FHA Mortgage Loan Advice
FHA Mortgage Loan is a mortgage loan insured by FHA (Federal Housing Administration). The FHA does not provide loan service directly to borrower, they have a panel of authorized lenders doing the lending business. If borrower default the loan, lender can seek resource from FHA. However lenders also won't simply lending loan to borrower, they will justify all applicator and only lending for those is qualified and reliable.
There are many benefits while taking FHA loans, generally there are :-
1) Offering lower mortgage rate if compare to other home mortgage loans.
2) Down payment for the home purchase can be as low as 3% for single family homes.
3) Helping buyers to finance for closing cost and insurance coverage.
4) No prepayment penalties associated with the loan. You may refinance it when the right timing come, but be sure the interest rate is lower than your existing. Calculate all costs incurred and how much saving from the deal.
5) The origination fees charge by lenders are limited in 1% only.
In order to qualify for the loan, below are some requirements that must be qualified by borrower:-
1) Have a good credit record
2) Able to pay down payment (the down payment can be as low as 3%)
3) Total housing cost incurred such principal payment, interest, property tax, and insurance shall not exceed 29% of gross income salary of borrower.
Although there are many lenders offering FHA Loans, but rates and terms are vary each other. Thus, getting few several lenders to quote for you. From the comparison made among the lenders will enable you to select the best deal.
No matter how, we should put more efforts to rebuild our credit rating if we bear a poor credit. If we can deposit more down payment in home purchase, rate offer will definitely be lower.
For more home information, please check out
Home Loan Guide instead of FHA Mortgage Loan Advice
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