No matter what side of I-70 you live on, whether you're rooting for the Cardinals or the Royals, or whether you pronounce it Missour-ee or Missou-rah, buying a house in The Show-Me State is a great choice.
FHA loans are great for Missouri homebuyers who maybe don’t have an established credit history, or don’t want to spend a lot of money on a down payment. Continue reading to see if an FHA loan in Missouri is right for you.
Why Consider an FHA Loan in Missouri?
Thousands of people are purchasing homes in the Show-Me State, and many are using FHA home loans to do so. As of April 2019, the total value of FHA loans in Missouri was $177 million, which makes it a highly popular mortgage option.
Benefits of choosing FHA Loans in MO
- FHA loans are great for first-time homebuyers, especially those who can’t or don’t want to put down a large down payment.
- FHA mortgage rates are typically lower than conventional mortgage rates.
- FHA down payment and credit score requirements are typically lower than conventional loans
- Sellers can contribute up to 6% of the purchase price or appraised value (whichever is less) towards the buyers’ closing costs.
- FHA loans are assumable
FHA Loan Limits in Missouri
Knowing how much a lender is going to let you borrow is important when beginning your house hunting journey. That said, there are maximum loan limits in place throughout Missouri. These limits are adjusted annually and depend on which county you want to live. The baseline limit in Missouri for 2022 is $420,680 but this may be higher in some counties. Use the table below to see the full list of Missouri FHA loan limits for 2022.
Missouri FHA Loan Limits by County
|County||FHA Loan Limit|
|All other areas||$331,760|
Are You Eligible for an FHA Loan in MO?
You may be eligible for an FHA loan, if you:
- Have 2 years of steady employment, preferably with the same employer.
- Have had steady income (or increasing income) in the past two years.
- Have had less than two 30-day periods of late payments on your credit report.
- Have declared bankruptcy no less than two years ago and have maintained good credit since.
- Have not been a party in a foreclosure for at least three years and have maintained good credit since.
- Anticipate your mortgage payment will be equal to or less than 30% of your gross income.
Learn More About FHA Loan Requirements
What Do You Need to Apply for an FHA Loan in MO?
Buyers must be able to provide the following information and documents as requested by lenders:
- The addresses of all your residences over the past two years.
- The names of your employers over the past two years.
- W2's for the past two years and current paycheck stubs.
- Your current gross monthly salary.
- Your Social Security Number.
- Names, addresses, and account numbers with balances on all checking and savings accounts.
- Addresses and loan information of any other real estate you owned.
- Self-employed individuals will need to provide personal tax returns for the past two years and a current income statement and balance sheet for the business.
- Students will need to provide evidence of enrollment. If you have student loans, you need to provide verification information.
Note: Facts and figures sourced from the latest statistics available at the time of this writing including data from the United States Department of Labor, United States Census Bureau and the United States Department of Housing and Urban Development.