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Federal Housing Administration's Mission
The Federal Housing Administration was started in 1934 as part of the New Deal. The FHA has contributed to buildings and preserving healthy neighborhoods and communities for many years. Maintaining, expanding homeownership, and stabilizing credit markets in times of economic disruptions have remained the FHA’s number one goal.
Details of an FHA Home Loan
The FHA now offers a variety of loan programs with both fixed and adjustable interest rates. Many find FHA home loans attractive because of they require minimal down payments, they allow gifts to be used as down payments and closing costs and because the closing costs are regulated. These loans also have qualifications that are easier to meet than traditional mortgages. The FHA does not require a minimum FICO credit score to meet qualifications and these programs will allow home purchase two years after a bankruptcy filing.
Energy Efficient Mortgages
Energy Efficient Mortgages, EEMs, recognize that reduced utility expenses can permit a homeowner to pay a higher mortgage to cover the cost of the energy improvements on top of the approved mortgage. FHA EEMs provide mortgage insurance for a homeowner who is purchasing or refinancing a principal residence and incorporates the cost of energy-efficient improvements into the mortgage. The mortgage loan is funded by a lending institution, such as a mortgage company, bank, or a savings and loan association, and is insured by the United States Department of Housing and Urban Development (HUD). FHA insures loans, they do not provide loans.
Rehabilitation Mortgage Insurance (203K)
Section 203(k) insurance enables home buyers and homeowners to finance both, the purchase (or refinancing) of a house and the cost of its rehabilitation through a single mortgage, or to finance the rehabilitation of their existing home. FHA approved lending institutions, which include many banks, savings and loan associations and mortgage companies, offer loans that are covered by Section 203(k) insurance.
Reverse Mortgages
Reverse mortgages are becoming popular in America. They are a special type of home loan that lets a homeowner convert the equity in his/her home into cash. Reverse mortgages can offer elderly Americans greater financial freedom to supplement social security, meet unexpected medical expenses, make home improvements and more.
FHA Refinance Requirements
FHA has permitted streamline refinances on insured mortgages since the early 1980's. The "streamline" refers only to the amount of documentation and underwriting that needs to be performed by the lender, and does not mean that there are no costs involved in the transaction. The basic requirements of a streamline refinance are:
- The mortgage to be refinanced must already be FHA insured.
- The mortgage to be refinanced should be current (not delinquent).
- The refinance is to result in a lowering of the borrower's monthly principal and interest payments.
- No cash may be taken out on mortgages refinanced using the streamline refinance process.
Call 800-760-0695 to discuss your FHA home loan options. |
