What is an FHA loan?
An FHA mortgage is insured by the Federal Housing Administration (FHA) and is a popular option with first-time homebuyers. It was specifically designed to help potential homebuyers get into a home with less stress by providing lower down payment options and flexible underwriting guidelines. FHA-approved lenders are able to offer these benefits because borrowers with an FHA loan pay mortgage insurance, which protects the lender in case the borrower defaults.
Can I qualify for an FHA loan?
Because an FHA loan is government-insured, it has less stringent qualifications and credit requirements compared to Conventional financing. The minimum credit score depends on a variety of factors, so be sure to check with your Loan Officer about your specific situation. The FHA mortgage was originally created for first-time homebuyers, but it is now open to a much wider audience. Under FHA guidelines, if you have not owned a primary residence for at least three years you can qualify as a first-time homebuyer! Qualifying homeowners may be able to refinance their FHA loan and obtain a lower rate with an FHA Streamline refinance.
How much is the down payment for an FHA loan?
A down payment as low as 3.5% is available through an FHA home loan. This amount may even be covered through a gift from a family member or by down payment assistance through state or local government programs. Ask your Loan Officer for available options in your area. If you’re not sure you can qualify for a mortgage, speaking to a loan officer who specializes in FHA financing may be a great place to start. Get pre-qualified now and we’ll review your current financial situation and credit score to help you find the best option for you.