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FHA Loans

FHA Loans can be used to purchase a new home or to refinance an existing property. FHA loans allow you to purchase property with a lower down payment than if you were to go with a conventional loan or refinance to lower your current payment.

FHA loans are insured by the Federal Housing Administration, which allows FHA-approved lenders to provide financing to buyers unable to qualify for a conventional loan. The FHA is not a mortgage issuer; instead, the agency provides insurance on mortgage payments, allowing a greater number of borrowers to qualify for financing.

FHA Benefits

FHA loans are designed for borrowers with little or poor credit history or who have experienced a financial setback such as a foreclosure or bankruptcy, to qualify. FHA loans are popular with first-time buyers because they can buy a property with a low down payment, qualify using lower underwriting standards, usually at a lower rate than a conventional loan. 

Broad Variety of Loan Options: There a number of flexible options such as a 30 year fixed, 15-year fixed or a 203k loan.

  • Low Down Payment: Great for first-time buyers with little money to put down.

  • 100% Gift Funds: The down payment funds can come from a gift from a third party.

  • All Types of Properties can be insured: Insurance is available for single-family, 2-4 unit homes, condos, and mobile homes.

  • Refinancing: The easiest way to refinance as there is no credit qualifying, no income verification, and no appraisals required.

FHA Guidelines

The guidelines vary depending on the loan type. Credit requirements tend to be more lenient but the loan criteria are stricter.

  • Less than perfect credit ok

  • Low down payments 

  • Gifts or grants allowed toward down payment

  • Sellers, builders, or lenders may pay some of the borrower's closing costs

  • 30% housing ratio

  • Higher home inspection standards

 

FHA Loan Options

FHA Fixed Rate Mortgages

FHA 15 Year Fixed Rate Loan:

  • All the benefits of a 30 Year Fixed Rate Loan

  • Save thousands in interest over the life of the loan

  • Build equity faster

  • Pay your house off sooner

 

FHA 30 Year Fixed Rate Loan:

  • Low-interest rates and monthly payments

  • No prepayment penalties

  • Low down payment options

  • Gift funds allowed

  • Ability to Refinance

 

FHA 203k 30 Year Fixed Rate Loan:

  • 203k is a renovation loan program designed for borrowers buying homes for rehabilitation or to make improvements to their existing property

FHA Adjustable Rate Mortgages

FHA 5/1 Adjustable Rate Mortgage:

  • Keeps interest rates low for 5 years

  • Introductory interest rates are typically lower than fixed rates

  • Good for buyers who plan to own the home for a short time or refinance in a few years

 

FHA Streamline 30 Year Fixed Rate Refinance Loan

  • Convert an adjustable rate into a fixed rate mortgage

  • Lower the payment by lowering the current interest rate

  • Require less documentation than a traditional loan

  • No appraisal required

  • No credit check

  • No income documentation

  • Easy to qualify

 

FHA 203k Streamline 30 Year Fixed Rate Refinance Loan

  • Allows borrowers to cash out up to $35,000 to pay for improvements or renovations to the property.

 

FHA Streamline 5/1 Adjustable Rate Refinance Mortgage:

  • FHA 5/1 ARM establishes a lower initial interest rate for the first five years, then the market determines your rate

  • Adjustable Rate Mortgages typically have lower rates than fixed-rate loans

  • Useful if you plan on selling your home in the near future