your valley FHA loan experts.

Start your homebuying journey with numbers you can trust.

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Your Valley FHA Loan Experts.

Start your homebuying journey with numbers you can trust.

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Experience is everything

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Danny was instrumental in helping our dream of owning a home come true. We are so grateful for all he’s done to help us.

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I had bad credit and they helped me get my house. I am so grateful for everything! Highly recommend!!!

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He will explore multiple options for you to ensure you will get your dream home at a good rate. Highly recommend!!!

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Convenient online access makes it easy to achieve your financial and homeownership goals.

Check loan eligibility and get accurate quotes in a matter of minutes, not days.
See how much you’re approved for so you can buy or refi with confidence.

Verify the details and get to closing quickly with our simple checklist.

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FHA Loans in McAllen TX

An FHA loan is offered by the Federal Housing Administration to help people become homeowners. It is an insured mortgage which prevents you from experiencing any loss if you are unable to keep up payments on the loan.

Back in 1934, the Federal Government created these loans under the Federal Housing Authority as a way to provide housing loans for people who normally wouldn’t be eligible for mortgage loans or would not be able to pay typical mortgage rates.

If you have been turned down by a bank for a mortgage in the past, then an FHA home loan in McAllen TX could be right for you.

The eligibility requirements are typically very lenient and we have tons of resources where you can learn about how FHA loans work. They are also ideal if there is a chance that you won’t be able to pay aback all of the loan on time, as you are protected from penalties that occur when you default on the loan.

In general, you will not be allowed to have more than one FHA loan at a time. However, there are exception to that rule. If you experience a divorce, you added a new family member or you changed jobs, you may be considered for a second FHA loan, but be prepared to be put under the microscope as the FHA evaluates you for eligibility.

FHA Loan Benefits

The biggest benefit to using an FHA home loan near McAllen is that you don’t have to pay additional fees or suffer a credit score decrease if you default on your property in your state. However, you don’t want to forget how easy these loans are to qualify for online, which is a good enough reason on its own to apply for one.

Other mortgage products simply can’t compare when it comes to protection and eligibility. You probably won’t find better rates with other lenders either. These loans are meant to help out the less fortunate, and they are scaled accordingly.

FHA Loan Requirements

fha loan requirements in mcallen tx

Before you are approved for an FHA loan in McAllen, Texas, you will have to meet certain eligibility requirements. They are as follows:

  • A credit score minimum of 530. All those applying for the loan, as well as all co-signers, will have to undergo a credit check much like VA loans. If your score is higher than 530, then it will be in your favor.
  • Steady employment for at least 2 years. Once again, if you have been employed steadily for longer than that, it will help your case.
  • Your primary residence has to be at the real estate in McAllen, Texas that you are attempting to purchase.
  • Cash for the down payment is small, usually a tad north of 3%
  • You also cannot have any record of foreclosure or bankruptcy from the last year.

If you fail to meet any one of these requirements, then you won’t be approved for the FHA loan. Once your situation changes, you are welcome to apply again. You can work to improve your credit score and put some distance between your last foreclosure to help out your chances next time.

FHA Loans and Mortgage Insurance

You will have to purchase mortgage insurance if you go with an FHA loan since those are the terms. This has to be paid both upfront and each month whereas VA doesn’t require it at all, but that’s an entirely different lending policy since those are different types of mortgages. The reason the FHA requires mortgage insurance with this type of loan is because it offsets the laxer standards for entry that comes with other types of mortgage loans.

While you can’t get out of paying this insurance at closing, you can pay it a few different ways. You can have the upfront payment rolled into the cost of the mortgage or put on the back-end to pay once the rest of the loan has been taken care of.

Looking for the best rates on July 16, 2024? Start here ›

Annual FHA Mortgage Insurance 2024

Loan Term Loan Amount LTV Ratio Annual Insurance Premium
Over 15 years $625,000 or less 95% or less 0.80%
Over 15 years $625,000 or less Over 95% 0.85%
Over 15 years Over $625,000 95% or less 1%
Over 15 years Over $625,000 Over 95% 1.05%
15 years or less $625,000 or less 90% or less 0.45%
15 years or less $625,000 or less Over 90% 0.70%
15 years or less Over $625,000 90% or less 0.70%
15 years or less Over $625,000 Over 90% 0.95%

FHA Mortgage Insurance Prior to June 3, 2013

Term Loan-to-Value (LTV) Ratio Duration
15 years or less 78% or less No annual MIP
15 years or less 79-89% Cancelled at 78% LTV
15 years or less 90% or higher Cancelled at 78% LTV
Over 15 years 78% or less 5 years
Over 15 years 79-89% Cancelled at 78% LTV & 5 years
Over 15 years 90% or higher Cancelled at 78% LTV & 5 years

FHA Mortgage Insurance After June 3, 2013

Term Loan-to-Value (LTV) Ratio Duration
15 years or less 78% or less 11 years
15 years or less 79-89% 11 years
15 years or less 90% or higher Full loan term
Over 15 years 78% or less 11 years
Over 15 years 79-89% 11 years
Over 15 years 90% or higher Full loan term

First-Time Home Buyers

first time home buyers taking a class in mcallen tx with valley fha loan pros

There aren’t as many first-time home buyers as there used to be. While the housing market is stronger than it has been in almost a decade, the number of new home buyers out there is actually down 32% in 2024 from the previous year. They have been on a steady decline for the past few years, and it is believed that is due to the increase in home prices. If those prices continue to go up, fewer new home buyers will be entering the market in the coming years.

That’s why so many first-time home buyers are turning to FHA loans. They give them an “in” they could not otherwise get. There is less risk involved as well, and new home buyers have to be careful with their finances, as their home buying decision can drastically affect their credit score over the next 10, 15 or 30 years.

FHA Loan Limits for McAllen TX 2024

The Federal Housing Administration places loan limits on what it offers based on the average market value in the area. So, the loan limit in McAllen, Texas will be different than they would in some other counties in south Texas. These loan limits change as the FHA reevaluates the housing market each year, and they are in place to ensure that the loans will be enough to cover the cost of an average home within a specific market.

One-Family (Single) Two-Family (Duplex) Three-Family (Tri-plex) Four-Family (Four-plex)
$271,050 $347,000 $419,425 $521,250

Compared to conventional loans, here’s how it breaks down:

FHA Loan vs Conventional Loan Limits
Loan Types One-Family Two-Family Three-Family Four-Family
FHA Mortgage Home Loan $271,050.00 $347,000.00 $419,425.00 $521,250.00
Conventional (Fannie/Freddie) $417,000.00 $533,850.00 $645,300.00 $801,950.00

How to Qualify

In order to qualify for an FHA loan, you have to undergo some basic questions during your application that your NMLS approved loan officer will ask you.

The lender will have your home appraised to make sure you are telling them the right value as well as making sure your home offer is in line. They’re also going to look at your debt and compare it to your income to ensure you can make the minimum payments. Essentially, anything that is required for approval will have to be examined before eligibility can be determined.

This is a process everyone has to go through, and the lender will go step by step through your finances, employment history, credit score and home ownership details before they approve the loan for you. Don’t worry though – you’ll have several fair financing options provided to you to keep costs as low as possible.

How to Apply for an FHA Loan

If you are looking to avoid the risk of the typical mortgage loans and you fear you would not even be eligible for them, then an FHA loan could be a good choice for you. In addition to refinancing benefits, it’s a great personal choice you can making when you search for the right type of home loan. Their low rates are ideal for new home buyers (we provide free calculators to help you calculate your payments), and you should definitely consider them if your credit or finances are keeping you from getting other loans.

Curious to see if you’re eligible? Click the link below to get started!

🤔 Do you qualify for special financing? Check here ›