FHA Loan FAQ's (Frequently Asked Questions)
How can I find a trusted FHA lender?
We affiliate with the most trusted FHA specialists in the industry. Click here to contact a trusted FHA mortgage person who can help you.
Will I qualify for an FHA loan?
The process of qualifying for an FHA mortgage is different for everyone and is loosely based on your ability to repay your FHA loan, income and employment status, credit score, property status and more. Click here to read more about qualifying for FHA loans
How much money do I need to make in order to qualify for an FHA mortgage?
This depends on certain factors like the amount you plan to borrow, your loans interest rate and the terms at which you will pay the loan back. Typically, an FHA lender will require that the amount of your new mortgage payment, plus monthly taxes, monthly home owners insurance, MIP, and all monthly debt obligations (like credit card and car loan payments), when added together, not exceed 50% of your gross monthly income. Click here to read more on FHA's income and employment requirements.
What documents will I need to provide when qualifying for an FHA loan?
The preliminary documents you may need to provide to you FHA lender usually consist of the following but may vary slightly:
- Income documentation: FHA does not offer a stated loan so your FHA lender will most certainly need any recent documentation supporting your income. You FHA lender may require 2 years of tax returns (W2's for the last 2 year if you are a wage earner or 1099's [all pages] if you are self employed) along with 1 month of consecutive, most recent pay stubs
- Assets:2 months of bank statements from your checking and savings account (all pages - even the blank ones!) - not always required but good to have on hand because your lender or broker may ask for this.
- Social security cards for all borrowers
- Valid photo identification for all borrowers (drivers license)
- The most recent mortgage statement(s) for the current mortgage(s) on the home (if any)
- Your home owners insurance policy number and agents contact information
- A fully executed contact of sale (if you are buying a home)
This is just a rough outline and the actual documentation you will need to provide your lender can vary depending on a number of circumstances. Click here to read more about the documents you may need when qualifying for an FHA mortgage.
What is MIP?
When an FHA loan is initially taken out - there is a "Fee" known as UFMIP (Up Front Mortgage Insurance Premium). This "UFMIP" is 1.75% of the initial loan amount. Unfortunately, this money is added to the initial loan amount and is "financed" over either 15 or 30 years. Your payment is then calculated based on the "increased" loan amount - (Initial Loan Amount + UFMIP). This Up Front fee is what directly goes into the aggregate insurance fund held by HUD to pay out on those defaulted loans nationally. Click here to learn more about FHA's mortgage insurance, MIP and UFMIP
What are the FHA loan limits?
The overall amount of money you can borrow with an FHA loan is based on the FHA loan limits but will also be determined by your actual ability to qualify for an FHA loan as an applicant. You can read more about qualifying for an FHA loan here or just click here to have a mortgage specialist determine how much you qualify for.
You can use HUD's FHA loan limit lookup engine to search for the maximum FHA loan limits in your area. Click here to use HUD's official Loan Limit Search Tool.