Las Vegas Conventional Home Mortgage
FHA Mortgage Loans in Las Vegas
Know exactly what you can afford before you start searching for a home.
What Is An FHA Mortgage Loan?
An FHA mortgage loan is a type of home loan that is insured by the Federal Housing Administration (FHA), a government agency within the U.S. Department of Housing and Urban Development (HUD). The FHA does not actually make loans, but it insures loans made by approved lenders.
FHA loans are popular with first-time homebuyers and borrowers with lower credit scores or smaller down payments, as they may have more lenient qualification requirements than conventional loans. FHA loans typically require a down payment of 3.5% of the purchase price and a minimum credit score of 580, although borrowers with credit scores between 500 and 579 may qualify with a down payment of 10%.
One advantage of FHA loans is that they allow for lower down payments and may be more accessible to borrowers who have limited funds for a down payment. FHA loans also have limits on the amount of money that can be borrowed, which vary by location and are set by the FHFA. As of 2021, the FHA loan limit for a single-family home in most areas of the U.S. is $356,362.
FHA loans can be used to purchase a variety of properties, including single-family homes, multi-unit properties (up to four units), and manufactured homes. In addition, FHA loans can be used to finance the purchase of a home that needs renovations through the FHA 203k loan program.
One potential downside of FHA loans is that they require borrowers to pay mortgage insurance premiums (MIP) for the life of the loan, regardless of the amount of equity in the home. These premiums can add to the overall cost of the loan.
Overall, FHA mortgage loans can be a good option for borrowers who have limited funds for a down payment or who have lower credit scores. However, borrowers should be aware of the costs associated with MIP and should carefully consider their options before selecting an FHA loan.
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