FHA Mortgages in Tucson

Federal Housing Administration (FHA) loans are available in Tucson and enable a significant number of home buyers in Tucson to be able to purchase a home. FHA mortgages were created during the Depression to stimulate the economy. It established a new financing structure that had never before been attempted.

Looking for real estate listings for Tucson homes for sale that are eligible for FHA mortgages? Click here to see a comprehensive list of available properties.

Some Background on FHA Mortgages

Prior to FHA mortgages, buyers looking to finance a home purchase had extremely limited options. A 5-year interest-only mortgage with a balloon payment from a private bank was the only real option available for about 200 years. The way it worked was a lender would require a 50% down payment and require monthly interest payments for the 5-year term. At the end of the 5-year term, the remaining balance was due in full. Lenders did not want to take chances financing large sums of money for more than five years at a time as that was incredibly risky to their solvency.

Borrowers who couldn't pay it off had to find another lender to give them a new mortgage at the end of the five-year term. In times of a down economy (the 1800's to early 1930's was plagued with severe recessions and depressions that lasted years at a time), the borrower would essentially be forced to sell the property at whatever they could get for it. In many cases, this only increased the intensity of the downturn in the economy as it concentrated and forced many real estate sales. Think 2008-2011. We saw the same thing happen.

Federal Housing Administration (FHA) loans changed everything. FHA loans took us into what is now called modern home finance. The FHA allowed for a 30-year mortgage amortized to be paid off at the end of the term, with a fixed interest rate for the duration of the loan. Nothing like this had ever been tried anywhere in the world.

Even today, worldwide, a 30-year fixed rate amortized home loan exists only in the USA. No other country can keep their interest rates stable for long periods like the US seems to be able to do.

TIP: Apply for your FHA loan through a mortgage broker. If you apply through a commercial bank (i.e., an extremely large national bank) they have what are called "overrides," which means they have higher requirements than the FHA deems allowable. We frequently have clients who were declined for an FHA loan by a large commercial bank but were easily approved by going through a mortgage broker.

The reason? These huge banks do a lot of business with the federal government and they are not trying to cut anything close. In some situations, these banks have significant overrides that disqualify most applicants.

Benefits of an FHA Loan

  • Low down payment. 3.5% down is the minimum down payment required. This is the lowest down of any major home financing option.

  • Low interest rates. For such a low down payment, the interest rates on FHA loans are incredibly low. The reason is that the federal government wants to promote homeownership in a significant way and this is how to do it.

  • Ok credit is good enough. While FHA loans do require at least OK credit, in the outside world of mortgage lending, merely "OK credit" scores will not get you anywhere. FHA only requires that the borrower have a certain income level and a 580+ credit score.

  • FHA Loans are assumable. We think this will become a major benefit of the FHA loan within the next decade. An assumable loan is a very beneficial bonus. If you have an FHA loan for your home and want to sell it and interest rates are now sky high, the buyer can take over your mortgage and keep the super-low mortgage rate that you initially received. Since 2011, mortgage rates on FHA loans have been under 5%, so if/when mortgage rates reset higher, there will be a major advantage for borrowers holding properties with FHA financing. The only rule is that the FHA must deem the new borrower "credit worthy." Remember, the FHA wants to do this in order to encourage home ownership.

Homeownership provides many benefits to society, and the Federal Government recognizes this. That's why FHA loans were created almost 100 years ago. Homeowners have a stake in their community. That stake makes them more prone to care about their property and fosters better communities. Remember, the USA was formed after breaking ties with a king who owned essentially everything. The founding fathers wanted the citizens of the USA to literally own the country via ownership of the land itself. These ideals came to the fore during the Depression, and the FHA was developed to directly promote them.

If you would like help buying a home in the Tucson area using an FHA loan, contact us today and we will help you find a mortgage loan officer who can help you to get approved. We have expert knowledge of the best financing options available and we share it with clients to enable them to get the best results on their home purchase in the Tucson area.


Homes Eligible for FHA Mortgages for Sale

1809 E Vico Bella Luna 27, Oro Valley
  • Residential
  • 3 Beds
  • 3 Baths
  • 1,520 SqFt

1809 E Vico Bella Luna 27, Oro Valley

$299,900 ↑ $25,000
4285 W Golden Gate Mountain Court, Tucson
  • Residential
  • 3 Beds
  • 3 Baths
  • 3,278 SqFt

4285 W Golden Gate Mountain Court, Tucson

$299,900 ↑ $9,100
64418 E Sugar Lane, Tucson
  • Residential
  • 2 Beds
  • 2 Baths
  • 2,199 SqFt

64418 E Sugar Lane, Tucson

$299,900
4852 W Saguaro Point Place, Marana
  • Residential
  • 3 Beds
  • 2 Baths
  • 1,803 SqFt

4852 W Saguaro Point Place, Marana

$299,500 ↑ $10,500
2229 E Celosia Avenue, Oro Valley
  • Residential
  • 2 Beds
  • 2 Baths
  • 1,298 SqFt

2229 E Celosia Avenue, Oro Valley

$298,126
12614 N Sleeping Coyote Drive, Oro Valley
  • Residential
  • 2 Beds
  • 3 Baths
  • 1,644 SqFt

12614 N Sleeping Coyote Drive, Oro Valley

$295,000 ↑ $5,000
60683 E Eagle Heights Drive, Tucson
  • Residential
  • 3 Beds
  • 2 Baths
  • 2,300 SqFt

60683 E Eagle Heights Drive, Tucson

$294,000 ↑ $800
1801 E Vico Bella Luna 25, Tucson
  • Residential
  • 3 Beds
  • 3 Baths
  • 1,520 SqFt

1801 E Vico Bella Luna 25, Tucson

$287,595
2726 W Calle San Isidro, Tucson
  • Residential
  • 3 Beds
  • 2 Baths
  • 1,825 SqFt

2726 W Calle San Isidro, Tucson

$285,000
1601 W Sunset Road, Tucson
  • Residential
  • 4 Beds
  • 3 Baths
  • 2,453 SqFt

1601 W Sunset Road, Tucson

$280,000
6139 E Hawthorne Street, Tucson
  • Residential
  • 3 Beds
  • 2 Baths
  • 1,721 SqFt

6139 E Hawthorne Street, Tucson

$272,500
4279 E Columbus Park Place 2, Tucson
  • Residential
  • 3 Beds
  • 3 Baths
  • 1,549 SqFt

4279 E Columbus Park Place 2, Tucson

$271,278


Eligible for FHA Estate Market

In the current Eligible for homes for sale, the highest price home is listed at $300,000 with the lowest available home listed at $100,000. The current average price for a home in the Eligible for real estate listings is $213,479 with a median price of $215,000. Eligible for homes for sale range in size from 1 Sqft to 4,032 Sqft and sit on lots that average 15.93 Acres in size. Eligible for properties appeal to a wide variety of home buyers and are some of the most popular homes in the Upper Northwest" area.";


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MLSSAZ LogoThe data relating to real estate listings on this website comes in part from the Internet Data Exchange (IDX) program of Multiple Listing Service of Southern Arizona. IDX information is provided exclusively for consumers' personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. Listings provided by brokerages other than Oliver Realty are identified with the MLSSAZ IDX Logo. All Information Is Deemed Reliable But Is Not Guaranteed Accurate. Listing information Copyright 2019 MLS of Southern Arizona. All Rights Reserved.

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