FHA Mortgage Loan

Need a FHA mortgage in California? Learn more.

The federal government insures loans for FHA-approved lenders in order for lenders to limit their probability of loss in the event that the borrower fails to make their mortgage payments.

Since the decade of the 1930s, the FHA loan program has been available to assist and energize the housing market by creating accessible and affordable loans for families in the armed forces, older people, disabled, or lower-income households however actually, anybody is able to get an FHA mortgage; they aren’t reserved for only first-time home-buyers.

An added benefit of conforming loans is you may buy an owner-occupied 2 to 4 unit income property with 5-percent subject to qualifying with a high credit score and debt to income ratios. It can be a huge advantage to use the other units to help pay your mortgage or qualify.

FHA Loan Overview

  • - As low as a 3.5 percent down payment
  • - Traditional income & employment documentation
  • - Minimum credit score: 620. 10-percent with a 580 score
  • - Minimum loan amount: $150,000
  • - Maximum amount: $1,149,825 (1-unit home); higher for two to four-units

 

fha home loan Condo

fha home loan California

Does a Mortgage Broker's FHA Loan Beat the Banks?

  • Their interest rates are typically the same
  • Broker's rate may offer YOU a credit for some or all closing costs1
  • Brokers allow 10-percent down with 580 credit scores, NOT banks
  • More flexibility on job(s), recent credit issues, etc.
  • No Junk fees!
  • $0 Application fee
  • $0 Loan processing
  • $0 Origination fee option


FHA Loan Requirements

1.) Age – you should be beyond the minimal age necessary to put your signature on a mortgage loan in your state. There isn’t a maximum age limit.

2.) Citizenship – It is not necessary to be an American citizen, however you should be a permanent resident in the USA who’s allowed to be employed within the United States.

3.) Social Security Number – you are expected to have a legal SSN; a Tax ID number by itself isn’t satisfactory.

4.) The subject property should be a residential property either a one-to-four family dwelling(single unit home, condo, duplex, triplex, fourplex).

5.) The value of the property can’t be more than the allowable FHA limit in the property’s county .

6.) You will want to fulfill the lender’s eligibility provisions for a mortgage loan. The provisions for FHA loans are usually somewhat more flexible than conventional home loan qualification criteria.

7.) Credit Score – you’re not required to have a very good credit rating (720 or above) to get approved for an FHA loan. Some lenders used to have programs that went as low as 520. FHA lenders can not legally decline an applicant as a result of your credit FICO scores. Currently, the minimum credit score is 620.

8.) Bankruptcy / Foreclosure – If a borrower has had a chapter 7 or any category of bankruptcy prior to applying, it needs to have been discharged for greater than 2 years and maintain a satisfactory credit history in the period after the bankruptcy. If you have had a foreclosure before, it needs to be a minimum of three years prior to applying for an FHA loan request. In essence, you will need to have your financial house all sorted out.

9.) Employment – Borrower should have a consistent employment record or have worked for the same employer for the most recent two years.

10.) Debt-To-Income (DTI) Ratio – In a lender's perfect world you should allocate as much as 29% of your salary towards to house payments, and as much as 43% of your earnings towards your combined housing payment plus all supplemental monthly debts that have a repayment history lasting more than 6 months. Some lenders will allow a debt to income ratios much higher at 56.9%. So, don't be discouraged if yours is over 43%.

11.) Down Payment – you’ll need a 3.5% down payment, but this can be in the shape of a gift or grant, and it’s essential to have the ability to finance the closing expenses of the mortgage.

12.) Closing Fees – you will want to be able to pay the closing fees of the FHA mortgage which will probably be greater than a regular conventional loan. Normally, you will want to have an additional 2.5 percent of the property's purchase price.


FHA Refinancing

FHA loan refinancing is made available to keep money in the pockets of thousands of Americans and prevent foreclosure. This type of loan can assist owners in decreasing their interest rate, their month-to-month expenses, or also get some money out using an FHA Refinance. Should you have an FHA loan and desire to learn more about refinancing, you can be helped quickly by an FHA approved lender.

Streamline
If you have an FHA loan how do you lower your rate? You can do so possibly using a an FHA streamline loan. If you’d like to start an FHA refinance using the streamline process you have got quite a few advantages in your favor such as no minimum credit score, no job or income documentation and usually no appraisal is necessary. In order to begin at this instant and apply for additional info on this refinancing alternative click here to set up an appointment with a loan originator.

FAQs

See answers to questions borrowers also ask about FHA loans

Can I buy or refinance without a job?

Yes. If you are currently unemployed the underwriter will review and determine if you can refinance to lwoer your interest rate without job or income verification.


How many months of liquid reserves do I need?

The number of months generally from 2-months.


How long does an approval take?

A conditional pre-approval can be obtained within hours.


What documents do I need to apply with?

In general, you will need copies of your recent bank statements, valid state or govt. ID, a copy of rent checks covering the last 1-2 years(if renting), W2s last 2 years, tax returns, signed purchase contract if buying.

 


1. View the disclosure disclaimer regarding loan approval, loan product availability and qualifying for a loan. Not All borrowers will qualify.