Homebuyer 2017: A Guide To Applying For The FHA Loan

The housing market can be complicated, and for the first-time buyers, even more so. Luckily, the U.S. Department of Housing and Urban Development has introduced loan programs especially tailored to fit new homebuyers’ needs. The Federal Housing Administration (FHA) loan takes the lead.
Avoid the mental strain of skimming over thousands of pages of the loan handbook. We have narrowed down the finer points of FHA loan just for you, so that you can have a smooth start to the journey of getting your dream home.

FHA Down Payment

FHA offers a minimum down payment limit of 3.5%—providing the homebuyer has a credit score above 579. This helps low-income buyers purchase a home without spending years of saving. A credit score of 500 or more is a core requirement in getting an FHA-insured loan; a score lower than that, and you may have to make down payment that exceeds 10%.

FHA Income Requirements

There is no maximum or minimum limit to the salary a buyer earns for them to get the FHA loan. However, a few things you need to keep in check:
-Have at least two active credit accounts
-Have no liens or judgments on your credit report
-Have no pending debts associated with past mortgages
-Account for cash benefits that help make down payment

FHA DTI Requirements

According to the FHA handbook 2017, a borrower’s debt-to-income (DTI) ratio should not exceed the defined limit of 43%. This includes your monthly mortgage payments, credit card debts, student loans and other obligations.

FHA Loan Limits

The property in question must meet the Federal Housing Administration’s geographic limits. In 2017, these limits encompass $636,150 for single-family in high-cost areas and $275,665 homes in low-cost areas.

FHA Property Requirements

Apart from borrower credit and financial requirements, the requirements of the property itself must align with FHA mortgage rules. The property you choose is not eligible for the FHA loan if it is:
-An investment property
-A flip property (The house cannot be bought within 90 days of a prior sale)
-Not entitled to you, or in the name of a living trust settlement
-Not meeting minimum property standards
-Not surveyed to meet the lender’s standards

FHA Documentation

Finally, you need to present the proper documentation when applying for an FHA loan. This includes your social security number, W-2 forms or valid tax returns, and original pay stubs.
As for other specifications that apply to specific borrowers, let a specialist guide you; e-Finance Mortgage, LLC offers extensive assistance to help homebuyers apply for FHA loan.
Call today at (844) 433-4626 to get your loan process started!