FHA Loan Requirements
FHA LOAN REQUIREMENTS are set by the Department of Housing and Urban Development. Here we will discuss the basics of qualifying for an FHA home loan.
FHA loan requirements can be discussed in detail with a lender by applying at our site. Once you have applied we will provide you with up to four competitive rate quotes for your loan. Down payments for FHA home loans are low, generally 5% or even as low as 3%. Qualifying for an FHA home loan is done by using a set of debt-to-income ratios that are a bit more in your favor than those used for conventional home loans. The following two fha loan requirements are important for qualifying:
- Housing expenses should not exceed 29% of your gross income
- Total indebtedness should not exceed 41% of your income.
FHA Home Loans
These numbers are by no means set in stone. If you have a history of making payments on time or cash reserves, special considerations will be made to see if you can still qualify. In most cases, you can even dump your closing costs into the mortgage amount so that less money is needed up front in cash. FHA loans do not carrying a prepayment penalty so you are free to pay off the loan as soon as you are able without facing fees. You will need an FHA-approved lender to help you with the details of your purchase. To be put in touch with a qualified loan officer in your area, simply fill out our application.
Common FHA Loan Requirement Questions:
1. Where are FHA home loans available?
FHA home loans are available in rural and urban areas. Restrictions on the maximum purchase price of a home that is FHA varies from state to state and your lender can give you a number for the area in which you live.2. How long do I have to pay PMI?
Private mortgage insurance is generally paid until you have a certain minimum amount of equity in your home. Once you have reached 20% equity in your home it is generally possible to cancel PMI payments.3. Will an FHA Loan cover my closing costs?
In some cases yes, the closing costs can be rolled into the home loan if you cannot come up with the cash to cover closing cost expenses.