California FHA Loan

California FHA loan is a mortgage home loan, which is inured by the Federal Housing Administration (FHA). FHA is an agency of the federal government, which actually insures private loans that are issued for renovations and real estate buying purposes.

California FHA loan programs are designed to help you to purchase real estate even if you belong to the lower income group, as it offers a subsidized loan rate. When you resort to FHA Loan program you should note that the Federal Housing Administration does not provide the loan that you opt for directly. These FHA Loan programs can insure loans taken from private lenders only. 

Before you opt for an FHA loan you should first of all check whether the mortgage brokers and lenders you opt for are compatible with FHA loan. This is very important to help you qualify for a California FHA loan. Before resorting to any mortgage broker or lender you need to go with a thorough comparative study of the rates offered by different lenders to get the best deal.

California FHA loan offers you a number of loan options that you can choose from. Depending on your financial status and situation make sure that the program gives you the best money value. Below is the list of some of the FHA loan options:

- FHA Fixed Rate Mortgage
- FHA Adjustable Mortgage
- FHA Graduate Payment Mortgage
- FHA Condominium Loans
- FHA Energy Efficient Mortgage
- FHA Growing Equity Mortgage

There are certain criteria you need to show to qualify for a California FHA loan. You need to be an employed individual for at least two years and your job is stable and a reliable one. This is to show that you have a regular flow of income and in turn will show that you will be able to pay off your monthly payments.

Another criterion is your credit history. It should have a clear report without any bankruptcy or foreclosure for at least the last three years. The main reason of the strict eligibility criteria is that you have to prove that you have been maintaining a good credit record.

The most popular California FHA loan is the 203(b) FHA fixed rate mortgage loan program and it is suitable for the first time buyers. Its popularity is due to its down payment at a minimal amount rate.  The advantage of this FHA loan is that even the closing expenses can be decreased to a certain amount.

The 203(b) California FHA loan program also does not have a minimum income requirement to qualify but you need a specific debt-to-income ratio to qualify for it. There are efficient financial advisors who will be able to help you to calculate your debt-to-income ratio in accordance to your current income status.

It is advisable not to make major purchase just before you opt for a California FHA loan. It may show a negative shade, which may effect qualifying for the program. See that you do not fall short of payment as this might show that you are on the verge of a foreclosure. Take the guidance of a housing councilor if required to direct you on how to sustain your FHA payments.