What is an FHA Loan?
FHA mortgage loans are issued by federally qualified lenders and insured by the U.S. Federal Housing Authority, a division of the U.S. Department of Housing and Urban Development.
How Do I Apply for an FHA Loan?
The FHA asks for a lot of information on your FHA loan application. You will need to provide the FHA with a wide range of details including:
- All addresses where you have lived in the previous two years.
- Your employer’s name and addresses for the last two years, plus the amount of your Gross Monthly Salary.
- W2s for the past two years.
- Income tax forms submitted for the last two years.
Gather all of this information to begin your FHA application so you will have everything handy to complete your FHA loan forms at one time and give us a call!
FHA Loan Requirements
The FHA, or Federal Housing Administration, provides mortgage insurance on loans made by FHA-approved lenders. FHA insures these loans on single family and multi-family homes in the United States and its territories. It is the largest insurer of residential mortgages in the world, insuring tens of millions of properties since 1934 when it was created. Learn more about FHA loan requirements and guidelines.
FHA insured loans require mortgage insurance to protect lenders against losses that result from defaults on home mortgages.
FHA lending limits vary based on a variety of housing types and the state and county in which the property is located.
Before you start the loan process, you’ll want to be prepared for the loan application. Have your information organized and ready for your loan officer. Be prepared to pay for property appraisal and a credit report.
While FHA defines which closing costs are allowable as charges to the borrower, the specific costs and amounts that are deemed reasonable and customary are determined by each local FHA office.
In order to prevent homebuyers from getting into a home they cannot afford, FHA guidelines have been set in place requiring borrowers and/or their spouse to qualify according to set debt to income ratios.
An FHA loan applicant’s past credit performance that demonstrates good credit history and a solid track record of timely payments will likely be eligible for the mortgage.
FHA loans are an attractive option, especially for first-time homeowners:
- Generally easier to qualify for than conventional loans.
- Lower down payment requirements.
- Cannot exceed statutory loan limits based on county