FHA Loans

 

What Is FHA?

FHA is not a mortgage lender. The Federal Housing Administration (FHA) does not provide you with a loan, but instead provides mortgage insurance on loans made through FHA approved lenders. FHA is one of the largest insurers of whole mortgages in the United States and provides lenders protection against any losses as a result of borrowers defaulting on their mortgage loans. Long Beach Home Loan Corp. specializes in FHA loans and is proud to offer excellent rates with flexible financing options to support your specific needs.

 

What Can I Use A FHA Loan For?

A Long Beach Home Loan Corp. FHA loan is a great product for first time home buyers because they require a lower down payment percentage and lower credit scores than a conventional loan would typically allow for loan approval. Homeowners can lower their interest rate with an FHA Streamline Refinance or even have the option to use FHA’s Cash-Out Refinances if they are in need of capital to make repairs, consolidate debt, or use as down payment funds for a new investment.

 

Is A FHA Loan Right For Me?

A Long Beach Home Loan Corp. FHA loan offers lower down payment options and relaxed credit requirements. Borrowers who have less than perfect credit, less than 20 percent for down payment funds, or who may have had a bankruptcy or foreclosure in the past may find an FHA loan to be perfectly suited for them. Long Beach Home Loan Corp. FHA loans are very popular among first time home buyers.

 

FHA Loan Requirements

  • Income Requirements: A borrower’s back end debt-to-income ratio, the total of the mortgage and all your monthly debt, must not exceed 55% (credit score dependent).
  • Down Payment: The minimum down payment for FHA loans is 3.5% of the purchase price.
  • Credit Score: The minimum credit required to obtain a Long Beach Home Loan Corp. FHA loan is a middle score of 620 (special circumstances may allow for lower scores).
  • Property Requirements: Properties purchased with a Long Beach Home Loan Corp. FHA loan must meet the safety and security requirements implemented by FHA.

 

Mortgage Insurance Premiums (MIP)

FHA mortgage insurance premiums exist so that lenders bear less risk in the event of a homeowner’s default. With all FHA loans there are two different mortgage insurance premiums. There is an upfront premium (UMIP) of 1.75% of the base loan amount and a monthly premium of .85% or less depending on loan-to-value ratio.

 

Working With A Qualified Lender

At Long Beach Home Loan Corp. we are committed to serving clients throughout the state of California with all of their home needs. If you are thinking about purchasing your first home, or refinancing your existing FHA loan, we can help. Contact me, Jack Skovgard (562-340-9453), for any questions you may have about FHA loans.