FHA Home Loans are not a Dream for DACA Recipients Anymore

FHA loans are not out of reach for DACA recipients anymore. Here is an article on all the necessary information!

Dreamers of America have found a new pathway to fulfilling their coveted wish to own a house since the Department of Housing and Urban Development brought changes to the policy. The recipients of the Deferred Action for Childhood Arrivals Program are eligible as lawful citizens who can apply for an FHA home loan. The DACA recipients did not earn eligibility for government-sponsored home loans before because of the statement in the FHA Handbook. According to it, non-U.S. citizens who did not have lawful residency in the States could not apply for FHA-backed programs.

For years, this has been a major setback for DACA recipients. FHA home loans for DACA recipients in Fairfax County, VA have waived the previous statement for those who are present in the country lawfully. As this is the first time purchasing a house, numerous things must be on your mind. So, let’s move on to the next section!

Why FHA Loans are Everyone’s First Choice?

The popularity of FHA loans stems from mortgage benefits. The minimum down payment requirement is 3.5%, so you might have to put down $12,000 on a home worth $20,00,000. The interest rates are competitive, unlike the conventional programs. On the other hand, the minimum credit score is 500, but you need to prove a credit score of 550 for putting down 3.5% of the loan value. All these things together make homeownership flexible so that the entire process remains affordable.

However, do not give in to unbelievably low-interest rates. You might be stuck with high closing costs and monthly payments. So, you should have a word with the lender before going forward. Moreover, FHA mortgage insurance is another thing to keep in mind. There is a high chance to pay for upfront costs over the loan term. Ask the lender whether you need to pay the fee with closing costs.

Things to Remember

Starting out your journey of homeownership can be intimidating. You can look around for first-time homebuyer’s programs in order to receive the necessary assistance. Even though down payments are exclusive to people with specific occupations – but asking the lender does not hurt anyone. It is better to save for a down payment before filling out the loan application. FHA loans require a small down payment; however, large down payments work in favor. Of course, you should get the letter of pre-approval. This is the best way to start the mortgage application.

Are you a DACA recipient dreaming of homeownership? Discuss your situation with Clear Lending now.