Are You Eligible for an FHA Loan?

Whether you are buying or refinancing a home, an FHA loan might be a great option. FHA loans have flexible credit guidelines and low fixed rates.

FHA loans also offer down payments and underwriting. These loans are backed by the government and administered by HUD. The FHA requires buyers to make down payments of at least 3 percent; however, it also allows nonprofit agencies to bestow gifts of down payment money to buyers. Many nonprofit agencies were started to do this.

Down Payment Assistance

A seller is not allowed to give down payments to the buyer. However, a non profit agency can facilitate a down payment assistance plan. This requires that the seller, buyer and lender all cooperate. The seller donates money to the down payment assistance provider (often equivalent to a 3 percent down payment). At closing, the program gives the money to the buyer out of the program’s pool of money. Immediately afterward, the seller gives the program a contribution equal to the down payment plus a processing fee.

Congress has raised the loan limits for FHA loans higher loan limits mean lower rates for more people. Fill out the form to find out if you can take advantage of an FHA loan.