FHA Loan Limits in Indiana: Mortgage Guidelines 2023
Applying for an FHA loan can be a long and confusing process. You have to gather all of your financial information, know your Indiana FHA Loan limits, submit it to the lender, and then wait to hear back. We are an online resource that connects you with FHA-approved lenders in Indiana so that you can get pre-approved for an FHA loan fast. Plus, our lenders offer competitive rates and terms so that you can find the best mortgage for your needs.
What are FHA Loan Limits 2023?
The Federal Housing Administration, or FHA, was created to assist low- and moderate-income homebuyers in obtaining mortgage loans. The FHA sets yearly FHA loan limits for buyers who take out FHA loans (any bank or mortgage company insured or guaranteed by the FHA) and those limits are based on the area’s average house price. The higher the loan limit, the more expensive the typical house.
The limit is based on the area’s median home price, which is set at 115% of that figure in low-cost locales and 150% in high-cost locations. The FHA adjusts loan limits each year based on the most up-to-date sales data available. With home prices, the FHA mortgage loan limits fluctuate. This is to ensure that people in high-cost regions have the opportunity to acquire a loan that will allow them to access an expensive market.
FHA Loan Indiana Requirements:
- Job History – Stable income and employment. Proof of employment for 2 years is required. It is ok if you have changed jobs, but you need to show consistent employment/income. People with a part-time income need to be seasoned for at least 2 years.
- Financial Statements – You should expect to be required to provide your 2 most recent bank statements, pay stubs, and tax returns.
- Credit Score – To qualify for the FHA loan you must have a 500 credit score or higher.
- Down Payment – HUD requires a 3,5% down payment for the FHA Loan depending on your credit score. On $300,000 house you will need $10,500. If your credit score is between 500–579, you are eligible for up to 90% financing. So the minimum down payment would be 10% of your home’s purchasing price. So if you buy a house worth $300.000 you need to come up with $30,000.
- Debt-to-Income (DTI) – You can not have a debt-to-income ratio higher than 43%. However, if you have “compensating factors” you might be able to get approved with higher debt levels (a compensating factor could be more money in savings, long job history, or great credit).
- Primary Residence – You must occupy the home that you intend to purchase and have it be your primary residence. FHA loans are not available to purchase an investment property, second home, or vacation home. It’s possible to add a non-occupying co-borrower to the FHA mortgage loan also.
- Mortgage Insurance – All FHA loans, regardless of the lender, require two types of mortgage insurance. This includes the UPMIP (Upfront Mortgage Insurance Premium) and the regular MIP (Mortgage Insurance Premium). FHA MIP acts similarly to how PMI (Private Mortgage Insurance) on a conventional loan acts. You can use our loan calculator to estimate your monthly payment and mortgage insurance costs.
- FHA Loan Limits (Maximum FHA loan amount) – FHA loans have maximum lending limits, which are set at the county level. You can view the 2023 FHA loan limits for all counties in Indiana below.
We know that you’re busy and you don’t want to waste your time talking to a bunch of lenders who won’t give you the time of day. At FHA Lend we do loans in Indiana, we’ll do the work for you. We have a wide network of approved lenders who are ready to help you get into your dream home. Request a free consultation today and one of our friendly loan officers will be happy to help.
Indiana FHA Loan Limits by County in 2023
In 2023, in Indiana FHA loan limits are up to $472,030will be available for a one-unit property. The FHA limit for a two-unit home is $604,400. For a three-unit home it’s $730,525. A four-unit home is the FHA limit of $907,900. In High-cost areas limits are follow: $970,800 for Single Unit, for Duplexes: $1,243,050, for Triplexes (three units) is $1,502,475 and for Four units is $1,867,275.
|County||Single-Family||2 Family||3 Family||4 Family||Median House Price|
FHA Loan Process Timeline in Indiana
It is important to plan for an extended closing for a mortgage and to protect yourself from extra costs and risk your deal. Homeowners who are refinancing with FHA can find out how long they will have to wait once their application is complete and all the documents are turned in. The time it takes for the documents to be submitted and for the closing to happen is different for different reasons, and each party has a lot of control over what happens.
Closing on an FHA loan typically requires submitting a mortgage application within 30 days. It usually takes about 30 days to 60 days from the time the application is submitted to closing. Despite a high number of applicants, the FHA lender can typically underwrite the loan package in a matter of days to weeks. First-time homebuyers and homeowners with minimal equity in their homes are in high demand for FHA loans. Government-backed loans protect participating lenders by promising to reimburse them if borrowers default. Down payment requirements and flexible credit guidelines have made FHA loans in high demand.
FHA Loan Indiana Application Process
The first thing you’ll need to do is get pre-approved for a loan. You can do this through any lender that offers FHA loans.. Once you’ve been pre-approved, you’ll need to fill out a formal application with the lender (brokers or lenders call it 1003 – “ten o three app”) and e-consent to pull your credit.
The next step is to get an appraisal of the property you’re looking to purchase. The appraiser will need to confirm that the property meets all of the FHA’s standards for safety and habitability. Once the appraisal is complete, you’ll need to submit all of your documentation to the lender for final approval.
Is an FHA Loan For First-time Home Buyers Only?
No, FHA loans are not restricted to first-time home buyers. If you have owned a home before, then you may still get an FHA loan. However, only one FHA loan is available and it must be used for a primary residence.
How Do I Get an FHA Loan in Indiana?
It is easy to get pre-qualified or to apply for an FHA loan. We recommend having us match you with an FHA lender in Indiana based on your personal needs (such as estimated credit and loan amount). To be matched with the right lender, please check the below apply now link.
Does FHA Offer a Loan With a Low Down Payment in Indiana?
Yes, if you qualify for down payment assistance, it can be used with an FHA loan. There are many programs available that provide funds to use for down payment assistance. We can help you find out if you qualify for any of them.
Is Cosigner Allowed on FHA loans in Indiana?
FHA loans are a great option for first-time homebuyers or those with less-than-perfect credit. One of the best things about FHA loans is that they allow for a co-signer. At least one of the borrowers must live on the property. Non-occupying co-borrowers are allowed, which means they do not need to live at the property that is financed using an FHA loan.
This means that if you don’t have the best credit, you can still qualify for an FHA loan as long as you have someone who is willing to cosign the loan with you.
Can I Get a Loan After Bankruptcy Indiana?
The FHA rules state that you have to be waiting at least 2 years after filing a chapter 7. For chapter 13, you must wait until you have made 12 months of payments. You will also need to provide the court trustee’s approved written confirmation. One should also note that the clock starts when one files for bankruptcy and not when they are discharged from it. The time period in which you can get an FHA loan after a foreclosure depends on a number of factors.
The three-year waiting period has been set by the FHA. But, there is an exception to this rule if there were “extenuating circumstances”. You would have to improve your credit since the foreclosure. In the event that the circumstances and credit improvements are satisfactory, you would only have to wait until after one year before you can apply for a Federal Housing Administration loan.
What Are The Options For Refinancing an FHA loan?
The FHA offers two types of refinancing for their loans. This includes the FHA streamline refinance, which allows you to easily lower your interest rate and mortgage payment. There is only one option for refinancing an FHA loan, and that is the “FHA cashout refinance“.
Top Mortgage Companies in Indiana
It’s hard enough trying to find the right home when looking in Indiana, but when you add in all of the paperwork and red tape that comes with getting an FHA loan. It can seem downright impossible. We are a free matching service for Indiana residents who want to get an FHA loan. We have a wide network of approved lenders who are ready and waiting to help you get the best deal on your new home. Request a free quote today and let us take the hassle out of getting your new home.
Applying for a mortgage can be a long and difficult process. You shouldn’t have to spend hours online or on the phone filling out applications and waiting for a response. FHA Lend is an Indiana-licensed company that offers fast, easy, and reliable FHA loans. We work with local nationwide lenders to get you the best deal on your home loan. Apply now and get pre-approved in minutes.
Indiana Down Payment Assistance Program
The Indiana Housing and Community Development Authority (IHCDA) has two programs that offer down payment assistance.
- First Place Program: Up to 6% of the purchase price may be offered to first-time home buyers. Depending on the debt-to-income ratio (DTI), it must be used with an FHA mortgage and has a credit score of 640 or higher.
- Next Home Program: Up to 3.5% of the property’s purchase price may be paid out as a tax credit to first-time home buyers. Must be used with an FHA loan and have a debt-to-income ratio of less than 0% (DTI) depending on your credit score. This program can also be used together with IHCDA
The IHCDA also has a mortgage credit certificate that can assist first-time home buyers and veterans obtain better mortgages.
For more information on these, go to the IHCDA website. Also, visit HUD’s list of Indiana’s other initiatives to see if there are any you’re interested in.