FHA Loans

What is an FHA loan?

FHA loans are an attractive option in Birmingham, AL, especially for first-time homeowners because it is insured by the Federal Housing Administration (FHA).  Primarily, the federal government insures loans for FHA-approved lenders in order to reduce their risk of loss if a borrower defaults on their mortgage payments.  Typically the borrower can be approved with 3.5% down vs 20% that could be required on other loan programs.

How do I qualify?

Qualifying for an FHA loan is easy in the Birmingham, AL area.  The Federal Housing Administration has created  less stringent underwriting process, which is more forgiving for individuals with slightly lower FICO scores.  They’re also forgiving with bankruptcy and foreclosure waiting periods.  A perfect candidate for an FHA loan would be any individual with a 620+ FICO score to take advantage of the strong rate pool that FHA has to offer.


I filed bankruptcy, can I still qualify?

Yes you can!  It depends on the bankruptcy type that you discharged from.  Chapter 13 requires a 1 year waiting period from the discharge date.  Chapter 7 discharge requires a 2 year waiting period from the discharge date.