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FHA Home Loans: the Requirements, Guidelines, Limits & Rates

FHA Home Loans: the Requirements, Guidelines, Limits & Rates Video

FHA Loans are great loans for first-time home buyers, as they tend to more relaxed requirements, giving new borrowers greater flexibility.

FHA loans are backed by the Federal Housing Administration, which means that the FHA guarantees that a lender will not have to write off a loan if the borrower defaults.  Because of this guarantee, lenders are typically more willing to finance large mortgage loans.

Typically, FHA loans tend to have more lax requirements than conventional loans.  Home buyers can put as little as 3.5% down, must have a minimum FICO score of 620, and will have to have mortgage insurance for a minimum of five years.  To qualify for a FHA loan, a buyer will have to have a reasonable debt to income ratio and decent credit. In San Diego County, the FHA County loan limits are up to $697, 500 for a single- family home.

The general documentation needed is still the same as other loans.  Borrowers will need to submit tax returns and W-2 statements for the last two years, bank statements and pay stubs for the last two months, and a credit report. Based on this information, a Mortgage Advisor will be able to determine the loan amount and rate a potential buyer qualifies for.

It is important to sit down with a qualified and knowledgeable mortgage expert when applying for a home loan, as they can help share their knowledge and expertise to make your home buying experience a pleasant one.

Please feel free to call Gary Giffin or reply with any questions about San Diego Real Estate.  I look forward to working with you in 2012.

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