The most common loan program is via FHA financing which allows for a 3.5% down payment. In California, you can also combine FHA financing with a downpayment assistance program through the state which results in the buyer coming out of pocket with only 1% of the purchase price. So basically $2,000 on a $200,000 purchase.
Minimum credit score required to purchase is 620. However, you do want to work on increasing that number as much as possible before you purchase a home. Currently, the loans being originated have an average borrower FICO score of 720+. With qualifying at the lower range of credit score requirements, options are limited and you will also pay more in the interest rate and fees.
Work on increasing your credit score as much as possible to help lower your interest rate and fees. It will be worth it.
Here is an article I wrote last year about this:
Thank you for your question.
The property on 151 Santa Fe Ave is a major fixer. It is a fourplex and requires approx $200k in foundation repairs. This would have to be a cash purchase only.
Well it has been a while since I have written an article so I decided I’d write one today. It seems like the Federal Housing Administration (FHA) is looking to ramp up its Distressed Asset Disposition Program. Currently the FHA has over 700,000 delinquent loans on its books so to cut down on the backlog they created a program in which they sell mortgages to investors.
Well according to the FHA, the program was a success in its pilot program to sell 2,000 mortgages that now they have decided to ramp up the sales. Starting in September, the FHA will be selling 5,000 mortgages per quarter. The new investors will be required to continue efforts in keeping the owner in the property and cannot foreclose for at least six months. According to the FHA, more options can be provided to distressed homeowners by going this route. Other options include deeding the property back to the investor in which the previous owner can rent-to-own in three years.
So what do you think? Is this really a way to help distressed homeowners or another way to sell properties to corporate buyers? I want to hear your thoughts so please leave a comment below.