Buying a home
FHA loan
FHA financing lets qualified buyers purchase with 3.5% down and a credit score as low as 580. It is the program that opens the door for a lot of the families we work with in East Point and Stonecrest.
How the fha loan works
An FHA loan is a regular mortgage from a regular lender, insured by the federal government. That insurance is what lets us approve buyers who would be declined on a conventional file, whether because the score is in the low 600s or because a student loan payment pushes the debt ratio up.
Two insurance charges apply. An upfront premium of 1.75% of the loan amount is financed into the balance, and an annual premium is collected monthly. On most FHA loans with less than 10% down, that annual premium stays for the life of the loan.
That permanence is not a reason to avoid the program. It is a reason to plan. Plenty of our clients use FHA to get into a house, spend two or three years rebuilding credit, and then refinance into a conventional loan with cancellable insurance.
What you get with us
Not program features. The things our office does on every file of this type.
580 score floor
At 580 and above the down payment is 3.5%. Between 500 and 579 it rises to 10%, and we will tell you honestly whether that math works.
Higher debt ratios
FHA regularly approves debt-to-income ratios above 50% where a conventional file would stop at 45%.
Non-occupant co-borrower
A parent or sibling can be added to the loan to strengthen the file without living in the house.
Assumable loan
If rates rise, a future buyer may be able to assume your FHA loan at your rate, which is a real selling point.
203(k) renovation option
Roll repair costs into the purchase loan on a house that needs work before it is livable.
Exit plan documented
We hand you a written refinance target: the score and equity level where switching to conventional saves money.
Step by step
Six stages, and what each one actually asks of you.
Credit review
We pull credit, look at what is hurting the score, and tell you whether waiting 60 days would meaningfully change your pricing.
Pre-approval letter
Issued with an FHA-specific price ceiling, since county loan limits apply.
Offer and contract
Your agent submits. We call the listing agent directly to vouch for the file when it helps.
FHA appraisal
FHA appraisals check condition as well as value. We prepare you for the common repair callouts: peeling paint, missing handrails, exposed wiring.
Underwriting and conditions
Expect questions about gaps in employment and large deposits. We collect the explanations up front to avoid a second round.
Close and plan ahead
At closing we set a calendar reminder for your refinance review.
Why people choose it
Lower entry bar
Approvals at 580 where conventional underwriting typically stops at 620.
3.5% down
On a $300,000 home that is $10,500 rather than $60,000.
Assumable
A future buyer can take over your rate, which protects your resale in a high-rate market.
Co-borrowers welcome
Family members can co-sign without moving in.
What moves your pricing
Six levers underwriting actually looks at. Two of them you can change before you apply.
| Factor | How it affects you |
|---|---|
| County loan limit | Fulton, DeKalb, Cobb and Gwinnett share one metro Atlanta FHA ceiling. |
| Credit score band | 580 and 620 are the two thresholds that change pricing most. |
| Property condition | The appraisal must confirm the home meets minimum property standards. |
| Debt-to-income | Approvals above 50% are possible with compensating factors. |
| Down payment source | Gifts and assistance grants are both acceptable. |
| Previous FHA loan | You generally cannot hold two FHA loans at once, with narrow exceptions. |
Programs people compare this with
- Conventional loanThe workhorse loan for buyers with steady income and reasonable credit. Down payments start at 3%.Compare
- First-time buyer programOur bundled path: a low-down-payment first mortgage plus the Georgia assistance funds you qualify for.Compare
- USDA rural loanNo down payment in eligible areas, and more of metro Atlanta's outer ring qualifies than people expect.Compare
Questions about this program
No. Anyone who meets the credit and debt guidelines can use FHA on a primary residence, whether it is their first house or their fourth.
If you put 10% or more down, the annual premium drops off after 11 years. Below 10% it stays for the life of the loan, so the usual exit is a refinance into a conventional loan once you have 20% equity.
It can, because listing agents worry about the repair standards. We counter that by calling the listing agent with a direct line to the underwriter and a pre-underwritten approval.
Yes, and it is our most common pairing. Georgia Dream funds layer on top of an FHA first mortgage very cleanly.
Magnolia Lending Group
Ready to look at a fha loan?
A pre-approval takes about four minutes to start and one business day to issue. No cost and no obligation.
Free consultation. Sample rates and assistance amounts shown on this site are illustrations, not offers.