Page 17 - The Latest Homebuying Guide

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or backed by the government. Convention loans that follow the
guidelines set by the government-sponsored entities (Fannie Mae
and Freddie Mac) and are called “conforming.” Non-conforming
loans have their own standards.

FHA Loans
The Federal Housing Administration (FHA) provides an easier op-
portunity for potential home buyers to qualify for loans. These
loans are insured by the FHA but provided by lenders who must
meet the FHA’s standards.

FHA LOANS
Features Requirements
3.5% with 580 credit score
Down payment
10% with credit score 500-579
Credit Score Minimum 500

One-time payment of 1.75%
Annual fee of 0.8% to 1.05%
Insurance
Pay insurance premium for 11 years with
10% down payment
Debt-to-income ratio Up to 50%

Proof of steady income for 2 years
Income Pay stubs for 2 months
2 years tax returns
Single-family homes
Planned Unit Developments (PUDs)
Eligible properties
Condominiums
2, 3, and 4-unit properties

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