FHA Loans

FHA (Federal Housing Administration) / HUD (Housing and Urban Development)

FHA Home Loans: Affordable Financing with Low Down Payment Options

At AAA Capital Funding, we specialize in helping you achieve homeownership by offering a diverse range of mortgage products, including the highly popular FHA loan. This section is dedicated to helping you understand the benefits, qualifications, and features of an FHA mortgage so you can determine if it’s the right fit for your needs.

What Is an FHA Loan?

An FHA loan is a government-backed mortgage insured by the Federal Housing Administration (FHA), which operates under the U.S. Department of Housing and Urban Development (HUD). FHA loans are designed to make homeownership more accessible, especially for first-time buyers and those with less-than-perfect credit.

One of the most attractive features of an FHA loan is the low down payment requirement—just 3.5% of the purchase price for qualified borrowers. This makes FHA financing an ideal option for buyers with limited savings. AAA Capital Funding’s FHA loans also have more lenient guidelines in regards to credit score and debt ratio.

Even with a larger down payment, mortgage insurance is required on all FHA loans, which is why many borrowers opt for the minimum down payment and use their savings elsewhere. Unlike conventional loans, the only way to remove FHA mortgage insurance is by refinancing into a different loan type.

FHA Loan Benefits

• Down payments as low as 3.5%

• Competitive, fixed interest rates

• Flexible credit and income guidelines

• Co-borrower flexibility

• Allows non-occupying co-borrowers

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FHA Loan Requirements

Minimum Credit Score

To qualify for an FHA mortgage, a minimum credit score of 580 is typically required. Your creditworthiness is determined by evaluating scores from the three major credit bureaus: Equifax, Experian, and TransUnion. We use the middle score to assess your eligibility.

Eligible Property Types

FHA loans can be used to finance the following property types:

• Single-family homes

• Townhomes and villas

• Multi-unit properties (duplex, triplex, quadplex)

• Condominiums (must be FHA-approved)

For multi-unit homes, you may use projected rental income from the additional units to help you qualify, provided you plan to occupy one of the units as your primary residence.

Income and Asset Documentation

We accept a range of income sources and documentation types:

• Wage earners (W-2 employees): We typically require your two most recent W-2s and a current pay stub.

• Self-employed borrowers: We’ll review your two most recent years of personal and business tax returns (if applicable).

• Retirees: We can use income from Social Security, pensions, or other verified retirement sources.

We will also verify your assets through bank statements to ensure you have the necessary funds for your down payment and closing costs.

Gift funds are permitted for FHA loans, provided they come from an eligible and verifiable source. (Unverifiable cash, such as cash deposits without a paper trail, cannot be used.)

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Why Choose an FHA Loan?

FHA loans are a fantastic solution for buyers who may not qualify for conventional financing due to limited savings or lower credit scores. With flexible guidelines and affordable entry costs, FHA mortgages help make homeownership possible for more families every year.

AAA Capital Funding, in partnership with FHA, offers more flexible credit score and debt-to-income ratio guidelines, making it easier for borrowers to qualify for a home loan.

At AAA Capital Funding, we’ll guide you through every step of the process—ensuring you understand your options and choose the loan that’s right for your financial goals.