Who is the FHA Federal Housing Administration ?
The Federal Housing Administration was established in the 1930's to assist Americans in purchasing homes. Originally designed for low income housing occupants FHA and first time buyers is now becoming a cornerstone of mortgage financing for all borrowers.
Borrowers may obtain an FHA-insured loan by paying an insurance premium along with their payment. Because the loan is insured by the federal government, the risk to the lender is less. The FHA does not actually lend any money to borrowers or lenders but rather insure the loans
Why FHA Now?
FHA has been overlooked in recent years with all the alternative credit lending programs which led to the recent credit crunch and foreclosure epidemic, the new FHA modernization will improve the use of FHA financing for both new high loan to value purchases and refinances insuring that Americans can utilize this federal resource to create homeownership.
Benefits of FHA
Underwriting /Credit Requirements:
- FHA provides Flexible credit standards.
- There are no credit score requirements. (Trinity 1 Financial Group requires a minimum FICO of 580)
- Non-occupant co-borrowers are allowed to help occupant borrowers qualify (single-unit only).
Cash Reserves Down Payments:
- Simplified down payment/loan amount calculations
- Purchases to 97% for one loan
- Borrower only required to pay 3% down The down payment may consist of a gift fro family or gift program, ( essentially 100% financing)
- Seller concessions may be as high as 6% of sales price.
Refinances at High Loan to Values
- Cash-out refinances allowed up to 95% of your current homes value
- Rate/Term refinances to 97% of value
- Example your home is worth/Appraised at $100,000 your loan limit is $95,000. Please see loan limits link for your state and county on this page.
- Chapter 13- Bankruptcy. If one year of trustee payment period has passed, must provide evidence that payments have been made satisfactorily and have the courts' approval to enter into a mortgage
- FHA streamline refinances available for Principal and Interest reductions of an existing FHA mortgage with out credit qualifying and appraisals on some cases
Loan Types and Advantages
- 30 year fixed rate mortgages low prime rates even for blemished credit borrowers
- No Prepay penalties
Gift Program Links
*Note seller contribution Gift programs will be eliminated after October 1st Based on the bill HR 3221 signed on July 30, 2008, due to the high level of foreclosures associated with these programs.
We can use a gift program to assist you in providing down payment and closing cost . Gift programs will allow a contribution to be provided through seller participation up to 6% there for covering the 3% down and 3% in closing cost ,essentially providing you close to 100% financing .
