FHA Loans & 93.5% Financing
Determine What You Need To Qualify For a FHA Loan
- FHA allows up to 6% seller paid closing cost, also known as Sellers Concession! -
FHA Total Loan Amount
Minimum FHA Down Payment is
FHA Upfront MIP
FHA Loan Summary
If you purchase a
home with an FHA loan at
down, your FHA loan payment will be
This does NOT include monthly escrow for taxes and insurance. Please enter annual taxes and insurance to calculate your full payment.
FHA Loan Limits
FHA stands for Federal Housing Administration. This agency, funded largely by HUD, does not give loans directly. Instead, loans are insured to protect lenders against losses and default. The FHA establishes limits for loans that will be insured by an FHA mortgage. If you attempt to buy a home above these limits, it will be considered a jumbo loan and not eligible for FHA financing. Financing for jumbo loans are possible once they conform to FHA limits. That means if the loan limit for a 1 family home is $417,000, but you are buying a home for $500,000, you must pay the $83,000 difference at or before closing. Loan limits for FHA loans vary by property type and region. Loan limits for the New York City and Westchester regions cannot go above what FHA will insure. Maximum loan sizes are: 1 family - $625,500, 2 family - $800,775, 3 family - $967,550, 4 family - $1,202,925.
Mortgage Insurance Premiums
FHA requires 2 types of Mortgage Insurance Premiums to be paid on all loan products. These fees, paid by the borrower is required when less than 20% of the purchase price is put down as a downpayment. To encourage banks to lend, FHA guarantees a percentage of the loan will be insured if the borrower ever defaults. If the borrower defaults, claims are paid from a fund called the Mutual Mortgage Insurance. MMI is funded by the two premiums, both paid by borrowers. This contribution is collected in the forms of Upfront Mortgage Insurance Premium and Annual Mortgage Insurance Premium.
Upfront Mortgage Insurance Premium (UFMIP) is calculated at 1.75% of the loan amount. For example, if the FHA mortgage loan is $200,000, the UFMIP would be $200,000 x 1.75%, or $3,500. This amount is automatically added to your loan. The final loan amount for a $200,000, would be $203, 500.
Annual Mortgage Insurance Premium (AMIP), the 2nd type of FHA Mortgage is calculated annually and paid in 12 monthly installments with your mortgage payment. FHA loans originated before June 3, 2013, can be dropped after 5 years of payment if the loan balance reaches 78% of the loan original price. FHA loans originated after June 3, 2013 follow new guidelines. Loans with an original LTV of 90% or less must pay MIP for 11 years. If the original LTV is greater than 90% you'll pay MIP throughout the entire life of the loan.
Starting The FHA Loan Process
The first step in starting the process is to contact a lending institution that is familiar with the FHA Loan. This will help you to completely understand the FHA Loan process and understand the steps. The lender will also provide you with valuable information about your credit, possible loan size or issue a pre-approval. A pre-approval assures a realtor and seller a lending institution has qualified you to buy a home. This is an important document needed to start your home search.
The decision to apply for a FHA Loan starts with you. The FHA Calculator on this page will help you to calculate the math and at least get an accurate range of what to expect if you purchase a home using the FHA Loan product. Any questions about the FHA loan process, an approved FHA lending institution, or to find a home using the FHA product can be forwarded to 914-299-0420.