Home Loans In Springfield, Illinois 

Springfield is the capital city of Illinois and the home of Abraham Lincoln, the 16th President of the United States. The housing market in Springfield has mirrored the real estate situation across the country — gradually recovering following the effects of the pandemic. 

Are you planning to move to Springfield? You’ll likely need a home loan to make the deal happen. One of the best loan options available is the FHA home loan. Thanks to its lower credit score and down payment requirements, it is ideal for first-time borrowers. This makes it accessible even to low- and moderate-income families.

If you’re considering getting an FHA home loan in Springfield, we can help. At Capital Home Mortgage, we offer flexible underwriting and competitive interest rates for FHA loans. Let’s do a quick walkthrough of what the FHA home loan program is all about. 

• What Is An FHA Loan?

An FHA loan is a loan insured backed by the Federal Housing Administration under the arm of the Department of Housing and Urban Development, aka HUD. 

The primary purpose of FHA loans is to help families with low- to moderate-income afford homeownership. 

In an FHA home loan, the federal government insures your loan against future default to reduce the risks that lenders shoulder to borrowers. The maximum loan-to-value limit for FHA loans is 96.5%.

FHA Loan Requirements

Per FHA guidelines, borrowers with credit scores of 500 and above may qualify for an FHA loan. 

FICO scores ranging from 500 to 579 may secure an FHA loan as long as the borrower can afford a 10% down payment, and certain restrictions will apply. However, if you have a credit score of 580 or higher, you can enjoy a lower down payment as low as 3.5%.

Lenders will also want to see your credit transactions for the past two years and evaluate your payment patterns. Late payments, defaults, foreclosures, and bankruptcy can make your credit report look bad.

You’ll need to submit tax returns, paycheck stubs, last two years’ W2s, or an employment offer letter for proof of income. Business owners may submit the latest balance sheet and profit and loss statement along with their last two years’ personal and business tax returns.

Our home loan specialists at Capital Home Mortgage will walk you through the complete list of eligibility requirements. 

Loan Relief Benefit

A great benefit of an FHA loan is the loan relief program. Borrowers who’ve experienced legitimate financial difficulties or business reverses may ask for loan relief. Loan payments may be reduced to help the borrower pay off the loan.

Mortgage Insurance

A prominent drawback with FHA loans is mortgage insurance. Since FHA loans accept low down payments, borrowers may have to pay insurance payments to the FHA. 

• VA Home Loan

The Department of Veteran Affairs helps servicemembers, veterans, and eligible surviving spouses become homeowners. The VA provides a home loan guaranty benefit and other housing-related programs to support a servicemember buying, building, repairing, or retaining and adapting a home for a primary residence.

A VA home loan requires no down payment and no mortgage insurance. It also offers limited closing costs that a lender may charge the borrower. The VA home loan is a lifetime benefit and doesn’t expire; you can use the guaranty multiple times.

Springfield, Illinois Home Loans

An FHA loan is an affordable and accessible solution to individuals who can’t afford more exclusive loans like conventional mortgages or Jumbo loans. Our mortgage experts at Capital Home Mortgage will help you understand how FHA loans work and determine what type of FHA loan suits you.

We also offer USDA Guaranteed Home Loans, Jumbo home loans, Native American home loans, and non-qualified mortgage loans.

We are direct Springfield mortgage lenders, meaning we handle, process, and fund all loan applications. This puts us in the best position to process your loan quicker and provide on-time closings. 

Get A Home Loan In Springfield 

Finance your dream home in Springfield with an FHA loan from Capital Home Mortgage. We understand how tasking the loan process can be, so we’ve taken the necessary steps to ensure a smoother experience. Get started by calling us at (630) 339-3388.

We look forward to providing you with your next home loan in Springfield.