FHA Eligibility

Unlike the VA program where you can get into a house without a down payment, one of the FHA eligibility requirements is you have to have a down payment from 3.5% to 10% of your purchase price. The amount down is going to depend heavily on your credit score. For example if you were purchasing a $200,000 house and had great credit you would be required to put down anywhere from $7000 to $20000.

FHA wants to ensure you are going to be able to make your payments and requires that your debt to income ratio is no more than 43%. For example, if you make $4000 a month then your debt payments, including car payments, credit cards, your new house payments etc, can not exceed more than $1720. In order to figure out what your maximum debt can be use the following formula (your monthly income *.43 = the max amount of debt you can have to qualify for an FHA loan)

This requirement is largely dependent on the lender you choose, but most lenders have their own internal requirements for your credit worthiness. It’s in a lender’s best interest to not take on risky loans. They want to make sure people will be able to make their payments.

This is the most common type of mortgage purchase made using the FHA program. This type of home also includes all condominiums, including those which are part of a homeowners association. Even multi family homes qualify.

A mobile home is also really popular with the FHA program, because it’s difficult to get conventional loans for these types of assets. In some areas a mobile home is the only option for borrowers to own a home. The FHA program will insure these type of loans both land and without land. If you don’t own the land you just need to make sure to show to proper lease documents. A mobile home is anything not affixed to the property, meaning it can be moved.

This is an extremely popular option with FHA, and this is what Village Capital & Investment LLC specializes in. Most lenders that do FHA purchases will also do a refinance. There are different types of refinances and you don’t have to have an FHA loan in order to refinance. For example, if you have a conventional loan, you can refinance that loan into an FHA insured loan.

This is an option that has become very popular in the last few years, as it allows people to bring in extra income based on the equity they have in their property. Many retired people will take advantage of this program because there has is either paid off or they have a high percentage of equity.