What is an FHA Loan and How Can It Help You Refinance or Purchase a Home?
January 27, 2009
An FHA loan refers to a home mortgage that is insured by the United States government. This type of home mortgage is typically easier to qualify for than a conventional, full-documentation loan. Even if you have had major credit issues in the past couple of years, chances are that you can qualify for some type of FHA loan program. Many are surprised to find that even borrowers with a recent bankruptcy may qualify.
FHA does not actually extend the financing, nor does the agency set interest rates. The Federal Housing Administration was created in 1934 and has been providing strength and stability to the 1-4 family home market. An FHA-insured mortgage can be used to purchase or refinance a new or existing single family home, duplex, triplex, quadplex, condo or manufactured home (on a permanent foundation).
FHA Loan Downpayment
In contrast to convention loans, which may require downpayments of 5% or 10% (or more) — FHA mortgage loans have a 3.5% downpayment. This money can come from a variety of sources, including family members or a charitable organization that provides downpayment assistance.
FHA and the Hope for Homeowners Program
In July of 2008, President George W. Bush signed legislation that created the Hope for Homeowners assistance program. This initiative allows HUD to continue providing FHA-backed mortgages to struggling families. Contact a local HUD-approved housing counselor for immediate assistance, or call the HOPE NOW Alliance, 1-888-995-HOPE.
The H4H program is currently for owner occupants only and the borrowers must meet certain eligibility qualifications. An FHA-approved lender can provide complete details.
FHA Loans Can Stop Foreclosure
In some circumstances, FHA loan programs can provide the assistance you need to keep your home, if you have fallen on difficult financial times. If you are facing down foreclosure, speak to a lender about FHA options that might help.
Find out if an FHA loan program is right for your Texas Refinance or Texas Home Mortgage.
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