FHA loans permit to qualify with as small as 3.5% down payment

FHA loans are loans that are guaranteed by the US Government’s Federal Housing Administration. It is an attractive offer for those first-time home buyers who do not qualify for traditional home loans. On one side when traditional home loan products require 10 to 20 percent down payment on a loan, this mortgage option allow buyers to qualify with as little as 3.5% down payment.

One of the main benefits of FHA loans is it offers better interest rates. Home buyers who are looking for lowest interest rates in San Jose mainly look for this option. It offers the same interest rate for all borrowers. There is no interest rate penalty for anyone who have credit issue. FHA loans guidelines do not require a minimum credit score. If you are a borrower, you can easily qualify with no or little credit history. With a credit, you need only one year of clean credit history. You can qualify for this loan in as little as two years after a bankruptcy and three years after a foreclosure. The only thing is you should have a clean credit within that time period.

So, if you are looking for a loan for your home buying needs, make sure you research all options before making the final decision. Take help of a mortgage broker who can help you know whether FHA loans in San Jose is right for you or not.