5 Benefits of the FHA Home Loan Program You Need to Know!
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Published by TOP4 Team
You will find many home loan programs available to finance your new home purchase. You need to research the different programs available and choose the one that best fits your needs. One of the best ones available is the FHA Home Loan Program.
Although the FHA Home Loan Program was designed for first-time home buyers, anyone may apply for the program. Not only can an FHA Mortgage Loan be used to finance the purchase of a new primary residence but also you can use it to refinance your existing home mortgage loan.
There are many benefits to the FHA Home Loan Program.
1. Low Down Payment Requirement
An FHA home mortgage loan has a lower down payment than a conventional loan.
The down payment requirement currently is as low as 3.5% of the purchase price. And here is some more good news, the down payment funds can come from many different sources such as a gift from a member of your family, your church, or a withdrawal from your 401K. It could, of course, come from your own savings.
Because you can get the down payment funds from many different sources, it will make it a lot easier to purchase your home.
2. Seller Can Help Pay Your Closing Costs
The FHA Home Loan Program will allow the Seller to contribute up to 3% towards to your closing costs on your new home.
This will allow you to purchase a new home without any funds if you can get a gift from a family member for the down payment and ask the Seller to pay up to 3% of the closing costs. The closing costs that the Seller can pay include also the "prepaid" such as property taxes, home insurance, and interest.
3. The Interest Rates Are Low
The FHA mortgage interest rates are very competitive if not lower than most other home loan rates. Although in today's mortgage market you will need around 620 credit score to get an FHA Mortgage Loan, the FHA interest rate is not tied to your credit scores.
If your credit score is 620 and another person's credit score is 750 you both will get the same interest rate. On a conventional home loan, the person with the higher credit score would get lower interest rate.
4. No Limits On The Amount Of The Mortgage
There are not limits on the amount of FHA home loans, but there are limits on the property values you can purchase with an FHA loan. The limits on the property values are different throughout the country and you should check with a Realtor or lender in your area.
5. You Can Refinance With An FHA Streamline Mortgage Refinance Loan
If you already have an FHA mortgage loan one of the great benefits is you can refinance using an FHA Streamline Mortgage Refinance Loan.
This type of refinancing loan is when you already have an existing FHA mortgage and you want to refinance it into a new FHA mortgage. You can do this without limited paperwork and a lot less cost.
The FHA Home Loan Program is a great way to purchase your new home with a low down payment, low-interest rate, and the opportunity to refinance it with limited paperwork and cost. The best place to get additional information is the Internet. You will find many websites with FHA Loans Information that will help you with the financing of your new home!
Looking for a reliable and professional mortgage broker that also specialises in home loans? Contact Lendium today!