As the economy improves, and mortgage rates begin to rise, more home buyers are looking for a way to get out of their rental situation and into a home of their own. One of the most flexible mortgage loan programs available for home buyers in Asheville, NC is the FHA program. The down payment requirements are minimal, and the mortgage interest rates for FHA Loans in Asheville | Buncombe County NC are the lowest available because they are currently being purchased by The Fed.
FHA Loan guidelines vary somewhat by county, because there are maximum loan limits for each county in NC, and they are subject to change each fall.
2018 FHA Loan Limits for the areas around Asheville, NC and Buncombe County, NC
- One Family Dwelling: $294,515
- Two Family Dwelling: $377,075
- Three Family Dwelling: $455,800
Minimum credit scores for FHA loans run from 600 to 680 for the very best rates. If you’ve experienced a bankruptcy that did not involve a property, and you’ve re-established your credit, FHA requires a “waiting period” of 24 months before you can purchase again. If you had a property foreclosure or short sale (first off, we’re so sorry you had to go through that), FHA says you can buy a new home 36 months after the event. FHA does not include Student Loans that are in deferment when calculating debt to income ratios.
Unlike the USDA Home loan program, FHA does not set maximum household limits to qualify for a FHA Loan. The down payment for a FHA loan is 3.5%, and FHA allows for that money to come from a gift or a program like the NC Affordable Housing Program. The NCHFA loan programs changed recently, and it can now be used in partnership with FHA. In fact, the NC First Time Home Buyer program is no longer restricted to First Time Home Buyers and is available to folks who are residents of NC and have been renting for the last 3 years.
The Program offers home buyers in Asheville below market mortgage interest rates, additional tax credits, the ability to qualify for a little larger home and a forgivable 3% Grant that can be used to cover most of the FHA Down payment. The minimum credit score for this program is 640, and there’s no maximum sales price for a new or existing homes. There are maximum household income requirements that vary per county. Maximum Sales price with MCC is $250,000
- NC Affordable Housing Income Limits for Buncombe County (how to calculate income)
- Household maximum income is $87,500
- For MCC Mortgage Tax Credit 2018, Households with 3 or more people the limit is $70,000
Q: Isn’t it harder for houses to qualify for an FHA mortgage than a traditional mortgage?
A: FHA has eliminated most of the barriers to a property qualifying in January of 2006. The only thing we still find pretty consistently in NC is a problem with “out buildings.” If an outbuilding appears to have lead paint (meaning it hasn’t been painted for 20 or 30 years or the paint is PEALING) then it will have to be repainted prior to closing, even if it’s not the “home” you will be living in.
Generally speaking, however, if a home is in good enough condition to qualify for a traditional mortgage, it will also qualify for an FHA mortgage.
Looking for a home in the Asheville / Waynesville area? Steve lived in Sylva as a kid, and our son went to WCU (our neice is there now) so we are very familiar with the area. Call Steve and Eleanor Thorne 919 649 5058. We do TONS of FHA loans in NC and we’d love to help you! Here are 5 things we think ALL first time homebuyers in NC should understand before they buy a home.