FHA Loans

FHA (Federal Housing Administration – a Division of the Department of Housing and Urban Development) loans are government-insured loans that are approved and funded by private lenders.  The maximum FHA loan amount is presently $546,250 for San Diego County.  Certain “high cost” counties in the State have maximums of $625,000.  Qualified buyers can put as little as 3.5% cash down when purchasing a home by using FHA financing. 

FHA Purchase Home Loans

FHA is very popular with first-time buyers for the following reasons:

• Low 3.5% cash down payment
• Interest rates are competitive with “conventional” (non-government) home loans
• Flexible qualifying questions
• Non-occupant co-borrowers (typically parents) can assist with the qualifying
• Property sellers can pay up to 3% of the purchase price to defray the buyer’s closing costs.

FHA Mortgage Insurance

FHA is a government insurance company backing home loans provided by private lenders. The mortgage insurance premiums that are paid when using FHA financing result in a lower-down payment requirement and more flexible loan qualifying standards than for conventional (non-government) financing.  The mortgage insurance premium structure for FHA loans changes periodically based upon the performance of the “MIP Fund” (Mortgage Insurance Fund).

Here is how you pay for the FHA mortgage insurance when buying your home:  You are charged a 1% up-front mortgage insurance premium (1% of the loan amount) which may be financed into your loan amount.  In addition you pay a monthly premium of 1.15% of the loan amount each month with your monthly payment. 

Qualifying for an FHA Mortgage

The single most important step that you can take when seeking to buy your home is to have your home loan pre-approved.  While FHA qualifying standards are more flexible than for conventional financing, one must have a strong employment, earnings, and credit history in order to qualify.  Please contact me today if you are interested in purchasing a home, whether new or existing and we will work with you to pre-approve your home loan.

Types of FHA Loans

FHA loans come with fixed and adjustable terms.  You can select the standard 30 year fixed-rate loan or adjustable rate loans fixed for the initial three or five years.  FHA also has a 15 year fixed-rate mortgage type available.

Home | Bert Morrison | Your Loan Officer | Residential Loans | 
First-Time Buyer Loans |  Reverse Mortgages | 
Mortgage Calculators | Podcasts | Pre-Qualify | Ask Bert | Contact Us

Hosting and site maintenance by Billy Fire LLC