FHA qualified programs are a great thing for many first time home buyers. FHA or Federal Housing Administration, is a program that creates an additional funding/mortgage loan resource for many home buyers who ordinarily might have difficulty qualifying.
Terms for FHA loans are almost always much more attractive than those of conventional loans. FHA Insured Mortgages have low interest rates and more friendly qualifying terms for entry level downtown Denver condo and downtown Denver home buyers.
Perhaps the greatest aid FHA loans give to home buyers is the low down payment requirement. FHA insured mortgages have a low 3.5 percent down payment and more flexible underwriting rules.
What many don’t realize is how difficult it can be for a condo developer to qualify for FHA financing. FHA financing is not an automatic option. It takes time, money, and many steps for a building to qualify for FHA financing.
So many wonder why a developer would opt to take on all the cost and time involved with getting their Denver loft or condo building qualified for FHA loans? The answer is simple…. More sales.
FHA qualified buildings can appeal to a much larger range of buyers. SPIRE, the Downtown Denver condo tower located in the heart of the Theater district launched during what would be considered a rough patch in the real estate market. By allowing FHA buyers to qualify they were able to attract numerous first time buyers and that most likely contributed to the rapid sales of the lower priced residences.
In comparison, the building most consider the biggest competitor to SPIRE is the Glass House. Similar amenities, similar architecture, and both were even built by the same general contractor… they are vastly different in terms of financing.
The Glass House launched during one of the strongest real estate markets in Denver. The developer had no need to apply for FHA financing and the building sold out quickly. In comparison, SPIRE still has inventory to sell after years of sales. Although it is certainly one of the most popular downtown Denver condo buildings in Denver the timing of it’s launch benefited greatly from the FHA offering.
Unfortunately, FHA rules are getting tougher and developers are finding it more difficult to qualify as reported in the Denver Post article. There are still may great FHA properties in Denver and New Era Realty is your expert to help assist in your first time home buyer search. Contactanyone at New Era Realty today.