What is an FHA Loan?
FHA loans are home mortgages that are insured through the Federal Housing Administration, and were designed to help more people become homeowners. They do just that by offering a low down-payment for home purchases of 3.5%. We also offer a 100% FHA option! FHA mortgages are also popular because they have lower credit score requirements and they allow for a higher debt ratio than conventional loans. Most First-Time homebuyers benefit by using this program as well.
What are the Limitations of FHA Loans?
FHA loans have limitations on the amount you can borrow. Each county has it's own FHA Loan Amount Limit based on the median home price. Currently the FHA loan limit for NC, AL, and SC is $541,287 in most counties. Higher FHA loan limits are available for multi-unit properties. Alabama
FHA mortgages cannot be used to finance a second home, rental home, or investment property. However, you can use an FHA loan for a 2-4 Unit dwelling, as long as you reside in one of the units as your primary residence.
An FHA mortgage does not have income restrictions.
What is the Mortgage Insurance Requirement with an FHA Loan?
FHA charges an upfront Mortgage Insurance premium, which is 1.75% of the loan amount. Normally it is financed into the loan. Also, just like traditional mortgages with low down-payments, FHA loans require monthly mortgage insurance. The amount of FHA mortgage insurance depends on your loan term and the loan-to-value ratio. If you put down at least 10% of the purchase price, you will only have to pay the monthly mortgage insurance for the first 11 years. If you put down less than 10%, you will pay mortgage insurance throughout the entire loan.
Why should you get an FHA Loan?
FHA allows for a higher Debt Ratio and Offers Lower Rates. It also requires little to no down-payment.
To Inquire about an FHA Loan, simply click : Quick Quote. Our team would be happy to assist you!
