Are you a first-time home buyer? Have you heard the FHA loan from friends and family? This loan option may be the perfect solution for you when finding that first home.
A Federal Housing Administration (FHA) loan is a government-backed mortgage option. Since this type of loan is designed to protect lenders for a loss it does have some stipulations added required by the borrower.
An overview of the FHA home loan option and requirements:
- FHA loans are popular for the lower down payment sometimes as low as 3.5% depending on certain qualifications.
- Borrowers can have credit scored that are between 500 – 600 with a larger down payment.
- The FHA loan requires the borrower add the mortgage insurance premium to their payments.
- FHA loans require that property be inspected by an approved FHA appraiser. The property must meet the FHA requirements.
- This loan options also requires the purchaser be the primary resident occupying the home.
- You must be a resident of the US, have a valid Social Security and be of legal age to purchase a home.
- While the debt-to-income ratio can vary typically this loan requires a 31 – 40% income over debt.
- Out of bankruptcy two years or more and three years for a foreclosure. Speak with one of our Lendevity advisors about extenuating
circumstances that may reduce your waiting time.
- Interest rates on the FHA fluctuate depending on government rates. Please speak to our advisors for the latest rates or use one of our online tools for a fast estimate.
Contact us today if you are interested in the benefits of the FHA loan option.