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FHA loan basics for mid-year 2011

Consider this – you would like to purchase a primary residence home, and one of the following applies to your situation:

* limited downpayment funds

* marginal credit history

* high debt load

The Federal Housing Administration is a division of the Department of Housing and Urban Development – they insure mortgage lenders against your default on a mortgage, which enables you to obtain a loan at a great rate and with only a 3.5% downpayment. The program is available for both first-timers and repeat homeowners alike.

The benefits enable you to buy a home with little money down and less than perfect credit at an interest rate that is often better than conventional mortgage rates. This loan allows your lender to “stretch” your qualifying “ratios” a little more than many other types of loans.

Look for a detailed description of FHA loans in my next post, tomorrow!

Did you know that if your interest rate goes up 1%, your monthly payment will go up 10%? What’s more likely? Home values dropping 10% or interest rates going up 1%?

The second half of 2011 will be a popular time to buy for smart, savvy buyers, and the FHA loan will enable many to take advantage of the best residential real estate prices in history!

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