TEXAS FHA LOANS

What are the Benefits of FHA Loans?

So what is a Texas FHA loan? A Federal Housing Administration (FHA) loan is a government-backed mortgage designed to help individuals with lower credit scores and limited down payment funds purchase a home.

1. Lower Down Payment: A big advantage to first time home buyers is that a FHA down payment can be as low as 3.5% of the home’s purchase price.
2. Flexible Credit Requirements: While conventional loans usually require a higher credit score, at Lone Star Financing we can go down to 600 credit on FHA loans.
3. Competitive Interest Rates: FHA mortgages in Texas come with competitive interest rates, which can reduce your monthly mortgage payment compared to other home loan options.
4. Assumable Loans: Texas FHA loans, are one of the few loan types that are “assumable” meaning that you when you sell your home, the buyer may be able to take over your existing loan under its original terms. This can be a favorable selling point for prospective buyers in Texas.
5. High Loan Limits: 2026 FHA loan limits in Texas are now $541,287 for most counties but this loan limit varies from county to county.

What are the Texas 2026 FHA Loan Requirements?

FHA loans are a perfect option for first time home buyers, due to lower down payments and easier credit guidelines. The FHA program is designed primarily to assist borrowers who do not meet the requirements for conventional loans. Learn more about FHA loan requirements at Lone Star Financing. 

1. Credit Score: While Texas FHA loans are more lenient than conventional loans, a higher credit score can still improve your chances of approval and result in better loan terms.
2. Down Payment: A minimum down payment of 3.5% of the purchase price or appraised value is required for those with credit scores of 580 or higher. If your credit score is between 500 and 579, a down payment of at least 10% is necessary.
3. Debt-to-Income Ratio: FHA guidelines suggest that your total debt-to-income (DTI) ratio should be no more than 43%. This includes all monthly debts, such as your mortgage payment, credit card bills, and other loans.
4. Property Requirements: The property must be a primary residence and meet certain standards set by the FHA to ensure it is safe and habitable. An FHA-approved appraiser will assess the property.
5. Mortgage Insurance: Texas FHA loans require both an upfront mortgage insurance premium (UFMIP) and monthly mortgage insurance premiums (MIP). This insurance protects the lender in case of default and is a key feature of FHA loans.

Texas FHA Refinance 

• Streamline Option (Rate and Term)
• No Appraisal / No Income * Full Doc Loans
• Rate and Term / CashOut
• Closing Costs can be rolled into loan
• Terms: Up to 30 Years
• Purchase financing: up to 96.5% LTV
• Refinance financing: up to 97% LT

Texas FHA mortgage refinancing offers homeowners an opportunity to lower their mortgage rates and adjust their loan terms, potentially leading to reduced monthly payments and significant long-term savings. This type of refinancing, backed by the Federal Housing Administration, is especially beneficial for those with existing FHA loans or for first-time refinancers. It provides access to favorable terms with less stringent credit requirements compared to conventional loans. Additionally, refinancing in Texas can help consolidate debt or access home equity, making it a versatile option for improving financial stability and managing housing costs.

WHAT ARE TEXAS FHA QUALIFICATIONS?

For single-family homes, the 2026 FHA loan limit in Texas is $541,287 but it varies by county. 

To qualify for an FHA loan, you’ll need to meet the following requirements.

• Stable employment/income
• The home will be your primary residence
• No foreclosures (last 3 years)
• 50% or lower DTI ratio
• Minimum 3.5% down payment
• Money to cover the upfront mortgage insurance premium (UPMIP), which could be anywhere from 2 – 6% of the purchase price.

Things to know about Texas FHA Loans

1. Pre-Qualification: Start by getting pre-qualified for your FHA loan in Texas. This involves providing basic financial information to a lender to determine how much you might be eligible to borrow.
2. Documentation: Gather necessary documentation, including proof of income, credit history, and employment verification. This information helps the lender assess your financial stability.
3. Application Process: Complete the FHA loan application with Lone Star Financing to get started online. We will review your financial documents, credit report, and property details to determine your eligibility.
4. Home Inspection and Appraisal: Schedule a home inspection and appraisal. The FHA requires an appraisal in Texas to ensure the property’s value supports the loan amount and meets safety standards.
5. Loan Approval: Once your loan is approved, you’ll proceed to closing. During closing, you’ll review and sign final loan documents, and the mortgage will be funded.

Call or Apply Online and see why Lone Star Financing is the Best FHA lender in Texas!