FHA vs Conventional. 3% vs 5% plus down payment. Short Sales and Foreclosures. ?
Posted by Usual in Bank approved short sales, tags: conventional, down, foreclosures, payment., plus, Sales, ShortWe want to buy a home right now before rates increase due to more foreclosures filling up the market, and before laws get into place that make it harder to get a mortgage.
My husband and I were preapproved for two types of mortgages: FHA and Conventional. I want to know what is pros and cons of each and what is the best for us?
We are looking for homes between $170-$225k. Whats most important to us is to get a really low rate (we have above 714 credit). We prefer putting 3% down, but we could put 5% down if that means we get a lower rate. We would like to have the seller pay for parts of the closing cost, but again we would be willing to pay this too if this means we will get a lower rate.
Last question is the process of short sales and foreclosures. If let’s say a house’s market value is $240 but a bank approves for us to buy it at $200k, does that mean we immediately own 20% of the home? If so, does that mean we don’t have to pay PMI or MIP? How does this differ with FHA and Conventional? Should you or can you ask for less on short sales and for foreclosures if that is the market right now, regardless of how much the previous seller owns on it? Does that mean we won’t get it?
Sorry for all the questions! I hope you guys can answer all, or if not, parts of this! Also, any other suggestions for me in regards to the homebuying process would be wonderful! Thank you!
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