An FHA mortgage is probably the best kind of mortgage you can get, especially if you are buying a home for the first time. Backed by the Federal Housing Administration or FHA, this type of mortgage is designed to make home ownership accessible to home-buyers with less than superior credit scores and you will always find a good FHA lender ready to serve you once you are ready.
Conventional mortgages usually require a credit score of 620 and above, but an FHA loan only asks for 580 for you to be able to give a down payment of only 3.5%. If your credit score is only 500, however, the down payment required can go up to 10%. So if you are eyeing a $300,000 property and your credit score is 500, you need to have $30,000 ready for down payment
The good news is, your credit score can be improved, so the sooner you work on it, the better off you’ll be. You can do this for about a year to a year and a half before applying for a mortgage. This helps you increase your chance of getting approved.
In addition to having a good credit, finding the best FHA lenders can definitely make your home-buying experience pleasant and worth-remembering.
How to Find the Best FHA Lenders
While they are in this for business, the best mortgage lenders genuinely care about their clients and have their client’s best interest in mind. They never rush you into making a decision and committing into something without taking into consideration your current financial situation and needs.
Good FHA lenders also make sure they deliver the best results promptly. They make sure you understand the entire process and know what to expect and when t expect it.
You will also want to work with lenders who value transparency in all their business dealings. They never trick you into saying yes to a seemingly exceptional deal only to change their rates at the last minute, saying the rate at which you signed up for is no longer available. These are exactly the kind of lenders you want to steer clear from.
Other Things to Consider In Looking for a Lender
Now that you know what to look for in a good mortgage lender, it’s time to decide on what you actually want to get. What are your preferences? Do you prefer a mortgage with the lowest rates regardless of the length of term? Or would you rather pay a substantial amount upfront to get a loan with the shortest term? Are you looking for a mortgage with the lowest closing costs? It’s important to determine your personal preferences so you can discuss them with your chosen mortgage lender.
Luckily, if you are looking into getting a property anywhere in Texas, you will find yourself surrounded by an almost endless list of options for getting Texas FHA loans. Guided by the suggestions given above, you can now begin your exciting journey of improving your credit score and looking for the best lender you can work with.