FHA Loans

FHA loans are backed by the Federal Housing Administration, an agency under the jurisdiction of the U.S. Department of Housing and Urban Development (HUD). FHA loans are insured by the FHA, which simply means that the owners of your mortgage are protected against loss if you default on your loan.

FHA loans allow home buyers to borrow up to a certain percentage of a home’s value, depending on their credit score. Home buyers with a credit score at or above 580 can borrow up to 96.5% of a home’s value. While borrowers with credit scores of 500 – 579 may still qualify for an FHA loan with a 10% down payment, many lenders have their own minimum credit score requirements.

While FHA loans are available with low down payment options and a lower minimum credit score than most other types of home loans, you’ll have to pay a mortgage insurance premium.

Low down payment and lenient credit score requirements often make FHA loans attractive for home buyers, especially first-time home buyers.

Here are some benefits of FHA loans:

  • Credit score requirements are low compared to most other loans.
  • Your lender can accept a low down payment.
  • Qualifying for an FHA loan can still be possible even if you have a bankruptcy or other financial issues in your financial history.
  • FHA closing costs can often be rolled into your loan.

Borrowers must meet certain requirements to qualify for an FHA loan. For example:

  • The home you consider must be appraised by an FHA-approved appraiser.
  • You can only get a new FHA loan for your primary residence, which means it can’t be an investment property or second home.
  • You must occupy the property within 60 days of closing.
  • The loan requires an inspection, and the inspection must report whether it meets minimum property standards.

The FHA Streamline Refinance

If you currently have an FHA mortgage, the FHA Streamline Refinance is the easiest way to get a lower rate and monthly payment.

The FHA Streamline is a “low-doc” refinance with limited paperwork required. The lender doesn’t have to verify your income or credit, and there’s no home appraisal. That means a Streamline Refinance closes faster than other loans and has slightly cheaper closing costs.

Thanks to the FHA Streamline, borrowers with FHA loans have easier access to today’s low rates than most other homeowners.

Degang Cheng, PhD
Loan Officer
NMLS: 2464860
Googain Inc. 
NMLS: 275975
1288 Kifer Rd STE 208, Sunnyvale, CA 94086
Email: DegangCheng@googain.com
Cell Phone: 510-516-8551