FHA–CAN IT HELP ME?
January 29th, 2010 categories: Buying, Investment, Market Trends, Real Estate Finance, Selling
In words of one syllable, YES, it certainly can. The Federal Housing Administration was founded in 1934 as a response to the banking crisis of the Great Depression. There are a few frequently asked questions about FHA loans and I would like to answer them here. A recent Realtors Confidence Index report states that 39 per cent of recent home buyers purchased with a FHA loan. My problem with that is the question of what is a “recent period of time?” Suffice it to say that this type of loan has become more popular because of the housing credit crunch.
1. Does the FHA actually provide the loans?
No, the FHA insures the lender.
2. Are FHA loans available only to low income borrowers?
No, there are loan limits, but the loans are available to any qualified buyer.
3. Is it true that FHA loans are only available for small homes?
No, they can be used for all sorts of properties. Single family homes, condominiums–even owner-occupied multi-unit properties. Repeat, there is a limit to the amnount that can be borrowed. Note: not all condominium associations are eligible for FHA loans.
4. What about first-time home buyers, are FHA mortgages only for them?
No, again, anyone who qualifies can have a FHA loan. If you have a low credit score or a smaller down payment, they are particularly helpful.
5. Are FHA appraisals more difficult than other appraisals?
The lender must use an FHA approved appraiser when they order the appraisal. It shouldn’t take any longer or be any different from any other appraisal.
6. Does FHA loan processing take more time and is it more difficult and complicated than conventional loans?
No, it coesn’t take longer. Any delay can have a variety of causes–incomplete paper work or a slow lender or any of a number of reasons. I have heard of FHA loans closing in 30 days.
7. Can all lenders make FHA loans?
Not everyone can make an FHA loan. The lender must be approved by the FHA.
This is the basic nuts and bolts of the thing. Let me know if you need more information. I can also give you a list of approved condominium associations in a given zip code. Just call me at 312-981-2360 or my cell phone, 312-607-1306 or e-mail me.
Here are three other posts you might enjoy:
Credit Boo Boo Down With Your Credit Score
Home Affordability and Mortgage Rates
This entry was posted on Friday, January 29th, 2010 at 2:14 pm and is filed under Buying, Investment, Market Trends, Real Estate Finance, Selling. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
Thanks for lifting the haze around the fha.
Aloha,
Keahi