2024 Florida FHA Loan Requirements

FHA Loan Florida

How To Qualify For An FHA Loan in Florida

The FHA loan has long been a standard for first-time homebuyers and experienced home buyers alike to purchase a home. There are many reasons why this program continues to be popular among potential homeowners. Here we present some of the basic guidelines of the program for people interested in how to qualify for an FHA loan.

Basic Florida FHA Loan Requirements

Down Payment Obligation

FHA (Federal Housing Administration) states that a minimum down payment of 3.5 percent of the purchase price must be paid at the time of purchase or 96.5% loan-to-value. The money for the down payment may come from the borrower’s funds such as checking, savings, or money market accounts. It may also come from retirement accounts or stock and bond investments.

FHA will also allow family members to gift the money to the buyers for the down payment. Certain documents are required to show the transfer from the relative to the buyer.

Maximum Lending Limits in Florida

There are maximum lending limits for FHA loans in place. The maximums are dependent on the type of property and the Florida county where the home is located.

For example, in Alachua County, the maximum amount for a single-family home in 2024 is $498,257 and for a four-plex, the maximum is $958,350. However, in Collier County, the maximum for a single-family home is $730,250 and the maximum is $1,404,350 for a four-plex. It makes sense to check with your lender to find out the maximums in your county for your intended property type.

View current Florida FHA loan limits for your area.

Seller Contributions

This is one of the major benefits of an FHA home loan. FHA will allow sellers to pay up to 6% of the selling price towards the closing costs. This is not an eligibility requirement of the loan, but merely it is allowed by FHA. The buyer and seller, along with the real estate agents, will need to negotiate this into the contract.

Debt-to-Income Rules

To determine if a borrower is eligible for FHA financing, lenders will examine the borrower’s debt and income and calculate a ratio. The debt-to-income ratio has two formulas.

The first formula takes all of the home buyer’s monthly debt payments and compares it to their monthly gross income.  It is often called the front-end ratio. Generally speaking, the ratio should be around 28%, but many borrowers get approved for loans with a higher ratio.

The second formula takes the home buyer’s monthly debt payments and adds it to the proposed mortgage payment and then compares it to the monthly gross income of the homebuyer. This calculation is often called the back-end ratio. Again, in general, the back-end ratio should be approximately 41%, but it is common for home buyers to be approved with higher ratios.

For example, suppose a married couple has a yearly gross income of $84,000. This means that their monthly income is $7,000. If the couple has monthly debt payments of $1,610 this would mean the calculation would be $1,610 divided by $7,000 is 23%, which is acceptable. Furthermore, if the proposed home payment is $1100 (you can use our loan calculator above to figure out payments), the calculation would look like this.

$1,610 + $1100 = $2,710

$2,710 / $7,000 = 38.7%

This debt-to-income ratio would also be acceptable.

Minimum Credit Score Requirements

Many online lenders and nationally televised commercials boast about approving low FICO scores for FHA loans. However, this information can be slightly misleading. FHA indeed approves borrowers with less than perfect credit scores regularly. It is also true that getting approved is much easier with a low credit score compared to other kinds of loans. However, many lenders have their own credit overlays. Since each home buyer’s situation is unique, it is impossible to apply a blank statement to any credit range or credit score requirements. It is much better to talk to an experienced FHA lender about your credit score and get pre-approved for a mortgage.

Income Documentation

Home buyers will need to prove their income for the last 2 years. People who are employed will need to offer copies of W-2 statements, pay stubs, and tax returns. People who own their own business, or partial owner of a business, will need to provide copies of personal tax returns along with business tax returns. People with other forms of income, such as retirement earnings, disability income, or investment income will likely need to show monthly/quarterly statements along with personal tax returns.

Eligible Homes

FHA will allow people to buy single-family homes as well as multi-family homes, up to 4-unit properties. Condos are also allowed if the condo project is FHA approved.

Mortgages on investment homes or vacation properties are not allowed. The home buyer must intend to live in the property as their main residence.

Upfront and Monthly Mortgage Insurance

FHA requires mortgage insurance premiums on all FHA loans to protect the program in case of foreclosure. There is an annual mortgage insurance premium and upfront fee which can be viewed here. Those rates have not changed in several years and are more affordable than conventional loan private mortgage insurance premiums. Keep in mind that the upfront mortgage insurance premium can be financed into the mortgage.

Unique Credit Situations

FHA will allow people with previous credit issues to purchase a home, depending on certain rules. Here are some of the common issues and their rules.


People who have filed Chapter 7 bankruptcy must wait 2 years after the discharge before applying for an FHA loan. If there are extenuating circumstances that caused the home buyer to file Chapter 7, they may be approved for a loan before the 2-year waiting period.

For Chapter 13 filers, the home buyer may be eligible for an FHA loan by using the Chapter 13 payment history if the bankruptcy is discharged.

Child Support

Home buyers who are delinquent on child support will need to get their payments up to date before applying for an FHA mortgage.

Federal Tax Debt

Any borrower behind on paying federal taxes is not eligible for an FHA loan. The borrower will need to pay off the tax debt or arrange payments and develop a payment history before applying for an FHA loan.

Deferred Student Debt

Borrowers that have student debt in deferment will need to allow for their loans in their debt-to-income calculations. 1% of the total balance will be calculated as a monthly payment that is included in the debt-to-income ratios.

Unique Repair/Rehab Loan

FHA offers a unique product to help people make improvements and/or repairs to their homes. This type of loan is called the 203k and can be used in several ways.

Purchase and Minor Repairs

FHA will allow people to borrow enough money to buy a home and get extra funds to make minor repairs or improvements. This is called the FHA 203k Streamline. The maximum amount of funds that can be used for the repair work is $35,000.

There are a few limitations on how the money can be spent with the streamline option. The money is intended for minor repairs or slight improvements.

The other type of FHA 203k is called the standard version. It has very few limits on how the money can be spent. The amount of money that can be loaned is based on the maximum loan amount for the county and the customer’s debt-to-income ratios. This program will allow customers to renovate their homes.

For the standard version, a certified home contractor must be used and certain lending rules will need to be followed.

Refinance in Florida

FHA offers a variety of loan programs to refinance a mortgage. Customers may choose a cash-out refinance or a streamline refinance option.

Streamline Refinance

The streamline refinance is only available to people who currently have an FHA loan. For qualifying borrowers, this can be a great way to lower their mortgage rates without a complete loan process.

Basic requirements:

  • The borrower must intend to continue living in the home as their main residence
  • No more than one 30-day late payment on the mortgage is allowed in the last 12 months
  • Income verification is not required
  • Appraisal is generally not required

Cash-Out Refinance

People may choose to refinance their home loan to tap into the property’s equity and use the excess funds to pay other bills, go on vacation, pay off a car, or other reasons.

It is not a requirement to currently have an FHA loan to apply for a cash-out refinance. People with a VA, conventional, USDA, FHA, or another type of mortgage may apply for the cash-out refinance. The requirements for the refinance are the same as for a purchase loan.

Summing Up FHA Mortgage Guidelines for Florida Residents

There are lots of reasons for people to apply for this loan. Whether it is buying a home, refinancing an existing mortgage, or buying a fixer-upper to make improvements and live in the home, there are numerous ways that this program can assist you. The various uses make this an appealing loan option financially to numerous buyers and make it possible to become a homeowner with relative ease.

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