First of all, let’s clear up some confusion. With an FHA loan, the
Federal Housing Administration (FHA) does not lend you money; a mortgage lender
does. The FHA simply insures the mortgage, protecting the lender if a borrower
happens to default.
For the borrower, of course, FHA loans offer many advantages. For
starters, to buy a home, an FHA loan normally requires only a 3% down payment.
And, unlike most traditional loans, the down payment can come from outside
sources (as a gift from parents, for instance). Additionally, credit
qualifications are often less stringent: even bankruptcy or foreclosure will
not automatically disqualify a borrower.
And now, because of the vast changes in the mortgage industry which
has limited the programs available, it is often easier and quicker to qualify
for an FHA loan than it is for many traditional loans.
For these reasons, FHA loans have become increasingly popular,
particularly among those who have good credit but have been unable to obtain a
traditional mortgage, such as recent college graduates, young families, and
working students.
Even if you have never considered an FHA loan before, recent changes
in the industry make it worth a look. For many people, FHA loans are the best,
most secure way to secure a mortgage or to refinance their current home loan.
American Equity Mortgage has a number of FHA loan products available right now.
Contact one of our loan officers to see which one might be right for you.
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