Going for an FHA loan program is a great way to buy a property if you qualify. FHA is government supported agency that enables people to get government insured loan. FHA programs have a number of loan types to help people to attain their house ownership goals. With several options, there is definitely one that will fit your requirements.
Here are some of the FHA loan programs that are offered:
First Time Home Buyer
Buying a home for the first time is a crucial financial step in your life. Approaching the right way is important. This is what FHA first-time homebuyer program is all about. It is referred to as the 203(b) loan program. Getting qualified for this FHA loan program will enable you to get your first houses with a minimum amount down payment. It allows more people to qualify for buying their first house without burning holes in your pocket. To get this loan, you can go to a lending institution in the market. They write the loan and government insure it for you from them. This takes away the chance of your risk and puts it on the government.
Fixer Upper
Opting for a fixer-upper with a conventional loan is not very simple. Mostly, buying this type of property needs the buyer to have a large amount of cash in reserve. Banks want most of the houses in this situation to be fixed before you get the loan. However, you are not able to fix something that doesn’t belong to you. This FHA loan program will help you to have enough money to buy the house and do the repairs that are needed. This makes life a lot more simples for the people looking to buy a fixer-upper.
Home Equity Conversion Mortgage (reverse mortgage)
A home equity conversion mortgage is the FHA’s adaptation of a reverse mortgage. A reverse mortgage is when a financing institution pays you the money on a mortgage in place of you paying them. The equity is slowly bought by the institution and at the end of the mortgage, a large payment is due. You can pay the amount when you sell the house. The financial agency or bank can’t force you out of the house, but it will own all the rights of the property after the equity has been bought out.
For this type of loan, it is not an important factor whether you have good credit or a steady income. As long as you have the house that is paid and if you are more than 62 years of age, you can most likely qualify. This is a good option for retired persons who are looking for some additional income.
The above provided FHA loan types are a few of the programs that can educate you about the process and which one you want to opt for.