Looking to Purchase a Home? You may want to consider a FHA Loan.

More buyers are choosing to go with a FHA loan because of the program’s flexible requirements.

Here are the requirements you need to know if you are considering a FHA loan.

A credit score of at last 500.

A minimum down payment of 3.5%.

Debt to loan ratio: less than 43%.

Loan can only be used for a primary residence

The property must meet FHA’s “minimum property standards.” What does that mean? It means that the house is safe, sound and secure. To name a few of the requirements — the house must have functional plumbing, heating, and electrical systems; a sturdy, leak-free roof; good property drainage; freedom from pest infestations and hazards like lead-based paint; and secure doors and windows. An FHA appraiser checks these aspects to ensure the property is a viable and a safe investment.

The borrower must show proof of employment and steady income.

Mortgage balance must meet FHA loan limits. What are the loan limits?

Loan limits vary by county. The specific limit for any particular area depends on the classification of the area as either a “low cost” or a high cost” area. This is determined by the local median home prices compared to the national conforming loan limit. For more information on FHA loan limits in your area, go to U.S. Housing and Urban Development’s Look Up tool. https://entp.hud.gov/idapp/html/hicostlook.cfm.

A REALTOR® who understands how FHA loans can work for you will help ensure that you have a smooth transaction from your offer through to close of escrow.