FHA Mortgage

FHA Mortgage or home loans are insured by the Federal Housing Administration. It may be easier to qualify for an FHA mortgage than a conventional mortgage. Here are some of the reasons you might qualify for an FHA loan if you don’t qualify for a conventional loan.

Low down payment. The minimum down payment is 3.5%. Those funds can be a gift from a family member, charity, or your employer. Generally, a conventional loan requires 5% down.

More lenient credit guidelines. Credit (FICO) scores as low as 580 are accepted. You may qualify with an even lower score depending on other circumstances. Conventional loans often require a score of 620 or higher. FHA also allows you to obtain a loan in as little as 2 years out of bankruptcy or as little as 3 years out of foreclosure. The standard is 7 years for both on a conventional loan.

Higher debt-to-income (DTI) ratios. DTI is the amount of your monthly income that goes toward paying monthly debts. Conventional mortgages generally allow a lower percent while FHA allows for a little higher ratio.

Your experienced mortgage advisor can help you understand these differences. They will help determine which loan option is best for you.

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Wisconsin FHA Mortgage Refinance Options

FHA Streamline Refinance.

An FHA streamline refinance is one of the easiest home loans from start to finish with minimal paperwork and requirements. In order to qualify, you must currently have an FHA mortgage that is in good standing and you must have made at least 6 payments on it.

FHA Cash Out Refinance.

Although a streamline refinance does not allow you to cash out equity; there are other FHA loan refinance programs specifically designed for borrowers who want to cash out equity to consolidate debts, make home improvements, or access funds for other purposes.