Types of properties that qualify for FHA loans
FHA loans are guaranteed by the Federal Housing Administration (FHA), making them a popular option among homebuyers due to their low down payment requirements and flexible credit score standards. FHA loans are designed to help low and moderate-income borrowers achieve homeownership. However, not all properties are eligible for an FHA loan. In this article, we'll take a closer look at the types of properties that qualify for FHA loans.
Single-family homes: The most common type of property that qualifies for an FHA loan is a single-family home. This can be a detached home, townhome, or condominium.
Multi-unit properties: FHA loans can be used to purchase multi-unit properties with up to four units. This is a great option for those who want to live in one unit and rent out the others to generate income.
Manufactured homes: FHA loans can also be used to purchase manufactured homes, but they must meet specific criteria. The home must be built after 1976 and be permanently affixed to a foundation. Additionally, the home must meet HUD's minimum property standards.
Condominiums: FHA loans can be used to purchase condominiums, which is a popular option for first-time homebuyers. However, the condominium must be on the FHA-approved list.
Mixed-use properties: FHA loans can be used to purchase mixed-use properties that have both residential and commercial spaces. However, the residential portion of the property must be at least 50% of the total square footage.
Fixer-upper properties: FHA loans can also be used to purchase fixer-upper properties through the 203(k) rehabilitation loan program. This program allows borrowers to purchase a home in need of repairs and finance the cost of renovations into the mortgage.
In conclusion, there are many types of properties that qualify for FHA loans, including single-family homes, multi-unit properties, manufactured homes, condominiums, mixed-use properties, and fixer-upper properties. If you're interested in purchasing a home, an FHA loan could be a great option for you.
At Mortgage Brokers Pro , we specialize in helping borrowers secure FHA loans. Our team of experienced mortgage professionals can guide you through the entire process, from pre-approval to closing. Contact us today to learn more about how we can help you achieve your homeownership goals.