Alaska FHA Loans – Requirements and Loan Limits for 2024 – Alaska FHA Lenders
Alaska home buyers who need a small down payment or have poor credit scores may be able to purchase a home with an Alaska FHA loan. With an FHA loan, home ownership is possible and the program will enable you to stretch your income to afford the home of your dreams.
We will take you through the FHA loan requirements, detail what is needed to qualify, then help you to get pre-qualified. If you already know that an FHA loan is right for you, whether you live in Anchorage, Fairbanks, Juneau, or anywhere else in Alaska.
FHA Loan Benefits for Residents of Alaska
There are many benefits of an FHA loan especially when compared to a conventional loan. Something we experience often with our customers from Alaska is there are many older homes that are in need of repair. An amazing benefit of an FHA loan is having the ability to purchase an older home but also include additional funds to help repair or rehabilitate the home to bring it up to today’s standards.
Some other important benefits are as follows:
- Lower credit scores permitted
- Lower down payment requirement
- FHA interest rates are lower than conventional rates
- Gift funds from relatives allowed
- Seller closing cost contributions are also permitted up to 6% of the purchase price
- There are no income limits
- Co-signers allowed
- Higher debt to income ratios permitted
FHA Down Payment Requirements
The down payment requirements for an FHA loan is the same in every state. The minimum requirement for an FHA loan is 3.5% of the purchase price. However, if your credit score is below 580, then the down payment requirement will be 10%.
If you do not have the down payment needed, you can also use gift funds from a relative.
Alaska FHA Down Payment Assistance
There are various down payment assistance programs in every state. Below is a list of just a few down payment assistance programs that may be available to you in Alaska. Home buyers will need to contact, and arrange for these programs independently.
Third party down payment assistance programs like the ones referenced below are acceptable. However, we can also help with down payment assistance that is included in the loan package. In some instances the assistance must be repaid and there are also options where it can be forgiven after a certain number of years.
Affordable Housing Advanced Loan Program
Alaska Home Opportunity Program
Neighborworks Alaska Assistance Program
If you need help with the down payment, please contact us so we can discuss your options.
FHA Loan Requirements in Alaska for 2024
These are the basic FHA loan requirements for this year. All of these must be met to be approved for an FHA loan. If you are not positive on whether you meet these standards or have questions, just reach out to us. There may also be some exceptions to some of the requirements below.
- Down payment of 3.5% or 10% if your credit score is below 580
- 2-year employment history with some exceptions allowed
- Fully document your income for the past two years
- Minimum FICO score requirement of 500 – down payment will vary
- Mortgage Insurance Premium (MIP) is required for every FHA loan
- Maximum debt to income ratio of 43% with exceptions up to 56%
- The home must be your primary residence
- No bankruptcies or foreclosures in the past two years
Employment Stability
The FHA requires borrowers to have a consistent employment history or have worked for the same employer for the past two years. This stability indicates that you’re likely to continue making money in the future, reducing the risk that you won’t be able to pay back your loan. Even job changes within that time frame are acceptable as long as there are no significant gaps in your work history.
There are exceptions to your work history that we can work through. If you do have gaps in employment or have recently started a new job, we can still make that work and help you to purchase or refinance your home.
FHA Debt to Income Ratio
The debt to income ratio calculation is what will ultimately determine how much you qualify for. Your gross income as compared to your debt and proposed mortgage payment make up your DTI.
The monthly payments that appear on your credit report will limit your ability to qualify for a mortgage. Car payments are the biggest offender so if you are thinking about buying a home, please do not purchase a car until we speak and develop a plan.
We have creative ways to improve your debt to income ratio to help you to qualify for a larger loan amount. You can also read more about the FHA debt to income ratio here.
Alaska FHA Loan Limits
Every county in the United States has specific maximum loan limits that are set for single family homes, as well as 2-4 unit properties. The limits are set based upon the average home sales value in that county. The base FHA loan limit for single family residences in Alaska for most counties is $498,257. Use this FHA loan limit lookup tool to see what the FHA loan limits are in your county.
| County Name | Single Family | 2 Units | 3 Units | 4 Units |
|---|---|---|---|---|
| ALEUTIANS EAST | $498,257 | $637,950 | $771,125 | $958,350 |
| ALEUTIANS WEST | $545,100 | $697,800 | $843,500 | $1,048,300 |
| ANCHORAGE MUNIC | $498,257 | $637,950 | $771,125 | $958,350 |
| BETHEL CENSUS A | $498,257 | $637,950 | $771,125 | $958,350 |
| BRISTOL BAY BOR | $498,257 | $637,950 | $771,125 | $958,350 |
| CHUGACH CENSUS | $498,257 | $637,950 | $771,125 | $958,350 |
| COPPER RIVER CE | $498,257 | $637,950 | $771,125 | $958,350 |
| DENALI BOROUGH | $498,257 | $637,950 | $771,125 | $958,350 |
| DILLINGHAM CENS | $498,257 | $637,950 | $771,125 | $958,350 |
| FAIRBANKS NORTH | $498,257 | $637,950 | $771,125 | $958,350 |
| HAINES BOROUGH | $498,257 | $637,950 | $771,125 | $958,350 |
| HOONAH-ANGOON C | $524,400 | $671,300 | $811,450 | $1,008,450 |
| JUNEAU CITY AND | $553,150 | $708,150 | $855,950 | $1,063,750 |
| KENAI PENINSULA | $498,257 | $637,950 | $771,125 | $958,350 |
| KETCHIKAN GATEW | $498,257 | $637,950 | $771,125 | $958,350 |
| KODIAK ISLAND B | $517,500 | $662,500 | $800,800 | $995,200 |
| KUSILVAK CENSUS | $498,257 | $637,950 | $771,125 | $958,350 |
| LAKE AND PENINS | $498,257 | $637,950 | $771,125 | $958,350 |
| MATANUSKA-SUSIT | $498,257 | $637,950 | $771,125 | $958,350 |
| NOME CENSUS ARE | $498,257 | $637,950 | $771,125 | $958,350 |
| NORTH SLOPE BOR | $498,257 | $637,950 | $771,125 | $958,350 |
| NORTHWEST ARCTI | $498,257 | $637,950 | $771,125 | $958,350 |
| PETERSBURG CENS | $498,257 | $637,950 | $771,125 | $958,350 |
| PRINCE OF WALES | $498,257 | $637,950 | $771,125 | $958,350 |
| SITKA CITY AND | $586,500 | $750,800 | $907,550 | $1,127,900 |
| SKAGWAY MUNICIP | $524,400 | $671,300 | $811,450 | $1,008,450 |
| SOUTHEAST FAIRB | $498,257 | $637,950 | $771,125 | $958,350 |
| WRANGELL CITY A | $498,257 | $637,950 | $771,125 | $958,350 |
| YAKUTAT CITY AN | $498,257 | $637,950 | $771,125 | $958,350 |
| YUKON-KOYUKUK C | $498,257 | $637,950 | $771,125 | $958,350 |
Types of FHA Loans Available
There are various types of FHA loans available in the state of Alaska for both purchases and also refinances. Each of these are for a specific situation that a home buyer or current homeowner may encounter. Although these programs are available, not every lender offers them and the ones who do may have their own unique requirements.
We can help you with each of these programs referenced below.
- Standard FHA Purchase
- Standard Refinance
- FHA 203k Rehab (when buying or refinancing)
- FHA Streamline Refinance of an existing FHA loan
- FHA One Time Close Construction Loan
- FHA Cash Out Refinance
- FHA Energy Efficient Mortgage
We will review a few of these FHA loan programs below and will provide additional information. Feel free to contact us here to discuss.
FHA 203k Loans in Alaska
FHA 203k loans are a great program which will allow you to borrow the money needed to purchase the home plus additional funds needed to rehabilitate or remodel the home. it is the program we mentioned earlier which can help with the purchase of an older home.
If the home you are buying is in perfect condition, you can still use the rehab loan to make cosmetic changes, add landscaping, a fresh coat of paint, and more.
If you would like to fully understand how this program works, we suggest reading our article on FHA 203k loans.
FHA Streamline Refinance
The FHA streamline refinance program is available to homeowners who currently have an FHA loan and would like to refinance to a lower rate while eliminating some of the refinance costs such as an appraisal. You may also get a discount on the mortgage insurance premium which is another advantage.
For more information, please read our article on the FHA streamline refinance.
Alaska FHA Loan Pre-Approval Process
If you are looking for an FHA loan, there is an optimal process you should follow to get pre-approved.
- The first step is to make sure you have the minimum down payment needed to qualify
- check your credit and try to cleanup anything that is pulling down your scores
- Get a copy of your tax returns for the past two years
- Get copies of your pay stubs for the past month
- Get copies of your last two months’ bank statements
- Speak to an Alaska FHA lender about your loan scenario
Speak to a lender early in the process because they can identify opportunities to help with your FHA approval. This should be done months before you start looking for a home. Read more about how to get pre-approved for an FHA loan.
Alaska FHA Loan Calculator
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5 Tips for House Hunting with an FHA Loan
- Stay Within Loan Limits: Stick to properties that fall within the FHA loan limits to avoid complications during the purchasing process.
- Consider Property Requirements: Ensure that the property meets the FHA minimum property standards, which cover safety, security, and soundness criteria.
- Engage with an experienced loan officer: We have experienced loan officers who can hold your hand through the entire process.
- Understand Down Payment Requirements: Familiarize yourself with the down payment requirements specific to your FHA loan program.
- Be Mindful of Property Types: Certain property types, such as investment properties or fixer-uppers, might not be eligible for FHA loans.
The best tip we can offer is to work with us to get pre-approved well before you begin shopping for a home.
Frequently Asked FHA Questions
Is it hard to get approved for an FHA loan?
FHA loans are more forgiving than other loan programs which sometimes makes them easier to get approved for.
Can I get an FHA loan with a bankruptcy?
In general, you will need to wait two years before applying for an FHA loan after a bankruptcy. However, there are some exceptions which may allow you to apply sooner. Read our article on the bankruptcy waiting period.
Are all Alaska FHA lenders the same?
Not all lenders who offer FHA loans are the same. They all do not offer all of the FHA programs and their rates and fees may also vary. Most importantly, the individuals who help to process and underwrite your loan will have a huge impact on your FHA loan experience.
Can I use gift funds for an FHA loan?
FHA loans do allow for gift funds to cover your down payment as well as your closing costs. The gift funds must come from a relative or a close friend as approved by the lender. You will need to provide the lender with a gift letter that is signed by the donor.
Do I need an appraisal for an FHA loan?
The FHA does require an appraisal and inspection before your loan can be approved. The FHA inspection has clear guidelines on what needs to be repaired before your loan can close. They want to make sure home buyers are moving into a home that is safe and operational.
Can I get an FHA loan for an investment property?
FHA loans are for primary residences only and if your goal is to purchase an investment property, you cannot use FHA insured financing for that purchase. However, if you are currently living in a home that is financed with an FHA loan, you can move to a new home and keep the current home as an investment.
What is the maximum loan amount for an FHA loan in Alaska?
The maximum loan amount for an FHA loan in Alaska is determined by the county you reside in. As of 2024, the maximum loan limit ranges from $570,750 to $1,094,625 depending on the county. These loan limits are revised annually by the Federal Housing Administration (FHA) to accommodate changes in housing prices and market conditions.
How does the process of applying for an FHA loan in Alaska differ from other states?
The process of applying for an FHA loan in Alaska does not differ significantly from other states. FHA loans have the same basic eligibility requirements and guidelines nationwide, offering low interest rates and simple eligibility criteria. However, it’s worth noting that Alaska has a unique housing market with certain specific challenges, such as high construction costs and remote locations, which may impact property appraisals and underwriting considerations. Nonetheless, overall, the process of applying for an FHA loan remains consistent across states.
