What is an FHA Loan?
This program is often referred to as a “first-time buyer” loan. However, you can utilize the leniency and purchasing power of an FHA home loan at any time.
With a low down payment (3.5% of the purchase price), FICO scores allowed down to 580 and flexible guidelines, an FHA home loan is always a viable option.
FHA Advantages
3.50% Down
Required
Low down payment for all FHA Home Loans.
Assistance
Various Programs
Add a down payment assistance program.
Flexibility
Types Of Properties
SFR’s, Condo’s and Manufactured allowed!
Forgiving
Lenient Guidelines
Less than a perfect credit & income is okay.
Only 3.5% Down
FHA only requires a 3.50% down payment with 580+ credit score on all homes.
FHA Benefits
Streamline Refinance
“Streamline” your refinance for a lower rate and payment. No appraisal, minimal docs.
580 Credit Score
Flexible requirements, go below a 580 FICO with 10% or more down payment.
55% Debt-To-Income
FHA has one of the most flexible “DTI” requirements out there. More purchasing power for you.
Up 6% Seller Credits
Sellers can help with some or all closing costs. FHA allows up to 6% seller concession.
Self-Employed, Okay!
Working for yourself? No problem, we got you! Qualify with the last two years of tax returns.
Frequently Asked Questions
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You need to wait 3 years after a short sale, or foreclosure to get another FHA loan. You need to wait 2 years from a bankruptcy.
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Collections are okay. Lenders will qualify you with a monthly payment of 5% of the balance.
Charge-Off Accounts When an account is “charged off” by a creditor, lenders will not count it as a debt.
Medical Bills (collection) Medical collections are not considered in your qualifying analysis at all.
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Yes! Gift funds are allowed and can cover the entire down payment plus all closing costs if needed. Gift funds can come from:
Relatives & Immediate family members.
A close life-long friend (this is a tough one but doable).
Your employer or labor union.
Government or public agency.
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Checking & Savings
Retirement Accounts (401k, IRA, 403b, etc.)
Stocks & Bonds (once liquidated)
IRS & State tax refund checks.
Employer is allowed as well, it would need to be documented and is considered a gift.
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Keep in mind, all money being used to purchase the home needs to be sourced and/or seasoned (sitting in a bank account for at least 2-months) in order to be usable.
The below are funds that cannot be used:
Large, unsourced cash deposits.
Cash advance, taken out from a credit card.
Crowdfunding programs.
“Gift Funds” from multiple friends who are not family nor allowed to be donor’s (see gift funds question above).
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Most often times the answer is YES! You don’t have to be with an employer for a full 2-years. However, we need to document a full two years of work. Some carve-outs to consider:
Just graduated college with a degree and started full-time with an employer in the same line as your degree. This is allowed!
You have been unemployed for a year, however you are back to work full-time for six months (or more), in this case we would need to go back and document income & employment with prior employer(s) for at least two years. This is allowed!
