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FHA Loan in Bradford County, Florida: Learn About the Low Down Payment Options

One of the biggest stumbling blocks for potential homeowners is the down payment. Even with a mortgage, buyers have to save up enough to make the substantial down payment for their home, which makes owning a home more complicated. The situation worsens if you have a less than perfect credit score because going for a conventional mortgage becomes more expensive.

If you're looking to buy a home in Bradford County, Florida, an FHA loan could solve your down payment and credit history woes. Here's everything you need to know about the low-down payment benefits of an FHA loan.

What is an FHA Loan?

The Federal Housing Administration (FHA) Loan is a government-backed mortgage through the FHA. The FHA has been part of the U.S. Department of Housing and Urban Development since 1965 but started three decades earlier.

The FHA was created as part of the National Housing Act of 1934, aimed at stemming the tide of foreclosures that came with the Great Depression by making home ownership more affordable.

With the FHA loan, borrowers can part with a minimum 3.5% down payment and a credit score of 580 or higher. These loans are standard among first-time buyers with little savings and credit challenges but have an insatiable desire to own a home.

Like other government-backed loans, the loan is issued through lenders like credit unions, banks, and nonbanks but insured by the FHA. The insurance protects lenders in case of default which is why lenders offer favorable terms because they are exposed to lower risks.

It's also worth mentioning that most people applying for an FHA loan might not qualify for a home loan, and only an FHA-approved lender can issue an FHA-insured loan.

You can use your FHA loan to buy or refinance single-family houses, two-to-four-unit multi-family homes, condominiums, and manufactured homes.

How Does the FHA Loan Work?

You can use an FHA loan to buy yourself a home in Bradford County, Florida. But before you do, you should understand how FHA loans work.

FHA loans come in 15, and 30-year terms and have a fixed interest. Because of the agency's flexible underwriting standards, you can access an FHA loan even when you don't qualify for a private mortgage.

However, you should know that you will pay an FHA mortgage insurance designed to protect the lender from losses if you default. However, mortgage insurance is the norm in most instances where the home buyers put down less than 20%. For FHA, it's a requirement that you pay two mortgage insurance premiums:

  • Upfront mortgage insurance premium - The upfront FHA premium is 1.75% of the loan amount. It's paid when the borrower gets the loan. The premium can be rolled into the loan amount you get.

  • Annual FHA mortgage insurance premium - It is 0.45% to 1.05%. It depends on the loan term, amount, and the initial loan-to-value ratio or LTV. The premium is divided into 12 installments which you pay monthly.

FHA mortgage insurance premiums are canceled after 11 years for most borrowers if they financed 90% or less of the property's value. The insurance premiums are canceled if you put at least 10 percent down and stay current with your monthly mortgage payments. But if the loan had an initial LTV ratio greater than 90%, you will carry the insurance until the mortgage is fully paid.

Also, no matter the type of FHA loan you're seeking, there will be limits on the mortgage amount. The FHA mortgage limits vary by county, depending on whether it's a low-cost or high-cost county. The limits vary between $420,680 to $1,867,275.

There are also limits to the closing costs that FHA-approved lenders can charge, ranging from 3 to 5 percent. The FHA allows the seller, builder, or lender to pay up to 6 percent of the borrower's closing costs like fees for a credit report, title search, or appraisal.

FHA Loan Interest Rates

FHA loans can either have fixed or adjustable-rate loans:

  • With a fixed-rate loan, the interest doesn't go up or down based on the index rate. Your loan payments will be predictable and more stable throughout the life of the loan.

  • For adjustable-rate FHA mortgages, the interest rates move along a specific benchmark index interest rate. This is a rate used by some large banks to charge each other for short-term loans. Therefore, your interest rates and monthly payments will adjust from time to time.

Generally, adjustable-rate loans have lower initial rates than fixed-rate loans, but over time, they go up. But you should also know the length of the loan will also affect the rate you pay.

Who Qualifies for an FHA Loan?

FHA has set various guidelines that borrowers must meet to qualify for lending. These qualifications include:

  • You should have a FICO score of 500 to 579 with 10 percent down or a FICO score or higher with 3.5 percent down.

  • Have verifiable employment history for the last 48 months.

  • Verifiable income through federal tax returns, pay stubs, and bank statements.

  • Ensure the property is appraised by an FHA-approved appraiser and meets HUD guidelines.

  • Use the loan to finance a primary residence.

  • Have a front-end debt ratio of no more than 31 percent of gross monthly income.

  • Back-end debt ratio of no more than 43 percent of gross monthly income. Some vendors could allow ration up to 50 percent.

  • If you've applied for bankruptcy, you must wait for two years and three years after a foreclosure. However, in some extenuating circumstances, lenders might make an exception.

Types of FHA Loans

Different types of FHA loans are suited to potential homeowners with different needs. Some of the available options and their functions are:

Section 245(a) Loan

The Section 245(a) loan is a fixed rate graduated payment mortgage known as a "growing equity mortgage." The installments of the loan increase over the life of the loan. As the loan amortizes, it reaches a point where your equity starts gaining traction.

One of the benefits of section 245(a) loan is it comes with a near-guarantee of early payoff. Section 245(a) loans are set up in 30-year terms. But it's not uncommon to pay off the loan early, depending on your chosen graduate plan.

FHA Energy Efficient Mortgage (EEM)

This financing add-on allows you to roll the cost of approved energy efficiency upgrades into your home loan. Homebuyers commonly use this program to update homes by upgrading the windows, HVAC systems, and insulation.

Adding solar and wind technologies to your home also qualifies for the upgrades. When applying for the loan, you need an energy assessment to prove that the efficiency upgrades are cost-effective.

FHA mobile home loan

You can use an FHA loan to finance the purchase of a manufactured or mobile home. However, since this is not common, finding a lender willing to approve the financing may take a few tries.

Mobile and manufactured homes are viewed as personal property and often attract higher insurance rates because they are riskier for lenders. When applying for the loan, you should know that there are limits that range between $23,226 and $92,904.

FHA Condo loans

Most people don't know you can buy a condo using an FHA loan. However, there are restrictions because some condo associations enforce rules regarding property sales and improvements. When applying for the loan, you will look for a community that shows signs of stability, such as:

  • A high percentage of owner-occupied units

  • Minimal non-residential square footage

  • Fewer restrictions on buying and selling

  • No rent-pooling agreements

You can check out the FHA's list of approved developments. But also make sure you double-check the current list before putting an FHA offer on the condo because some associations will let their approval status lapse.

FHA 203(k)

The FHA 230(k) loan offers the opportunity for buyers to purchase upper fixers while financing additional funds for home renovations and repairs into the mortgage. With the financing add-on, you can finance up to 110% of the anticipated post-renovation appraised value of the home.

This type of FHA loan is designed to include renovation projects, keeping the options open for ambitious fixer-uppers and fostering maintenance and improvement of local neighborhoods.

FHA reverse mortgage (FHA HECM program)

You've probably seen TV ads for reverse mortgages used as a home equity conversion mortgage (HECM). Qualified homeowners can receive monthly cash disbursements by liquidating the equity they've up in their homes.

This loan is attractive for older Americans who already own their home and want to increase their monthly cash flow. Because HECMs reduce your home equity, the FHA has strict requirements for their HECM programs.

Homebuyer signs the document

Why Are FHA Loans Valuable?

The value of FHA loans lies in their benefits and ability to help you buy a home in Bradford County, Florida, sooner. Here are some of the benefits of purchasing a home using an FHA loan:

Low minimum down payment

For many would-be buyers, down payments are the most significant impediments to buying a home. With FHA's minimum 3.5% down payment, you can secure the funds from your funds, a gift, or an affordable loan from a traditional source.

Low minimum credit score

The credit score requirements for FHA loans are also low: 580 for a loan with a 3.5% down payment and 500 for a 10% down payment. These conditions allow underwriters to extend loans to borrowers whose credit has been damaged by circumstances beyond their control.

Underwriting flexibility

FHA has more forgiving of credit mishaps than other programs. Underwriters are instructed to distinguish between applicants who habitually misuse credit and those with valid reasons for their lapses, allowing customers with bad credit but good payment patterns to be treated more leniently.

Streamline Refinance

You can use FHA streamline refinance facility to refinance your mortgage to a more favorable and lenient home loan with better terms. To qualify, lenders are not required to verify your income, employment, or credit score.


You can apply for FHA loans after waiting for the required period after filing for bankruptcy under Chapter 7 and Chapter 13.

The loan is assumable

If you sell the property while still paying the FHA loan, you can allow the buyer to take over the mortgage. This eliminates thousands in closing costs for the buyer and presents a decisive advantage and incentive.

How to Apply for an FHA Loan

You will need personal and financial documents to apply for an FHA loan. The scope of documents required will vary depending on the type of FHA loan you're applying for and the lender, but at a minimum, you will need:

  • A valid Social Security number.

  • Proof of U.S. citizenship, legal permanent residency, or eligibility to work in the U.S.

  • Bank statements for at least the last 30 days and documentation for any deposits made during that time (pay stubs).

Your lender can automatically retrieve some required documentation like credit reports, tax returns, and employment records. You may require additional paperwork if you don't have a credit score.

Once you have the proper paperwork, you can find the ideal FHA-approved lender to begin the application process.

Can You Refinance with an FHA Loan?

Existing FHA mortgage loan holders can refinance, and there're four primary options you can consider:

  • FHA simple refinancing - Simple refinancing allows you to replace your existing FHA insured loan with a new fixed-rate or adjustable-rate loan. Refinancing is faster and simpler because you're already an FHA borrower. Simple refinancing is recommended if you're looking to get out of an existing adjustable-rate loan to lower your interest.

  • FHA streamline refinancing - The streamlined refinancing option doesn't require an appraisal. It may not even need an additional credit check or income verification, but some lenders may require additional information beyond what the FHA requires. Streamline refinancing has low requirements, which translates to lower closing costs.

  • Cash-out refinancing - You can consider cash-out refinancing if your property has built some equity and you want to refinance and take cash out for an important event, pay down a higher interest debt, remodel your home, or finance tuition. The requirements for this loan are more stringent than other FHA refinancing options because you're getting cash as part of the loan.

  • Refinancing from FHA to conventional loan - If you want to get out of the FHA loan and replace it with a traditional loan, which will remove the annual mortgage insurance payment or increase the amount you can borrow against your equity, this is the perfect refinancing option for you.

Why You Should Use Your FHA Loan to Buy a Home in Bradford County, Florida

Bradford County, Florida, is set on the backdrop of panoramic views and scenic beauty. It thrives on hunting, fishing, hiking, and camping, among other outdoor recreations.

The vast fields and rural settings make it an excellent place for families who love the outdoors and want to escape the busy city life.

Some of the activities you can enjoy while in your new home in Bradford County Include:

Gold Head State Park

This is one of the first state parks in Florida since 1935. The park offers a wide range of activities, from hiking to wildlife viewing along the park's nature trails, and you can also enjoy the 5.44-mile stretch of the Florida National Scenic Trail.

Here are large picnic areas with tables and grills perfect for family events and a playground for kids. You can also dip in Little Lake Johnson and spend a lazy afternoon canoeing or fishing. It's a wholesome, all-in-one experience.

Location: 239 State Rd 21Keystone Heights, FL 32656

The Florida International Rally & Motorsport Park

The Florida International Rally & Motorsport (FIRM) Park is perfect for speed demons and high adrenaline enthusiasts. The track caters to off-road, ATV/UTV, and HPDE driving.

There are plenty of lessons from professional drivers and events hosted at FIRM that make it the ultimate stopover for car and race track lovers. The firm also rents out the tracks to race teams, hosts open track days, and provides the perfect venue for corporate events, making it a great place to catch some car action.

Location - 7266 Airport Rd Starke, FL 32091

Bradford County Fair Grounds

The annual Bradford County Fair is held around March of every year. There is excellent food, cakes, and other exciting experiences to enjoy during the county fair. Cattle and swine are some of the animals on display and for sale.

Location - 2300 North Temple Avenue Starke, FL 32091

Outdoor Tactical Laser Tag

The Outdoor Laser Tag is the best place for you if you're going for some conventional fun. It is a real-life Call of Duty that sees how you measure up.

It features 10,000Sq.ft of our laser tag arena with options of upgrading your weapons, ammo, and armor as you level up. Your stats are updated as you play to give you instant bragging rights.

Location - 7248 SE 9 Ave Starke, FL 32091

Apply For your FHA Loan Today and Enjoy the Open, Free, and Captivating Fields of Bradford County, Florida

Bradford County, Florida, is an excellent getaway for families that want space and an opportunity to experience life in the countryside. Many family activities with a nice mix of amenities create a peaceful, eventful environment for your family.

With the low down payment requirements for FHA loans, you can purchase your home or mobile home in Bradford County, Florida, and be a part of the vibrant community with minimal savings. Apply for your FHA loan now and start enjoying the experience that is Bradford County.

With over 50 years of mortgage industry experience, we are here to help you achieve the American dream of owning a home. We strive to provide the best education before, during, and after you buy a home. Our advice is based on experience with Phil Ganz and Team closing over One billion dollars and helping countless families.

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