Great for first-time homebuyers.
Buying your first home can be intimidating and confusing, but it doesn’t have to be. Mortgage advisers at The Wood Group of Fairway are here to help, and the FHA loan program is a great place to start.
The FHA loan program is government-insured* and created specifically for first-time homebuyers. FHA loans offer flexible qualification guidelines with a nice list of benefits. The minimum down payment and credit score requirements are lower than conventional loan options.
FHA Eligibility Requirements
FHA eligibility is often perfect for first-time homebuyers since the program was created with you in mind. While it’s not only for first-time buyers, the requirements are appealing.
- Flexible FICO credit score requirements (starting with 580)
- Down payments of only 3.5%
- No previous homeownership in the last 3 years
- The home must be your primary residence for 12 months
Benefits with the FHA Loan Program
The program’s simple requirements are matched with a great set of benefits appealing for all who qualify.
- No minimum income requirements
- Funding available for home repair or improvements
- No prepayment penalties
- Gift funds allowed for the down payment
- Options for seller-paid closing costs
- Fixed- and adjustable-interest rate options available
First-time Homebuyer FAQs
Are there limits on the loan amount?
Yes. FHA loan limits are capped by county in Texas. You can search for your county’s limit or ask your mortgage adviser for help.
Do I have to pay mortgage insurance?
The FHA loan program does require that you pay mortgage insurance for the life of the loan. But that is often a good trade-off when you think of the money you save in a lower down payment.
Which types of properties are eligible for the FHA program?
Single-family homes, condos, and duplexes are all qualifying properties with the FHA loan program. There are specific situations when investments and second homes can be purchased with the FHA program as well
Will I save money buying vs renting?
Probably. Mortgage payments are often lower than rental amounts. Plus, you gain equity in the house and can make a profit when you sell it. With renting, that’ll never be possible. Check out an example, or speak with a mortgage adviser to get specific numbers.
What’s the true cost of owning a home?
The total monthly cost of homeownership includes principal, interest, taxes, and insurance (PITI). That’s what makes up your mortgage. For an idea of what those numbers may be, check out this example of a median home purchase in Texas.
What if I don’t have enough for a 3.5% down payment?
It’s still possible to become a homeowner without a down payment ready to go. In Texas, down payment assistance (DPA) programs can help with all or part of the down payment for qualifying buyers. If you’re interested in these DPA programs, speak with a mortgage adviser to learn about their benefits, costs, and qualification options.
*Fairway is not affiliated with any government agencies. These materials are not from VA, HUD or FHA, and were not approved by VA, HUD or FHA, or any other government agency.