Is FHA right for you?

FHA loans accept lower credit scores and are easier to qualify for, however there are limitations as to how you can use the property. There is also a limitation as to how much you can borrow based on the region of the country the home is located.

Upsides of an FHA Mortgage Loan

Low down payment of 3.5%
The 3.5% down payment applies to credit scores as low as 580
With a 10% down payment, a score of 500 can qualify
Lower mortgage insurance rates than conventional lender mortgages.

Frequently Asked Questions

ARE FHA LOANS JUST FOR FIRST-TIME HOME BUYERS

FHA loans are for anyone who can qualify for the program and they are not just for first time home buyers. However, the majority of the individuals who do apply for an FHA loan happen to also be first time home buyers.

DO COLLECTIONS NEED TO BE PAID OFF BEFORE GETTING AN FHA LOAN

Collections do not have to be completely paid off prior to applying for an FHA loan if they have not reported within in the last year. In addition, medical collections are handled differently than other types of collections. Do not pay off anything until you speak to a mortgage specialist and get guidance from them on how to proceed.

CAN I APPLY FOR AN FHA LOAN WITHOUT MY SPOUSE?

You may apply for an FHA loan without your spouse. However, the lender still may want to see your spouse’s credit report. For refinances, local laws will also require that your spouse sign a document acknowledging that you are taking out a mortgage against your mutual primary residence.

CAN THE SELLER PAY MY CLOSING COSTS

The FHA guidelines permit the seller to contribute up to 6% of the sale price towards the buyer’s closing costs. This is often managed during the negotiation process and is a great option for home buyers who are limited on cash.

FHA

Concerns of an FHA Mortgage

Mortgage Insurance is non-cancellable with a down payment of less than 10%.
Mortgage Insurance can drop if the FHA loan is modified into a conventional mortgage or if a down payment of 10% or more was made. Mortgage insurance will automatically fall off after year 11 with a down payment of 10%.
FHA loans apply only to a home you’re going to live in. No vacation, income or rental properties.
FHA loan limits differ depending on where the property is located. In Louisiana, as of 2023, the FHA loan limit is $472,000.