Answers from FHA Experts
- What is the Federal Housing Administration?
- What are some common mistakes when buying or refinancing?
- What is FHA Mortgage Insurance?
- Why does FHA Mortgage Insurance exist?
- How is FHA funded?
- How do I know if an FHA mortgage is right for me?
What is the Federal Housing Administration?
The Federal Housing Administration, generally known as "FHA", provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA insures mortgages on single family, multifamily, manufactured homes and hospitals. It is the largest insurer of mortgages in the world; insuring over 34 million properties since its inception in 1934.
What mistakes are commonly made when buying or refinancing a home?
If you're like most people, purchasing a home is the biggest investment you'll ever make. If you're considering buying a home, you see how complex it can be. Because of all the factors to consider when purchasing a home, it's important to prepare as best you can. Call our experts now at 888-218-0094 if you have any questions, or contact us by email.
What is FHA Mortgage Insurance?
FHA mortgage insurance protects lenders against loss if the homeowner defaults. FHA will pay the lender if a homeowner defaults on their loan.
Why does FHA Mortgage Insurance exist?
Unlike conventional loans, FHA-insured loans require small down payments. There is more flexibility in an FHA loan than conventional loans in calculating household income and payment ratios. The cost of the mortgage insurance is passed along to the homeowner and typically is included in the monthly payment. In most cases, the insurance cost will drop off after five years or when the remaining balance on the loan is 78 percent of the value of the property-whichever is longer.
FHA operates entirely from self-generated income and costs the taxpayers nothing. The proceeds from the mortgage insurance paid by the homeowners are captured in an account that is used to operate the program entirely. FHA provides a huge economic stimulation to the country in the form of home and community development, which trickles down to local communities in the form of jobs, building suppliers, tax bases, schools, and other forms of revenue.
How do I know if an FHA mortgage is right for me?
We can help you find the right type of mortgage for your home purchase or refinance. FHA is a great program for first time home buyers, people with credit issues, and people who need down payment assistance. You do not need all of these, and the interest rates are very competitive. The loan process is similar to other loans. Call now to find out if an FHA loan is right for you 888-218-0094.
