FHA Home Loans

MCM Mortgage
Nov 4
4 min read

Opening the Door to Your First Home

What is an FHA Home Loan?

An FHA Home Loan is a government-backed mortgage program that can make it easier for people to become homeowners. FHA mortgage loans are insured by the FHA or the Federal Housing Administration, which is a sector under the U.S. Department of Housing and Urban Development, or HUD.

Since these loans are backed by the FHA, we can provide you with financial flexibility benefits like a lower required down payment. An FHA mortgage loan is especially helpful if you're a first-time homebuyer or need help qualifying for home financing.

FHA Loan Types

You can use your FHA loan to buy a home, refinance an existing mortgage, and renovate or build a home. FHA loans offer fixed-or adjustable-rate mortgages, offering more flexibility to borrowers. No matter what your specific needs are, we can find your solution.

PURCHASE LOANS

An FHA purchase loan is insured by the U.S. government's Federal Housing Administration, allowing lenders to offer qualifying terms that are less strict than conventional mortgages.

Low Down Payments
Easy Credit Qualifying

REFINANCE LOANS

An FHA streamline refinance allows homeowners to lock down lower rates. With a more affordable payment, borrowers can stay in their homes and pay off their loans. Benefits include

Lower Monthly Payments
No Appraisal Needed

An FHA cash-out refinance lets borrowers convert home equity into cash to use for anything from high-interest debt to vacations to large purchases. Benefits can include:

Potential to Lower Interest Rate
Access to More Funds

FHA STANDARD 203(K) LOAN

An FHA Standard 203(k) loan is ideal for major repairs and construction, including remodeling, landscaping, room additions, and structural repairs, and does not have the extra mortgage insurance premiums. An FHA Limited 203(k) loan is designed for less expensive repairs and improvements, including energy efficiency, appliances, roofing, and non-structural repairs such as paint.

FHA Standard 203(k) Benefits:

Low 3.5% Down Payment
Still only one payment per month (mortgage and improvements)
This loan qualifies as assumable

FHA Limited 203(k) Benefits

Low Down Payment
No Minimum Repair Cost
Finance just the cost of the desired necessary projects

CONSTRUCTION LOANS

A one-time close construction loan finances the costs of building your own home. They are separate from a traditional mortgage and cover specific building costs, including materials, labor, land, and utilities. Then you combine that with your FHA loan and combine it into one loan.

Single Closing
Low Down Payment
Fixed Interest Rates

FHA Down Payment Assistance Programs

FHA Loans are a great option to get the best bang for your buck, especially if you're building up your credit or are recovering from past credit incidents. Combining your FHA loan with down payment assistance can help more people afford the home they really want and not settle for a home they may regret later.

These national programs support homebuyers with 3.5% or 5% down payment assistance options for those who qualify. They have flexible guidelines, competitive interest rates, and zero down payment options.

FHA Specialty Programs

There are many specialty FHA Mortgage options that have been created to remove some of the barriers to homeownership and make purchasing a home easier for everyone. The following are state-specific programs that focus on certain regions to be revitalized.

FHA HUD $100 DOWN PROGRAM

Exclusively for the purchase of HUD homes, this program gives borrowers the opportunity to pay just $100 for their down payment. It's an option for those who may not be able to afford a home otherwise.

Benefits:

Very low out-of-pocket expenses
Can combine programs to pay for repairs
Eligible properties include 1 to 4-unit homes, manufactured homes, condos, and PUDs.

FHA GOOD NEIGHBOR NEXT DOOR

Eligible single-family homes located in revitalized areas are listed exclusively through this program for law enforcement officers, teachers, firefighters, and EMTs.

Benefits:

50% discount from the list price of the home
Must live in the property for 36 months as the principal residence
Flexible financing and equity building

SECTION 184 INDIAN HOUSING LOAN GUARANTEE PROGRAM

This program is specifically designed for American Indian and Alaska Native families, Alaska Villages, tribes, or tribally designated housing entities.

Benefits:

Low Down Payment
Flexible Underwriting
Can be used for new construction, rehabs, purchase, or refinancing

FHA Loan Requirements

ELIGIBLE BORROWERS

When you apply for a mortgage, your income, assets, liabilities, and credit history will be considered. But don't worry – you can qualify for an FHA mortgage loan with less-than-perfect credit.

To be eligible for an FHA home loan, you must meet FHA mortgage requirements:

You must have a minimum credit score of 500
You must have a down payment of at least 3.5%
3.5% minimum down payment requires a credit score of at least 580
You must have consistent employment for at least two consecutive years and verifiable income
You must be current on all federal non-tax debt

ELIGIBLE PROPERTIES

1-4 Unit Homes used as a primary residence
FHA-Approved Condos
Site Condos
Manufactured housing (must be on a permanent foundation)

MCM Mortgage is an FHA-approved lender and is not acting on behalf of or at the direction of HUD/FHA or the federal government. Guidelines are subject to change without notice.

How to Apply for an FHA Loan

Even though the FHA guarantees loans, they do not provide the funds. You'll need to go through the same process with your own private lender choice. Follow the steps below to apply for your FHA loan.

6 Steps to Apply:

Find an FHA-Approved Lender
Fill out an FHA loan application
Submit your financial and personal documents
- Name and Social Security Number
- Valid driver's license or state-approved ID
- Income and employment history
- Property details, including address and purchase price
- Down Payment Amount
Schedule an FHA Appraisal
Await Underwriting
Close on Your Loan