June 16, 2024

How FHA Loans Can Help New Phoenix Buyers Purchase Their First Home?

Published on: August 15, 2023
Updated on: August 15, 2023
FHA Loan

You could have any reason for wanting to move to Phoenix. Phoenix has much to offer new homeowners, from hot summers to mild winters to affordable housing and outdoor recreational activities. Perhaps you’ve lived here all your life, or the recent shifts in the job market resulted in an opening down south.

Phoenix, AZ, has a lot to offer new homeowners. But today’s housing market is a bit of a mess. Homes are a considerable investment, and with today’s inflation rates, many people mistakingly believe they are out of reach for most Americans. But if you know your options and research the pros and cons, you can find financial solutions for just about any situation. 

Luckily for first-time homeowners, you can rely on Arizona’s shifting housing market and federally-guaranteed FHA loans to secure your mortgage and start your journey into homeownership.

What is an FHA Loan?

FHA stands for the Federal Housing Administration, an agency within the US Department of Housing and Urban Development, which you may have heard referred to as HUD. FHA loans are loans secured by the FHA to help first-time homebuyers with low to little credit qualify for a mortgage.

This Loans have a few benefits over conventional loans, but there are restrictions to match. Ready to take a closer look?

Benefits of an FHA Loan

FHA loans are only available to first-time homebuyers, so they are tailored to help individuals, couples, or families afford their first home with certain benefits. One of the more immediately apparent benefits is a lower down payment requirement. You’ve likely read that you need a downpayment between 5-20% of the home’s final price to secure a mortgage. With a conventional loan, that’s true, but with FHA? You can get that requirement down to as little as 3.5%.

FHA loans are also more lenient with your credit history and risk assessment. This makes purchasing a Phoenix home easier for people with little to no credit history. You will also get a competitive interest rate, lowering monthly mortgage payments. Between the down payment and low monthly payments, the future’s looking brighter for purchasing your first home.

Qualifying for an FHA is incredibly easy, as well. Your employment history and debt-to-income ratio still play a big part, but the requirements are way more lenient than what big banks are looking for. You also can streamline refinancing options down the road; the FHA has a program named the FHA Streamline Refinance. This lets you refinance an existing FHA loan with less paperwork hassle.

How to Choose the Right Loan?

One thing first-time home buyers will notice about FHA loans is they carry more restrictions. You will have rules about how the funds from the loan can be spent and how much you can qualify for. It’s always important to apply with a few lenders and compare results before choosing who to work with.

Working with a mortgage broker familiar with FHA loans is even better. The expert finance teams at a mortgage broker local to Arizona will help you find the best loan options available, helping you compare FHA loans to other available options in the area, and they’ll help you figure out how much mortgage you can afford, regardless of what you qualify for. Even better, mortgage brokers understand all the fine print in the contract and will ensure you know all the rules and guidelines that you’ll be required to follow; FHA guidelines can vary by county, so this is especially helpful if you aren’t sure whether you’re going to settle in Phoenix or one of the surrounding suburbs.

Experience the Natural Beauty of Arizona from the Comfort of Your First Home

Arizona has wonders like the Grand Canyon, the Painted Desert, and more. By purchasing a home in Phoenix, you’ll be close enough to enjoy a new marvel every weekend.

Start researching loan options and mortgage brokers today, and take your first step into homeownership.

Steve Fletcher
Steve Fletcher
Meet Steve Fletcher, a seasoned wordsmith specializing in the captivating realms of cartoons, anime, and celebrity culture. With a background in the Entertainment Industry, Steve seamlessly blends humor and depth to breathe life into characters and unveil the compelling stories of iconic personalities. From animated wonderlands to the real-life drama of stars, Steve crafts narratives that resonate and entertain, making every tale a captivating journey.