Owning a home is a feat that takes a long time to achieve. Luckily, there are many ways you can make that dream a reality, especially nowadays. Buying a home with an FHA loan is one of them. You may have heard of FHA loans before. However, did you know that you can use this particular type of loan as a mortgage?
Yes that is correct. FHA loans give many people the opportunity to buy a home, even if they don’t meet the traditional requirements. Whether you have bad credit, a non-existent credit history, or you’re only able to afford a small down payment, an FHA loan could be your ticket to walking onto that “welcome home” door mat with a smile.
We’ll introduce you to FHA loans, tell you what you need to qualify, and even guide you through applying for a loan in just minutes after reading this article. Your dream home – and mortgage – awaits. let’s get started!
What is an FHA loan?
FHA loans are a type of mortgage that is “insured by the Federal Housing Administration,” according to NerdWallet. The Federal Housing Administration (FHA) is one of several organizations that offer programs designed to help you buy a home when the traditional mortgage route isn’t necessarily an option. There are many other opportunities similar to FHA loans that you can take advantage of. Some examples are VA loans, USDA loans, Freddie Mac home potential loans and Fannie Mae HomeReady loans.
In this article, we’ll focus only on FHA loans. We’ll talk about what requirements you must meet to qualify for an FHA loan in a minute.
Know first, however, that an FHA loan must be repaid through an FHA-approved lender. That is, you will not receive a loan directly from the FHA. For this reason, it is best to contact a few lenders for their exact offers. Here’s more context from TheLendersNetwork on why this matters:
“Not all FHA-approved lenders offer the same interest rates and costs – even on the same FHA loan. Costs, services and underwriting standards will vary between lenders or mortgage brokers, so borrowers need to shop around.
Don’t take the first offer you get as your only option.
Another thing to remember is that FHA loans extend well beyond your typical single-family home. As NerdWallet points out, “FHA home loans can be used to purchase or refinance single-family homes, two- to four-unit multifamily homes, condominiums, and some manufactured and mobile homes. Specific types of FHA loans Can also be used for new construction or renovation of an existing home.
Be sure to research the different types of FHA loans to see which one best suits your situation.
