November 17, 2019

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FHA Mortgage Facts You Should Know

FHA mortgage loans are a very good option for borrowers looking for a lower down payment and less stringent credit requirements than conventional mortgages.

Did you know that FHA home loans do not feature a minimum or maximum income requirement? A borrower’s ability to qualify for an FHA mortgage depends on FICO scores, debt-to-income ratios, credit history, and other factors but there’s no “qualifying dollar amount” for income in terms of minimums OR maximums.

Some believe that FHA mortgages are only for first time home buyers, the economically disadvantaged, or only for typical suburban homes. But FHA home loans are available to anyone who is financially qualified and wants to use the property to be purchased as their primary residence.

FHA mortgages require only a 3.5% down payment in typical cases, though a borrower’s FICO scores and other financial qualifications will play a role in the amount of the down payment in situations where there are “borderline” FICO scores or other issues.

The down payment can also be affected by the nature of the transaction, but most typical purchases require the 3.5% down compared to much higher down payments for some conventional mortgages.

FHA home loans can be refinanced, using FHA-to-FHA streamline refinancing (which has no FHA-required appraisal or credit check), or FHA cash-out refinancing. There are also FHA reverse mortgage loan options for seniors who either own their homes outright or are very close to doing so.

FHA mortgages are available from participating lenders. Not all participating lenders agree to offer every single type of FHA mortgage option, but shopping around for a lender who can meet your specific needs is a good thing. You may need to find a lender willing to do a manufactured home, an FHA mortgage for a fixer-upper property, or you may need to find one who can give you a mortgage loan for a build-to-suit project.

All of these options are available under the FHA mortgage loan program and once you find a participating lender who can help, the next step is to discuss your specific needs and see what’s possible with that particular lender.

FHA loans include flexible options for energy efficient upgrades or improvements, and those improvements can also be built into FHA refinancing loan packages.

Joe Wallace - Staff Writer

By Joe Wallace

February 2, 2017

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.

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About FHANewsBlog.com
FHANewsBlog.com was launched in 2010 by seasoned mortgage professionals wanting to educate homebuyers about the guidelines for FHA insured mortgage loans. Popular FHA topics include credit requirements, FHA loan limits, mortgage insurance premiums, closing costs and many more. The authors have written thousands of blogs specific to FHA mortgages and the site has substantially increased readership over the years and has become known for its “FHA News and Views”.

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