Nearly 20% of home buyers in the Kansas City area use an FHA loan to finance their home purchase. But what is an FHA loan and how can it work for you? FHA loans are among the most popular types of mortgages in America because they are insured by the Federal Housing Association. However, the FHA is an insurer, not a lender, so those who are interested in FHA loans in Kansas City will have to go through an FHA-approved lender to get the loan they’re looking for.
What makes an FHA loan so desirable? Quite simply, because they are insured through the FHA, FHA loans often carry a smaller down payment. For individuals with a credit score of 580 or higher, down payments as low as 3.5% are available. However, while a good credit score makes it easier to qualify for an FHA loan, if you have a credit score of less than 580 you may still be able to get an FHA loan, simply at a slightly higher down payment—typically around 10%.
Why People Apply for FHA Loans
FHA loans may be one of the best Kansas City home loans and mortgage options for many first-time home buyers, and especially those who may not have a lot of money saved up for a down payment. Because credit ratings play a significant role in determining eligibility for many loans, the less stringent qualification process of FHA loans make them extremely appealing for aspiring homeowners with less-than-perfect credit, or who don’t have the typical 20% down payment for a new home. After all, regardless of the price of the home you’re looking for, 20% of its total cost is a lot to pay upfront, especially for families who are just starting out. As such, FHA loans, with their lower down payments and more flexible lending guidelines, are often a perfect solution.
First Fidelis for FHA Loans
Since the FHA is an insurer and not a lender, those who are interested in FHA loans in Kansas City will need to find an FHA-approved lender. What loan is right for you depends on many different factors, but as an FHA-approved lender and FHA loan specialist in Kansas City, First Fidelis is here to help you make sense of all your loan options and find the mortgage solution that is perfect for you, your family, and your budget. So if you’re looking for the best Kansas City home loans and mortgage options—from FHA loans to loans for first-time home buyers to jumbo loans and more—contact First Fidelis today!