FHA loans are very popular for first-time homebuyers. These loans are insured through the Federal Housing Administration, or FHA. This backing by the FHA enables qualified lenders to offer credit to prospective home buyers with less than perfect credit. This, in turn, makes home ownership a reality for many families who otherwise may be denied credit by private lenders.
Benefits of FHA Loans
There are many great benefits in choosing an FHA loan, including:
- Lower Credit Score – Potential home buyers with a credit score as low as 600 still may be eligible for a FHA loan.
- Smaller Down Payment – While many private lenders require as much as a 20 percent down payment, home buyers can get an FHA loan with as little as 3.5 percent down and benefit county based down payment assistance programs.
- Reduced Closing Costs – The FHA loan program allows sellers to pay as much as 6 percent of the total loan amount towards closing costs, compared to the 3 percent allowance for many conventional loans.
FHA Loan Qualifications
Not everyone qualifies for an FHA loan. You must meet specific qualifications, such as:
- Meet Credit Score Minimum – You must have a credit score of at least 600.
- Have 3.5 percent for Down Payment – You must have at least 3.5 percent of the loan amount to use for your down payment.
- Steady Employment – Must be able to prove a steady employment history.
- Debt-to-Income Ratio – Your current debt-to-income ratio will determine that maximum loan amount you can request.
- Property meets FHA Standards – The property must pass an inspection completed by an authorized FHA appraiser.
FHA Loans through Southpoint Financial Services
If you think you may qualify for an FHA home mortgage, Southpoint Financial Services can help. As an approved FHA lender, we can help you determine if an FHA loan is right for you. We offer accurate and informative home ownership education and resources to help our clients make the home buying decisions that are beneficial for them and their families.
When you work with Southpoint Financial Services, you never have to worry about hidden fees. Our informative Loan Estimate Fee Worksheet will help you determine exactly how much purchasing a house will be, including all costs and fees. In addition, our experienced team will ensure that you understand the total amount of your closing costs, what your monthly payments will be and what is and is not included in your monthly payment, including mortgage insurance, homeowner insurance, HOA fees and property taxes.
At Southpoint Financial Services, we can make your dream of home ownership a reality. Contact us by phone at 888-297-7227, email or through our convenient online contact form and find out if you qualify for an FHA loan today.