| If you are delaying trying to purchase a home, whether | | | | will repay the loan, thus making it easier to qualify with |
| it is your first home or not, because your income is low, | | | | a low income. With interest rates being at an all time |
| STOP. You are not automatically excluded from the | | | | low, this will also significantly increase your chances of |
| dream of home ownership just because you think that | | | | qualifying for an FHA loan with lenders familiar with |
| you don't make or have enough money to qualify for a | | | | FHA rules and guidelines. The lender's risk factor is |
| loan. | | | | greatly reduced since the FHA is guaranteeing the loan |
| The most widely available and well known program for | | | | repayment. |
| home loans for lower income buyers is the FHA or | | | | VA or the Veterans Administration also offers a |
| Federal Housing Administration. Traditionally the FHA | | | | program for those who have served in the military |
| existed primarily to aid those who could not obtain a | | | | (both past and present) which allows the borrower to |
| conventional mortgage. Based on the theory that | | | | get a no down payment loan and actually requires the |
| responsible people with jobs and a steady income, | | | | seller of the property to pay most of the closing costs. |
| however low, can qualify for a home loan so long as | | | | The lending criteria is very lenient in these types of |
| they meet the debt/income qualifications for | | | | loans. However, you must be able to provide a |
| repayment, the FHA has many programs available to | | | | Certificate of Eligibility verifying that you have served in |
| help achieve this. | | | | the US military. These are also government |
| Programs exist with as little as 3-5% down payments. | | | | guaranteed loans but must be provided by lenders |
| These down payments may be made by the buyer | | | | approved by the VA and familiar with their loan |
| through gifts from a parent or family member so long | | | | requirements. |
| as the money is accompanied by a gift letter. | | | | Another avenue to pursue for those seeking home |
| Assistance is also allowed to buyers in the form of | | | | loans available for lower income buyers is the RHA, or |
| closing costs. A sales contract stating that the seller | | | | Rural Housing Authority. Unlike FHA and VA loans, the |
| must pay up to 3% of the sales price to assist with | | | | RHA is part of the Unites States Department of |
| the buyers closing costs will achieve this. In some | | | | Agriculture and actually makes loans directly to the |
| cases, a home can actually be purchased with very | | | | buyer for rural land and housing both for residential and |
| little of the borrower's money. Significantly lower FICO | | | | commercial purposes, rather than simply guaranteeing |
| scores and higher debt to income ratios are also | | | | the repayment of the loan to another lender. |
| allowed under most FHA programs. Understand | | | | Home loans for lower income buyers are out there. |
| however, that the FHA doesn't make or give you the | | | | Your piece of the American Dream is waiting! |
| loan. They guarantee designated FHA lenders that you | | | | |