FHA programs can work well for borrowers who need flexible qualifying guidelines. Mortgage lender rate quotes are available to buy a home or refinance with FHA. Zero point option, rate & term, cash out refinancing programs are available, as well as bad credit FHA programs.
If you have an existing mortgage through FHA, you have the opportunity to reduce the monthly loan payment using a streamline FHA refinance, which requires no income verification.
Benefits of the FHA Program:
- Cash out FHA refinance up to 85% loan to value
- Minimum down payment for buying a home is 3.5%
- Higher loan limits are based on location of the property
- FHA lenders allow for credit scores as low as 620
- A higher debt ratio is allowed in comparison to conventional loans
- FHA rate quotes are comparable to conventional home loans
- Non-occupant co-borrower may be added to help qualify
- Certain closing costs have limitations which are set by FHA
- A previous bankruptcy only needs to be discharged for 2 years
- Collection accounts may not have to paid to close a loan
- FHA may not have a requirement for any cash reserves
Compare FHA refinance or home purchase quotes for 15 year or 30 year fixed rates, and 5 year ARM program. Every loan is required to have a mortgage insurance premium of 1.75%, which can be added to the financed loan amount. There is also a monthly premium added to the payment. Condominiums do not require the up-front premium, only the monthly amount. For information on non-approved condos, see spot loans.
FHA program guidelines allow a debt ratio of 43% of gross income for the PITI monthly payment, plus all other monthly debts. For an FHA refinance or home purchase, Good compensating factors may allow for a higher ratio, such as: Documented ability to pay more than the proposed loan payment; demonstrated ability to accumulate savings; minimal increase in housing expense; potential for increased earnings; substantial non-taxable income; good credit history.