There are many reasons to get a mortgage
from a FHA home lender. You may have heard some myths and other
bad things about FHA loans, but you should really learn about them yourself so you
can see that an FHA home loan is something that is very beneficial.
Learn More About FHA Home Loans
By learning about FHA loans and FHA home lenders you will be able to see if this
is the type of loan that can help you to become a homeowner.
Open to Almost Anyone
FHA loans are available to almost anyone. There are no income limits even though
the program was originally designed to help low to moderate income families afford
to buy homes. Also FHA loans are available to people with any credit rating.
An FHA loan is secured through an FHA approved lender. These lenders are the same
lenders that offer other types of loans, too. They are quite easy to find and the
process for an FHA loan is not much different than a traditional home loan. The
lender will usually handle the paperwork and the FHA loan process for you.
Benefits
FHA loans have many benefits. The FHA loan program was developed in the Great Depression
of the 1930’s as a way to help people to get through the tough times and still be
able to buy homes. Lenders at that time where very hesitant to loan money for fear
it would never be paid back. Through the FHA mortgage program the government insured
the loans so there was less risk for the lenders.
The main benefit of an FHA loan is that it helps people get a mortgage loan when
they may otherwise be unable to qualify. It helps people get over obstacles like
low income, no down payment or bad credit.
FHA loans have other benefits, too, like the fact that there is not a pre-payment
penalty. In a traditional mortgage most lenders will charge a fee to pay off the
mortgage before the intended payoff date. This is because they are losing money.
You are paying it off so you are actually saving the money on the extra interest
it would have accumulated if you had paid off on time. So, they charge a penalty
to make up that money, but with an FHA loan they are not allowed to do that.
Stiff Guidelines Help You
One of the criticisms that are often heard about FHA loans is about the strict guidelines
for the amount of money that can be borrowed. This limit is set because, as you
know, the whole purpose behind an FHA loan is to help lower income individuals get
a home loan, and the limits help to ensure a borrower does not get in over their
head on a loan they can not afford.
Another common criticism is about the strict appraisals guidelines. Appraisals are
beneficial to buyers because they allow you to catch problems with the home before
you sign the contract. If something is found usually the seller is going to have
to fix it before you can buy the home. This ensures that you are getting a home
that is safe.
All of these things add up to make getting a loan from a FHA home lender
a good idea for many people.