FHA Loans

Federal Housing Administration (FHA) is a popular homebuyer choice. These loans must meet certain requirements.

Features

• Available in a variety of fixed rate and adjustable rate loan options.
• Has down payment options as low as 3.5%.
• May allow you to use a gift or grant for all or a portion of your closing costs.
• You typically have to pay upfront and monthly FHA mortgage insurance premiums.

Benefits

• Require less cash upfront for your down payment and closing costs.
• Available for all income levels.
• Allows a new buyer to take over the loan if you sell your home (subject to loan approval).
• Allows a co-applicant to help you qualify even if the person doesn’t live in the home.

Considerations

• FHA loans have the benefits of a low down payment but there are other loan products with the same option.
• Ask for help to compare the overall cost of all products, including the monthly and long-term costs and conditions of the required mortgage insurance.
• You can typically only have one FHA mortgage at a time.
• In many instances, you may find FHA to be a more expensive financing option and should be considered after thoroughly evaluating all other product options that meet your credit qualifying and financial needs.