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FHA loans are one of the best options for young, first-time home buyers who have not had as much time to save for a large down payment or establish a high credit score.

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Which FHA Loan Is Right for Me?


Which FHA Loan Is Right for Me?
A new house is one of the most expensive purchases most people will make in their lifetimes. Throw in the number of mortgage options to choose from, and it can become an overwhelming decision to make. While it may be stressful, knowing your options goes a long way in narrowing down to pick the one that’s best for you! 

Many borrowers go with the route of an FHA loan. This is because of the numerous ways the FHA has designed their mortgages with first-time homebuyers in mind. FHA loans have a minimum credit score stipulation of 580 with a low- down payment requirement of 3.5%, making it easier for my buyers to qualify.  

Another reason many Americans go with FHA loans is that there are a number of mortgage programs that can fit different needs. Here are few of the most popular FHA loan programs: 

FHA Fixed-Rate Loan 

The fixed rate FHA Home Loan is a popular mortgage choice. With this type, the interest rate remains the same through the term of the loan. The consistent interest rate means that monthly payments remain the same. This is a good option for homebuyers who want to rely on fixed payments to help them set long-term budgets. 

FHA ARMs 

An Adjustable- rate mortgage (or ARM) has an interest rate that changes over the term of the loan. After an introductory period with a fixed, low interest rate, the rate changes annually, increasing or decreasing, depending on the market indices approved by the FHA. An adjustable- rate loan may work for borrowers who intend move out of the home within a few years. That way they can capitalize on the initial low interest rate and sell before the rates rise. 

FHA One-Time Close Loan 

The FHA One-Time Close Loan is a construction-to-permanent loan that finances a lot purchase, construction, and permanent loan of a new home as part of one, single mortgage. Borrowers need to qualify just once and pay a single set of closing costs whereas before, they were required to go through the closing process twice, once for the construction loan, then again for the permanent mortgage. The FHA One-Time Close Loan is a great option for those looking to build their home from scratch! 

FHA EEMs 

The FHA's Energy Efficient Mortgage (EEM) is a special loan program that finances various energy-efficient home improvements as part of a home loan. Along with helping borrowers pay for upgrades on their home, the FHA’s EEM program helps them save money on household utility bills by allowing them to install energy saving appliances in their home. The EEM program is a great way for FHA borrowers to upgrade their home, and can also be used as part of a refinance. 

FHA Condominium Loans 

In addition to buying single family homes, the FHA finances the purchase of condominiums with its Section 234(c) loan. These loans come with a 30-year term and borrowers can buy residential condos that have at least two units and are located in an FHA-approved condominium projects.  

With all the options that the FHA offers, there is bound to be a program that fits your mortgage needs.

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FHA Loan Articles

What You Need to Know About the FHA Rehab Loan

The FHA Rehabilitation Loan program allows lenders to cover the purchase or refinance, as well as the rehabilitation of the home, as part of a single mortgage. This loan can be used to finance a property that is at least one year old with a total cost of repairs amounting to at least $5,000

FHA Loan Requirements for 2021 and Beyond

The FHA’s aim is to make homeownership more affordable and accessible for Americans, and it has been doing so for decades. It insures home loans made by FHA-approved lenders so borrowers can purchase single-family and multi-family homes in the US and its territories. 

How Much Do I Need to Put Down on a House

A down payment is an upfront installment or part of a larger amount paid on a purchase. The remainder is paid off in separate installments, usually with interest, as part of a loan. The down payment represents your initial ownership stake in the home you continue to make payments on.

First-Time Homebuyers and the FHA Loan Requirements

For many first-time home buyers, the FHA loan is a popular option. With its lenient credit and income requirements, it appeals to young borrowers who don’t have an extensive credit history, or enough money saved up for a down payment.

Things to Know About Making an FHA Loan Down Payment

Many first-time homebuyers need some help understanding and navigating the ins and outs of the mortgage process, and down payments are an essential part of that. A down payment is an upfront installment made on a large purchase while the remainder is paid off with a loan.

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