Buyers making purchases with FHA loans are a rarity these days in San Francisco. In the past two years, FHA loans were used by only 54 single-family home and six condo buyers, as per the SF MLS.
An FHA-insured loan is backed by the U.S. Federal Housing Administration, which insures a loan made by a private lender. Buyers can make a purchase with a very low down payment. FHA loans are a bit more complex than regular loans, and typically take longer to process.
The San Francisco market moves quickly, and many sellers don’t want to wait any more than 21 or 30 days to complete their transaction. Many buyers also have large down payments these days and make offers that frequently omit loan contingencies. So it’s no wonder that in a competitive offer situation (nine times out of ten), a seller will go with the buyer that presents the most direct and efficient path to closing. And that typically will not involve an FHA loan. Continue Reading