FHA
FHA LOANS
The FHA, or Federal Housing Administration, provides mortgage insurance on loans made by FHA-approved lenders. FHA insures these loans on single family and multi-family homes in the United States and its territories. It is the largest insurer of residential mortgages in the world, insuring tens of millions of properties since 1934 when it was created.
What Are the Benefits of FHA Loans?
LOW DOWN PAYMENTS
Applicants with credit scores 580 or above qualify for a low down payment advantage.
FLEXIBLE INCOME AND CREDIT REQUIREMENTS
Even borrowers who have suffered from bankruptcy or foreclosures may qualify for an FHA-backed mortgage.
FIXED & ADJUSTABLE RATE OPTIONS
Both fixed and adjustable rate mortgages are available to those who qualify for FHA loan programs.
MULTI-UNIT PROPERTIES
Loans for 1-4 unit properties and condos may be available.
DOWN PAYMENT GIFTING
Funds for down payments may be gifted by a relative or employer.
SELLER CLOSING COST CONTRIBUTIONS
Home sellers may contribute to up to 6% of the closing costs.
FHA LOAN PROGRAMS
Adjustable Rate Mortgage
An FHA adjustable-rate mortgage (ARM) insures your purchase or refinance with a rate that can change after an initial fixed-rate period. Changes in the market could change your monthly payment if interest rates increase or decrease over the life of the mortgage. An ARM might be the right choice for you if you only plan on staying in your home a few years, are anticipating an increase in your salary, or cannot afford the current interest on fixed-rate mortgages.
Fixed Rate Mortgage
An FHA fixed-rate loan ensures that the interest rate remains the same for the entire loan. Additionally, FHA fixed-rate mortgages allow you to select select different terms, or lengths, for the loan (10, 15, 20, 25, or 30-year term). These fixed-rate loans have higher monthly payments, but this also means you build equity in your home faster than you might otherwise. This equity can be used as a down payment for your next home or a cash-out refinance. If you have plans to be in your home for a longer period of time, a fixed-rate mortgage might be the right solution for you.
Adjustable Rate Mortgage
An FHA adjustable-rate mortgage (ARM) insures your purchase or refinance with a rate that can change after an initial fixed-rate period. Changes in the market could change your monthly payment if interest rates increase or decrease over the life of the mortgage. An ARM might be the right choice for you if you only plan on staying in your home a few years, are anticipating an increase in your salary, or cannot afford the current interest on fixed-rate mortgages.