Today I’m joined by Shannon Pohl of Caliber Home Loans to talk about FHA loans and allay any uncertainty some homebuyers have about them.

According to Shannon, this is the best market we’ve seen in terms of interest rates since 2016—FHA rates are very low and very attractive to any buyer entering the market. What is an FHA loan, though? Essentially, FHA loans allow buyers to purchase with as little as 3.5% down. Here in Indian River County, this means you can get maximum financing for homes in the $325,000 range. 

This is the most important thing you need to remember because many buyers are under the assumption that you must put 20% down when obtaining financing, but that’s not true. The FHA also raised their loan limits, which means more buyers can buy in higher price ranges with little money down. With an FHA loan purchase, sellers are also allowed to provide up to 6% of the closing costs, whereas with conventional loans, they’re only allowed to pay 3%. 

FHA loans aren’t just for first-time buyers, either. If your credit isn’t perfect or you’ve gone through a foreclosure, they’re a great option for you. Even pristine buyers have several reasons to choose an FHA loan, and in today’s rate environment, your loan rate becomes assumable when you buy your next home in a few years, which is a great selling point. 

“This is the best market we’ve seen in terms of interest rates since 2016—FHA rates are very low and very attractive to any buyer entering the market.”

Caliber Home Loans gets creative when it comes to FHA loans, which brings me to another important point: To truly know whether an FHA loan can work for you, you’re much better off working with a local lender. If you call a national bank, you’ll likely end up talking to someone at a call center who won’t know anything about your situation or what’s best for you. A lender like Shannon will not only know all the tips and tricks to get you into a bigger, better house, but she’ll also know your name and your kids’ names. 

Some sellers and listing agents are wary of FHA loans, but with loan balances as high as they are, appraisers will look at the same factors when doing their appraisal, so it’s not a deterrent anymore. Additionally, some listing agents aren’t familiar with FHA loans, but in this case, Shannon can always get on the phone with them and discuss any issues that give them pause. If you limit yourself to just using a conventional loan, you’re limiting your ability to make full-price offers. 

In our county, the actual FHA loan limit is $314,827, but as stated above, you can still buy as high as $325,000. You can also just put more money down. 

The bottom line is, there are many scenarios where an FHA loan can help you get into the home you want, so talk to your local lender to find out more. 

If you have any more questions about this or any other real estate topic, don’t hesitate to reach out to me. I’d be happy to help you.