Do you know if you qualify for an FHA mortgage?
You may already know that the Indianapolis market is a super hot seller’s market right now. Inventory is low and buyers are scrambling for properties, and the largest majority of buyers today are FHA buyers. However, FHA mortgages aren’t just for first-time homebuyers. That’s a common misconception.
FHA mortgages are government loans, not just first-time buyer loans. So how do you qualify?
For starters, you can’t have more than one FHA loan at a time. If you currently own a property with an FHA mortgage, you’ll need to refinance it to a conventional mortgage or sell the property if you want to buy another home with an FHA loan.
There are a few rare exceptions, however. For example, you might be able to get a second if you got one as a single buyer and then got married, had kids, and no longer fit in the home anymore but wanted to rent it out instead of selling it.
For the most part, anyone can get an FHA mortgage as long as you have a credit score of 580 or higher and can make a down payment of 3.5%. That low down payment is one of the reasons FHA loans are so attractive right now; with interest rates so low, it doesn’t cost buyers hardly anything to borrow money. It’s smarter to possibly have your money earning more for you in other places rather than dumping it into your down payment.
Here’s the kicker: FHA loan amounts are all the way up to $308,200.
We’re seeing a lot of our sellers pleasantly surprised to find out that even though they’re not first-time buyers, they can still qualify for an FHA mortgage for their next home. In fact, we recently helped a couple meet with a builder about a beautiful new $200,000 home that they’re buying with an FHA loan.
If you have any questions about buying a home with an FHA loan or you’re thinking about selling your house in the Indianapolis area, give me a call or send me an email soon. I’d love to help you out!