How to get an FHA loan in Texas

February 28, 2022

Are you looking for a way to buy a house? If so, you may want to consider an FHA loan. An affordable way to finance your home purchase, FHA loans provide borrowers with a means to purchase a house with lower credit scores and less upfront cash.

In this article, we will talk about what FHA loans are, and FHA loan in Texas requirements. Please read on!

What is a FHA Loan and what are the benefits of getting one in Texas?

An FHA loan is a mortgage insured by the Federal Housing Administration. The FHA insures loans on single-family homes, condos and some multi-family properties, like duplexes or triplexes.

You can get an FHA loan if you meet certain requirements. As long as you have a 620 credit score or higher, you can borrow with as little as 3.5 percent down, or $3,500 on a $100,000 home. If you qualify for the FHA streamline refinance program, then you only need to put down 1.75 percent of the purchase price.

How to qualify for a FHA Loan in Texas

To qualify for a FHA loan, the main requirement is the ability to repay. You have to show enough income or assets to pay back the loan. Typically, you need at least two years of steady employment and a minimum credit score of 620.

In addition, you cannot have any delinquent federal debt to count toward your debt-to-income ratio. If you have a FICO score lower than 620, you'll need to provide an explanation of why your score is lower.

The other major requirement is that you have enough money for the down payment and closing costs. The standard down payment on an FHA loan is 3.5 percent of the purchase price, or $3,500 on a $100,000 home. However, you can qualify for an FHA streamline refinance down payment of 1.75 percent if you've owned the property for more than six months and haven't made any claims against your HUD-1 settlement statement.

If you want to find out how much house you can afford with different down payment amounts, you can use our home affordability calculator.

Applying and being approved for a FHA Loan in Texas

Before you apply for an FHA loan, make sure you read the handbook and understand your obligations as an FHA borrower.

There are three ways to apply for an FHA loan: online, by telephone or through a HUD-approved lender. You can also work with an independent mortgage broker who can shop your application around to multiple lenders with FHA loans.

Before you apply, make sure you have a complete list of your employment and personal information, including Social Security number and annual income. You'll also need to gather pay stubs and bank statements to show that you meet the minimum down payment requirement.

Tips for maintaining your FHA Loan in Texas

Keep your FHA loan current by paying your monthly premiums as soon as you get them. Pay stubs and other documentation will be required every year to maintain your eligibility for the program.

If you have a claim against your settlement statement, then you'll have 90 days from the date of claim to submit additional information. If you do not submit the required information, then you may be subject to foreclosure proceedings.

If your home incurs damage that is not your fault, you can file an insurance claim through the FHA's Self-Insurance Program. Your lender will need to submit a Special Claims Determination Request on your behalf so the damage can be evaluated by HUD. If approved, the funds will be provided to your lender and you will not need to make any monthly payments while the repairs are taking place.

Additional resources about FHA Loans in Texas

Here are a few additional resources that can help you understand FHA loans and how they work:

Texas Home-buying Programs–This program helps first-time home buyers in Texas with their down payment and closing costs. It works in conjunction with an FHA loan, but is only available for homes within the state of Texas.

What You Need to Know About FHA Loans–This section of the HUD website explains the benefits, qualifications and requirements for using FHA loans.

HUD Mortgage Assistance–You can find a list of HUD-approved lenders who specialize in providing affordable mortgages.

Texas Home Search–If you're looking for a home to purchase with your FHA loan, use this search engine to find properties that match your needs. When you're ready to begin the application, click "Get Started" and enter your ZIP code.

Texas Homebuyers–This site has a list of FHA-approved lenders as well as information on Texas real estate news and other related topics.

There are many benefits of working with a HUD-approved lender. The primary benefit is that they have extensive experience working with FHA loans, so you can be confident in your loan approval process.

HUD lenders are also trained to help you find the best properties within your budget and needs.

Conclusion

Now that you're familiar with the things to know about how to get an FHA loan in Texas, you can find out if it's right for your current situation.

 

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