Buying a home without perfect credit is easy with an FHA mortgage. This type of home loan also lets you purchase a home with a low down payment.
What is an FHA Loan?
An FHA mortgage is a lending product backed by the Federal Housing Administration. By guaranteeing your loan, the FHA makes your mortgage less risky than a conventional home loan.
Lenders are willing to accept credit scores that are not perfect and still offer affordable interest rates because of the lower risk of the loan.
Benefits of FHA Loans in Florida and Michigan
- Buy a home with a competitive loan even if you are still working to improve your credit score.
- Make a low down payment on a home.
- Purchase a home now instead of waiting.
- With competitive interest rates and capped closing costs, FHA mortgages are affordable.
- FHA loans can be tailored to your needs with a variety of loan terms available and fixed or adjustable interest rates.
- There are FHA loans for home purchase, construction, renovation, refinance and debt consolidation.
Do You Qualify for an FHA Loan?
To be eligible for an FHA mortgage, you need to meet the following requirements:
- Your credit score must be 500 at a minimum to qualify for FHA financing. The lowest down payment is available if your score is a minimum of 580.
- Your debt-to-income (DTI) ratio must be 43-45%.
- You need a clear Credit Alert Verification Reporting System (CAIVRS) record.
- You must be on a solid career trajectory with steady employment over the past two years.
- If you declared bankruptcy in the past, the 12-24 month waiting period must elapse prior to submitting an application for an FHA loan.
- If you have been foreclosed on, the three year waiting period must elapse before you submit an FHA home loan application.
Along with requirements for the borrower to meet, there are also a few for the residence for which you are shopping.
It must rest on a permanent foundation. The construction date must be on or after June 15th, 1976. The intended use of the property must be as a primary residence.
Apply for an FHA Loan in Jacksonville, Rochester Hills or Beyond
Ascend Mortgage can help you apply for an FHA mortgage anywhere in Florida, Michigan, or throughout the United States. Please give us a call today at (248) 775-1275 to schedule your consultation.