What is an FHA Loan?
- FHA Loans are loans from approved lenders where a portion of the loan is guaranteed by the Federal Housing Authority
- FHA loans require borrowers to pay mortgage premium fees at closing and as a part of your monthly payment for that guarantee
- FHA Loans can be used to purchase homes or to refinance your existing mortgage
- FHA Loans are designed for borrowers who want to put less cash up front in the form of a down payment (less than 20% down)
- FHA loans are also designed to aid those who don’t qualify for standard Conforming loan financing due to lower credit ratings or due to a lack of credit history
- FHA offers 30-year terms, 15-year terms, and Adjustable Rate Mortgages
- Not all lenders or loan originators provide FHA loans
What are the Benefits of an FHA Loan?
- They are not limited to 1st-time homebuyers.
- You don’t have to have great credit to qualify for a loan
- Credit scores as low as 560 are eligible for review
- Interest rates are as low as any other rate in the market today
- Perfect for borrowers who have not yet established extensive credit
- Very low down payment requirements of 3.5%, which can be gifted from a family member
- FHA Loans allow large seller contributions of up to 6% of the sale price allowing borrowers to limit their out of pocket expense when purchasing a new home
- Loan limits on FHA loans are at $331,760 in the state of Missouri. That means a home with a sale price of $343, 790 with 3.5% down would qualify at a market rate under FHA guidelines.
- Refinancing provides borrowers with the highest percentage of cash back for debt consolidation
- Special streamline refinance option allows borrowers to refinance their home to a lower interest rate even if their current FHA loan is upside down on the value of your home… NO APPRAISAL REQUIRED!!
- Allow borrowers to get a new loan after only two years following a bankruptcy
How Do I qualify for an FHA Loan?
Not sure if you qualify?
No Problem – FHA Loan eligibility can be determined by contacting our office for a free consultation.
- Generally a 580 score is necessary to qualify, however, we have FHA programs that will go as low as a 560 credit score
- They have great programs for purchasing homes with as little as a 3.5% down payment and those funds can even be gifted to you from a family member!
- FHA also offers what is called a “Streamline Refinance.”
- This allows you to refinance out of a higher interest rate and into a lower interest rate without having to have an appraisal or income documentation.
- All you need is a 580 credit score and have your mortgage payments be paid within the month that they are due for the last 12 months.
- There is also a great refinance program that allows you to draw cash out up to 85% of the value of your property without having any increase to your interest rate.