FHA Mortgages Are Making A Comeback!

FHA Mortgages took a “back seat” when the more recent Conventional 100% financing programs were introduced by Fannie Mae and Freddie Mac. However, as recently as a few weeks ago, most Mortgage Insurance companies have announced they will no longer insure mortgages above 97% of the purchase price, taking these 100% programs from one of the most popular programs, to the nearly extinct!
 
FHA has recently become a popular choice for borrowers that would most likely have chosen the 100% financing program. Many consumers are finding the FHA program a good fit for many reasons. The program, when used to purchase a property, allows for a minimum 2.25% down payment, lower interest rates than Conventional programs, a lower monthly mortgage insurance factor, and allows for down payment assistance through various non-profit organizations. This keeps not only the monthly payments affordable, but the cash to close affordable, too!
 
FHA offers home owners the ability to refinance their homes up to 95% of the value of the appraisal, which is a difficult situation to be approved for in the current mortgage/real estate market with any Conventional program. With home values tending to be a little lower currently, a program allowing a home owner to go to 95% of the appraised value is a great tool offering a more flexible mortgage program that meet current needs.
 
If you are looking into purchasing a home, or refinancing a home, look into FHA loans. Make sure your Lender is educated on the program, as you could be missing out on an opportunity that not only can save you money monthly, but could lower your payments and/or even get you into a home you may never have been able to before!