| FHA loans are a great option for first time | | | | meets all of the minimum safety standards that the |
| homebuyers on the house hunt, as well as current | | | | FHA requires and to document the value of the |
| homeowners who are looking to refinance their current | | | | property. Borrowers also will be required to escrow |
| mortgages. These loans offer low down payments, as | | | | their homeowner's insurance and property taxes, |
| well as low interest rates, which helps keep monthly | | | | which ensures that everything is paid up to at least |
| mortgage payments low. This type of financing, which | | | | one year. |
| is insured by the Federal Housing Administration (FHA), | | | | There is interest on the loan, but it is typically lower |
| also has more lenient credit and income qualifications | | | | than conventional loan rates. And borrowers can opt |
| than most other home loans. Even potential borrowers | | | | for fixed interest rates so that their rates remain |
| who have less-than-average credit scores may still be | | | | unchanged over the life of their loans and their monthly |
| able to qualify. | | | | mortgage payments are consistent. This option would |
| Loan Eligibility | | | | be especially good for borrowers who have had credit |
| It is typically easier to qualify for this type of financing, | | | | issues in the past. |
| compared with other types of home loans. While the | | | | Loan Refinance |
| FHA does have lenient credit score and income | | | | For a current homeowner, refinancing with an FHA |
| requirements, most lenders require that applicants have | | | | loan could lower his or her interest rate, which could |
| a credit score of at least 620 to qualify. The FHA also | | | | also lower the monthly mortgage payment. Refinancing |
| requires that applicants have a clean credit history of | | | | also gives homeowners the option of changing the |
| at least twelve months, meaning they have had no | | | | terms of their loans. They can extend the length of |
| delinquent mortgage payments during the twelve | | | | their loans or change from adjustable rates to fixed |
| months preceding their application. The house an | | | | rates, which could save them thousands of dollars in |
| applicant wants to finance must be his or her primary | | | | the long run. With the cash-back refinancing option, |
| residence, which means they plan to live there at least | | | | homeowners can take out a loan for a higher amount |
| six months out of the year. | | | | than the amount needed to pay off their current |
| Loan Requirements | | | | mortgage and use the rest to pay off large bills or |
| This type of financing requires that the borrower make | | | | cover other expenses. There are no restrictions on |
| a down payment on the home being purchased, as | | | | how a homeowner can use the cash. |
| well as monthly mortgage payments. The down | | | | Apply Now Before Requirements Change! |
| payment can be as low as 3.5%, which is much lower | | | | This type of financing offers several benefits and has |
| than down payments on most other home loans. | | | | relaxed guidelines. A borrower who does not have a |
| Applicants will also have to pay an upfront mortgage | | | | lot of money for a large down payment can still |
| insurance premium on the loan, which is currently equal | | | | become a homeowner with this type of loan. Current |
| to 1.75% of the loan amount. | | | | homeowners can save money every month by |
| Before the loan can be closed, an appraisal will need | | | | refinancing and getting lower interest rates, as well as |
| to be done on the home to ensure that the home | | | | receive cash back for other financial needs. |