FHA Home Loans

One of the most popular loan products amongst homebuyers and homeowners in California is an FHA home loan. Millions and millions of people have applied for and used FHA loans to buy a home for the first time, renovate an old home or refinance a current mortgage into a lower interest rate. The best FHA home loan guide on the internet provides a wealth of information for those looking to purchase a home in California or refinance a current home loan.

What Is A FHA Home Loan:

An FHA home loan is different from a Conventional loan and a Conventional-Conforming Loan. An FHA home loan is a mortgage that is backed by the U.S. Government whereas a Conventional or a Conventional-Conforming loan is not. All FHA loans come with MI (Mortgage Insurance). This is not homeowner’s insurance; this insurance covers the lender in case you default on your mortgage. It’s a monthly amount you pay with your mortgage payment.

FHA home loans can be used to purchase a residential home, renovate a residential home or refinance a mortgage already attached to a residential home. You can use an FHA home loan to buy a Single Family Residence, a Condominium, a Townhome or a 2-4 unit residential property. And, FHA loans can only be used for primary residences; they cannot be used for investment properties, commercial properties, industrial properties or land purchases.

FHA Home Loan Rates:

Mortgage companies that offer FHA home loan rates in California are very competitive. Most people opt for the 30 years fixed FHA home loan rate, and others go for the 15 years fixed FHA home loan rate. To get the most current FHA home loan rates you’ll want to contact the best mortgage companies so they can compete for your business. Make sure you have your information ready to go so you can get an accurate quote.

Who Can Get A FHA Home Loan:

The basic requirements for obtaining an FHA home loan are fairly simple. If your credit score is above 580, then you can put down as little as 3.50% when buying a home or have 3.5% equity when refinancing a home. If your credit score is below 580 then you must put down 10% of the purchase price or have 10% equity in the home you are refinancing.

Your debt-to-income ratio needs to be at 43% or below, and you’ll need to document your income. If you’re self-employed, you’ll need two years of your most recent tax returns, and if you’re a W2 employee, you’ll need your two most recent W2’s and your two most recent pay-stubs.

A Great Home Loan Program

The FHA home loan program is a great loan program for first time home buyers and those with less than perfect credit. Be sure to discuss your current financial situation with the loan officer so he/she can set up a long term goal that will match your mortgage needs.


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