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The most popular FHA home loan is the fixed-rate loan known as the 203(b). It often works well for first-time homebuyers. It allows individuals to finance up to 96.5% of their home loan and helps to keep down payments and closing costs.

FHA Loan Programs for 2022

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FHA.com is a privately owned website, is not a government agency, and does not make loans.

Fixed Rate FHA Loans

The Popular 203(b) Federally Guaranteed Mortgage

Get the Full Story About FHA Loans

Home ownership rates in America continue to increase at a steady rate due in a large part to the implementation of FHA home loans insurance program. Over the years, FHA has helped Americans gain the financial independence that comes with owning a home. By creating jobs and reasonable mortgage rates for the middle class, financing military housing, and producing housing for the low income and the elderly, FHA has helped Americans become some of the best housed people in the world with a homeownership rate of 64.2% for Americans currently owning their own homes. FHA has insured more than 46 million home loans since 1934.

HOW IT WORKS

By serving as an umbrella under which lenders have the confidence to extend loans to those who may not meet conventional loan requirements, FHA's mortgage insurance allows individuals to qualify who may have been previously denied for a home loan by conventional underwriting guidelines.

FHA loans benefit those who would like to purchase a home but haven't been able to put money away for the purchase, like recent college graduates, newlyweds, or people who are still trying to complete their education. It also allows individuals to qualify for a FHA loan whose credit has been marred by bankruptcy or foreclosure.

NUTS AND BOLTS

The most popular FHA home loan is the 203(b). This fixed-rate loan often works well for first-time homebuyers because it allows individuals to finance up to 96.5 percent of their home loan which helps to keep down payments and closing costs at a minimum. The 203(b) home loan is also the only loan in which 100 percent of the closing costs can be a gift from a relative, non-profit, or government agency.

FHA will collect the annual MIP, which is the time on which you will pay for FHA Mortgage Insurance Premiums on your FHA loan. Cancellation of the premiums are as follows:

  • No more than 15 year term
    Loan to value at closing up to 90%
    11 year termination
  • No more than 15 year term
    Loan to value at closing greater than 90%
    No cancellation until loan paid off
  • Greater than 15 year term
    Loan to value at closing up to 90%
    11 year termination
  • Greater than 15 year term
    Loan to value at closing greater than 90%
    No cancellation until loan paid off

GUIDELINES

It is not necessary to meet a minimum income requirement in order to qualify for a FHA loan but debt ratios specific to the state in which the home will be purchased have been put into place to prevent borrowers from getting into a home they cannot afford. This is done through a close analysis of income and monthly expenses.

FHA Loan Programs

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FHA Loan Articles and Mortgage News

Can I Buy a Townhouse With an FHA Mortgage?

August 4, 2022 - There are FHA home loans for a variety of property types including duplexes, condo units, planned unit development, and also townhouses. FHA’s rules for home loans generally allow for a single unit or as many as four living units. Townhouses typically have two living units.

How FHA Loan Limits Work

July 30, 2022 - FHA loan limits increased this year for many counties in the United States. Mortgage limits are calculated based on the median house prices in accordance with HUD 4000.1. FHA’s single family mortgage limits are set by Metropolitan Statistical Area and county and are published periodically. 

Getting Help With Your FHA Mortgage Down Payment

July 21, 2022 - Are you a first-time homebuyer? If you are looking for a home to buy with an FHA mortgage the idea of saving up for your down payment might feel intimidating. But as a first-time homebuyer, you have options for down payment help that can offset your upfront costs. 

FHA Loan Approval Questions For Self-Employed Borrowers

July 20, 2022 - Because of the global COVID-19 pandemic, many Americans had a job loss or a drop in income over coronavirus-related employment gaps. Those employment gaps can make it harder for a loan officer to approve a mortgage.

Which Bank has the Best FHA Loan?

July 12, 2022 - Which bank offers the best FHA loan choices? Not all lenders offer all FHA loans, and not all lenders price their closing costs the same. You will want to shop around for a lender that meets your requirements. Your lender should be transparent about its loan options.