Are you looking to buy your first house in Texas and want to secure an FHA loan? Then, you have come to the right place. Buying a house can a challenging task, but with a bad credit score history, this can be even more daunting. But worry not; you can still be eligible for FHA loans. Here you will understand what exactly is an FHA loan in Texas, what are its advantages and the eligibility criteria you need to pass to secure your loan.
What is an FHA loan in Texas?
Federal Housing Agency is a U.S. government agency that provides services and loans for certain borrowers. The FHA loans are insured by the Federal Housing Administration as a way to protect lenders from risk if a borrower can’t repay their mortgage. corporate tax accountant How do FHA loans help borrowers? These loans are offered to families who have low to moderate incomes and are looking to buy their dream house. Due to credit score flexibility and low-down payment, FHA loans are quite popular among first-time home buyers. Â
What is the FHA loan limit in Texas?
If you are entertaining the thought of moving to Texas either for work or to be closer to family and are looking to buy a house, you need to get an FHA loan. But before you do that you need to know the limits. The loan limit for a single-family home in the Texas area is generally $498,257 and for high end areas it is about $571,550.
What is the lowest down payment for an FHA loan in Texas?
The best aspect of procuring an FHA loan is the low-down-payment you have to pay. You only need to pay a 3.5% upfront. But if you have a credit score of about 500 to 579, you will need to pay about 10% down payment. It is always better to pay about 10% down payment so that you can save money in the long run.
Lowest credit score required for an FHA loan in Texas:
If you want to qualify and pay only 3.5% down payment then you will need to bring your credit score to at least a 580. Not that having a lower credit score will make you ineligible, but you have to pay a larger down payment. So, it is better to increase your overall credit score and repay any standing debt.
What is the advantage of an FHA loan in Texas?
Following are some of the advantages you might get when you procure an FHA loan in Texas:
- Easier Qualifications: One of the reasons why this loan option is so popular among first-time home buyers is that FHA loans are far easier to qualify for than other loan options.
- Low-Down Payment: To secure an FHA loan, all you need to do is pay a 3.5% down payment as compared to a 20% down payment, which is required for other loan or mortgage options.
- Private Mortgage Insurance (PMI): The FHA is also a good option for those buyers who don’t have a 20% down payment and cannot get approved for a PMI.
- Credit Score Flexibility: If you are someone who has a bad credit score, don’t be disheartened because you can qualify for FHA loans if you meet the requirements.
Requirements for FHA Loans:
To be eligible for an FHA loan in Texas, you need to pass some requirements. Here is the list of the basic requirements you need to fulfill to continue your journey of home ownership.
- Steady Employment: One of the most important requirements is that you must have proof of employment for up to 2 years.
- Legal Documents: You might be asked to show your social security number, proof of lawful residency in the U.S., and last but not least, you should be of legal age when applying for a mortgage.
- Down Payment: Before applying for FHA loans make sure you have 3.5% down payment ready beforehand and extra funding set aside.
- Property Appraisal: You have to get the property appraised beforehand by an FHA-approved appraiser to avoid any risk.
- Out of Bankruptcy: You need to be out of bankruptcy for up to 2 years and should be able to provide proof of improved credit score.
FHA Loan in Texas and Dream Home Mortgage:
Now that you have a general idea of what an FHA loan is, eligibility requirements, and loan limit, all you have to do is get in touch with a good mortgage lender. Dream Home Mortgage lenders are the best choice as they have over 25 years of experience helping thousands of families all across the 50 states in the U.S. achieves their dream of owning their own homes. Under the seasoned stewardship of Hussein Panjwani, your dream of unlocking the keys to your Dream home can become a reality by securing an FHA loan in Texas. So, what are you waiting for? Book your free consultation today!