This loan is a great option for people whose credit scores are 580 and higher, and who have a 3.5% down payment. Read more about other benefits below.
These loans are insured by the Federal Housing Administration (FHA). The FHA protects lenders against defaults on payments. This makes it easier for you to qualify, and allows lenders to offer lower interest rates.
– A minimum 3.5% down payment.
– A minimum FICO® Score of 580.
– A debt-to-income ratio -(DTI) of no more than 50% with a steady employment history.
– Money to cover the upfront mortgage insurance premium (UFMIP); usually equal to 1.75% of your loan amount.
– Money to cover closing costs, which could be anywhere from 2% – 6% of the purchase price.
– Credit score requirements are lower compared to other loans.
– You could still qualify for an FHA loan if you’ve had a bankruptcy or other financial issues in the past.
– They’re available with fixed or adjustable rates and for 30- or 15-year terms.
– They have low down payment requirements with a down payment as little as 3.5%.
– Closing costs can be rolled into your loan.