Loan Types Available in Florida
Conventional Loans (Fannie Mae / Freddie Mac)
The most common mortgage type in South Florida. Not government-insured but conform to Fannie Mae / Freddie Mac guidelines. Minimum down payment is 3% for first-time buyers (HomeReady or Home Possible programs) and 5% for repeat buyers. PMI is required when the down payment is less than 20% and can be removed once the LTV reaches 78%. Available for primary residences, second homes, and investment properties.
FHA Loans (Federal Housing Administration)
Government-insured mortgages for buyers who may not qualify for conventional financing. Minimum down payment of 3.5% with a credit score of 580+ (10% down required for scores 500–579). FHA loans require both an upfront MIP of 1.75% and an annual MIP that remains for the life of the loan if the down payment is less than 10%. Important for South Florida condo buyers: FHA requires the condominium project to be on the FHA Condominium Approval list. Buildings without a completed SIRS or adequate reserves may lose FHA approval.
VA Loans (Department of Veterans Affairs)
Available to eligible active-duty service members, veterans, and surviving spouses. Zero down payment required. No private mortgage insurance, though there is a one-time VA funding fee (which can be financed into the loan). Available for primary residences only.
USDA Loans (U.S. Department of Agriculture)
Zero down payment for properties in eligible rural areas. Some areas in western Palm Beach County (such as parts of the Acreage and Loxahatchee) may qualify. Eligibility is determined by both property location and borrower household income (must be at or below 115% of area median income). Check eligibility at eligibility.sc.egov.usda.gov.
Jumbo Loans
Exceed the conforming loan limits set by FHFA and are not eligible for purchase by Fannie Mae or Freddie Mac. Typically require higher credit scores (700+), larger down payments (10–20%), and more substantial cash reserves. Jumbo loans are common in South Florida given high property values in areas like Boca Raton, Palm Beach Gardens, Fort Lauderdale, and Weston.
DSCR Loans (Debt Service Coverage Ratio)
Designed for real estate investors — qualify based on the property's rental income rather than the borrower's personal income. No W-2s, pay stubs, or tax returns required. Typical requirements: credit score 620+ (700+ preferred), down payment 20–25%, DSCR of 1.0 or higher (1.25+ preferred). The DSCR is calculated as the property's net operating income divided by the annual debt service. Popular with South Florida investors purchasing 1–4 unit residential investment properties.
Conforming Loan Limits — South Florida
Conforming loan limits are set annually by the Federal Housing Finance Agency (FHFA) under the Housing and Economic Recovery Act of 2008 (HERA). Both Palm Beach County and Broward County fall within the Miami–Fort Lauderdale–West Palm Beach Metropolitan Statistical Area (MSA).FHFA.gov
2025 Conforming Loan Limits — Palm Beach & Broward Counties
| Property Type | Conforming Limit | FHA Limit |
|---|---|---|
| 1-Unit (Single Family) | $806,500 | $654,350 |
| 2-Unit (Duplex) | $1,032,650 | $837,700 |
| 3-Unit (Triplex) | $1,248,150 | $1,012,550 |
| 4-Unit (Fourplex) | $1,551,250 | $1,258,400 |
2026 FHA Loan Limits — Palm Beach & Broward Counties
| Property Type | FHA Limit |
|---|---|
| 1-Unit (Single Family) | $1,209,750 |
| 2-Unit (Duplex) | $1,548,975 |
| 3-Unit (Triplex) | $1,872,225 |
| 4-Unit (Fourplex) | $2,326,875 |
Loan limits are updated annually. Always verify current limits at fhfa.gov and hud.gov before advising clients.HUD/FHA
Florida Down Payment Assistance Programs
Florida Hometown Heroes Housing Program
Administered by the Florida Housing Finance Corporation (FHFC), the Hometown Heroes program is the state's primary down payment assistance program. Since its 2022 launch, the program has assisted thousands of Florida homebuyers across all 67 counties. For current program statistics, funding availability, and participating lenders, visit the official FHFC program page.floridahousing.org — Hometown Heroes
Eligibility Requirements
- First-time homebuyer (not owned a home in past 3 years)
- Income-qualified (limits vary by county)
- Must work full-time for a Florida-based employer
- Eligible occupations: healthcare, school staff, first responders, public safety, child care, active-duty military, veterans
Program Benefits
- Up to 5% of first mortgage (max $35,000, min $10,000)
- 0%, non-amortizing, 30-year deferred second mortgage
- Due on sale, refinancing, transfer, or if no longer primary residence
- NOT forgivable — must be repaid
- Competitive first mortgage rates on FHA, VA, USDA, and Conventional loans
Program Statistics (Aug 2025 – Feb 2026)
$319,979
Avg Loan Amount
$16,160
Avg DPA Provided
96%
Avg LTV Ratio
Local Programs (SHIP)
Palm Beach County and Broward County may offer additional local down payment assistance through the State Housing Initiatives Partnership (SHIP) program. SHIP is funded by documentary stamp tax revenue and administered at the county level. Availability and terms vary by county and funding cycle. Contact the local housing authority for current program details.
Florida-Specific Mortgage Considerations
No State Income Tax Advantage
Florida does not impose a personal income tax (Florida Constitution, Article VII, Section 5). For buyers relocating from states with income tax, this effectively increases take-home pay and can improve their debt-to-income (DTI) ratio for mortgage qualification purposes — a significant advantage that mortgage loan originators should factor in when pre-qualifying relocating buyers.
Insurance Impact on Qualification
Florida's property insurance costs — including homeowners insurance, flood insurance, and windstorm coverage — are among the highest in the nation and directly impact mortgage qualification. Lenders include insurance premiums in the monthly PITI (Principal, Interest, Taxes, Insurance) calculation when determining DTI ratios. Buyers should obtain insurance quotes early in the home search process to understand the true monthly cost of ownership.
Condo Financing Challenges
Condominium financing in South Florida has become more complex since the Surfside collapse and subsequent legislation (SB 4-D, SB 154, HB 913). Fannie Mae, Freddie Mac, and FHA now routinely request evidence of structural inspections, adequate reserves, and SIRS compliance before approving condo projects. Buildings that are non-compliant may be classified as "non-warrantable," meaning conventional mortgage financing is unavailable and buyers must seek portfolio loans or pay cash.
Closing Cost Taxes on Mortgages
Florida imposes two taxes on new mortgages at closing:
| Tax | Rate | Statute |
|---|---|---|
| Documentary stamp tax on promissory note | $0.35 per $100 | §201.08, F.S. |
| Nonrecurring intangible tax | $0.002 per $1 ($2 per $1,000) | §199.133, F.S. |
For a $400,000 mortgage, these taxes total approximately $2,200 ($1,400 doc stamps + $800 intangible tax).