What is an FHA Loan?

The FHA has been helping Americans for over seventy years to become first time homeowners. Since the National Housing Act of 1934, millions of American families have taken advantage of the many benefits of an FHA Loan. Surprisingly, many people are not aware of the program and how it can help them become a proud new homeowner today. Here are some facts about the FHA Loan Program and what you need to do to procure a loan today.

What is an FHA Loan?

The FHA does not issue the money for the home loan itself. Rather, the FHA insures a loan that is issued by a private lender. The lender can be any institution such as a bank, mortgage company or savings & loans association. The only requirement is that the institution participates in the FHA Home Loan Program.

What does this mean for me?

When you are insured by the Federal Government with an FHA Loan, you become a very secure and desirable borrower. Because of this, private lenders are willing to extend benefits to you that cannot be found with conventional loans. Even if you have a poor credit score and low income, you will still be able to take advantage of these benefits that make FHA Loans so affordable.

What are the benefits?

The first major benefit of FHA Loans is that you can qualify for a loan with a low down payment. Most conventional loans charge around 20% for a loan, whereas FHA Loans can be as little as 3%. You also will not be required to pay Private Mortgage Insurance (PMI) because you are already insured by the Government. Additional benefits include quick and lenient approval, low interest rates and streamline refinancing.

How much can I borrow?

How much you borrow depends on your credit score, debt-to-income ratio and your county’s FHA loan limit. To find out the loan limit in your county, check out the website for the US Department of Housing and Urban Development.

Can I get pre-approved for an FHA Loan?

Yes, and we can help! All you need to do is fill out our online form and you’ll be pre-qualified in minutes. Plus, the application is 100% and has no obligations. Pre-approval has never been easier!

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