With its vibrant city life and its incredible diversity, Los Angeles is an amazing place to purchase your first home, or your next. But dreaming big of a life in Los Angeles doesn’t mean you need to put a big down payment on a new home. If you purchase a home using an FHA loan, your down payment could be only 3.5%.
FHA loans are lending products insured by the Federal Housing Administration (FHA). This backing from the FHA lowers your risk profile, which raises your negotiating power. The result is easier qualification for more affordable loans with an array of special benefits and features.
Here’s why many first-time homebuyers and repeat homebuyers alike turn to FHA-backed financing:
The down payment on your FHA loan could be just 3.5%.
With the FHA reducing your risk profile, credit requirements also are reduced.
Low interest rates are available for long-term affordability.
You can expect low closing costs. Sometimes, the seller may pay the closing costs.
Whether you prefer a fixed or adjustable mortgage rate, you can structure your loan in a way that works for you.
You can use an FHA loan for home purchase, refinance, upgrades, repairs or consolidation.
Many homebuyers are surprised by how simple and relaxed FHA loan qualifications can be. You can read over the basic requirements below.
Ideally, your debt-to-income ratio should not range higher than 43%-45%.
With a credit score of 580 or above, you can qualify for a 3.5% down payment with an FHA loan. With a credit score between 500-579, you can still qualify for an FHA loan with a 10% down payment.
Along with sufficient income, you must be steadily employed. You need to document continuous employment over the past two years.
You must be applying for financing for your primary residence.
Your credit alert interactive voice response system (CAIVRS) report must be clear.
I’m not a first-time homebuyer. Can I still apply for an FHA loan?
I hear this question a lot! It is true that the majority of FHA loans do go to first time homebuyers. But being one is not a requirement for approval.
My previous home was foreclosed. Does this disqualify me?
This is another common question among homebuyers applying for FHA loans. The great news is that your past foreclosure should not stop you from qualifying if sufficient time has passed. This is true for bankruptcy as well.
If you are eligible for an FHA loan, you could move into your home in Los Angeles with a down payment of just 3.5%. Find out now if you qualify. Call (818) 601-2231 to schedule your FHA loan consultation and start the application process. Soon you could be getting the keys to your LA home!
Shannon Christenot is an Equal Housing Lender. As prohibited by federal law, we do not engage in business practices that discriminate on the basis of race, color, religion, national origin, sex, marital status, age, because all or part of your income may be derived from any public assistance program, or because you have, in good faith, exercised any right under the Consumer Credit Protection Act. Disclaimer: Programs subject to change without notice. All borrowers must qualify per program guidelines.