Buying a home is one of the biggest investments you will ever make in your life. That's why it's important to do your research and understand all of the costs associated with purchasing a home in Maryland. One question that often comes up is, "How much money do I need at closing for an FHA loan?" In this blog post, we will break down the costs associated with an FHA loan and help you understand what you need to bring to the table at closing. Contact My Home Mortgage Team today to learn more!
Down Payment
One of the biggest benefits of an FHA loan is that you only need a down payment of 3%. This can be huge savings for first-time homebuyers, as the average down payment for borrowers is 20%.
Closing Costs
There are several other costs paid at closing. These include but are not limited to title fees, appraisal fees, prepaid interest (if applicable), and origination points. The total of these should equal about 6% of your purchase price. For a $200,000 home, your closing costs would come out to be about $12,000.
Mortgage Insurance
Another cost that comes with an FHA loan is mortgage insurance. This insurance protects the lender in case you default on your loan. The monthly premium for mortgage insurance varies based on your down payment amount, credit score, and loan-to-value percentage.
Getting Down Payment Assistance
If you don't have the money to cover your down payment and closing costs, there are several down payment assistance programs available. These programs provide grants or loans that can help get you one step closer to homeownership.
The My Home Mortgage Team is here to help! We can pre-qualify you for an FHA loan and help you find the best down payment assistance program to purchase your dream home in Maryland. Contact us today to get started!
Testimonials
Patient & Helpful
Tammi was very patient and very helpful throughout the entire application process. Being a first-time home buyer I didn't know a lot of this which made me frustrated but I was able to get approved and now I am a homeowner thanks to Tammi!
— James C.
No Pressure or Stress!
Tammi Lewis made my home buying experience very easy. I felt no stress or pressure. Tammi was with me every step and made sure I understood everything with detailed talks. My credit score was low and Tammi advised me how to raise it. So that the Loan process would be approved with no problems. Any one know that wants to buy their first home I am recommending Tammi Lewis and First Home Mortgage.
— Charlie F.
Professional & Timely
Rob made sure my experience as a first time home buyer was smooth and painless. Very professional and got things done in a timely manner. Could not have asked for more!
— Samantha J.
Great Experience for a New Homeowner
Rob was at all times, willing to go over the numerous pages of information with me. I am a new homeowner and had many as this was my first time navigating the home-buying waters. He explained things to me in a way that I understood and got me all of my documents in a timely and efficient manner. I enjoyed working with him and would refer him to anyone who is looking.
— Erica F.