When purchasing a home there are many home loan options that are available to you, one such home loan program is an FHA loan. FHA loans are one of our most popular home loan programs. An FHA home loan is a government loan program that anyone living in Chula Vista, Point Loma, Bonita or anywhere through out San Diego can qualify for. While some government loans such as a VA loan require that you be a current or past member of the military or the USDA home loan that requires purchasing a home in rural communities, there are no such restrictions with an FHA loan making accessible to almost everyone.
The main advantage of an FHA loan is that the down payment can be as low as 3.5%, which is significantly lower than a typical down payment you’d see with a conventional loan. For many people, a down payment is the biggest obstacle standing between them and home ownership. If you look at the chart below you can see the difference in the amount you’d have to generate for a down payment when you compare a conventional loan and an FHA loan on an average priced home in San Diego.
| Average Home Price in San Diego March 2013 | Conventional Loan Down Payment of 20% |
FHA Loan Down Payment of 3.5% |
| $430,000 | $86,000 | $15,050 |
As you can see, the down payment on an FHA mortgage is significantly less than that of a conventional mortgage, opening the door for more people to be able to purchase a home. Beyond the lower down payment, FHA loans also tend to have financial requirements that are a little easier to meet than other loans. You will still need to have decent credit; however you don’t have to worry about having perfect credit. This is because an FHA loan is guaranteed by the government, taking away some of the risk from the lending company.
One thing to keep in mind when considering your options is the loan limit set in place that restricts the amount your loan can be. The FHA loan limit for San Diego County is $697,500. When you compare that to the average home price of a home in San Diego, this still leaves a lot of room, so there will be many of options out there for you.
If you are wondering if an FHA loan is the right home loan option for you, let us help you. We can give you a free FHA loan analysis if you use our Purchase Assistant tool on our website, or just give us a call directly (619) 498-0000.
