Pink House Team
Keller Williams Realty

FHA is one of the most popular types of financing. It has a low down payment and the guidelines to qualify are a little more relaxed than a conventional loan. That is probably one of the reasons you got an FHA loan to purchase your house. Now you are a seller and it is important for you to be aware of how FHA works.

When you are ready to sell your house FHA requires something that neither VA or conventional loans require. Extra interest.

Be careful if you look at your statement and see, for instance, that your principal balance is $150,000. Your payments are received by your mortgage company on the 1st of every month.

Buyers like to close on the last day of the month because that makes their pre-paid interest nothing. This is NOT what you want, however. If FHA does not receive in their hand the entire payoff ON the 1st you will owe another entire month’s interest.

On $150,000 at 6% interest that would be an extra $750 even if only one day past the first. It is important that your Realtor understand this and make sure to negotiate the contract to close a few days before the end of the month. It would actually be better for you if you closed well enough in advance so that if there is a problem and you need an extension it want go past the 1st.

We always make that determination for our sellers because we want them to receive the most money in the least amount of time with the least amount of hassle.

Call today for additional information!

Pamela Madore
Keller Williams Realty
3955 S Soncy Rd
Amarillo, TX 79119