With housing prices climbing to record levels, you might wonder if the words “affordable” and “mortgage” still go together. Fortunately, FHA loans — insured by the Federal Housing Administration — bring these two words together for hundreds of thousands of people each year. Thanks to the different types of FHA loans, you’ll likely find one that fits your needs. From everyday purchase and refinance loans to specialty loans for specific buyers and those looking to renovate a property, the sheer number of FHA ...

When buying a house, many people opt for a conforming loan, which allows you to obtain a mortgage up to a specific limit. If you want to buy a house in 2026 with a conforming loan, most borrowers face a conforming loan limit of $832,750. This is an increase from $806,500 in 2025. What is a conforming loan? Before we discuss the conforming loan limits (CLL), you should understand what a conforming loan is in the first place. A conforming loan is probably what you’d think of as a “regular mortgage.” It’ ...

Core Insights - Refinancing a mortgage can be beneficial not only when interest rates drop but also in various other scenarios that can improve financial conditions [1][2] Group 1: Reasons to Refinance - Lower interest rates can lead to reduced monthly payments and long-term savings [4] - Improved credit scores can qualify borrowers for better mortgage rates and terms [7][10] - Changing loan terms can help borrowers save on interest or lower monthly payments [11][12] - Accessing home equity through cash-out refinancing can provide necessary cash [14] - Eliminating mortgage insurance can be achieved by refinancing into a conventional loan [16][18] - Swapping between adjustable-rate mortgages (ARMs) and fixed-rate loans can be strategically beneficial [19][20] Group 2: Financial Considerations - The average cost of refinancing is around $5,000, and calculating the break-even period is essential to determine financial viability [26][35] - Closing costs for refinancing can range from 2% to 6% of the new loan amount, impacting the overall cost-effectiveness [34] - Timing of the next move and personal financial situations should be evaluated before deciding to refinance [28][29]

Core Insights - The Federal Housing Administration (FHA) has been insuring home loans since 1934, making it easier for lenders to issue mortgages, particularly to first-time home buyers and low-to-moderate-income households [1][3] - FHA loans are designed to extend homeownership opportunities to borrowers with lower credit scores or higher debt levels [3] FHA Loan Requirements - Borrowers must have a minimum credit score of 500 to qualify for an FHA loan, with a down payment requirement of 10% for scores between 500-579 and 3.5% for scores of 580 or higher [5] - The maximum debt-to-income (DTI) ratio for FHA loans is typically 43%, although higher ratios may be acceptable with strong credit scores or other compensating factors [6] FHA Loan Limits - For 2025, the FHA borrowing limit for a single-family home is set at $524,225 in most areas, with a maximum of $1,209,750 in high-cost areas [7] - In Alaska, Hawaii, Guam, and the Virgin Islands, the loan ceiling is even higher at $1,814,625 for a single-family home [8] Mortgage Insurance Requirements - FHA loans require borrowers to pay mortgage insurance premiums (MIPs), including an upfront mortgage insurance premium (UFMIP) of 1.75% and an annual premium as part of monthly payments [10] - If the down payment is less than 10%, MIP must be paid for the life of the loan; if 10% or more is put down, MIP can be canceled after 11 years [11] Home Appraisal - An FHA loan requires a home appraisal by an FHA-approved appraiser to ensure the property meets market value and HUD's minimum property standards [12] Income Requirements - There are no minimum or maximum income requirements set by the government for FHA loans, but lenders will assess affordability through the debt-to-income ratio [13] Disqualification Factors - Disqualification for an FHA loan can occur if the credit score is below 500, the DTI ratio exceeds 43%, or there is insufficient down payment [14] Qualification Difficulty - Qualifying for an FHA loan is generally easier than for a conventional mortgage due to lower credit score requirements and higher allowable DTI ratios, although FHA loans may incur higher costs due to ongoing mortgage insurance premiums [15]

Core Insights - Investment property loans are essential for financing properties intended for income generation, such as rental properties or fix-and-flip projects [3][4][14] - Various types of investment property loans exist, each catering to different financial situations and investment goals [4][5][6] Types of Investment Property Loans - **Conventional Loans**: Suitable for purchasing one to four-unit properties, requiring a debt-to-income ratio of 45% or less [4] - **Fix-and-Flip Loans**: Designed for investors who buy, renovate, and sell properties quickly, typically requiring repayment within a few years [5] - **Non-QM Loans**: These loans do not adhere to standard requirements, allowing more flexibility in lending [6] - **Bank Statement Loans**: Qualify based on bank account trends rather than traditional income documents [7] - **DSCR Loans**: Allow qualification based on the property's cash flow without needing income or employment information [7] - **Bridge Loans**: Short-term financing for situations where funds from a property sale are delayed [8] - **Hard Money Loans**: Less reliant on creditworthiness, often provided by private lenders [9] - **Home Equity Loans and HELOCs**: Allow borrowing against the equity of existing properties to finance new investments [10][11] - **FHA Loans**: Can be used for investment properties under specific conditions, such as relocating for a job [12][13] Loan Requirements and Considerations - **Higher Interest Rates**: Investment property loans typically have interest rates 0.25% to 0.75% higher than traditional mortgages [15][16] - **Larger Down Payments**: Expect down payments of 15% to 25%, significantly more than the 3% to 3.5% required for primary residences [17] - **Increased Cash Reserves**: Lenders may require up to 12 months' worth of mortgage payments in reserves to mitigate risk [18] Lender Options - Many banks and mortgage lenders offer investment property loans, with specialized lenders like Angel Oak Mortgage Solutions providing a range of non-QM options [19] - The application process is similar to traditional mortgages, requiring documentation and property appraisal [20][21] FAQs on Investment Property Loans - **Difficulty in Obtaining Loans**: Generally, larger down payments and more cash reserves are needed compared to regular mortgages [22] - **Down Payment Flexibility**: Some lenders may allow down payments of less than 20%, but this varies [23] - **Credit Score Requirements**: Typically, a credit score in the mid-600 to 700 range is needed for most investor-focused loan products [25]

Core Insights - Refinancing a mortgage can serve multiple financial objectives beyond just lowering interest rates, particularly for homeowners with FHA loans [1][2] FHA Refinance Overview - Homeowners may refinance FHA loans to lower monthly payments, shorten loan terms, pay for home improvements, switch loan types, or consolidate high-interest debt [2][12] - FHA refinance loans include options like Streamline, Simple, Cash-out, and 203(k) loans, each catering to different borrower needs [6][9][12][17] FHA Refinance Requirements - Minimum credit score for FHA loans is typically 580, with some lenders requiring higher scores; debt-to-income ratio should be 43% or less [4] - Closing costs for FHA refinancing range from 2% to 6% of the loan amount, and mortgage insurance is mandatory [5][20][21] Types of FHA Refinance Loans - **FHA Streamline Refinance**: Best for current FHA borrowers wanting to refinance without appraisal or credit checks; requires six months of on-time payments [6][8] - **FHA Simple Refinance**: Allows borrowers to avoid upfront closing costs and requires a home appraisal; also requires six months of timely payments [9][10] - **FHA Cash-out Refinance**: Suitable for borrowers with at least 20% equity in their home, allowing them to take cash out while keeping the loan under 80% of home value [12][13] - **FHA 203(k) Loan Refinance**: Designed for borrowers looking to renovate their homes, combining renovation costs into the new loan balance [17][18] Specific Loan Requirements - FHA Streamline Refinance requires existing FHA mortgage and timely payments [8] - FHA Simple Refinance requires appraisal and allows closing costs to be wrapped into the loan [10] - FHA Cash-out Refinance requires a minimum credit score of 580 and a tangible benefit from refinancing [15][16] - FHA 203(k) loans have specific project financing rules and require an appraisal [18][23]

Core Insights - Mortgage interest rates are crucial for home buyers as they directly influence monthly payments and overall affordability [2][3] - The current mortgage rates are significantly higher than the lows seen during the COVID-19 pandemic, with expectations of rates remaining above 6% throughout the year [4][3] - Various external factors, including the federal funds rate, demand for mortgage-backed securities, inflation, and overall economic conditions, play a significant role in determining mortgage rates [5][12][15] Group 1: Mortgage Interest Rate Dynamics - The mortgage interest rate is the cost charged by lenders for home loans, impacting monthly payments and total loan costs over time [1][2] - A historical perspective shows that mortgage rates have fluctuated significantly, with current rates being much higher than the all-time lows of around 3% during the pandemic [3][4] - Predictions indicate that rates may decrease slightly before the end of 2025, but buyers should prepare for rates above 6% in the near term [4] Group 2: Factors Influencing Mortgage Rates - The federal funds rate influences mortgage rates, with increases in the federal funds rate typically leading to higher mortgage rates [5][6] - Demand for mortgage-backed securities (MBS) affects mortgage rates; increased demand lowers yields and consequently mortgage rates, while decreased demand has the opposite effect [9] - The 10-year Treasury yield serves as an indicator for long-term loan rates, with lower yields generally leading to lower mortgage rates [11] Group 3: Economic and Global Influences - Inflation is a key determinant of mortgage rates, with higher inflation leading to increased rates as lenders seek to maintain profitability [12][13] - The overall economy impacts mortgage rates; a strong economy can lead to higher rates due to increased demand for loans, while a weak economy typically results in lower rates [15][16] - Global events can also influence U.S. mortgage rates, as investors may seek safe investments like U.S. Treasury bonds during international economic instability [19][20] Group 4: Individual Borrower Factors - Individual mortgage characteristics, such as term length and type, significantly affect interest rates; shorter terms usually have lower rates [22] - Borrower financial standing, including credit score and debt-to-income ratio, plays a critical role in determining the interest rate offered [23] - The type and location of the property being financed can also influence the mortgage rate, with single-family homes generally receiving lower rates than condominiums [24] Group 5: Lender Variability - Mortgage rates can vary significantly between lenders due to differences in operational costs and profit margins [25][26] - Borrowers are encouraged to shop around for the best rates, as lenders may offer different terms based on their individual circumstances [28] - The overall cost of a mortgage, including fees and points, should be considered alongside the interest rate when evaluating options [29]

Core Insights - The article discusses mortgage options available for borrowers with bad credit, highlighting various lenders and their offerings for September 2025 [1] Group 1: Best Mortgage Lenders for Bad Credit - PNC Bank is noted as the best for FHA loans for bad-credit borrowers, offering a minimum credit score of 600 and grants for closing costs ranging from $10,000 to $15,000 [2][7] - Pennymac is highlighted as the best for military-connected borrowers, with a low credit score requirement of 600 for FHA, VA, and USDA loans, and a 1% buydown option for the first year [5][10][15] - Rate (previously Guaranteed Rate) allows a higher debt-to-income ratio, making it suitable for modest-income households [11][16] - Guild Mortgage accepts alternative credit forms, allowing borrowers without a credit score to qualify based on payment histories [13][14] - Rocket Mortgage's RentRewards program offers financial incentives for renters looking to buy, with a minimum credit score of 540 for various loan types [18][23] - New American Funding caters to borrowers with foreclosures or bankruptcies, offering non-qualified mortgages [24][31] Group 2: Loan Types and Requirements - FHA loans are available for borrowers with credit scores as low as 500 with a 10% down payment, or 580 with a 3.5% down payment [27][34] - VA loans do not have a minimum credit score set by the VA, but lenders like Pennymac have low requirements [15][29] - USDA loans are aimed at low- and moderate-income households, with lenient credit score minimums [32] Group 3: Customer Satisfaction and Market Position - PNC ranks well for customer satisfaction according to J.D. Power, while Pennymac has a below-average rating [7][10] - Rate has a below-average score for customer satisfaction, despite offering flexibility in debt-to-income ratios [16] - Guild Mortgage also has a below-average rating in customer satisfaction, with higher loan costs compared to market averages [14][26]

Core Insights - Government home loans play a crucial role in making homeownership affordable for Americans, particularly for first-time home buyers and those with modest means [1][2] - These loans are typically backed by the federal government, which encourages lenders to offer loans to borrowers who may not qualify for conventional mortgages [2][3] Types of Government Home Loans - Government home loans can be categorized into three main types, each serving different borrower needs and situations [4] - FHA loans, backed by the Federal Housing Administration, offer down payments as low as 3.5% but require mortgage insurance premiums [5] - VA loans, available to military-connected borrowers, typically require no down payment and have relaxed credit standards [20][21] - USDA loans are designed for low- to moderate-income households in eligible rural and suburban areas, often requiring no down payment [25][26] Specific Loan Programs - The FHA 203(b) loan is the primary tool for home purchase and refinance, financing single-family homes or up to four units [6] - FHA Streamline Refinance allows homeowners to exchange existing FHA loans for lower interest rates with less paperwork [12] - VA cash-out refinance loans allow borrowers to tap into home equity, similar to civilian loans [23] - USDA Section 502 Guaranteed Loan Program assists low- to moderate-income households through approved private lenders [27] Unique Loan Features - The FHA Energy Efficient Mortgage Program helps finance energy efficiency improvements, potentially lowering utility costs [14] - The FHA Rehabilitation Mortgage Standard 203(k) allows financing for extensive home improvements [15] - The USDA Section 504 Home Repair program offers loans at a fixed interest rate of 1% for home repairs to very-low-income households [29] Additional Considerations - Government-backed loan programs typically limit borrowers to one program at a time, such as having either an FHA loan or a USDA loan [33] - Grants may be available from government programs for specific demographics, such as single parents [34] - FHA rules stipulate that homes purchased with government-backed loans must be owned for more than 90 days before they can be flipped [35]

Mortgage interest rates change daily, meaning the mortgage interest rate you see when you first apply for your mortgage preapproval or approval may not be the same rate you end up with at closing. That’s why mortgage rate locks exist. Simply put, a mortgage rate lock freezes your interest rate until the loan closes and protects you from rising rates. Learn more: Strategies for getting the lowest mortgage rates In this article: What is a mortgage rate lock? A mortgage rate lock is a commitment from a mor ...