FHA financing has many benefits over traditional conv financing. For most home buyers, 20% down is not a reality. So, let’s say you have 5% down or less and you are looking to purchase a home. Fha offers:
- Lower credit scores for best rate. For FHA our lenders are looking for a 640 or higher credits scores. On a conventional loan, lenders expect a 740 or higher score to get the lowest rates
- FHA allows for higher debt to income ratios. When qualifying for a mortgage FHA allows most borrowers to go up to 55% of total income to qualify for loan. A conventional loans ususally requires lower than 45% to qualify for loan
- FHA will allow a non occupying co borrower (ie mom, father, brother) to help qualify for loan.
- FHA allows the required 3.5% down payment to be a gift from a direct relative.
- FHA allows the seller to contribute up to 6% towards closing cost and pre paid items.
Daniel Cornell – VP, Sales
888-547-0757 | NMLS: 131746
For more information about anything discussed in this article, please contact me. I’d be happy to assist you or put you in touch with someone that can.