FHA (Federal Housing Administration) loans are insured by the Federal Housing Administration and backed by the government. As compared to conventional loans, these loans have more flexible lending requirements. Private lenders fund these loans flexibly and have low standards for qualification typically because these loans are insured against default which provides adequate coverage to the lender in case the borrower fails to pay back.
Benefits of FHA Loan
FHA loans offer a plethora of benefits to borrowers. Here are some of the many benefits you can enjoy:
- Low interest rate
Low interest rate means you can save thousands of dollars over the life of your mortgage as you don’t have to make big monthly loan payments due to high interest rates.
- Low Down Payment
FHA loans require a minimum of 3.5 percent down payment. It is significantly lower than the down payment required by traditional loans which is between 5 and 10 percent.
- Flexible Repayment Terms
FHA offers two options; a 30 year fixed rate mortgage, or a reverse mortgage, making it super easy for you to pay back
- Liberal Credit History
There is no minimum credit score requirement. You can apply for an FHA loan as long as you don’t have a negative credit history. For those with negative credit history, they can apply for FHA 2 years after a bankruptcy and 3 years after a foreclosure.
- Higher Seller Contribution
You can negotiate with the seller to pay most of the closing costs and buy down the interest rate for your loan thereby minimizing your pocket expenses.
Other benefits include:
- Low mortgage insurance premiums
- FHA loans are assumable
- You can use gift funds for down payment and closing costs
- Co-borrower can be added to your FHA loan application
To apply for an FHA loan, get in touch with Greentree Mortgage. We are a licensed FHA Direct Endorsement Lender. At Greentree Mortgage, we offer you a large variety of FHA loans best suited to your needs. Whether you wish to buy a home, rehabilitate, repair your current home, or refinance it, we have an FHA loan product perfect for your needs. We have helped thousands of homeowners in financing their home ownership dream - give us a chance to help you too!
Here is a list of FHA loan products you can benefit with us:
- Purchase Loans
Whether you are purchasing a home for the first time or you are looking to buy a primary residence, this FHA product is your best bet.
- Refinance Loans
If you wish to tap into your home equity and use those funds for your personal benefits, then FHA refinance loan is a good option for you.
- Streamline Loans
You can refinance your conventional loan with this loan and easily lower your interest rate and monthly mortgage payments.
For more information on FHA loans or to find out which loan type is best for you, get in touch with us today.