FHA Home Loans
UPDATE: Feb 22, 2023, the Federal Housing Administration (FHA) announced a 30 basis point reduction to the annual mortgage insurance premium charged to homebuyers who obtain an FHA-insured loan. According to the FHA, “this could mean an estimated savings of $678 million for American families in aggregate by the end of 2023 alone. The reduction will benefit an estimated 850,000 borrowers over the coming year, saving these families an average of $800 annually.”
December 1, 2022, the Federal Housing Administration (FHA) announced new limits for the 2023 calendar year for its forward and home equity conversion mortgage (HECM) insurance programs. FHA loan limits for most of the country will increase in 2023 due to the housing appreciation during the first half of 2022.
“The loan limits announced today reflect steep increases in home prices throughout much of the country and will ensure continued access to FHA-insured mortgage financing despite those increases,” said Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon.
The new forward mortgage loan limits are effective for FHA case numbers assigned on or after January 1, 2023:
|Property Size||Low-Cost Area “Floor”||High-Cost Area “Ceiling”||Alaska, Hawaii, Guam, and U.S. Virgin Island “Ceiling”|
An FHA loan is a mortgage backed by the Federal Housing Administration (FHA) and is often one of the easiest to qualify for. FHA loans are an attractive option for first-time home buyers and those with lower credit scores or smaller down payments. Intercap Lending is approved by the Federal Housing Authority and specializes in FHA lending as a direct Fannie Mae and Freddie Mac lender.
Is an FHA Loan right for you?
The FHA program was created to stimulate the housing market by making loans more accessible to people with lower credit scores and/or smaller down payments. First-time home buyers and low-income buyers often benefit from FHA loans as they may qualify for a down payment as little as 3.5% with a minimum credit score of 580. Having a credit score that’s lower than 580 doesn’t necessarily exclude you from FHA loan eligibility; if your credit is between 500 and 579 you may still be eligible with a 10% or greater down payment.
An FHA loan requires mortgage insurance (MI) and has maximum purchase limits. Other little and low down payment options include USDA, VA, and State Housing Loans.
If you have a high credit score, more money to put down, and you want to purchase a home that exceeds the FHA loan limits you may want to consider a Conventional Loan. To find out if an FHA Loan is the best option for you, contact an Intercap Loan Officer today.