FHA

FHA loans are a great option for homebuyers who need a low down payment and more flexible credit requirements. Backed by the Federal Housing Administration, these loans allow for down payments as low as 3.5% and offer competitive interest rates. They are designed to help first-time homebuyers and those with lower credit scores qualify for home financing.

FHA loans provide more lenient qualification criteria compared to conventional loans (down to 500 FICO for qualified borrowers), making homeownership more accessible. They also allow for higher debt-to-income ratios, which can be beneficial for buyers with existing financial obligations. Additionally, FHA loans offer both fixed and adjustable-rate options to fit different financial situations.

All FHA loans require mortgage insurance premiums (MIP), which help protect lenders but increase monthly payments. However, these loans provide an affordable pathway to homeownership for many buyers. If you’re looking for a loan with lower credit barriers and a smaller down payment, an FHA loan may be the right choice.

Disclaimer: Loan product guidelines are subject to change. Contact your Caritas Mortgage loan officer for the most up-to-date information.

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