Buying a home is a dream that many people share. However, for those without a lot of income who don't have great credit or a large amount of savings, it can be difficult to get the mortgage that makes home ownership a possibility. One thing that might make it easier to find a mortgage is to look into FHA Home Loans.
FHA Home Loans are loans that the Federal Housing Administration insures. There are a wide variety of lenders that have been approved to offer these loans. It is a good idea to shop around and find out the rates and conditions that a number of these loan providers are willing to offer you since there are no set terms required.
However, these FHA mortgages are available to people with lower down payments and lower credit ratings than conventional mortgages, so it is a good idea to check into them and see whether this type of mortgage would work for you.
For those who don't have enough money to make a large down payment, there are a couple different options available. If you qualify for a conventional mortgage, you can get private mortgage insurance (also known as PMI) that will allow you to still get a conventional mortgage. If you don't qualify for PMI or a conventional loan, then it is a good idea to look into FHA home loans. With these loans you usually need to be able to put down a down payment of at least 3.5%, but you don't need as high a credit rating as you would for a conventional mortgage with this low of a down payment.
What can you use FHA Home Loans For?
1. You can get FHA home loans to purchase one to four family homes.
2. You can even use them to purchase mobile homes or factory built housing.
3. If you are purchasing a home that needs to be fixed up, you can get a FHA 203K Loan that will include both the cost of the purchase and the cost of fixing the house.
4. For those who already own their own home, you can refinance your loan to include the cost of fixing up your home or making it more energy efficient. This makes home ownership a much more reachable goal for many people.
As you can see you can use a FHA Home Loan for about any type of home ownership you want. And the best advantage is you don't have to have perfect credit scores. Most Americans want to own their own home and with the help of FHA Home Loans that dream can come true for most Americans.