FHA
An FHA loan is a mortgage that is insured by the Federal Housing Administration. FHA loans are a good option for consumers who have a lower credit score or a smaller down payment, as they typically have more lenient eligibility requirements than conventional loans.
Requirements: In order to qualify for an FHA loan, borrowers typically need a credit score of 580 or higher and a down payment of at least 3.5%. They also need to have a debt-to-income ratio of 43% or lower and show proof of employment and income.
Common OBJECTIONS and SOLUTION that you or your clients can encounter along the road:
"I don't have enough money for a down payment."
Solution: Borrowers can consider an FHA loan, which requires a smaller down payment than conventional loans.
"I have a low credit score."
Solution: Borrowers can consider an FHA loan, which has more lenient credit score requirements than conventional loans. They can also work on improving their credit score by paying down debt and making payments on time.
"I'm worried about the cost of mortgage insurance."
Solution: Borrowers can factor in the cost of mortgage insurance when budgeting for their home purchase. They can also look into refinancing their loan once they have built up enough equity to qualify for a conventional loan.