FHA loans are an attractive option, especially for first-time homeowners, because it is insured by the Federal Housing Administration (FHA). Primarily, the federal government insures loans for FHA-approved lenders in order to reduce their risk of loss if a borrower defaults on their mortgage payments. Typically the borrower can be approved with 3.5% down vs 20% that is required on other loan programs.
What are the advantages of an FHA loan
An FHA loan can be a great option if you are looking to purchase a home with a minimal down payment and you do not have excellent credit. With an FHA loan, you may have credit scores as low as 600 and still qualify, assuming other guidelines are met. FHA loans are also a great option for first time homebuyers. Contact Dan Palumbo today to discuss whether or not the FHA mortgage will be beneficial for you or if one of the 3% down payment programs may be a better fit.
What is needed to qualify for an FHA mortgage
Qualifying for an FHA loan is similar to a conventional mortgage except there may be a few extra disclosures to sign and a couple additional appraisal conditions need to be met. If you are interested in purchasing a new home and want to know if an FHA loan is right for you, contact us today for details and to start the pre-approval process.
What documents are needed for an FHA loan
- Last 2 years of W2s
- Last 2 Pay Stubs
- Last 2 Months of Bank Statements
- Copy of Drivers License