You may have been saving for a long time to have enough money for a traditional 10 to 20 percent down payment on a home. You’re still trying to get there. While you have the income to pay for a mortgage, it’s just been taking forever to get the funds for the down payment. You are so ready to get into a home. Do you have any other options? With an FHA loan qualification, you most certainly do
FHA loans are offered through the Federal Housing Administration, a government agency controlled by the U.S. Department of Housing and Urban Development. They are designed for someone exactly like you who has been trying to save up enough money for a down payment, but still has a ways to go to meet traditional numbers. FHA loan qualification can help get you on your way and into the home of your dreams.
Traditional vs. FHA
With a traditional loan, a potential homeowner goes to the bank, fills out the application, and if approved, provides a down payment for the home as collateral. So, if Joe and Jane want to buy a $100,000 bungalow in Phoenix, they would write a check for $10,000 to $20,000 and take out a loan for the balance. It might have taken the couple 5 to 10 years, maybe longer to save up the down payment. Some never manage it, even though they can afford a mortgage.
With an FHA loan, however, the down payment requirement is lower and the qualification requirements are relaxed. This means it is easier for potential homeowners to get through the FHA loan qualification process.
What Are the Requirements?
According to the FHA.gov website, to qualify for a loan through their program:
Instead of requiring borrowers to put down a large down payment borrowers put down smaller amounts, and agree to carry mortgage insurance. This insurance guarantees that the lender will receive payment in the event the borrower defaults on the mortgage.
The program serves those who often fall between the cracks. People who can afford a mortgage, but cannot afford to set aside enough money each month to create a large down payment. This program allows these people to enter the FHA loan qualification process and become homeowners.
There are a lot of hoops to jump through during the FHA loan qualification process, and that’s how Starboard Financial can help. We have the experience and expertise to help home buyers navigate the sometimes confusing and complicated mortgage process. Contact us and we’ll lead you through.