Own A Home Now With FHA Home Loans

FHA home loans are the best because they help you buy a home even with limited credit or low down payment. FHA home loans or Federal Housing Administration loans are a housing mortgage program that is issued by an FHA approved lender like the Livingstone Team and is insured by the Federal Housing Administration. FHA home loans are designed for low-to-moderate-income borrowers. Currently, in 2020 you can borrow up to 96.5% of the value of a home.

Low Down Payment Requirements

One of the perks of getting FHA home loans from an accredited lender is the very low down payment you need to shell out for the mortgage loan program. Many people do not even bother thinking that they can own a home of their own because they believe that the enormous down payment for the loan or mortgage is just too much for them. However, with an FHA home loan program, you need not worry about that. When you apply for an FHA home mortgage loan you get the flexibility used for a down payment and this includes your personal savings, a gift from a family member, and even approved government down payment assistance programs. Most conventional mortgage loan products from lenders require at least a 5% down payment, depending on your credit, and up to 20% down. With an FHA home loan from lenders, you can avail of a very low 3.5% down payment of the purchase price for the mortgage.

Reduced FHA Annual Insurance Premiums

People that apply for FHA home loans are eligible for the newly reduced down payments on annual insurance premiums. Based on estimates from the HUD, the lower premiums will save more than two million FHA homeowners an average of $900 yearly in payments.

Designed To Make The Dream Of Owning A Home A Reality

Approved FHA Home Loan in St Paul Minnesota

FHA home loans are popular with lenders because of the fact that it is federally insured. Since the Housing & Urban Development provides the guidelines, some of the requirements to qualify are more attractive and doable compared to conventional loans. Some of these are excluding deferred student loan payments from debt-to-income calculations and lesser minimum credit score requirements.

Bankruptcy And Foreclosure Does Not Disqualify Borrowers For The Loan

Even if you have filed for bankruptcy or have recently undergone foreclosure of your property you still can apply for an FHA home loan from lenders. You can qualify for FHA home loans in as little as two years after declaring bankruptcy and three years after you had a foreclosure event. You will need to reestablish good credit or select not to incur new debt obligations as well as show that you have the ability to effectively manage your conventional mortgage responsibilities.

Better Allowance of Seller Concessions

FHA home loans let property sellers pay up to 6% of the purchase price to cover closing costs or prepaid items with obtaining the loan. With conventional loans seller contributions are capped at 3% when a borrower puts a down payment that is less than 10%. The increased capability lets you reduce out of pocket costs when buying a home.

How to get FHA Home Loans

Establish Verifiable Income

As with any loan, you will need to establish that you have the ability to pay for the monthly payments and this can be achieved with the establishment of verifiable income. Steady income documents such as pay-stubs and tax returns are the single most important requirement you need to get when applying for the best FHA Home loans. As a rule, lenders need to see that you have a stable job for at least a year or two in the same field. Also, under the FHA program, the lender can still accept a shorter work history from mortgage loan applicants.

Afford the Housing Payments

One of the biggest factors, in order to qualify for FHA home loans, is the ability to pay the monthly mortgage payment. As a guideline, the mortgage payment should not be more than 35% of your income (before taxes) and the mortgage payment and other monthly debt payment obligations such as credit cards, car loan etc. should not be more than 48% of your monthly income.

Prepare the 3.5% Down Payment

The minimum down payment for FHA home loan mortgage products is 3.5%. In actuality, you need to save almost 6% of the home’s purchase price as closing costs need to be put into account as well. This includes an upfront mortgage premium equivalent to 1.75% of the value of the property. There is the possibility of being able to reduce this amount to 1.25% by simply undergoing an FHA-approved credit counseling program before closing.

Establish your Credit History

At the very least, in order to qualify for FHA home loans, applicants must get an established credit history with at least two lines of credit such as a student loan or a credit card.

FICO Score 580-640

In order to get the best FHA Home Loans, your FICO score should at least be 580. However, the FHA is not a lender but the insurer of the loan. Keep in mind that it is the lender that sets the guidelines for the minimum score requirements. Most of the time the score should be around 640 for FHA home loans and 700 for conventional mortgage loan products.

Get FHA home loans as this can make your dream of owning a home a reality. It is important that you know the federally set limits on how much you can borrow for this loan as this varies by state and county. Talk to your lender today to know more about the right FHA home loans that can suit your needs.