Purchasing a home using a FHA (Federal Housing Administration) loan

Are you a first-time homebuyer? Are you working to improve your credit ratings? Can’t afford a down payment of 20% or more? Need affordable housing? If one or more of these conditions fits your financial situation, a FHA (Federal Housing Administration) loan may be your best loan option.

These home loans offer low down payments, low closing costs, and easy credit qualifying. They are available with fixed- rate or adjustable-rate terms.

FHA loans have helped people buy homes since 1934 by insuring the loan, so lenders can offer better terms.

Advantages of FHA loans include:

• A good alternative if you have limited equity or money available for a down payment.
• You can receive up to 96.5% financing on some loans.
• A family member or employer may gift you with 100% of a down payment.
• Your seller can contribute up to 6% of sales price for closing costs and prepaid items.

FHA loans are available for:

• New homes—your down payment could be as low as 3.5% of purchase price.
• Existing homes.
• Refinancing your home.
• 1-4 unit properties.

FHA loan requirements

• There are strict inspection requirements because the agency expects the property to be livable from the first day.
• FHA maximum loan limits vary by county. Consult your loan officer to determine the maximum loan amount in your area of interest.
• FHA has limits for your debt-to-income ratio.

Debt-to-income ratio is the amount of income you make each month versus the amount of debt you pay monthly.

HomeTrust Bank lending experts can help you get pre-approved now!