If you’ve been considering purchasing another home or want to refinance your current property, you may be wondering if you can get another FHA loan. In this article, we’ll discuss the process of applying for a 2nd FHA mortgage and answer some of the most common questions people have about taking out a second loan. We’ll also provide some tips on how to get approved for a 2nd FHA Loan and get the best interest rate possible. So read on to learn more!
What Is An FHA Loan?
An FHA loan is a mortgage that’s insured by the Federal Housing Administration. These loans are available to all buyers, not just first-time home buyers as many think, and are also great for borrowers who may not qualify for other types of loans. FHA loans require a lower down payment than many conventional mortgages, and they have flexible credit requirements. However, borrowers must pay mortgage insurance premiums for the life of the loan, which can make these loans a little more expensive in the long run.
Can I Get A 2nd FHA Loan?
Typically, you can only have one FHA loan at a time. If you want to get another FHA loan, you’ll need to pay off your existing loan first. However, there are some circumstances where you may be able to qualify for a 2nd FHA Loan and forgo those rules, including:
- You have a growing family and need a larger property
- A new job opportunity requires your family to relocate
- Your new home is more than 100 miles away from the current home you own
- During the divorce, your spouse is staying in the existing house, and you’re looking for a new property
- You’re buying a HUD REO (real-estate owned or foreclosed) property
- The purchase is not for an investment portfolio
- The first loan is a non-FHA loan
In order to qualify for a 2nd FHA Loan, you’ll need to meet all the standard eligibility requirements for an FHA loan, including having a steady employment history, a good credit score, and being able to prove that you can afford the monthly mortgage payments. You’ll also need to prove that you’re eligible with paperwork or proof that supports one of the reasons listed above.
Immediate Disqualifiers For A 2nd FHA Loan
While there are some circumstances where you may be able to qualify for a 2nd FHA loan, there are also some immediate disqualifiers that will prevent you from getting approved. These include:
- You’re delinquent on your existing FHA loan or owe more than the home is worth
- You’re currently going through a bankruptcy or have had a bankruptcy discharged within the past 12 months
- Your current property is not your primary residence
These are just a few examples of when you may or may not be able to get approved for a 2nd FHA loan. If you have any other questions about this process, be sure to talk to a qualified mortgage professional. They can help guide you through the process and ensure that you’re getting the best interest rate possible.
How To Get Approved For A 2nd FHA Loan
If you want to apply for a 2nd FHA Loan, the process is similar to applying for your first mortgage. You’ll need to submit financial information, including tax returns and bank statements. The lender will also pull your credit report to check your score and see if you have any outstanding debts.
You may be able to get approved for a 2nd FHA Loan even if you have less than perfect credit. However, your interest rate is impacted by your credit score. Therefore, it’s essential to work on improving your credit before you apply for a 2nd mortgage. Please don’t feel like you have to do that on your own. Give us a call so we can share with you the tips and tricks we have learned over the many decades of experience.
Getting The Best Interest Rate On Your 2nd Mortgage
You can get a competitive interest rate on your second mortgage by shopping around and comparing rates from different lenders. It’s also a good idea to check your credit score and make sure it’s in good shape before applying for a 2nd mortgage. The better your credit, the lower your interest rate will be.
You can also try to get a 2nd FHA Loan with a shorter term than your first mortgage. A shorter loan term will raise your monthly payments and help you pay off your loan faster.
Work With A Knowledgeable Expert At Fort Myers Mortgage Expert
When it comes to finding the right mortgage program for your home, you’ll want to work with a team of experts who understand precisely what you need. At Fort Myers Mortgage Expert, we have a team of experts who are here to help you every step of the way to help you obtain a second mortgage. So if you’re interested in learning more about how to get a second loan, fill out our online contact form to get started!
