FHA Loans in Omaha, NE
At Mutual 1st Federal, our team of mortgage loan experts can help take the worry out of applying for an FHA home loan by assisting you through the process, and securing a loan to get you and your family into a new home!
What Is an FHA Loan?
An FHA loan is a type of mortgage loan that's insured by the Federal Housing Administration, hence the FHA abbreviation. These loans are popular among first-time homebuyers as they allow for down payments of 3.5% and require credit scores of 620+. Additionally, homeowners with credit below 620 can still have the chance to secure an FHA loan with a 10% down payment.
What Are the Benefits of an FHA Loan?
For many first-time homebuyers around Omaha, NE, the major benefit you'll find with an FHA loan comes from its requirements. The simple fact that you need a credit score of just 620+ and 3.5% for a down payment opens up the ability to purchase a home for more than you'll find with a conventional loan. The reason FHA loans are a little bit easier to get approval for comes from the government backing. With the Federal Housing Administration behind the loan, lenders have become more likely to approve borrowers with lower credit scores.
FHA Loan Requirements
Since FHA Loans are backed by a government entity, there's more to securing one of these home loans than just meeting the 620+ credit score and 3.5% down payment requirements. To receive an FHA loan, applicants must:
- Have a steady employment history
- Have a valid social security number, lawful residency in the U.S., and be of legal age to sign a mortgage
- Pay a minimum down payment of 3.5%
- Have a property appraisal from a FHA-approved appraiser
- Have a front-end ratio of less than 31% of their gross income
- Have a back-end ratio of less than 43% of their gross income
For more information on FHA loans and the application process, contact us today or visit HUD.gov to learn more!
Should you apply for a conventional loan instead? Learn more about these loans from Mutual 1st Federal today!