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Federal Housing Administration Loans

Your Pathway to Lower Down Payments

Who Is This For?

FHA loans are ideal for first-time homebuyers or anyone who might not be able to secure traditional financing. To learn more about buying a home but are concerned about the down payment or closing costs, an FHA loan could be a great fit.

Key Features to Consider

Lower Down Payment:

Your down payment could be as low as 3.5%, making it easier to get started on your homeownership journey.

Gift Funds Allowed:

You can receive your entire down payment as a gift from family, friends, or even your employer, so you don’t have to save all the money yourself.

Help with Closing Costs:

The seller can contribute up to 6% of the purchase price to assist with closing costs, reducing your out-of-pocket expenses.

Flexible Credit Requirements:

FHA loans have more relaxed credit score requirements, so you might qualify even if your credit score is lower than what’s needed for conventional loans.

Financing Options:

You can choose to pay the upfront mortgage insurance in cash or finance it into your loan, giving you more flexibility.

Refinancing Opportunities:

FHA loans are also a good option for those looking to refinance their current mortgage, even with limited equity.

Things to Keep in Mind

Mortgage Insurance:

FHA loans require mortgage insurance, which adds to your monthly payment.

Property Standards:

The home you buy must meet certain safety and livability standards set by the FHA.

Limitations on Loan Amounts:

FHA loans have maximum loan limits that vary by location, so check what applies in your area.

If you want to learn more about how an FHA loan can work for you, reach out to your VanDyk Mortgage loan officer for guidance on eligibility and additional options!

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Frequently Asked Questions

1. Who is eligible for an FHA loan?

FHA loans are generally available to borrowers who have a credit score that is below what would typically be required for a conventional loan. They are also ideal for individuals with limited financial resources or those who are first-time homebuyers.

2. How is an FHA loan different from a conventional loan?

The main difference is that FHA loans are insured by the government, which makes them more accessible to borrowers with lower credit scores or financial challenges. Conventional loans typically require higher credit scores and larger down payments.

3. What can you use an FHA loan for?

You can use an FHA loan for a variety of purposes, including:

• Buying a home.
• Building a new home.
• Renovating or making improvements to an existing home.
• Refinancing an existing mortgage to obtain better terms.

4. Are there any restrictions on the type of property I can buy with an FHA loan?

Yes, the property must meet certain standards, and it must be a primary residence. The home must also pass an FHA appraisal to ensure it meets the FHA’s safety and livability requirements.

30-Year Fixed-Rate Mortgage: The payment on a $200,000 30-year Fixed-Rate Loan at 4.375% and 75.00% loan-to-value (LTV) is $998.58 with 1.875 points due at closing. The Annual Percentage Rate (APR) is 4.635%. Payment does not include taxes and insurance premiums. The actual payment amount will be greater. Some state and county maximum loan amount restrictions may apply.

15-Year Fixed-Rate Mortgage: The payment on a $200,000 15-year Fixed-Rate Loan at 3.75% and 75.00% loan-to-value (LTV) is $1454.45 with 2 points due at closing. The Annual Percentage Rate (APR) is 4.214%. Payment does not include taxes and insurance premiums. The actual payment amount will be greater. Some state and county maximum loan amount restrictions may apply.