Government Loans: Qualifying for an FHA or VA Loan
There are government loan options that make borrowing for a home purchase more affordable for certain buyers. Home Loan Solutions facilitates two types of government loan transactions, Federal Housing Administration (FHA) loans and Veterans Affairs (VA) loans.
FHA loans are appealing for a variety of reasons, including flexible credit requirements, high loan-to-value allowance on refinances and low down payments on purchase loans.
There are 3 basic requirements to qualify for an FHA loan:
- A steady employment history, with consistent income for the past two years
- Ideally, a FICO score of 620 or higher – we can go lower in certain cases
- A 3.5% down payment – we do offer down payment assistance to qualified borrowers
Qualifying for an FHA loan is easier than qualifying for a conventional loan. Regardless, borrowers must be able to afford their monthly mortgage payment. With an FHA loan, your documented income must demonstrate your ability to make a mortgage payment that is approximately 56.99% of your total monthly gross income, under certain circumstances.
For veterans of the United States military, VA loans offer the opportunity to purchase a home on very flexible terms. The advantages to VA loans include no monthly private mortgage insurance requirement, flexible qualifying parameters, and 100% financing (for some buyers).
To qualify for a VA loan, you must have:
- Veteran eligibility: be a veteran, active duty personnel, reservist/National Guard member or surviving spouse
- A steady employment history
- Ideally, a FICO score of 620 or higher – we can go lower in some cases
In our opinion, qualifying for a VA loan much is easier than in years past. For qualified veterans, VA is an affordable mortgage option for many buyers.
To learn more regarding qualifying for an FHA or VA loan, contact Home Loan Solutions today.