FHA Loans in Connecticut
Are you a Connecticut resident who is thinking about buying a house? With the real estate market taking its cue from the slow economy, you can get a fantastic deal on a home. If this is the first time you'll be purchasing a house, you'll be able to take full advantage of low prices and won't have to save as much money for a down payment. First time homebuyers should also seriously consider investigating the Connecticut FHA loan program in addition to any traditional lending programs offered by banks.
Why Consider an FHA Loan?
Administered by the Federal Housing Administration (FHA), Connecticut FHA loans can help buyers who might not otherwise qualify for a loan due to poor credit history, not enough cash for a down payment, or other circumstance that would not make the buyer a good candidate for a traditional loan program.
The Connecticut FHA loan program permits buyers to put only 3.5% of the purchase price towards a down payment (as opposed to the traditional 20% required from most loan programs) and has less stringent credit requirements than traditional loans, partly due to the fact that the FHA has a guaranty program which backs these loans, making the loan more appealing and less risky to the lender.
Connecticut FHA Loan Limits
If you're considering a Connecticut FHA loan, you will need to speak with your lender regarding specific requirements and considerations to qualify for the loan. One important factor to consider is the cost of the home you'd like to purchase. The Connecticut FHA loan program does have limits on the amount of money you can borrow, and you must make sure that the purchase price of the home does not exceed this amount.
The minimum single family home amount is adjusted each year and is based on the median housing cost of your area, which means that higher cost of living areas will have higher allowances than lower cost of living areas. The adjusting amount ensures that even those living where housing is expensive can afford to purchase a home. For instance, the limit for 2009 in Fairfield county is $708,750, while the limit in Tolland county is $440,000. These current maximums are for single family homes, so if you're considering buying a multi-family dwelling, check with your lender for information pertaining to multi-family lending limits.