Qualifying for an FHA Loan in Denver
Buying a home for the first time can be intimidating, but a FHA loan in Denver can be a more accessible solution for your needs. Besides finding the right house and packing all your things, there’s a big question hanging over your head: How are you going to pay for it? Getting a home loan doesn’t have to be complicated. One of the most common types of home loans is an FHA loan. But what exactly is it, and how do you qualify? We’ve got your simple guide to FHA loans in Denver.
What is an FHA Loan?
FHA loans get their name from the Federal Housing Administration, which is the agency that insures your loan. If you default on your home loan, the FHA protects your lender from loss. FHA loans are incredibly appealing, particularly for first-time home buyers, because of their flexibility. They often require lower down payment amounts and credit scores than other types of loans.
FHA loans aren’t all created equal. There are actually several different types of FHA loans, differing in the amount you can receive and even the type of property you can purchase with your loan. A purchase FHA loan is arguably the most common. As the name suggests, this loan helps you purchase a home, typically with a down payment of 4% or less (depending on your credit score).
The FHA also offers rate or term refinances if you’re already paying a mortgage and want to look for lower rates. You may also be interested in an FHA Streamline loan, which is available to those who already have an FHA loan and want to do a term or rate refinance.
Denver FHA Loan Requirements
In order to see if you qualify for an FHA loan in Denver, there are several factors to consider. First, you have to have a steady income. The FHA doesn’t designate a specific income requirement, but you do have to be able to prove you make a steady income and would be able to afford your house payments. You’ll often be required to submit bank statements or pay stubs to your lender to verify your income.
You’ll also want to take a look at your credit score. No matter what type of FHA loan you’re interested in, you’ll typically need a credit score of at least 500. Even then, you’ll need to hand over a significant down payment. The higher your credit score is, though, the better chance you have of getting a low interest rate as well as a low down payment.
After you’ve met your personal requirements, you then have to meet some criteria with the house itself. You must move into the house within 60 days of closing on it, and the home you buy has to be your primary residence. You can’t use it as a second home or an investment or rental property. Finally, before you buy, you have to have a home inspection, as well as an appraisal performed by an FHA-approved appraiser.
Get an FHA Loan in Denver with 5280Lend.com
Looking for a home loan in Denver can leave you feeling overwhelmed, but the team at 5280Lend.com can help. We’ve been helping clients secure their FHA loans in Denver for years now, and we’ve seen just about every situation you can think of. Our wide range of expertise means we’re ready to help you get your loan and purchase the home of your dreams, no matter your circumstances.
Our team can walk you through the entire application process and will happily answer any questions you may have along the way. In the end, you’ll be able to purchase an incredible property and rest easy knowing you can afford it.