Affordable home loans provide borrowers with competitive long-term financing. Whether you are buying your first home or planning to purchase another home, the Federal Housing Administration offers attractive mortgage loans. Perennial Funding helps qualified borrowers secure low down payment home loans from the FHA.
In the 1930s, the Federal Housing Administration began offering government-backed financing for home buyers. Beyond the Great Depression, FHA loans were designed to help jumpstart the economy and to reduce some of the risks that home lenders might encounter. The lending criteria for FHA financing is generally more relaxed in comparison to purchase money loan programs that are underwritten according to conventional mortgage guidelines.
The standard ceiling for an FHA home loan may reach a maximum of $417,000. However, in various high-cost areas, the Federal Housing Administration has authorized larger loan sizes that are based on the subject property’s location. In certain counties the FHA lending threshold could reach as much as $636,150.
FHA guidelines enable qualified buyers to borrow up to 96.5 percent of the sales price for a home. Many borrowers are under the assumption that 20 percent is needed for a down payment to buy a home. Years ago, a 20 percent down payment was a standard requirement for a home mortgage loan. To get premier mortgage interest rates, some conventional loan programs require home buyers to furnish a down payment that could range from 10 to 20 percent.
3.5 percent is the current down payment requirement to secure an FHA home loan. The funds may come from a buyer’s savings account or via a gift from a relative.
The FHA is fairly lenient toward credit scoring. Home buyers will need at least a 500 credit score to be eligible for an FHA mortgage loan. However, certain lender benchmarks might require borrowers to have a 580 credit score or higher to obtain a mortgage loan without making a larger down payment than 3.5 percent. In some instances, a borrower with a credit score that is lower than 580 might need 10 percent toward a down payment for a home.
Before shopping for a home, you can apply for FHA financing online or by phone. Speak with a knowledgeable mortgage expert at Perennial Funding about getting an FHA loan to buy a home.
Contact us today at (888) 826-4856 to inquire about our low-rate mortgage loans.