Don’t forget- FHA Loans have impounds! Impounds are an additional closing cost. Typically lenders require 6 month impound on property tax, and 2 months impound on insurance.
FHA Impound Example:
Purchase Price $250,000
Annual Property Tax = $3,125
Monthly Property Tax $260/mo.
$260 x 6 months = $1,560 Property Tax Impound
Home Owners insurance Policy $1,200
Monthly Insurance $100
$100 x 2 = $200 Insurance Impound
The Impounds are a closing cost, and are due before closing.
The FHA Loan Program has maximum price limits. Obviously you can’t buy a $20M dollar mansion with an FHA loan! The FHA Loan limits are set every year, and vary by county.
The current maximum FHA Loan Limits in Los Angeles are:
$636,150 Single Family
For properties with a purchase price above the maximum loan limit, those properties don’t qualify for the FHA loan program. Fortunately, in Los Angeles county, the loan limits are quite high, higher than most other counties in California.
FHA Loans requires an FHA appraiser to inspect the property. FHA loans qualify two things- they qualifying you as the buyer and also the property. the FHA will not loan if the property is in substandard living condition (if the property is a major fixer, the FHA has the 203B Loan for that)- the appraiser will send a list of items that need to be fixed before the loan can go through- once the work has been completed another appraisal will be done and the loan can fund. If you have had an FHA loan in the last three years you will have to wait until 3 years after the loan date to qualify for a new FHA loan. Visit this link for a helpful checklist of information you will need to gather to apply: http://www.fha.com/loan_checklist.cfm