10 Reasons To Consider An Fha Loan

10 Reasons To Consider An Fha Loan

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Since 1934, the Federal Housing Administration has offered home ownership assistance to Americans in the form of FHA loans. The program originated to combat the effects of the Great Depression, when the rates of foreclosures and loan defaults were high. It is a mortgage loan guaranteed by the Federal Housing Administration and provided by an FHA approved lender.
In response to the recent economic downturn, modifications have been made to the FHA program. Now there are even more reasons to consider FHA financing.

1. FHA financing allows homebuyers a low money down option for their home purchase. The down payment can be as low as 3.5%.

2. Low rates and closing costs. With an FHA loan it is also permitted for the closing costs to be paid by the seller, or as a gift from a relative, non-profit, or government agency. This can make a home purchase possible with very low out of pocket expenses.

3. Even borrowers with less than perfect credit may qualify. FHA loans do have a minimum credit score that is required for all applicants, but it tends to be lower than many other mortgage programs.

4. FHA loans are not just for single-family homes. For qualified borrowers, they may be available for 1 to 4 unit properties. The homeowner must live in one unit, as FHA loans are strictly for owner occupied homes, but the additional units can be rented out helping to offset the mortgage cost or generate income. Alternatively a multi-unit home could be used to accommodate a large, extended family.

5. There is a specialty FHA loan available (203K loans) that allow the cost of buying a fixer-upper and making the necessary repairs to be financed in the mortgage.

6. Another specialty FHA loan is designed to keep Senior Citizens in their homes, allowing them to borrow from their equity to provide cash to live on. This is called a Reverse Mortgage.

7. The Energy Efficient Mortgage (EEM), also from the FHA, is designed to finance the expense of energy efficient home improvements. Home owners can improve their own property and make a positive impact on the environment.

8. FHA loans are available for manufactured and modular housing. Programs are in place for those who own the land where the home will be located and for those who will reside in a mobile home park.

9. In addition to loans for a home purchase, there are also FHA programs that offer funds for refinancing and debt consolidation.

10. FHA mortgages are available across the country. The maximum loan amount is based on the median real estate prices by county, so even homes in more expensive areas may qualify.

To learn more about FHA loans and whether or not you are eligible, contact an FHA approved lender. Ask about current FHA mortgage rates, the FHA loan limits in your county, and what the process is to be prequalified. Be sure to get a few different quotes for FHA pricing as rates can vary by lender. FHA loans are backed by the Federal Housing Administration and available through approved mortgage banks, mortgage lenders, mortgage brokers, and credit unions.

About the Author:
Lisa Andree is a marketing professional who helps mortgage companies promote their brands and products such as 30 year mortgage and jumbo loan programs online.



Article Originally Published On: http://www.articlesnatch.com


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