With so many loan options available to you, it’s important to understand each loan type and their individual benefits. FHA loans in particular come with several benefits, especially for first time home buyers. The number one reason buyers, and first time buyers particularly should look into FHA loan options is because it is easier to quality for an FHA mortgage loan than conventional home mortgages. Because most first time home loan applicants are younger, in the beginning of their careers, still have student loan debt, and may have had initial challenges building credit in their young adult lives. FHA home mortgages allow for lower down payments, provide loans with high debt ratio limits ( compared to conventional financing ), and are open to approving loan applicants with a shorter credit history.
Of the main reasons to investigate FHA loan options, the most appealing for many is that FHA Loan do not require a large down payment. Most first time home buyers simply haven’t had enough time to save to purchase a home. Therefore, with as little as 3.5% down payment and since the down payment is allowed to come from several sources ( be sure to ask your loan officer or mortgage broker for details or look up FHA down payment guidelines at HUD.Gov FHA Guide ), getting approved for a home mortgage might be easier than you think.
Furthermore, FHA looks at each loan application individually, which allows for more flexible loan approvals for applicants who may have high debt ratios than conventional loan programs. Because first time home buyers are younger in nature and may have student loan debt, auto loans outstanding, and incomes may not be at their highest potential because they have recently entered the workforce. While maximum allowable debt ratios with most lenders are very strict, FHA loans are reviewed individually and in many cases allow for high debt to income loan ratios depending on compensating factors.
See what your payments could look like with our mortgage calculators. Its quick and easy. Then, call Elite Financial a experienced mortgage broker in Westlake Village California. We can provide details, more FHA loan guidelines like maximum loan amounts to see how close you are to obtaining a new home! Call or request a quote today!