FHA Programs refer to the various loan insurance programs that the Federal Housing Administration offers to different communities and for different financing situations. FHA does not finance a mortgage loan, but provides insurance coverage for the risk a lender might have on account of underwriting loans to certain sections of the community.
As a result, we find a number of FHA programs designed specifically for underwater borrowers, teachers, first time buyers, distressed homeowners, seniors, firefighters, veterans and people with bad credit and a history of bankruptcy and foreclosure. In some states, such as Florida, Georgia, California and Alabama, it offers a special program that may allow a borrower to obtain a home loan with just $100 down.
FHA Program Types
The FHA Programs currently available cover a large section of under-privileged community. Depending upon the requirements of a homebuyer or an existing homeowner facing grim financial situation, FHA has streamlined its various programs to bring the maximum benefits while loosening the criteria of minimum qualifications. A brief overview of the different FHA programs that would still be available in 2011 is provided here.
- 203(b) Loan: This is among the most commonly used FHA programs. The program highlights include low down payment, flexible qualifying guidelines, limited lender’s fees and a maximum loan amount.
- 203(k) Loan: A perfect choice if you want to buy a home that needs repairs or a complete renovation. The approved loan amount is sufficient to meet both financing requirements – home purchasing as well as rehabilitation.
- Energy Efficient Mortgage (EEM): This loan program can be used in conjunction with both 203(b) and 203(k). The financing is provided to add energy-efficient features to a new or existing home
- Title I Loan: This is meant for making non-luxury renovations and repairs to a home. The loan limit is typically between $5,000 and $20,000. No lien is required against your home if the loan amount is below $7,500.
Apart from the above-mentioned, there are programs that can help homeowners with negative equity or those underwater, such as Hope for Homeowners and others. Check the HUD website to understand the basics as well as fully-explained descriptions for these government-aided programs.
Explore the pages of our website to get an understanding of the pros and cons of having a mortgage insured by FHA. Some topics, such as Program Matrix, Loan Modification, Refinance, Closing Costs, and several others can best be understood when you contact a HUD-certified counseling agency.
Website: www.hud.gov
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