FHA Loans
Residential Mortgages
FHA Loans
Currently, FHA financing requires a minimum 1.5% downpayment to obtain a home loan, although there are regional programs that allow up to 100% financing with the sellers assistance. There are also pending legislative proposals to modernize FHA loan programs, which, if the proposals are made law, would eliminate the requirement and or raise home loan limits in high cost areas such as California.
FHA loans do not require the borrower to have perfect credit, and also. FHA provides allowances (i.e. compensating factors) for individuals or families that have, for example. above average cash in bank, a long-term employment record, etc. These allowances are of particular value when the borrower is deficient in other areas. So, there are many ways that a borrower can qualify for a loan, which under conventional loan guidlines he/she would not. Apply Now.
A FHA loan can allow you to include the costs of your home improvements in your loan. With HUD'ls 203 (k) program you can purchase or refinance a home that needs improvements and include all repair and improvement costs in the loan. Learn more about FHA refinancing or compare FHA vs conventional loans.
The Federal Housing Administration is a branch of the Department of Housing and Urban Development and provides lenders with insurance on your loan. The FHA is here to help you become a homeowner. Both the FHA and HUD offer low-interest loans to qualified borrowers so that they may purchase homes. The FHA and HUD also offer mortgage insurance for those who are part of the VA Home Loan Guarantee Program. Contact a loan specialist to see if you are eligible for this type of loan.
FHA Refinancing
Subprime woes and ARM resets have many homeowners searcing for a solution to help pay their monthly mortgage bills. Look no further - an FHA Refinance is the most popular option on the market today. With the FHA, you can:
- Refinance Your Mortgage into a More Reasonable Monthly Payment
- Refinance Your Current Loan to help Avoid Foreclosure
- Take Cash Out of Your Home's Equity for Home Improvements
- So Contact Us for an FHA Refinance Today!
Benefits of a FHA Refinance
- It is easier to qualify for a FHA refinancing loan than it is for a traditional loan from your average lender. Since the FHA does not directly loan you the money, you have to qualify with a lender that funds FHA loans. It is easier to qualify because the FHA guarantees your loan, which means that they promise the lender that if you skip a mortgage payment, go into default, or they are forced to foreclose on the property, that the lender will get their money back. The FHA guarantees a percentage of the loan, which they pay directly to the lender in the case of foreclosure. So, the lender has nothing to lose by extending credit for a mortgage loan to a borrower who chooses an FHA loan.
- You do not have to have perfect credit to refinance with a FHA loan. The FHA requires certain standards order to offer you a loan guarantee, but the lender is still guaranteed their money in case of foreclosure, so they are more likely to fund the loan even if the borrower's credit is not ideal.
- You can have no down payment or a very low down payment, and still get a mortgage loan. Most traditional lenders require a minimum down payment, which preferably is around 20% of the purchase price of the home. FHA loans only require 1.5%, and this required portion can be a gift to you. Many lenders don't allow gifted funds to be used for down payments on a mortgage loan, but a FHA loan would allow you to do so. This means that you can borrow the down payment from a friend or relative, or use one of the requinal programs available in your area, that will give you the money for a free down payment on your home. If you are refinancing, you would be able to take more cash out from your home, or refinance sooner, even if you have a very small amount of equity built up in your home.
- You may get a much lower interest rate on your refinance mortgage. FHA loans can offer much better loan terms than traditional mortgage loans because the loans are guaranteed by the federal government, so there is almost no risk involved. Because of the guarantee, lenders are more secure with the loan, and can offer lower long-term fixed interest rates and fewer points.
- The FHA will stand by you in case of an emergency. Most lenders help you get your mortgage loan, and then leave you on your own. Your mortgage may even be sold to other companies, and you would never deal with your original lender again. The FHA stays with you for the life of your loan, and they can help you if you get in trouble. If for any reason you get to the point of default or foreclosure on your home, you should contact the FHA immediately. The FHA has programs that can help you retain ownership of your home in times of crisis.
