FHA Loans-Tucson, AZ
If you are looking for the perfect city to move to with a new home purchase, then it will be tough to top Tucson, AZ. Part of the greater metropolitan area of Phoenix, this city could be the place where your dream of homeownership comes true. It is far more affordable than many of the nearby cities, with a median sale price of $333,000.
Perhaps there are limits on your ability to afford a house. Fortunately, with FHA loans from the ideal lender at District Lending, you can secure the funding needed to cover the purchase price.
What is an FHA Loan?
FHA loans are insured by the federal government, specifically the Federal Housing Administration. By backing these FHA loans, a lender can take on more risk and lower their limits for approving an FHA mortgage. This allows borrowers to take advantage of several benefits.
Reduced Credit Requirement
A conventional mortgage typically requires a credit score of at least 620 for approval. An FHA mortgage, on the other hand, could be granted to a borrower with a score as low as 500.
Lower Down Payment
Another advantage of an FHA mortgage is not having to put as much money down upfront. FHA loans it easier to afford a new home in Arizona even if you have limited savings. First-time homebuyer programs can also help, such as the state-run Home PLUS initiative or the HOME Down Payment Assistance program. District Lending can provide you with more details.
Lower Interest Rates
The interest rate will determine the cost of the mortgage over the term length. FHA loans have lower average interest rates that make the mortgages more affordable for those with limited earnings. This benefit is one of the most significant for FHA loans.
What Affects My Payments?
How much you will be paying each month and throughout the mortgage term will depend on multiple factors. Here are a few things that will impact your loan payments.
Credit Scores
As mentioned previously, your credit history plays an important role in obtaining an FHA mortgage. It can also affect your monthly payment since a better score gives you access to favorable interest rates.
Bear in mind that the more money you pay at the beginning of the mortgage, the lower the total cost of the loan will be. This will lower the monthly premiums for your primary residence and allow you to save on interest.
Financial Status
Lenders who opt for FHA loans have limits on who can be approved for a mortgage. A debt-to-income ratio must be low enough to show that the borrower can cover payments for the home, and anything higher than 50% is not likely to be accepted. Additionally, the lender will look at bank statements, tax returns, pay stubs, and other documents to analyze your financial status. Lower-income families should look into the Pima Tucson Homebuyer’s Solution program to make their dream homes more affordable.
Closing Costs
When the contract is ready to be signed, closing fees come into play. FHA loans feature similar fees to conventional mortgages, so expect to pay between 3-6% of the total cost of the home at signing.
Tools From District Lending
Get Pre-Qualified
Pre-approval for an FHA mortgage can help you make quicker offers, which is a significant advantage in any real estate market, especially in a somewhat competitive area like Tucson. The right lender can get this process moving quickly so you can secure a mortgage ASAP.
Pre-Approval
Mortgage Calculator
Feel like you need to know more about competitive rates and what you can afford? Play around with our mortgage calculator to test different mortgage scenarios before applying for an FHA loan.
Calculate Payments
Refinance
Have you built equity in your current home after securing an FHA mortgage? Refinancing might be a great way to take advantage of that equity and a stronger credit score. Talk with a lender to find out your options for refinancing an FHA mortgage.
RefinancingServing the community of Tucson, AZ and the surrounding area
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