FHA Home Loan Group is pleased to announce that there are lenders who offer Grants and Down payment assistance for first time home buyers. This is a fantastic program...
FHA Home Loan Group
FHA loans have been helping people become homeowners since 1934. How do we do it? The Federal Housing Administration (FHA) – which is part of HUD – insures the loan, so your lender can offer you a better deal.
When a consumer purchases real estate and takes a loan out in order to secure the property a mortgage(promissory note) is created- A promise to repay the loan. The loan is made by a creditor to the consumer. The FHA insures the loan to the lender in the event of default the lender will be indemnified for their losses. As a result it allows the lender to feel more comfortable to make the loan.
From the FHA insuring the loan this allows more lenient loan requirements and more opportunities for people to own a home. For example, a person could buy a home with $0 Down or just 3.5% down as opposed to putting 20% down if they went to a bank to get a loan. Also, with the FHA, the closing costs can be paid by the seller or put into the loan. Even if the property needs repairs you can get cash back to fix the home.If you were to get a loan from a bank you would have to pay a large down payment, pay your closing costs and could not get funds for repairs.