FHA (Federal Housing Administration) loans are an attractive option, especially for first-time homeowners because it is insured by the Federal Housing Administration (FHA). Primarily, the federal government insures loans for FHA-approved lenders in order to reduce their risk of loss if a borrower defaults on their mortgage payments.
What is a FHA Loan?
A FHA can be approved with 3.5% Down vs 20% that is required on other loan programs. FHA loans can be good tools for first time home buyers or people who are in the process of repairing their credit. FHA loans allow borrowers to purchase homes with higher debt to income ratio’s and lower credit scores. FHA loans also allow seller concessions and or gift funds form a family member to be used for a down payment.
Benefits of FHA Loans
- Credit scores allowed start at 580
- FHA loans allow seller concession’s up to 6%. Click here to learn more.
- FHA will allow you to finance a property 2 years after a bankruptcy and 3 years after a foreclosure.
- Gift funds from a family member are allowed.
- Higher debt to income ratio’s are allowed.
- Competitive rates for lower credit scores.
- Require escrow accounts for payment of taxes and insurance.
FHA Loan Limits
Different counties have different limits on how much you can borrow for an FHA Loan.
Tri County Area,
Wayne, Oakland and Macomb counties the limit for single family is $472,030.00
Other area’s very between $472,030.00 to $1,089,300.00
Get Pre-Approved for a FHA Loan
If you are looking for your first house or even your last in Ann Arbor, Macomb Township, Clinton Township, Chesterfield Township, Harrison Township and St. Clair Shores, or anywhere in Michigan, give us a call and one of our FHA experts will see if this or one of our other mortgage products would be right for you! This is the second most common type of mortgage loan, behind Fannie/Freddie and there is about 250 Billion dollars owed in FHA loans across the United States.