Home Buyers Find FHA Loans Easy to Get

The federal government has a program of offeringprovided the new owner qualifies under FHA guidelines.
guarantees for loans. The easiest type of real estateIt is possible that the lending agency will be more
mortgage loans to qualify for are Federal Housinglenient, in times of financial distress.
Administration (FHA) loans. The FHA guidelines for loanWhy an FHA Loan Might Not be for You
qualification are more flexible than other mortgageThere are dollar limits according to the local area of
loans and require only 3% down payment or less.how much mortgage FHA is willing to guarantee. If you
FHA Loan Qualificationsneed a large mortgage, this might not be the right
You must document 2 years of steady employment,program for you. Additionally, upfront federal mortgage
preferably with same employer, with the last twoinsurance premium and ongoing premiums is often
years showing the same or increasing income. Yourmore costly than private mortgage insurance. If you
credit report should have less than 2 dings showing 30are a home buyer with a good credit school, you may
day late payments in the past two years. Anyeasily find standard loans with very little down that are
bankruptcy must be at least two years with no creditmore competitive than FHA loans.
problems since then. You must have three years ofAs always, you should compare FHA loans against
good credit since any foreclosure. Your mortgageother mortgage options. FHA loans appeal particularly
payment can only be about 30 percent of you grossto home buyers with less cash reserves as FHA does
income.not require borrowers to have reserves of up to three
Benefits for FHA Mortgagesmonths of payments after closing. Lenders want to
It is easier to use a gift towards the down paymentmake sure that you will get off to a good start making
and closing costs. You will find there is no prepaymentyour monthly payments.
penalty. Sometimes an FHA loan is assumable