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FHA Loans in Torrance
Torrance's South Bay location offers more space than central LA neighborhoods, making FHA's 3.5% down payment especially powerful here. First-time buyers dominate FHA applications in this area.
The city's mix of single-family homes and townhomes falls within FHA loan limits for Los Angeles County. Properties in El Camino Village and West Torrance see strong FHA activity.
Competition from cash buyers is lighter here than in Manhattan Beach or Redondo Beach. That gives FHA borrowers realistic purchase timelines without endless backup offers.
You need a 580 credit score minimum for 3.5% down. Scores between 500-579 require 10% down, but most lenders won't touch those files.
Debt-to-income ratios can stretch to 50% with compensating factors. That's higher than conventional loans allow, which matters in LA County's price environment.
Two years of steady employment history is standard. Self-employed borrowers need two years of tax returns showing consistent income.
FHA allows non-occupant co-borrowers, useful when parents help kids buy in Torrance. The co-borrower doesn't need to live in the property.
Most wholesale lenders handle FHA, but their overlays vary significantly. Some won't touch credit scores under 620 despite FHA allowing 580.
Mortgage insurance rates are identical across lenders since FHA sets them. The differentiation comes from origination fees and how fast they process appraisals.
Local appraisal timelines in South Bay run 10-14 days typically. FHA appraisals include property condition requirements that occasionally delay closings.
Shopping multiple lenders matters because rate quotes can differ by 0.25-0.375% even though it's the same FHA product. We check 15-20 lenders per file.
The biggest FHA mistake in Torrance is not understanding repair requirements. That 1960s ranch needs working HVAC and no peeling paint before FHA approves it.
Condos require FHA approval of the entire complex. Many Torrance developments aren't approved, killing deals before they start. Check the project status before writing offers.
Gift funds for down payment work well with FHA, but the paper trail matters. Depositing cash from relatives without documentation creates underwriting problems.
Sellers here sometimes resist FHA offers assuming they're weaker. A pre-approval from a responsive local broker changes that perception immediately.
VA loans beat FHA for eligible veterans with no down payment and no mortgage insurance. If you qualify for VA, use it instead.
Conventional loans require 5% down minimum but drop mortgage insurance at 20% equity. FHA's insurance lasts 11 years minimum, often the loan's full term.
FHA works better than conventional for credit scores between 580-680. Above 680 with 5% down, conventional usually costs less monthly.
Non-QM loans don't make sense if you qualify for FHA. The rates are higher and the documentation isn't actually easier despite marketing claims.
Torrance's older housing stock means FHA appraisals flag issues more often than in newer developments. Budget for potential repairs before close.
The city's proximity to aerospace employers means steady W-2 income, which FHA underwrites easily. Contract workers need two years of 1099 history.
HOA fees in Torrance complexes affect debt-to-income calculations. A $400 monthly HOA reduces your buying power by roughly $65,000 in loan amount.
Los Angeles County's FHA loan limit is $644,000 for single-family homes. Torrance properties above that need jumbo financing, which doesn't allow 3.5% down.
The limit is $644,000 for single-family homes in Los Angeles County. Properties above that price need conventional or jumbo loans.
Standard FHA requires the home to be move-in ready. Major repairs must be completed before closing or you need FHA 203(k) renovation financing.
You pay 1.75% upfront plus 0.55-0.85% annually based on down payment and loan amount. These rates apply nationwide, not just locally.
Many do, especially on properties under $700,000. A strong pre-approval and quick close timeline make FHA offers competitive.
Only if the complex is FHA-approved. Check the HUD approval list before touring condos to avoid wasted time.
Most lenders require 600-620 minimum despite FHA's 580 floor. We access lenders who'll do 580, but options narrow below 600.
Mortgage financing for independent contractors and freelancers who earn 1099 income instead of traditional W-2 wages.
Mortgage programs that allow borrowers to qualify based on liquid assets rather than traditional employment income.
Non-QM loans that use 12 to 24 months of bank statements to verify income for self-employed borrowers.
Short-term financing that bridges the gap between buying a new property and selling an existing one.
Debt Service Coverage Ratio loans that qualify investors based on a rental property's income rather than personal income.
Mortgage programs designed for non-US citizens and non-permanent residents who want to purchase property in the United States.
Asset-based short-term loans primarily used by real estate investors for property acquisition and renovation projects.
Mortgages that allow borrowers to pay only the interest for an initial period, resulting in lower monthly payments upfront.
Financing solutions tailored for real estate investors purchasing rental properties, fix-and-flip projects, or investment portfolios.
Home loans for borrowers who have an Individual Taxpayer Identification Number instead of a Social Security number.
Adjustable rate mortgages held in a lender's portfolio rather than sold on the secondary market, offering more flexible terms.
Non-QM mortgages that use a CPA-prepared profit and loss statement to verify income for self-employed borrowers.
Home loans with interest rates that adjust periodically based on market conditions after an initial fixed-rate period.
Specialized mortgage programs designed to support homeownership in underserved communities with flexible qualification criteria.
Mortgages that meet the guidelines and loan limits set by Fannie Mae and Freddie Mac for secondary market purchase.
Financing for building a new home or making major renovations, typically converting to a permanent mortgage upon completion.
Traditional mortgage financing not backed by a government agency, offering flexible terms and competitive rates for qualified borrowers.
Innovative loan products that leverage projected home equity growth to provide favorable financing terms.
A revolving line of credit secured by your home equity that allows you to borrow funds as needed during a draw period.
A fixed-rate second mortgage that provides a lump sum of cash by borrowing against the equity built in your home.
Mortgages that exceed the conforming loan limits set by the FHFA, designed for financing high-value luxury properties.
Loans for homeowners aged 62 and older that convert home equity into cash without requiring monthly mortgage payments.
Government-backed zero down payment mortgages for eligible rural and suburban homebuyers who meet income limits.
Government-guaranteed mortgages for eligible veterans, active-duty service members, and surviving spouses with zero down payment.