:  10/10/2008

FHA loans are available to a maximum loan of $729,750 with a minimum 3.5% down payment (up from 3% as of 10/1/08) until January 1, 2009 when they are currently scheduled to drop the maximum loan amount to $625,000, this could change. 

FHA Lending Limits for LOS ANGELES COUNTY (LOS ANGELES-LONG BEACH-GLENDALE, CA METROPOLITAN AREAS): 

• Single Family Home or Condo: $729,750
• Duplex:  $934,200
• Tri-plex:  $1,129,250
• Four-Plex:  $1,403,400

Jumbo Loans are currently requiring approximately 30% down payment and start at $729,000, also currently scheduled to drop concurrently on 1/1/09 to $625,000 unless something changes between now and then.

Here is a link to the FHA Website for more information about FHA loans (FHA website)

Posted on February 24, 2008 06:12:12 by Brian.Brady

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