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FHA Loan in Collier County, Florida: Learn About the Low Down Payment Options

When you're looking to buy your first home or a new home, one of the factors you consider is the price of the house. If it's too expensive, you can't afford it, and that dream of homeownership will continue slipping out of reach. However, there are ways to get around this by looking into programs like the FHA loan program, which offers low-down payment options for qualified borrowers.

An FHA loan allows borrowers to make down payments as low as 3.5% of the total home price and enjoy the benefits of low closing costs and less stringent credit requirements than most conventional mortgages.

Are you looking to use an FHA loan and take advantage of the low-down payment options available? That's great, but it can also be confusing since you must follow several rules and requirements when applying for an FHA loan, including meeting the income limits, credit score, debt-to-income, and other conditions.

This article will walk you through everything you need to know about FHA loans, including 3.5% down payment, down payment assistance programs from Florida Housing, using cash under the mattress for closing costs, loan limits, and other exciting things about Collier County, Florida. Read on to learn more.

Understand the FHA Loan

An FHA loan is a mortgage insured by the Federal Housing Administration (FHA). This loan is popular with first-time homebuyers because it has a lower down payment requirement than a conventional mortgage.

Unlike other mortgages, an FHA loan allows borrowers to make a down payment of as little as 3.5% of their home's purchase price. FHA loans, however, require you to pay mortgage insurance premiums (MIPs), which protect lenders if you have trouble repaying the loan.

Collier County, Florida, offers several low down payment options for FHA loans, making it an attractive option for those looking to purchase a home in the area. These loans are also known for their low closing costs and flexible credit and income requirements.

In addition to these benefits, borrowers may be eligible for special refinance and down payment assistance options. Below are more FHA loan basics you need to understand before applying.

The 3.5% Down Payment

If you're looking to buy a home in Collier County, Florida, you may be able to take advantage of a low down payment loan through the Federal Housing Administration (FHA). With an FHA loan, you can put as little to no down on your new home.

Generally, the FHA loan down payment is either 3.5 percent or 10 percent, depending on your credit score. For borrowers with a credit score of 580 or higher, 3.5 percent is the minimum down payment required. This can make it easier to afford a home, especially if you're a first-time buyer.

A low down payment doesn't mean you won't pay mortgage insurance premiums since the insurance is required with loans secured with less than 20% down. The mortgage insurance premium is calculated and paid with your principal and interest payments.

The rate will depend on how much you put down; you will pay a higher MIP if you put less down. For example, if you put 3.5% down, your MIP will be 1.75%, but if you put 10% down, your MIP is 0.85%.

FHA Loan Limits in Collier County, Florida

FHA loan limits in Collier County, Florida range from $552,000 for one-family homes to $1,061,550 for four-family dwellings. This loan limit is increased for multi-unit properties and high-cost areas, meaning you'll see higher limits if you're buying property in an expensive place.

You must know what your particular lender requires regarding down payment requirements, so make sure to speak with them before you buy your new home.

When applying for an FHA loan, you must reside in a state participating in the FHA program and purchase a property in one of the state's counties. The reason for this is the fact that the cost of living varies significantly across the state, and the median income levels differ by region. Within each state, county-specific rules apply, including loan limits and income requirements.

Down Payment Assistance Programs from Florida Housing

If you're looking for down payment assistance to help you buy a home in Collier County, Florida, you may be able to get help from the Florida Housing Finance Corporation. The agency offers various programs to assist you with down payments and closing costs. Other assistance programs are available specifically for military members, veterans, surviving spouses, and buyers purchasing homes in targeted areas.

Some programs offer grants or loans that you don't have to repay. Others provide interest-free loans that may be forgiven if you live in the home for several years. Other assistance programs that can help you with your down payment include the programs offered by state, local governments, private lenders, and non-profit organizations. Each aid program has specific application processes and eligibility requirements, including credit score, a steady income, and an excellent debt-to-income ratio (DTI).

A popular FHA down payment assistance program is a second mortgage program (FL Assist Program), which offers up to $10,000 in down payment and closing cost assistance. If you already own a home or plan on buying more than one property, you might not be eligible for the assistance program since it's only available for qualified first-time home buyers.

If you meet the qualifications, this second mortgage program will provide the following advantages:

  • If you're eligible for the FL First Mortgage Loan Program (FHA, USDA-RD, or Fannie Mae HFA Preferred) in any county, you'll automatically qualify. This is not a stand-alone second mortgage program.

  • 0%, non-amortizing, deferred second mortgage.

  • You may get up to $7,500 for conventional loans and up to $10,000 for FHA and USDA-RD loans (effective as of June 1, 2021).

In general, eligibility is based on your household income and credit history, but it can also vary by state and program. Most programs require an application, and occasionally you'll also need to attend a training course on how to get a mortgage or maintain your finances.

Each program allocates different amounts of assistance. Some offer a percentage of the purchase price, while others calculate it at a fixed dollar amount.

Can You Use Cash Under the Mattress for an FHA Loan?

If you're looking to buy a home using the FHA loan program, or if you're looking to get into the market in general, you may have heard that you can use cash under your mattress as part of your down payment or closing costs. But is it true? Is this an option? If you're wondering about this, don't worry—you're not alone. The following information will help you by dispelling some myths about cash under the mattress and setting the record straight about what you can and can't do regarding FHA loans.

There are some serious issues with the cash under the mattress. Besides counting as secret money that can adversely affect your FHA loan, it also represents one of the worst places to keep your funds due to several issues associated with this method. The Federal Housing Administration doesn't accept cash value as a qualified payment source when financing an FHA-insured loan. They do this to curb fraud and ensure FHA loans aren't being used as a money laundering technique rather than mortgages.

Keeping mattress money or money stashed in hidden places in your home is problematic since there's no paper trail. Your lender can't verify where the funds came from, when you started saving them, or whether they're part of your regular savings habit. The lack of proof that you can repay a loan with mattress money is often one of the reasons for loan delays or refusals. You must present the evidence of your regular income and savings to lenders before loan approval is granted.

If you have cash under your mattress or in a safe and want to use it for the down payment, deposit it in your bank account three months in advance. Thus you'll have seasoned funds in your bank account, and no significant deposits will reflect in your account when the lender reviews your bank statements. Depositing cash into your bank account may be done at your local bank, an ATM that accepts cash deposits, or online banking.

Man hand holding coins and modal house

Family-friendly Activities in Collier County, Florida

Collier County, Florida, offers numerous family-friendly activities that everyone in your family can enjoy, regardless of their age. From unique cultural experiences to exciting adventures and even relaxing resort vacations, Collier County has something to offer everyone and every interest.

Keep reading to discover six fun and exciting things to do with your family in Collier County, Florida.

Visit the Naples Botanical Garden

The Naples Botanical Garden is a must-see for any family visiting or living in Collier County. The garden is a great way to spend a day with your family while learning about nature. With 170 acres of gardens, there's something for everyone to enjoy. Garden admission is $25 per adult, $10 per child ages 4-17, and free for members and children three and under.

The garden offers educational programs for kids of all ages—a hands-on opportunity for your kids to explore native plants from around the world through play, gardening, and other interactive experiences. There are some special events that you can attend on specific days, including Christy Noonan: Meditations on Waterlilies, Daily Bread Food Pantry Mobile Drive, Dig Deeper, Daily Tours, and STICKWORK. If you're planning a visit on one of these days, check out their calendar and events for more information.

Visit the Naples Zoo at Caribbean Gardens

The Naples Zoo at Caribbean Gardens is a great place to visit with your family. There are plenty of animals to see, including lions, tigers, and bears. The zoo also has a variety of educational programs that your family can participate in. Plus, the gardens are beautiful and provide a great place to take a walk or enjoy a picnic.

The grounds are spacious enough for children to run around and explore independently while parents sit back and relax. The Naples Zoo is open from 9:00am-4:30pm Monday through Friday, from 10:00am-4:30pm on Saturdays, and from 11:00am-4:00pm on Sundays. Admission prices vary depending on age group but generally cost between $8 and $12 per person.

Visit the Museums

Collier County is home to some of the best family-friendly museums in The Sunshine State. From the museum of fine arts to the historical museums, there's something for everyone to enjoy. The museums in Collier County are full of exhibits on the county's history, culture, and natural resources, making them a great place to learn about the history and culture of Collier County.

There are also interactive displays that kids will love, including games and a sandbox to play in. Here is a list of some of the most famous museums in Collier County:

  • Collier Museum at Government Centre - Stories from our past

  • Marco Island Historical Museum - A living history

  • The Baker Museum - History comes alive!

  • Everglades National Park - The world's wonder

  • Palm Cottage - Unique furnishings and authentic decor

  • The Revs Institute - Preservation of rare automobiles

  • Napple Holocaust Museum - Unique artworks and stories

  • The Naples Depot Museum in downtown Naples - Early technology and transportation

Visit the Various Parks

Collier County is home to many fun-filled and family-friendly parks, each with unique offerings. From hiking and biking trails to playgrounds, picnic areas, and campgrounds, there's something for everyone to enjoy. And what's more, spending time in nature has been shown to benefit adults and children alike.

The Collier County parks will help you exercise while strengthening your family relationship and fostering new friendships. Be sure to explore the following parks in Collier County:

  • North Collier Regional Park
  • Vineyards Community Park
  • Sugden Regional Park
  • Freedom Park
  • Cocohatchee River Park
  • Veterans Community Park
  • Donna Fiala Eagle Lakes Community Park
  • Big Corkscrew Island Regional Park
  • Max A Hasse Jr Community Park
  • Collier County Parks & Recreation Administration

Everglades Airboat Tours

Airboat tours are a great way to see the Everglades up close and personal. With high speeds, plenty of fresh air, and energizing excitement, Everglades Airboat Tours are family-friendly, featuring many fascinating sites. These adventures are fun-filled and fast-pasted to keep you on your toes the whole time. Don't close your eyes while on an Everglades tour to avoid missing out on incredible wildlife, including Florida's ancestral dinosaur, the American alligator.

All tours are thrilling and safe, with the capability of being up close and personal with the fantastic creatures in the Everglades. Plus, the airboat tour guides are knowledgeable about the area and can answer all your questions during the tour. Best of all, it's an affordable activity.

Go Shopping and Visit a Restaurant for Hispanic Cuisine

Shopping is an excellent activity for families because it can be done together and at each person's own pace. It can also be a bonding experience, as you help each other look for items and make decisions. Plus, it's a great way to get out of the house and explore new places.

Collier County has plenty of places to go shopping for almost anything under the sun and find restaurants that serve authentic dishes. Some of the famous shopping spots in Collier County include:

  • Waterside Shops
  • Third Street South
  • Mercato
  • Coastland Center
  • Tin City Waterfront Shops
  • The Village Shops on Venetian Bay

Hispanic culture is vibrant, and there's no better place to experience it than in Collier County, Florida. There are plenty of Hispanic restaurants and cafes in Collier County. You'll find it here if you're looking for Mexican, Cuban, Puerto Rican, or Dominican food. And what's more fun than enjoying a delicious meal with your family?

Below are several restaurants and cafes offering the famous Hispanic cuisine in Collier:

  • Salsa Brava Mexican Grill
  • Taqueria San Julian 2
  • Taco Lindo
  • Tacos & Tequila Cantina
  • Mr. Tequila Grill

Bottom Line

If you're looking to buy a house but don't have enough cash to make a big down payment, you can still qualify for an FHA loan with the help of the low down payment program.

Contact a mortgage counselor or your local FHA-approved lender to confirm your eligibility and get the professional help you need to apply for the low down payment mortgage in Collier County, Florida.

This option makes it possible to pay as little as 3.5% of the total price of your home upfront, so you can get into your dream home without risking your savings or racking up credit card debt.

With over 50 years of mortgage industry experience, we are here to help you achieve the American dream of owning a home. We strive to provide the best education before, during, and after you buy a home. Our advice is based on experience with Phil Ganz and Team closing over One billion dollars and helping countless families.

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