FHA Financing is back!
Actually, it really never went away, but was certainly overtaken by the many loan programs that became such hot commodities the last few years. Many of these loan programs were the subprime mortgages that we now hear so much about in the media. And while most of these programs are now long gone, as are the lenders that made them, the FHA loan is now back in fashion.
Why is it such a good loan program for the first time homebuyer. Among the many reasons are it’s low down payment requirement, it’s more lenient qualification guidelines and… the rates are so low right now that it is an incredible deal.
Here is a scenario that I created today as an example:
Buyer buys a home for a purchase price of $150,000.
Using the FHA loan, the rate as of today is 5.75% with just a 3.00% down payment.
By the way, that 5.75% interest rate today was for 30 years, fixed rate. (No adjustable rates with skyrocketing payments in a year or two).
In this scenario, the buyer’s monthly payment for principal and interest would be only $849.10!
This payment does not include property taxes and homeowners insurance, but what an opportunity to buy a home and stop paying rent with a truly low monthly payment.
And by the way, FHA loans are not just for 1st time homebuyers!
If you would like more information on FHA loans or for that matter any other mortgage financing let me know and I will get you in touch with a top mortgage consultant.