Can someone please tell me what a FHA loan is and what does that mean?
- Anonymous1 decade agoFavorite Answer
FHA is one of only 3 ways to borrow 100% of the $ for a house (VA and USDA rural housing are the others).
They each have a set of guidelines for how much $ they will lend you based on your income/assets/credit.
You will need a 620 mid-score (though down to 550 is possible). Your mortgage payment (PITI + MI), HOA fees, credit card and car payments will need to add up to no more than ~45% of your gross monthly income. The seller can "gift" you your 3% down out of their equity and you can negotiate them paying your closing costs too.
Sit down with a mortgage professional with your paystubs/W-2s/tax returns/bank statements. A pro will be able to tell you within a few minutes how much house you qualify for. Then you can go and put an offer in on house knowing that your loan will close.
I closed a handful of FHA purchases this month. Each one came out of pocket $1000-$2000 total (appraisal fee, credit, home inspector, earnest $), AND they walked into equity in their new place. I love my work... we build peoples' wealth!
Best of luck to you!Source(s): Mortgage professional. DBeasley@URFunding.com
- fawdownLv 71 decade ago
The Federal Housing Administration (FHA) – which is part of HUD – insures the loan, so your lender can offer you a better deal.
Low down payments
Low closing costs
Easy credit qualifying
Your down payment can be as low as 3% of the purchase price, and most of your closing costs and fees can be included in the loan. Available on 1-4 unit properties.
FHA has a loan that allows you to buy a home, fix it up, and include all the costs in one loan. Or, if you own a home that you want to re-model or repair, you can refinance what you owe and add the cost of repairs - all in one loan.
This is just a start on it. There are funding limits varried by state and county.
If you are in WA state, send me a message.
- SteveoLv 51 decade ago
I'm doing a refi on a house right now, and it came in at 5.5%. Another plus is that your bank cannot require you to be penalized for a refi with another lending institution.