FHA Financing

Flexible qualification to help middle- and low-income buyers.

The National Housing Act of 1934 created the Federal Housing Administration (FHA) to help first-time buyers and lower income Americans purchase a home. Today, the US Department of Housing and Urban Development (HUD) insures FHA loans.

The FHA loan is a low down payment mortgage that provides flexible qualification options to buyers who marginally qualify under conforming loan programs. It is popular with first-time and middle-to-low income buyers.


The most popular FHA loan program is the 203(b) fixed rate mortgage loan. This loan helps middle- to low-income buyers compete in high-demand areas (San Luis Obispo County) by offering loose credit guidelines and flexible down payment options.

The Basics:

  • Down payment: as low as 3.5%
  • Credit score: as low as 550
  • Debt-to-income ratio: as high as 47% housing ratio and 57% total debt ratio
  • Gift payments: allowed; 100% can be a gift from a relative, non-profit, or government agency
  • Rate and Term: fixed and adjustable rate options
  • Ceiling: $417,000 ($561,200 for high balance in San Luis Obispo County; $625,500 for high balance in SB County)
  • Occupancy: primary residence only
  • Mortgage Insurance: yes; up front and monthly fees apply (Read more)

The 203(k) mortgage loan offers funds for home rehabilitation and renovation. Borrowers can get unlimited funding for cosmetic repairs and functional upgrades.


  • Roof, gutter, and downspouts replacement and repair
  • Heating, ventilation, plumbing, electrical, septic replacement and repair
  • Painting, flooring, and weatherization
  • Purchase and installation of appliances.

Click here for more information.

The FHA Streamline Refinance is a simple way for FHA borrowers to lower their monthly mortgage payment by refinancing into a lower mortgage rate. Borrowers must  display a history of consistent payments, and reduce their monthly payments by 5%. No appraisal, no income qualification, no asset documentation.

Click here for more information.

The FHA back-to-work program offers buyers the ability to purchase a home just 12 months after a negative credit event. Otherwise:

  • Foreclosure: 3 years from transfer of title date
  • Short Sale: 3 years from relinquished date
  • Bankruptcy (Chapter 7): 2 years from discharge date
  • Bankruptcy (Chapter 13): 2 years from discharge date; 1 year payout has elapsed & payment performance is satisfactory & BK approval
  • Deed-in-Lieu: 3 years from transfer of deed date

Click here for more information.

Loan Requirements

  • Credit: Minimum 530 FICO (limits to LTV/CLTV may apply)
  • Loan Term: Fixed Rate Mortgage (FRM): 10 – 30 year terms
  • Max LTV: 580+ FICO and No Score: 96.5% LTV calculated per FHA Guides
    <580 FICO: Maximum 90% LTV
  • Occupancy: Owner Occupancy Only
  • Propery Eligibility:
    • New Construction: Modular (off-frame only), Manufactured (double-wide or larger), and Traditional Construction.
    • Manufactured Homes: Engineer must certify foundation plans meet FHA guides. Must be titled as real property or have recorded affixation affidavit.
    • Loan may include simultaneous purchase of the land/lot or loan can be guaranteed for the construction of home on land/lot already owned by borrower.
  • Credit History: Borrowers with traditional credit histories and credit scores will be underwritten on their own merits. Non-traditional and derogatory credit history considered… (Read more)

The GSFA Platinum down payment assistance program was created to help low to moderate income homebuyers in the state of California purchase a home by providing down payment and/or closing cost assistance in the form of a non-repayable grant.

The Program Income Limit for FHA, VA, and USDA first mortgages

Program Limit - Copy

Click Here for More Information

Further Reading (from the FAQ Page)

  • Low down payment loan programs (Read more)
  • Gift giving guidelines (Read more)
  • Mortgage insurance guidelines (Read more)
  • Credit qualification standards: FICO and Debt-to-Income (Read more)

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From our Clients:

“Good explanation of process and forms. Always kept up-to-date during the loan processing.”
Anthony and Kathleen Toscano, Morro Bay
“Communication through telephone and emails was excellent with updates…”
R. David and Helen Cantu, Atascadero
“The speed and ease of communication… always flexible to accommodate our schedule.”
Berkeley and Meghan Lindt, San Luis Obispo
“Our transaction was complex due to various family entities. It was difficult but successful. Great job!”
Donald and Elisa Cameron, Cambria
“This was a painless process and you succeeded where conventional banks failed me.”
Susan Manbeian, Cambria


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Central Coast Lending Reach

We offer home loans / mortgages to the Central Coast and the entire state of California, including:

San Luis Obispo County:

Arroyo Grande, Atascadero, Avila Beach, Cambria, Cayucos, Creston, Grover Beach, Los Osos, Morro Bay, Nipomo, Oceano, Paso Robles, Pismo Beach, San Luis Obispo, San Miguel, San Simeon, Santa Margarita, Shandon, Templeton, and surrounding cities.

Santa Barbara County:

Buellton, Carpinteria, Goleta, Guadalupe, Hollister Ranch, Isla Vista, Lompoc, Los Alamos, Los Olivos, Mission Hills, Montecito, Orcutt, Santa Barbara, Santa Maria, Santa Ynez, Solvang, Cayuma, Vandenberg Village, Garey, Summerland,  and surrounding cities.

Kern County:

Bakersfield, Delano, Arvin, California City, McFarland, Ridgecrest, Maricopa, Taft, Oildale, Lamont, Rosamond, Rosedale, Greenfield, Shafter Lost Hills, Wasco, Bear Valley Springs, Boron, Frazier Park, Wofford Heights, Weedpatch, and surrounding cities.

Monterey County:

Carmel, Del Rey Oaks, Gonzales, Greenfield, King City, Marina, Monterey, Pacific Grove, Salinas, Sand City, Seaside, Soledad, Bradley, Castroville, Chualar, Las Lomas, Lockwood, Moss Landing, Elkhorn, San Ardo, San Lucas, Prunedale, Pajaro, and surrounding cities.

Real Estate Reports

Our quarterly reports on the Central Coast real estate market feature data on sales, pricing, foreclosures, and more.