California FHA Loan Rates

Securing an FHA Loan in California

FHA loans are mortgage loans insured by the Federal Housing Administration that are issued by federally qualified FHA lenders. California FHA loans allow prospective homeowners to borrow money for the purchase of homes that they would not otherwise be able to afford. To find out how much you can borrow, check the table below for the  California FHA loan limits by county.

California FHA Loan Requirements

In order to obtain an FHA loan, borrowers must satisfy California FHA Loan Requirements. While loans guaranteed by the Federal Housing Administration include fairly lenient qualifications, borrowers must satisfy requirements regarding down payment, debt to income ratio, income and residency.

General Requirements

• Your down payment must be 3.5% or greater (96.5% loan-to-value, or LTV).
• FHA requires a credit score of 500 or greater, but many lenders will not accept less than 580.
• Your debt-to-income ratio (DTI) should be no greater than 45 - 50%.
• Loan Limit (max allowable loan amount): Up to $625,500 in higher cost areas and as low as $271,050 in lower cost areas (see bottom of this page). 
• Mortgage Insurance is required depending on loan terms and down payment.
• Properties must meet FHA guidelines based on a home inspection.

Mortgage Insurance

• An upfront premium of 1.75% the base loan amount is required at closing. 
• Unless your mortgage term is less than or equal to 15 years and down payment is greater than or equal to 22%, a monthly mortgage insurance premium (MIP) must be paid alongside your principal and interest. 
• The monthly payment can be canceled on loans with 10% or more down payment after reaching 78% LTV and the 11 year mark. 
• If your down payment is less than 10%, you must also pay monthly mortgage insurance for the life of the loan.

California FHA Streamline Refinance 

FHA homeowners can get a lower rate or adjust their mortgage term with little hassle through an FHA Streamline refinance. Unlike other refinances, the FHA Streamline does not require a new home appraisal, and there is no income or employment verification step; the result is a faster process and with less paperwork. Borrowers who are underwater on their FHA mortgage, without significant equity, or have experienced any employment or credit hardships can still qualify for the fixed or adjustable-rate mortgage a Streamline refinance provides. 

Streamline Refinance Requirements:

• Borrower must currently have an FHA-insured mortgage.
• The refinance must pose a net tangible benefit for the borrower, meaning the process and fees won't outweigh the advantages. 
• A minimum of six mortgage payments must have been made at the time of applying, or applying must be at least 210 days from closing.
• Borrower must have clean payment history from the past year. 

Refinancing borrowers will likely have to pay an upfront and monthly mortgage insurance premium (MIP).

California FHA Loan Lenders

As mentioned above, FHA loans can be originated by qualified FHA loan lenders in CA. These lenders have received approval from the U.S. Department of Housing and Urban Development (HUD) and are qualified to issue all types of FHA loans, including FHA Streamline Refinances, FHA 203k Loans, and FHA Loans for the purchase of FHA-Approved Condos.

California Counties and FHA Loan Limits

Lenders in: California.