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FHA Loan Baton Rouge, LA

Baton Rouge FHA Loan Guide – Mortgage Broker -Bayou Mortgage

Getting an Federal Housing Administration (FHA) Loan in Baton Rouge, LA 

FHA Loans are one of the most popular loan programs in America. The Federal Housing Administration Loan is a great loan program for Baton Rouge homebuyers looking to purchase a home. 

The FHA loan was created by The Department of Housing and Urban Development to spark homeownership for low to moderate-income homebuyers. 

What are the benefits of an FHA Loan in Baton Rouge? 

The FHA loan is a great program but is it right for you? Here are a few benefits to consider: 

  • FHA has very flexible credit guidelines
  • Low and bad credit scores are allowed
  • FHA is a low-down-payment program
  • Past credit issues are ok with FHA
  • Below market interest rates

These are just a few of the benefits of getting an FHA Loan in Baton Rouge. 

What are the downsides to getting an FHA Loan?

FHA loans are a great program and if you are looking for a loan program that will make it easy to get a mortgage, especially if you’ve had past financial issues it’s hard to beat. However, it does have some downsides that you need to consider. 

  • Upfront Mortgage Insurance Premium: FHA charges an upfront premium of 1.75% of your loan amount that’s financed into your loan. This can make it more expensive than other loan programs
  • Annual Mortgage Insurance Premium: This is a premium that is charged to you annually and it’s 0.85% of the amount you owe on the loan.  The annual amount is divided up monthly and included in your mortgage payment. 
  • Mortgage Insurance for the life of the loan: The PMI or mortgage insurance stays with the FHA Loan for life. The only way to get out of FHA PMI is to refinance the loan into a conventional loan. 

* A quick note about PMI: PMI gets a bad wrap. Many people talk bad about PMI and tell you that you should avoid it, but keep in mind the only way to do that is to save 20% down! Without PMI you wouldn’t be able to get a mortgage. We think this is a small price to pay to start building equity now. 

FHA Loan Requirements in Baton Rouge

The FHA loan does have a few requirements you need to meet if you are going to be able to use the program.  

  • Minimum of a 580 Credit Score with 3.5% Down Payment
  • Minimum of 500 Credit Score with 10% Down Payment 
  • Monthly Income That is Documented 
  • Must Purchase a Primary Residence 
  • Down Payment Funds That Meet All Sourcing and Seasoning Requirements 

Can I Get An FHA Loan With Past Credit Issues?

 

FHA is one of the most flexible loan programs if you’ve had past credit issues. While some loan programs such as conventional loans may not approve you if you have collection or charge-off accounts, FHA can be very flexible. 

FHA allows: 

  • Collection Accounts
  • Charged-Off Accounts
  • Late Payments 
  • Bankruptcies
  • Foreclosures
  • Short-Sale

FHA Does Not Allow:

  • Student Loan Collections 
  • Judgments
  • Past Due Child Support or Child Support in Collections 
  • Any Government Collections or Judgement 

How to Get an FHA Mortgage in Baton Rouge, LA 

Now that you know a good bit about FHA Loans, you’re probably asking- How can I get one? Thankfully the process is fairly simple:

  1. Contact a local mortgage broker to see your options 
  2. Do a pre-qualification phone call with a loan officer
  3. Complete a mortgage application 
  4. Upload your documents 
  5. Get Pre-Approved
  6. Start Shopping for Homes

We would love to be the expert to help you find the perfect loan. As a  Baton Rouge mortgage broker we can show hundred of lenders in about two minutes. We’ll find the best terms and rates for you, and help to educate you throughout the process.  Talk to an Expert Today! 

Baton Rouge Mortgage Programs

If you’re shopping for mortgage companies in Baton Rouge, chances are you want to learn about which loan program is right for you. 

Check out each loan program below to see what your options are. 

An adjustable rate mortgage is a home loan with an inital rate that’s fixed for a specified period then adjusts. 

A FHA mortgage is a home loan insurance by the Federal Housing Administration. FHA Loans offer low down payment and flexible credit requirements

VA Mortgage are backed by the Department of Veterans Affairs and are available to military members and veterans. 

USDA Rural Development Mortgage is a home loan back by the United States Department of Agriculture and offers loans with no down payment requirement. 

Learn More About FHA Loans

FHA Loan Requirements

FHA Loan Pros and Cons

FHA Loan With Bad Credit

FHA Loan Just Got Cheaper

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